The Qantas pilot, licensed engineers and ground staff disputes are a strange spectacle whether you are a traveller, a shareholder, or an at risk stakeholder, such as a tourism operator or employee.
So far, there’s been no chaos and no real loss of business for anyone. Why? Because Qantas has done an outstanding job of using social media to ensure passengers know about disruptions and get rebooked on alternative flights.
But the media spectacle has been weird, with reporters reciting management lines about chaos, disruption and misery in live TV reports from nearly empty terminals. The message Qantas wants to deliver, and the reality, are two different things, but perhaps not for much longer.
In its language, tens of thousands of passengers have been “impacted”, which is a term that ought to be confined to blunt force trauma rather than the receipt of a text message, tweet or email about the need to go earlier or later to the airport than had been booked.
How did we get to a position where strike action can occur at union whim?
The short answer is they can’t strike at whim, although they can cancel any action they may notify at whim.
The pilots, the licensed engineers and the ground staff are only permitted to engage in protected industrial action after a prolonged process of hoop jumping in which they had to persuade Fair Work Australia that they had been in lengthy negotiations with Qantas in good faith, had won the support of their memberships for such actions in a secret ballot, and undertook to meet notice requirements concerning the actions that FWA had approved as being available to them.
Could this lead to a re-run of the 1989 domestic pilot dispute?
Not legally, and not likely. The FWA rules of engagement make it all but impossible for such catastrophic disruptions as caused by that strike, or the waterfront strike, ever happening again. And the Qantas pilots aren’t on about strikes anyhow, they are trying to prevent Qantas from breaking the Qantas Sale Act and setting up peripheral Asia based offshore entities to reduce Qantas tax and superannuation liabilities or other costs associated with Australian labor rules.
This is referred to as “job security” by the pilots and the licensed engineers, who are opposed to the transfer of maintenance jobs to overseas providers, like Rolls-Royce engine overhaul centres of excellence which are under investigation over problems with engines on the older Qantas 747s, as well as the situation with the engines on the A380 that is still being rebuilt at Singapore Airport following a near disastrous engine rupture caused by a design fault Qantas was not told about.
The baggage handlers definition of job security is different. They are objecting to their gradual replacement by cheaper contract workers.
Is job security a realistic industrial claim?
No. There is no plausible scenario in which either FWA or management itself would agree to job security clauses by any industrial relations definition. However there is a political possibility the government would enforce the Qantas Sale Act, and restrict management’s capacity to offshore jobs by, for example, using pilots and cabin crew domiciled in Singapore or Kuala Lumpur to fly Qantas or Jetstar jets into and out of Australian cities according to offshore terms and conditions instead of those that would apply to Australian domiciled and taxed employees. In fact, Jetstar is doing this now out of Asia and Qantas does this in Qantas-painted 737s registered, based and crewed in Auckland for trans-Tasman flights.
Do the groundings of jets by Qantas to maintain schedule reliability mean there will be a shortage of seats as the holiday season approaches?
That is a real risk, but it needs to be kept in mind that those jets being grounded from Monday for at least a month are already said to be broken or due to be scrapped in the short term. To whatever degree these claims are true, Virgin Australia has only a limited ability to quickly add capacity to handle Qantas refugees on domestic routes. As far as international routes are concerned, Qantas has already made itself a minor player, and there are many alternatives available for longer haul routes.
Are the unions damaging the Qantas brand, as claimed by its management and Martin Ferguson?
Not as much as management is damaging the brand. Qantas has repeatedly condemned its own full-service international brand as unsustainable, and cut off further major investments in it. And in a blow to inbound tourism, it’s given away half its capacity on the kangaroo route to London to British Airways, which will take over those flights at Bangkok or Hong Kong.
Qantas also claims that its low-cost franchise Jetstar is subsidising the Qantas service brand. It’s financial accounts contradict this. Everything at Qantas is being subsidised by selling frequent flyer points to grocery and petrol retailing interests like Woolworths to give to shoppers who might die before they get enough rewards to score a return flight between Australian cities, or Bali, if they eat and drive a lot and want to pay top dollar by avoiding discounts.
The irony of the situation is that Qantas and its apologetic minister Martin Ferguson are blaming the pilots and engineers for harming the brand with actions which so far have failed to cause massive or even minor chaos, while the airline cuts the heart out of its international operations and is determined to reduce what it sees as an the unaffordable costs of Qantas excellence in piloting and engineering.
But isn’t Qantas the victim of unfair competition from overseas airlines?
Not really. Qantas hasn’t been forced off routes by Emirates, Singapore Airlines, Cathay Pacific or Thai International rather than having decided not to contest them at all.
When those carriers began to connect dozens of tourism important cities in Europe, Asia, the Middle East and North Africa to Australian cities, including lesser cities, with fast one-stop services over their hubs Qantas stuck to its anglo-centric focus on trying to fly people to places like Moscow, Istanbul, Milan and Hamburg via atrocious time consuming connections onto British Airways flights at London Heathrow.
These routes are the fastest growing in the international market. Qantas couldn’t even find them on an atlas standing up in a phone booth, and yet its market share nosedived from almost 40% to around 15% in more than 10 years.
The claim that Qantas suffers from being at the end of the line rather than in the middle like Singapore is fatuous. Germany is also at the end of the line; it is the country’s most valuable source of inbound tourism, and without Emirates it would scarcely get here at all.
If the Qantas claims about its terrible end-of-line disadvantage were true, we wouldn’t see Emirates and Singapore Airlines A380s flying full of former Qantas customers out of Sydney for London, all the way to London.