“Blackmailed us into taking lower pay”: Qantas pilots express delight at CEO Alan Joyce’s exit

There was barely a wet eye in the house among Qantas’ engineers, pilots, cabin crew and middle management when the departure of longtime chief executive Alan Joyce was finally announced yesterday.

Still, his replacement, Qantas chief financial officer Vanessa Hudson, will have to cool her heels until Joyce completes a six-month victory lap ending with a triumphant annual general meeting. It is where shareholders should lock in the last tranche of bonuses that will see Joyce walk away at least $125 million richer for his 15 years as CEO. He will also get millions in post-employment travel up the front of the plane, as will his husband, as per the airline’s remuneration scheme.

If shareholders love him and customers increasingly dislike him after enduring a year of post-COVID chaos, his staff hold mixed views. He is more loved by employees at the top where he had feathered the nests of senior management, and far less popular with on-the-ground workers.

That Joyce has finally been replaced certainly seemed enough for many staff. One engineer told Crikey: “Frankly, we are just happy to see him go.” A pilot said: “Everyone will be delighted that he is going. He effectively blackmailed us into taking lower pay for flying 787s by threatening to outsource the jobs. He denies it now but that’s what happened.”

Pilots on the aircraft arriving in coming years will also take another pay hit.

Unions were understandably thrilled at the imminent departure of their nemesis as they head to the High Court this week over the sacking of 1700 Qantas ground staff, which the Federal Court twice found was illegal.

“Over a decade Alan Joyce has systematically splintered his workforce and driven down standards to the point where Qantas is a shadow of what it once was,” Transport Workers’ Union general secretary Michael Kaine said.

“Joyce’s position became untenable because Qantas was treated as a corporate vessel for excessive executive bonuses and shareholder dividends. Vanessa Hudson must be courageous enough to steer Qantas back to its core purpose: high-quality service for passengers and investment in the hard-working people who built the spirit of Australia.”

Some insiders questioned his replacement, who has been with the company for 28 years. “Well, she’s hardly a breath of fresh air, is she?” one middle manager told Crikey. Another said there are some staff who “reckon [Hudson] will just continue Joyce’s legacy”.

But the general feeling was summed up by one insider: “I also think [Hudson] will be a fall guy for the high debt levels that will be needed to refleet the airline. But everyone is looking forward to the end of the Joyce/Goyder/Clifford years [referring to former chairman Leigh Clifford who hired Joyce]. Hopefully, the board will be gutted as well.”

The estimated $12 billion to renew the airline’s fleet has been well documented. Less well-known is the deteriorating state of planes and maintenance facilities.

“The 787 cabins are atrocious for such new aircraft due to the Los Angeles facility still being a basket case,” an engineer told Crikey. He claimed Qantas management had been asking engineers with 787 and A380 licences who took redundancies if they are keen on 12-month contracts in LAX.

“This reeks of desperation,“ he said.

Sources said business class and premium economy seats are locked out on most aircrafts as engineers wait on parts and enough ground time to fix things: “They are trying to achieve 10 hours of maintenance in a three-hour transit and it doesn’t work. They are being flogged.”

The situation with the domestic workhorse 737 also continues to deteriorate as Qantas awaits replacement planes from Airbus, whose orders were delayed time and again by management, according to people in operations who describe the fleet as a “disaster”.

Fifteen years at the top of any company is generally seen as poor corporate governance, but chairman Richard Goyder and his board had found it strangely difficult to part with their often controversial chief executive, who he praised as “the best CEO in Australia by a length of a straight”.

That’s understandable. Joyce brought his fellow directors ever-increasing board payments while the wages of other employees were systematically slashed. Qantas failed to deliver a single new aircraft ordered by Joyce — who did not bite the bullet until 2019. The first delivery is due at the earliest late this year. Better still, their Qantas shareholdings have soared in value on the back of menial capital spend, record ticket prices and a round of share buybacks.

Meanwhile, Tuesday over at Qantas Loyalty, its boss Olivia Wirth — runner-up in the CEO race — held a scheduled lunchtime “town hall” meeting with staff. Sources said she ruefully noted “I’m still here” before skipping out at about 2pm.

Australians hope the board has made the right choice with Hudson, despite missing a rare opportunity to bring fresh eyes to an airline about to be squeezed with more competition both domestically and internationally. Whatever the case, after 15 years of Joyce’s headline-hogging tenure, boring may be something of a relief.

This article was first published by Crikey.