UPDATE: A landmark $90 million fine against Qantas is set to enrich former employees by up to $22,000 each, following a Federal Court ruling that the airline’s actions during the COVID-19 pandemic were illegal. The ruling, announced today, has drawn significant attention as it marks the largest employer fine in Australia’s history.
In 2020, Qantas outsourced 1,820 baggage handling, cleaning, and ground staff positions. This move was deemed a strategy to undermine union bargaining power during crucial wage negotiations. Justice Michael Lee ordered the airline to pay $50 million to the Transport Workers’ Union (TWU) for its role in exposing these violations, but the fate of the remaining $40 million remains uncertain.
The TWU argues that it deserves a larger share of the penalty, suggesting that its portion should be $60 million, allowing affected workers to split the remaining $30 million. During the proceedings, TWU barrister Noel Hutley SC emphasized, “The vast bulk of the remaining $40 million should go to the employees.” He cautioned against delaying payments to workers, underscoring the urgency of equitable distribution.
Justice Lee responded critically to the federal government for its lack of action regarding Qantas, emphasizing, “I don’t want any part of the penalty going to anyone except the affected workers… or the union.” His commitment to ensuring that the funds benefit those most impacted by Qantas’s outsourcing decisions is clear.
As part of the compensation plan, affected workers could receive approximately $65,900 each to address economic losses and suffering. Qantas has already begun distributing $9,000 in general damages to 1,759 former employees, totaling over $15.8 million. The court is currently assessing further compensation for the economic and non-economic losses these workers endured.
“This was an egregious wrong that had to be righted,” stated TWU national secretary Michael Kaine following the ruling. Justice Lee criticized Qantas executives for appearing more concerned about the company’s reputation than the welfare of affected workers. He noted, “I accept Qantas is sorry, but I am unconvinced that this measure of regret is not… ‘the wrong kind of sorry.'”
Qantas’s Chief Executive Vanessa Hudson accepted the court’s decision, acknowledging the “genuine hardship” faced by former employees. The airline reportedly saved about $125 million in the year following the outsourcing decision, with potential annual savings of the same amount.
The court’s final decision on the distribution of the remaining $40 million is pending, and the TWU is urging swift action to ensure workers receive their due compensation without delay. This developing story highlights the significant financial and emotional stakes for those impacted by the airline’s controversial staffing decisions.
Stay tuned for updates as this story unfolds.
