A new report examining the effect of wage freezes on worker income and superannuation shows that Jetstar workers are losing close to $200,000 because of an 18-month wage freeze.
Jetstar workers will lose up to $150,000 in lifetime wages and another $40,000 in lost superannuation balances because of wage freezes imposed by the Qantas Group between September 2014 and March 2016.
The report follows strikes at Jetstar last week and comes as the company today forces a vote on an agreement which will guarantee some workers no more than 20 hours a week. Jetstar has warned if workers vote the agreement down it will refuse to pay them rate increases owed since March last year, which will amount to another wage freeze.
Analysis by the Centre for Future Work at the Australia Institute states that “even a temporary wage freeze imposes a growing lifetime economic burden on affected workers”. It takes issue with employers which insist that the effect of wage freezes are modest and temporary, saying “they are wrong on both counts”.
The cumulative loss of income when wage freezes are imposed means that “workers continue to experience losses long after the wage freeze has been lifted”, says the report.
“The 2014-16 wage freeze at Jetstar, like those imposed by many other Australian employers, cannot be brushed off as ‘ancient history’. To the contrary, the legacy of that wage freeze is still visible, and getting larger, with each passing year,” the report states.
TWU National Secretary Michael Kaine said the report shows the devastating effect of wage freezes on workers and the wider economy. “Qantas imposed the wage freeze and moved on. Once it was back to making record profits it was able to massively raise the salary of its executives and pay them bonuses. But this report shows that the workers in Qantas are still suffering and will continue to be impacted by the wage freeze right into their retirement. That has real world consequences, from workers having to forgo healthcare to stress and anxiety over finances,” he said.
“We are asking Qantas to consider the findings of this report and to address the dire situation their decision has placed workers in. Jetstar workers, as the lowest paid workers in the Qantas Group, are suffering greatly because of the wage freeze. Over the lifetime of their work this will accumulate into bigger sums in wages and a massive hit to their retirement income. Qantas must acknowledge this pain and address it,” Kaine added.
Qantas imposed the 18-month wage freeze on workers when the airline ran into financial difficulties. Last year it announced workers would be paid a bonus but only if they accepted the company’s inferior wage offer – which does not reflect the ongoing impact of the wage freeze. Jetstar workers have been told that because of their industrial action they will not get this bonus.
A survey of Jetstar workers shows almost 80% of Jetstar workers say they struggle to pay household bills because of the lack of guaranteed hours. Over 45% stated they have had to contact their banks to ask to delay payments on loans while almost 90% say they want more hours.
One worker stated: “Stress, pain, agony, relationships failure. Don’t wanna be with family because of the feeling too poor to do things with them. Can’t afford to be with them.”
Another said: “I have to work seven days a week just to get 38 hours a week. I work around 340 days a year just to support my family. I have a wife and a son which I barely see because of the six-day, 30-hour roster.”
The strikes at Jetstar this month and in December follow a refusal by the company to negotiate a deal with its workers. Jetstar insists on a Qantas Group-wide 3% pay rise while ignoring worker demands for more guaranteed hours.
“Three per cent of not many hours is not very much. You can’t support a family on 20 hours a week and workers know the work is there since Jetstar are contracting it out to exploited workers at Swissport, which the Fair Work Commission has ruled is underpaying its workers. We are asking Jetstar to end the ultimatums and the blackmail and to return to the negotiating table to talk to their workers,” Kaine said.
Qantas announced last week it had made half year profits of $771 million.