Backlash as Qantas cuts 2500 more jobs by outsourcing ground handling
Labor leader Anthony Albanese has made a dig over Qantas’ recent cuts in a TV appearance overnight following a horror week for the airline.
Labor leader Anthony Albanese has made a dig over Qantas’ recent cuts in a TV appearance overnight.
Following the announcement of almost $2 billion in losses and 6000 job losses already, the Australian airline announced on Tuesday that it shed a further 2500 jobs from its groundhandling operations sector after the company had received taxpayer funded support through JobKeeper.
According to the airline, the decision will save the carrier almost $100 million, with the jobs set to go from ten major airports across the country.
Jetstar will also outsource ground handling at the six remaining Australian airports where the work is done in-house, impacting 370 jobs.
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On ABC’s 7.30 program on Tuesday night, Mr Albanese said the announcement was of “great concern”.
“It’s unfortunate that some employers will take opportunities to attack wages and conditions”, Mr Albanese said.
“I’m concerned that’s the case and I know that the union movement’s concerned.
“It’s of great concern that Qantas has had support of JobKeeper for these employees for a considerable period of time, so they’ve had the subsidies for those wages.
“I think it is very regettable that they’ve announced these changes which amounts to contracting out of work that has been done by a group of workers effectively for a long period of time.”
In a statement sent to news.com.au, a Qantas spokesperson said the measure will outsource its ground handling operations at the ten Australian airports where the work is done in-house.
The announcement follows a $2.7 billion statutory loss for the Group in FY20 and a $4 billion drop in revenue in the second half due to the COVID-19 crisis and associated border restrictions. Further significant losses are projected in FY21 and an at least $10 billion drop in revenue due to the ongoing impact of COVID.
Qantas Domestic CEO Andrew David said the job losses amid the pandemic had been “the greatest challenger the aviation industry has ever faced”.
“Airlines have to change how they operate to ensure they can survive long-term,” he said.
“We’ve already taken drastic action, with more than 220 aircraft grounded, the vast majority of our workforce stood down and assets mortgaged to raise cash. Right now, our domestic capacity is at 20 per cent of pre-COVID levels and international travel is expected to take years to recover.”
Mr David said the outsourcing of the work to specialist ground handlers would save the airline millions in operating costs.
“Today’s announcement will be very tough for our hardworking teams, most of whom have already been stood down for months without work,” he said.
“This obviously adds to the uncertainty but this is the unfortunate reality of what COVID-19 has done to our industry.”
Following the announcement, the Transport Workers’ Union is calling for Qantas CEO Alan Joyce to resign and Scott Morrison to step in as the airline moves to sack thousands more workers.
“If Alan Joyce’s only plan is two wield the axe on thousands of loyal staff, he should resign,” TWU National Secretary Michael Kaine. :This is not shrewd management, it is economic violence.
“Qantas has taken millions in Jobkeeper wage subsidies, more than any other company, with the express intent of keeping people employed. But now Alan Joyce wants to destroy thousands more livelihoods. This is callous abuse of public money. The chief executive must resign.”
When questioned about Mr Kaine’s comments, Mr David declined to respond.
As part of the airline’s $2.7 billion loss, the Qantas Group received $515 million in gross Government support.
A spokesperson for the airline said $267 million was in the form of JobKeeper payments, most of which went to the 20,000 employees stood down by the airline.
It is understood the balance of $267 million was used as a wage subsidy for those still working.
The remainder of the $515 million went to run repatriation flights on behalf of government, which included more than 100 international services as well as domestic flights, meaning the net benefit to Qantas from government support was $15 million.
The 10 airports that Qantas proposes to outsource this work are Adelaide, Alice Springs, Brisbane, Cairns, Canberra, Darwin, Melbourne, Perth, Sydney and Townsville.
Job losses of at least 6,000 have already been announced as part of the airline’s restructure in response to border closures and more permanent structural changes to the aviation industry.
Jetstar will also outsource ground handling at the six remaining Australian airports where the work is done in-house, impacting 370 jobs.
“We realise this decision will be extremely difficult news for our ground handling team and their families at what is already a very challenging time,” Jetstar Group CEO Gareth Evans said.
“Unfortunately this ongoing crisis means we have to make some really tough decisions which impact our team members who have provided a consistent and professional operation over many years.”
The latest cuts come just 24 hours after the airline axed its international CEO, Tino La Spina, as part of budget cuts to buffer COVID-19 storm.
In an update provided to the Australian Stock Exchange on Monday, the airline said Mr La Spina, the chief executive of Qantas International would leave the group, as it continued to reduce the size of its business while COVID-19 grounds international travel.
Mr La Spina has been at the airline for 14 years and was the company’s chief financial officer prior to being appointed CEO of Qantas International.
Mr Joyce said last week during the airline FY20 results that the coronavirus crisis had forced the company to evaluate its operations, with the airline expected to be much smaller when normal travel conditions can resume.
“It’s increasingly clear that our international flights will be grounded until at least mid-2021 and it will take years for activity to return to what it was before,” he said.
“Under those circumstances, we’ve made the decision to consolidate the domestic and international business units under a single divisional CEO.”
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