Despite Jetstar claiming that it will fight a Fair Work Australia action over its avoidance of superannuation contributions and the illegal imposition of cost of training fees on cadet pilots employed under a claimed sham New Zealand contract, the Qantas subsidiary has admitted the substance of the allegations made by FWA Ombudsman in a statement that also details its repayment of monies the prosecution alleges was illegally taken from the pilots.

This combination of bravado and tacit admission of wrongdoing contained in a defiant statement by Jetstar saying it will fight the charges laid by the FWA Ombudsman bodes ill for Jetstar and its role in spearheading a Qantas plan to lower the cost of its low-cost carrier to those of its various offshore Jetstar franchises by rotating cabin crew and pilots paid under the labour laws of Singapore, Thailand or New Zealand through its Australian operations.

In this case, the FWA Ombudsman alleges that Jetstar employed six pilots on New Zealand individual contracts in 2010 and last year when they should have been covered by Australian workplace laws.

It further alleges that the pilots, who were resident in Australia, were taken to New Zealand to open NZ bank accounts and make observational flights in the cockpit of Jetstar NZ flights, were illegally paid as NZ workers when they worked in Australia, were not paid their Australian superannuation entitlements, and were unlawfully forced to repay the cost of their training.

Jetstar’s case, so far detailed only as “defending” the charges, is further undermined by the testimony Jetstar group CEO Bruce Buchanan and Qantas CEO Alan Joyce, gave to Senate inquiry hearings into pilot training and airline safety last year.

In several sessions in those hearings, Buchanan and Joyce confirmed the fundamentals of the cadet scheme, while claiming it was variously a New Zealand-based training scheme that did not preclude working in Australia, or an Australian scheme in that it fully met the requirements of safety oversight by CASA that happened to be delivered in New Zealand,  but sort of, and so forth.

The net result, which the FWA Ombudsman is now prosecuting, is that the cadet pilots were allegedly robbed of their entitlements, which Jetstar says it has subsequently repaid in the interests of “goodwill” while making no admissions of fault.

The transcripts of those hearings are undoubtedly available to the FWA prosecution in the Federal Court, which is set down for a directions hearing on April 27.

In a subsequent Senate committee hearing, which touched on the arrangements by which Jetstar flight attendants hired in Thailand were being worked at a fraction of Australian wages on purely Australian domestic sectors by Jetstar, between arriving and departing on international Jetstar services, Buchanan insisted that if the airline couldn’t do this, it might withdraw services operating out of Darwin or Cairns on the grounds that they would no longer be economic.

Much of the future direction of the Qantas group appears to involve the transfer of assets from its full-service Qantas brand, such as Airbus A330s and much delayed Boeing 787 Dreamliners, to a base in Singapore, where their labour requirements will be met by staff engaged under Singapore industrial laws,  and used to reduce or dilute exposure to Australian rules, including taxation and superannuation.

This is supported by Qantas as giving it the flexibility to respond to opportunities to expand in Asia.  Qantas recently dropped one of those opportunities when it withdrew its plans to establish a low-cost but premium-quality minority-owned airline in Kuala Lumpur operating as a Malaysia flag carrier in order, according to CEO Alan Joyce, to fund the reinvigoration of the long-haul full-service Qantas brand, which, under his management, has been cutting back flights to London and reorganising other services.

However, it has also struck deals to expand the Jetstar franchise to Japan, in conjunction with Japan Airlines and other Japan investment firms, and Hong Kong, subject to approval, in conjunction with Shanghai-based China Eastern.

The notion of bringing what amounts to indentured cheap foreign labour into Australia to circumvent Australian industrial laws is not limited to Qantas and Jetstar, but planned for by Gina Rinehart for her WA iron ore mines about which she has even written supporting poetry, and is widely practised and abused in the construction industry.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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