Qantas talks reach 21-day deadline: What’s likely under arbitration?

Talks between Qantas and key unions are set to expire by the day’s end, with the dispute set for binding arbitration if an agreement – or at the very least progress toward an agreement – is not made.

Legal experts say if the dispute ends up in arbitration it will be the highest profile case to be arbitrated under Labor’s Fair Work Act and both sides will likely lose a little – although the unions’ job security claims will be the biggest loser.

Qantas has been involved in weeks-long discussion with three unions representing long-haul pilots, engineers and baggage handlers, after being ordered into talks by the industrial umpire.

Fair Work Australia ordered the talks last month after Qantas locked out its workers and cancelled flights, arguing it was facing a death of a thousand cuts through months of industrial action.

Qantas and the unions – the Transport Workers Union, the Australian and International Pilots Association and the Australian Licensed Aircraft Engineers Association – were granted 21 days to negotiate, with the option of another 21 days if real progress had been made. Arbitration will follow if parties cannot strike a deal.

According to the Australian Financial Review, there are suggestions a partial agreement can be reached, with outstanding matters referred to Fair Work Australia.

The Transport Workers Union and the Australian and International Pilots Association are said to favour an extension, whereas Qantas is believed to favour taking the issue directly to arbitration.

Industrial relations and adviser Peter Vitale says if arbitration proceeds, both sides will likely to be forced into compromise, but the unions’ job security claims are unlikely to succeed.

While some have urged the parties to reach an agreement rather than bear the uncertainty of arbitration, Vitale says the airline appears to “have taken the view that it’s [arbitration] no less risky than allowing the unions to continue to hobble the business with random industrial action.”

“It may be banking on the tribunal’s reluctance to impose the kind of job security provisions the unions are looking for,” Vitale says.

Joydeep Hor, founder and managing partner of employment law firm People & Culture Strategies, says it’s difficult to say how today’s negotiations will end, but agreed that the airline would be fairly confident in letting the matter go to arbitration.

Hor says although the parties would likely want to retain control of their destiny, if indeed the unions’ main purpose is to protect jobs rather than traditional concerns about pay and conditions, he expects “Qantas to be fairly confident in adopting the position that Fair Work Australia is not going to venture into that territory.”

This is because traditionally tribunals have been reluctant to wade into these issues, and the legislative infrastructure is tight about what can and cannot be arbitrated.