Qantas ordered to pay $170k to outsourced workers with a lot more to come

Qantas faces a hefty compensation bill for unlawfully outsourced workers but not as much as the TWU might have liked after a Federal Court ruling.

Qantas has been ordered to pay a total of $170,000 to three former staff whose jobs were unlawfully outsourced, in the first step towards compensating the wider ground-handling workforce.

In a much anticipated decision, Federal Court judge Michael Lee ordered sums of $30,000, $40,000 and $100,000 be paid in three test cases for non-economic loss suffered as a result of the outsourcing.

The balance of the compensation for all 1683 workers is a matter for Qantas and the Transport Workers Union to decide, with Justice Lee ordering the two parties back into ­mediation.

Qantas was expected to face a significant bill but perhaps not as much as the TWU hoped for after Justice Lee found the airline would eventually have gone ahead with the outsourcing.

In a 70-page judgment, Justice Lee said “given Qantas’ laser-like determination to focus on cutting costs, and the lack of priority it placed on the continuing employment of the affected workers … I am satisfied Qantas would have definitely decided to outsource by late 2021”.

He went on to urge both Qantas and the TWU to finalise the case promptly after four years of legal battles, to deliver long-awaited justice to the workers.

“Hopefully some common sense can prevail after all the disputation that has taken place, including three separate hearings, six first instance judgments, three appears – two by Qantas and one by the union – various notices of intention and interlocutory disputes,” Justice Lee said.

“Vast legal costs have been expended, and particularly by Qantas, who have retained no less than five senior counsel during the course of the matter and numerous solicitors from one of Australia’s pre-eminent law firms.”

He said both sides had “engaged in rhetoric about being willing to resolve all issues with promptitude” and now was the time for them to do so.

“It may be a triumph of hope over expectation, but my desire is for the court to move quickly to resolve any penalty and the balance of compensation issues,” said Justice Lee.

“Apart from any public benefit, finality would help bring a degree of closure to those workers who’ve been wronged, particularly for those who’ve experienced financial and emotional

Qantas ground handling workers would have lost their jobs with the airline within a year of the unlawful outsourcing decision, the Federal Court has found in determining compensation. Picture: Gaye Gerard

distress.” The TWU took action against Qantas in 2021 after the ground handling operation was contracted out to third parties including Swissport and Menzies.

Qantas claimed the decision was purely commercial, and would deliver savings of $100m a year, considered crucial to the airline.

But the TWU argued Qantas was using the opportunity presented by the Covid pandemic to enact a long-held plan to get rid of the below-the-wing workforce, to minimise the union’s influence and limit industrial strife.

Justice Lee found Qantas was motivated by unlawful reasons in a decision that was upheld by the full Federal Court and the High Court. 

The TWU and Qantas, led by CEO Vanessa Hudson, were then ordered into mediation to determine compensation for the outsourced workers, but the discussions failed.

The matter will return to the Federal Court on November 15 when Justice Lee expects a decision on final compensation for the three test cases.

TWU national secretary Michael Kaine said Monday’s decision was “another victory for the workers after the hell Qantas had put them through”.

“Qantas says it’s turned over a new leaf. Well, it’s time to prove it,” Mr Kaine said.

“After relentlessly prolonging this case and denying workers justice, Qantas must do everything in its power to ensure appropriate compensation to workers. They should not have to suffer a day longer after the last four years of anguish.”

Ms Hudson again apologised to the outsourced workers and pledged to expedite compensation payments. “We recognise the emotional and financial impact this has had on these people and their families,” she said.

“We hope that this provides closure to those who have been affected.”

Qantas increased its provision for the matter by $70m in its full-year results delivered in August but has not revealed the full amount it has set aside.

The TWU previously indicated it expected Qantas to face a bill of more than $200m for the case.

Originally published as Qantas ordered to pay $170k to outsourced workers with a lot more to come