Qantas says multi-employer bargaining could jeopardise flight routes as unions condemn employment “loopholes”

Labor’s omnibus industrial relations reform could impose devastating costs on Australian airlines and put the “viability of some services into question”, Qantas says, as union leaders accuse the carrier of weakening employee bargaining power by fragmenting its workforce.

In a November 11 submission to the Education and Employment Legislation Committee, Qantas group executive Andrew McGinnes and general counsel Andrew Finch argue the Secure Jobs, Better Pay bill will damage business through its approach to multi-employer bargaining and expanded arbitration powers for the Fair Work Commission (FWC).

With reputational setbacks of cancelled flights and luggage mishandling fading into memory for many passengers, Qantas expects its profits to fly towards $1.3 billion in the first half of FY23 alone. 

Now, the way businesses could be grouped together as “common” interests in multi-employer industrial agreements is among the airline’s chief concerns.

“Targeted industrial instruments would be susceptible to being replaced with potentially sector-wide, high-watermark terms and conditions that will inevitably test the financial viability of many enterprises,” Qantas said.

In a worst-case scenario, multi-employer wage outcomes “divorced from both productivity and the specific needs and constraints of individual enterprises” could dramatically increase costs, the airline states.

This pressure “will destroy demand on marginal routes especially, putting the viability of some services into question”, the submission argues.

“While airlines have mobile assets and can adapt, the implications for tourism would be extremely negative.”

If multi-employer bargaining is to take place, Qantas wants an opt-out system for employers. If that option is not on the table, the bargaining stream should be “confined” to low-paid sectors like childcare and aged care.

Boosting the ability of the FWC to arbitrate “intractable” bargaining disputes “will bring to an end Australia’s system of genuine, good faith enterprise negotiations between employers and employees,” it adds.

The FWC is not adequately equipped to arbitrate on those matters given the complex shifts and rest periods required by airline staff, the submission adds.

While the Qantas and the union movement remain staunchly opposed on multi-employer bargaining and extra powers for the FWC, the airline has stated its support for anti-discrimination and efforts to minimise the gender pay gap.

Moreover, the airline has called for lawmakers not to push the legislation through the Senate before this year’s Christmas break, and instead take more time to map out its impacts on the business sector.

The submission has been roundly rebuked by the Transport Workers’ Union (TWU).

In an op-ed published in The Australian on Wednesday, TWU national secretary Michael Kaine accused Qantas of deliberately fragmenting its workforce to fall under separate enterprise bargaining agreements, diminishing the overall bargaining power of its workers.

“Moving bargaining to an enterprise level has opened up loopholes through which entities can splinter the concept of employers into ever-smaller fragments to avoid bargaining,” Kaine said.

“Qantas is a prime example.”

Sally McManus, secretary of the Australian Council of Trade Unions, said Qantas engages external and subsidiary companies to “game the current system”.