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An Australian court has slapped airline giant Qantas with a record-breaking fine of A$90 million (£43 million; $59 million) for unlawfully laying off over 1,800 ground workers during the COVID-19 pandemic. The penalty, announced recently, is the largest ever imposed by a court for breaching industrial relations laws in Australia.
Federal Court Justice Michael Lee emphasized the importance of this fine as a means to serve as "real deterrence" against similar misconduct by employers. The Transport Workers' Union, which played a pivotal role in bringing the case against Qantas, expressed satisfaction with the ruling.
In an official response, Qantas acknowledged the penalty and took responsibility for its actions which caused "real harm" to the affected employees. Vanessa Hudson, the CEO of Qantas Group, extended their heartfelt apologies to the 1,820 ground handling employees, stating, "The decision to outsource five years ago, particularly during such an uncertain time, caused genuine hardship for many of our former team and their families."
The payment is not just a financial burden; it represents the culmination of a years-long legal struggle over Qantas's 2020 decision to outsource ground operations as a measure to cope with unprecedented disruptions in the aviation industry due to the pandemic. The court verdict mandated that A$50 million of the fine be compensated directly to the transport workers' union, signaling the closure of a long and arduous conflict.
The union hailed the judgement as the "end of a David and Goliath five-year battle" and a "moment of justice" for loyal employees who once cherished their jobs at Qantas. The sizeable fine approaches the strict maximum that can be levied for breaching Australia's workplace legislation.
Justice Lee's judgement also scrutinized the corporate culture of Qantas. He questioned the authenticity of the airline's remorse and noted a pattern of "unrelenting and aggressive" legal strategies employed by the airline to mitigate compensation costs to workers who it claimed they felt sorry for. Notably, in 2021, the court ruled that Qantas had partially outsourced its workforce to prevent industrial actions, with a significant proportion of the laid-off workers being union members.
In addition to the record fine, Qantas faces A$120 million in compensation payments to those laid off workers, scheduled for 2024 after exhausting multiple legal appeals. However, some legal experts, like Dan Trindade from Clayton Utz, argue that the fine may not be substantial enough to deter other companies from similar measures, noting that Qantas could have saved even more by outsourcing staff during the pandemic.
Trindade cautions that if the current fines fail to act as a deterrent, increased penalties might become a necessity for the government to enforce stricter workplace compliance. Besides the layoffs, Qantas has recently faced several controversies, such as a A$100 million penalty for selling tickets on flights that were already cancelled, further intensifying scrutiny surrounding the airline's practices during a challenging period for the aviation sector.
An Australian court has slapped airline giant Qantas with a record-breaking fine of A$90 million (£43 million; $59 million) for unlawfully laying off over 1,800 ground workers during the COVID-19 pandemic. The penalty, announced recently, is the largest ever imposed by a court for breaching industrial relations laws in Australia.
Federal Court Justice Michael Lee emphasized the importance of this fine as a means to serve as "real deterrence" against similar misconduct by employers. The Transport Workers' Union, which played a pivotal role in bringing the case against Qantas, expressed satisfaction with the ruling.
In an official response, Qantas acknowledged the penalty and took responsibility for its actions which caused "real harm" to the affected employees. Vanessa Hudson, the CEO of Qantas Group, extended their heartfelt apologies to the 1,820 ground handling employees, stating, "The decision to outsource five years ago, particularly during such an uncertain time, caused genuine hardship for many of our former team and their families."
The payment is not just a financial burden; it represents the culmination of a years-long legal struggle over Qantas's 2020 decision to outsource ground operations as a measure to cope with unprecedented disruptions in the aviation industry due to the pandemic. The court verdict mandated that A$50 million of the fine be compensated directly to the transport workers' union, signaling the closure of a long and arduous conflict.
The union hailed the judgement as the "end of a David and Goliath five-year battle" and a "moment of justice" for loyal employees who once cherished their jobs at Qantas. The sizeable fine approaches the strict maximum that can be levied for breaching Australia's workplace legislation.
Justice Lee's judgement also scrutinized the corporate culture of Qantas. He questioned the authenticity of the airline's remorse and noted a pattern of "unrelenting and aggressive" legal strategies employed by the airline to mitigate compensation costs to workers who it claimed they felt sorry for. Notably, in 2021, the court ruled that Qantas had partially outsourced its workforce to prevent industrial actions, with a significant proportion of the laid-off workers being union members.
In addition to the record fine, Qantas faces A$120 million in compensation payments to those laid off workers, scheduled for 2024 after exhausting multiple legal appeals. However, some legal experts, like Dan Trindade from Clayton Utz, argue that the fine may not be substantial enough to deter other companies from similar measures, noting that Qantas could have saved even more by outsourcing staff during the pandemic.
Trindade cautions that if the current fines fail to act as a deterrent, increased penalties might become a necessity for the government to enforce stricter workplace compliance. Besides the layoffs, Qantas has recently faced several controversies, such as a A$100 million penalty for selling tickets on flights that were already cancelled, further intensifying scrutiny surrounding the airline's practices during a challenging period for the aviation sector.
