Qantas raises stakes in battle over long-haul cabin crew contract

A ground worker walking near a Qantas plane is seen from the international terminal at Sydney Airport, as countries react to the new coronavirus Omicron variant amid the coronavirus disease (COVID-19) pandemic, in Sydney, Australia, November 29, 2021. REUTERS/Loren Elliott/

SYDNEY, Jan 20 (Reuters) – Qantas Airways Ltd (QAN.AX) said on Thursday it would seek to terminate its contract terms with long-haul flight attendants, in a move that would lead to large pay cuts, after union members voted against more flexible rostering.

Qantas said it is the first time in its history that it has sought to terminate an employment terms agreement, or a contract between employers and unions, which is a rare and heated move in industrial relations in Australia.

If successful, cabin crew pay and conditions would revert to a much lower Australian minimum industry standard while a new agreement is negotiated.

The move sets the airline up for a high-profile union battle at a time when it also needs to reach agreements with short-haul crew for it to seal the business case for a major Airbus SE (AIR.PA) narrowbody aircraft order.

Qantas’ latest contract offer to long-haul flights attendants was rejected by 97% in a vote in December.

The airline said a union counter-offer was “unworkable” as it would have raised costs by A$60 million ($43.30 million) over four years.

“We’re seeking termination because we can’t effectively run our business without the rostering changes we desperately need to properly restart our international network in a post-COVID world,” Qantas International Chief Executive Andrew David said in a statement.

Under the current agreement, cabin crew operating on the A330 fleet cannot be used on the 787 and A380 fleets, making it more difficult for Qantas to shift aircraft types.

The airline is running just 20% of its pre-COVID-19 international capacity in the current quarter with the emergence of the Omicron variant leading to tougher border restrictions in some countries.

Qantas said Australia’s Fair Work Commission was expected to deal with the application in the coming weeks, with the airline requesting an expedited hearing. It said it was open to putting the same deal the union had rejected back on the table.

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