In a landmark ruling, Australian airline giant Qantas has been ordered to pay a $90 million penalty for illegally outsourcing more than 1,800 ground handling jobs during the COVID-19 pandemic. The Federal Court’s decision, delivered by Justice Michael Lee, underscores the severity of Qantas’s actions, which were deemed a blatant violation of industrial relations laws.
Justice Lee emphasized that the penalty, which amounts to 75% of the maximum possible fine of $121 million, must reflect the gravity of the airline’s misconduct. He specified that $50 million of the penalty should be directed to the Transport Workers Union (TWU), with the allocation of the remaining $40 million to be determined in a subsequent hearing.
Background of the Case
The controversy dates back to 2020 when Qantas decided to outsource its ground handling workforce, a move later ruled illegal by the Federal Court. The TWU had advocated for the maximum penalty, arguing that the airline’s actions warranted severe financial repercussions. In contrast, Qantas proposed a more moderate penalty ranging between $40 million and $80 million.
Justice Lee criticized Qantas for displaying the “wrong kind of sorry,” focusing more on the company’s image rather than the impact on the affected employees. He noted that while Qantas’s Chief People Officer, Catherine Walsh, expressed regret during the hearings, the absence of a direct apology from CEO Vanessa Hudson was telling.
Reactions and Implications
The record penalty has been hailed as a significant victory for workers’ rights. Maurice Blackburn Lawyers principal Josh Bornstein described it as the largest penalty ever imposed by an Australian court for violations of industrial relations laws. He stressed that this decision sends a strong message to corporate Australia that calculated violations of workplace laws will not be tolerated.
“This record-breaking penalty reflects the monumental scale of Qantas’s wrongdoing and the court’s concern that Qantas and the business community need to understand that calculated, mass violations of workplace laws may result in severe financial punishment,” Bornstein stated.
Michael Kaine, TWU national secretary, highlighted the courage of the more than 1,800 Qantas workers who challenged the airline’s actions. He praised the decision as a victory for these workers and the broader union community that supported them.
“Today’s decision is a final win for both those workers and the tens of thousands of other TWU members who backed them every step of the way,” Kaine remarked.
Historical Context and Future Implications
This ruling marks a significant chapter in the ongoing struggle for workers’ rights in Australia. The decision follows a series of legal defeats for Qantas, including rulings against the airline for unlawfully standing down a union health and safety representative and breaching the Fair Work Act.
Labor Senator Tony Sheldon pointed out the pattern of legal challenges faced by Qantas, noting the airline’s repeated failures to comply with industrial laws. He emphasized the importance of this case in setting a precedent for future corporate conduct.
“The courts have found it unlawfully stood down a union health and safety rep for raising COVID concerns, illegally sacked its ground crew, and now must be penalized for breaching the Fair Work Act,” Senator Sheldon noted.
The case serves as a stark reminder of the importance of upholding workers’ rights and the potential consequences for companies that fail to do so. As Qantas navigates the aftermath of this ruling, the airline’s future actions will be closely scrutinized by both the public and the legal community.
As the corporate world takes note of this landmark decision, it remains to be seen how this will influence industrial relations practices in Australia and beyond. The outcome of the pending hearing regarding the allocation of the remaining $40 million will further shape the narrative of this significant legal battle.
