Tribunal begins hearing Qantas labour dispute

Release date: 23/03/2012

Qantas Airways’ right to increasingly rely on lower-paid ground workers is likely to be the central issue for Fair Work Australia in its arbitration of a dispute between the Transport Workers Union and the airline.

Andrew Cleary, The Australian Financial Review

The arbitration, which began in Sydney on Thursday, was triggered by a planned lockout of Qantas staff and subsequent grounding of the airline last year.

The TWU, representing Qantas employees including baggage handlers, catering, and other ground staff, said Qantas reneged on a 2009 agreement limiting the use of cheaper labour employed by the Qantas Ground Services (QGS) subsidiary. The current case is the first time Qantas has been in compulsory arbitration – where the industrial tribunal determines the outcome – since enterprise bargaining began in 1993. A favourable result would allow the airline to gradually employ more staff on the more flexible terms and conditions of QGS.

In opening arguments, the TWU’s barrister, Adam Hatcher, said the union wanted to restrict Qantas’s use of employees based in QGS to no more than 20 per cent of the total workforce in the relevant divisions. Mr Hatcher alleged the conduct of the company and its interaction with the union made it clear that the long-term goal was to replace existing ground staff with a majority of QGS-hired employees.

“Their conduct was capricious and unfair in a way that undermined collective bargaining,” Mr Hatcher said.

“My client, perhaps naively, thought that by entering into these agreements [in 2009] they had resolved the historical issue of labour hire. It quickly became apparent that Qantas had much greater ambitions for the use of QGS.”

Mr Hatcher said Qantas had sought ways to lift the ratio of QGS to legacy ground staff within months of signing the 2009 agreement.

In a statement from the company outside the hearing, Qantas repeated its argument from last year’s lockout that the company had to be free to manage the airline in a tough competitive environment.

“We are committed to a fair deal for our people by maintaining competitive salaries and working conditions – and a fair deal to the company that allows the flexibility needed to remain competitive in the global aviation industry,” group executive Lyell Strambi said.

“The union is sticking by the claims that were central to the dispute which would see the union dictate how we run our business.

“This would prevent us from the sensible use of contractors and having a flexible workforce while our competitors are free from these constraints,”

The TWU has put forward five key claims to be considered by the tribunal, including a new classification structure and a demand that the new agreement cover staff working for Qantas and subsidiaries.

Qantas said the union was demanding pay increases of about 10 per cent over two years, a new pay structure which would drive up wages further for some TWU employees, and terms which would make it uncompetitive for Qantas to use labour hire companies such as QGS.

A separate hearing at Fair Work Australia with the Australian and International Pilots Association, which represents the company’s long-haul pilots, will begin in June.

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