Qantas management has refused to budge on its plan to cut 1000 jobs over the next year, leaving unions to lobby for the Abbott government to link taxpayer support to the airline with assurances on job security.
Union leaders led by ACTU secretary Dave Oliver met Qantas chief executive Alan Joyce and the leaders of the airline’s operating divisions at a meeting in Sydney on Wednesday.
They found some common ground, but were at odds over the promised job cuts and job security for its 30,000 employees.
After the meeting, Mr Oliver said unions agreed in the importance of having a national carrier and that the government should ensure Qantas competed on a level playing field with other airlines, but Mr Joyce had given no information where the planned job cuts would be made.
“If the government is going to support Qantas, it should be attached around conditions for ongoing secure employment,” he said.
“There was no detail in respect of where the job losses were likely to come from, but Alan Joyce has committed to ongoing consultation.
“We heard that they need to reduce costs, but it should not just be a narrowly focused exercise aimed at reducing labour costs. We want to know all areas they are looking at.”
The airline has previously called for changes to the Qantas Sale Act which limits foreign ownership of the airline to 49 per cent.
The most recent negotiations with the government reportedly focus on a stand debt facility with a government guarantee that Qantas could access for a fee.
After today’s meeting, Mr Joyce said the airline had to take “tough decisions” as part of its $2 billion cost reduction over the next three years.
“Understandably, some unions sought commitments about jobs but with an all-options structural review of the business underway it would be disingenuous for us to rule anything in or out,” Mr Joyce said.
“We can say that Qantas will always have the bulk of its operations here in Australia, and that any actions we take are ultimately about protecting as many Australian jobs as we can by making Qantas stronger.
“To their credit, the unions seemed to understand that the policy settings in Australia’s aviation industry mean Qantas is effectively competing with one arm tied behind our back.
“There seemed to be a clear appreciation of the magnitude of the challenge we’re facing, particularly in terms of addressing our cost base given the changes in the broader aviation market.”
Mr Joyce said none of the options being discussed with the government to level the playing field would change the need to make the tough decisions to transform the business.
“We’ve seen unprecedented capacity added in both the international and domestic markets, there is intense pressure on yields and fuel costs are at near-record levels,” he said.
Qantas has complained that its main domestic competitor, Virgin, operated without “any apparent” foreign investment limits, while receiving equity injections from its foreign government backed owners, Etihad, Singapore and Air New Zealand, and having traffic rights normally reserved for Australian owned carriers.
The national secretary of the Transport Workers Union, Tony Sheldon, said it was disappointing Qantas indicated it was still developing “a definitive position” on jobs cuts that were flagged on December 5.
“Without information on the cuts, all 30,000 Qantas Group staff would spend Christmas in fear that their jobs might be the ones to go,” Mr Sheldon said.
“The only jobs guarantee these workers have is the Qantas Sale Act, which mandates that the airline’s international operations be principally headquartered in Australia. We’ll be holding Qantas and the Australian Government to that guarantee in 2014.”
Qantas has flagged an underlying loss for the first half year of $250 million to $300 million.
It has said the job cuts will be spread across the business and includes already announced job losses at its heavy maintenance base at Avalon west of Melbourne, plus more engineering roles as well as management positions.
In the last two weeks, it has announced a voluntary redundancy program for engineering management and support staff, job swaps for Avalon maintenance workers and a VR program for cabin crew.