Virgin’s owners to start over with search for new CEO after withdrawal of top contender
Virgin Australia's owners will resume the search for a new CEO a year after it began, following the withdrawal of frontrunner Paul Jones.
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Virgin Australia’s owners will resume the search for a new CEO following the withdrawal of front-runner Paul Jones after pressure from a key union and Employment Minister Murray Watt.
The airline issued a brief statement last Friday saying Mr Jones would not be Virgin’s next CEO, and the board was yet to make a decision on a replacement for Jayne Hrdlicka.
The decision was believed to have been prompted by Mr Jones’ withdrawal from the race as a result of criticism by the Transport Worker Union and Senator Watt.
Their concerns centred on Mr Jones’ previous role at Qantas, where he was involved in the illegal outsourcing of 1683 ground handling workers.
It’s understood Bain Capital will now resume the search for a suitable candidate a year after the process began.
It was announced last February Ms Hrdlicka would transition out of the role of CEO, at a time when Virgin was struggling with operational performance and had been forced to postpone a planned IPO.
Since that time, Virgin Australia has improved its on-time performance and completion rate for flights, achieved a healthy annual profit and signed new enterprise agreements with cabin crew and pilots. Ms Hrdlicka has also overseen a major deal with partner Qatar Airways, which is awaiting approval from the Foreign Investment Review Board and the Australian Competition & Consumer Commission.
It’s believed that once those approvals are received, she will leave Virgin Australia.
Mr Jones was identified as the first pick to replace Ms Hrdlicka in mid-2024, sparking an angry reaction from the Transport Workers Union.
At the time, the TWU wrote to Bain Capital to express its concerns, quoting Federal Court judge Michael Lee, who observed Mr Jones was an unreliable witness and his “professed lack of recollection was disingenuous”.
“I do not consider it is safe to place any significant reliance upon (Mr Jones’) evidence,” said Justice Lee.
A spokesman for Bain Capital refused to say whether the private equity firm responded to the TWU, but a few months later, national secretary Michael Kaine fired off another missive.
The letter came after Virgin announced it had struck a deal with Qatar Airways to buy a 25 per cent stake in the airline, and operate more flights to Doha in a wet lease arrangement.
Mr Kaine said the TWU would support the deal but warned that would change if Mr Jones was appointed CEO.
The final straw came last week, when Senator Watt urged Virgin Australia’s owners to think about Mr Jones’ involvement in the unlawful outsourcing at Qantas. “I would certainly hope and expect that Virgin would think about that when it comes to its choice of CEO,” he said at a doorstop in Canberra, alongside Mr Kaine.
To date no other candidates have emerged as contenders for the Virgin CEO job, although it is believed Bain has been looking at an overseas applicant.
Two other Virgin executives, Velocity boss Nick Rohrlach and chief financial officer Race Strauss, were believed to have been ruled out in favour of Mr Jones but they may now be reconsidered.
Ms Hrdlicka has indicated she is not in a hurry to leave, and even promised to be on the first Virgin Australia flight to Doha due to take off from Sydney on June 14.
“I didn’t say in what capacity,” she laughed, when asked if that meant she was sticking around.
“At some point we will transition this year.”
Ms Hrdlicka was installed as CEO by Bain Capital in November 2020 after the Boston-based firm bought Virgin Australia from administration. Mr Jones was among her first executive appointments, announced in December 2020. He has held the role of chief customer and digital officer ever since.
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Originally published as Virgin’s owners to start over with search for new CEO after withdrawal of top contender
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