Qantas CEO Alan Joyce’s crash landing softened by $24m

After 15 years as CEO, Alan Joyce has made an early exit from Qantas amid multiple crises but still stands to pocket a final payout of around $24m.

Alan Joyce with CEO-designate Vanessa Hudson. Picture: NCA NewsWire / Christian Gilles

After 15 years as CEO, Alan Joyce has made an early exit from Qantas amid multiple crises but still stands to pocket a final payout of around $24m.

The announcement of his departure two months sooner than planned, came as pressure grew on the board to take action after the disastrous handling of $570m in travel credits, allegations of slot hoarding at Sydney Airport and a lawsuit over thousands of cancelled flights.

Mr Joyce was also facing further heat over his massive share sell-off in June, his close relationship with the government and Qantas’ role in the decision to block more Qatar Airways’ flights.

A record profit of $1.74bn for the 2023 financial year only added to a wave of discontent among customers and employees, frustrated by high fares and cost cutting.

The outcry reached fever pitch last Friday, when it was announced Mr Joyce had been awarded another 1.74 million shares worth more than $10m under executive bonus schemes.

After discussions with board chairman Richard Goyder over the weekend, Mr Joyce said he decided Monday night to bring forward his retirement from November.

In a message to employees, Mr Joyce said he had taken the decision to “help Qantas accelerate its renewal”.

He said it had been a “tremendous honour” to lead an airline that had been operating successfully for more than 100-years.

“There have been lots of highs and lows over that period and we’ve lived through a few of both lately – but the airline keeps flying steadily with an eye on the horizon because of the thousands of professionals who stand behind it,” he wrote.

Despite acknowledging damage to Qantas’ reputation from recent controversies, the airline’s board was still expected to grant Mr Joyce a short-term bonus of $4.8m, and more long term bonuses totalling up to $9m.

It appeared unlikely “clawback provisions” would be exercised in the next two months, due to the condition of “serious misconduct” required to trigger that clause.

On Tuesday, Qantas remained of the opinion Australian Competition and Consumer Commission allegations of tickets being sold on already cancelled flights would be defended in court.

It was suggested no customer paid a “fee for no service”, and the issues were not a deliberate attempt to mislead passengers but rather an unfortunate glitch at a time when many airlines were struggling to ramp up.

As Mr Joyce made his exit, unions rejoiced while Mr Goyder and Ms Hudson paid tribute.

Mr Goyder said the decision to retire early was a further demonstration of Mr Joyce’s commitment to the company.

“Alan has always had the best interests of Qantas front and centre, and today shows that. On behalf of the board, we sincerely thank him for his leadership through some enormous challenges and for thinking well-ahead on opportunities like ultra long-haul travel,” said Mr Goyder.

“This transition comes at what is obviously a challenging time for Qantas and its people. We have an important job to do in restoring the public’s confidence in the kind of company we are.”

Ms Hudson wished him well in a video message to employees, stressing it was now time to rebuild customers’ trust.

Flight Centre managing director Graham ‘Skroo’ Turner also praised Mr Joyce as a visionary for the travel industry.

“Alan led Qantas through the most challenging government restriction period the industry has ever faced and has also helped pioneer initiatives that will benefit travellers long into the future, including ultra long-haul sunrise flights,” said Mr Turner.

“While there has inevitably been some turbulence along the way and we have not always agreed with the decisions that have been made, we have maintained a close and positive relationship with Alan and his people throughout his tenure.”

Business Council of Australia chief executive Jennifer Westacott said Mr Joyce had made a “tough decision” to protect the airline’s interests by exiting early, adding “clearly leadership is a tough gig”.

Outgoing Qantas CEO Alan Joyce at the launch of the Qantas Yes Campaign in Sydney. Picture: NCA Newswire / Gaye Gerard

Union reaction was less kind, with the Transport Workers Union declaring the decision “the first good one made by the board in a very long time”.

“The question should now turn to whether the board should spill their positions following years of decimated jobs and standards, illegal outsourcing and outrageous bonuses,” said TWU national secretary Michael Kaine.

“Alan Joyce is slipping into retirement two months early with a $24m pay packet, leaving one of the biggest messes in corporate Australia’s history in his wake.”

The Australian Services Union said the decision for Mr Joyce to exit was “the right one” after the events of the past week confirmed that “the merciless drive for profits had led Qantas to lose its way”.

“Incoming Qantas management now has a rare opportunity to rebuild the relationship between the airline and its workers and customers,” said ASU assistant national secretary Emaline Gaske.

“Frontline workers have borne the brunt of years of outsourcing and cost-cutting, and their stress levels have soared as travel volumes have returned but staffing levels have not.

“This has flowed through to people’s travel experiences, with customers enduring cancelled flights, lost baggage, and overall inadequate service.”

Pilots did not mention his name in a statement titled “new CEO can rebuild Qantas”.

“We look forward to working constructively with incoming CEO Vanessa Hudson to rebuild our iconic airline into the respected and trusted brand that has made all Australians proud,” said Australian and International Pilots Association president Tony Lucas.

“There is much work to be done, however we trust that Ms Hudson recognises the power of respecting and valuing all Qantas staff and how that can play a significant role in the renewal of the airline.”

Captain Lucas added that the “spirit of Australia may be deflated but it’s not defeated”

“If we can all work together, I’m confident Qantas can be great once more,” he said.

The Flight Attendants Association of Australia also expressed hope for the airline’s future.

“The same job, lower pay model should leave the building with Alan,” said FAAA federal secretary Teri O’Toole.

“Vanessa has a real opportunity to build back the trust of her employees and to work with the unions.”

Mr Joyce previously indicated he planned to take six months off when he left Qantas and take an Antarctic cruise with husband Shane Lloyd, before deciding on his next venture.

The couple was expected to remain in Sydney where they have a huge apartment at The Rocks.

Originally published as Qantas CEO Alan Joyce’s crash landing softened by $24m