By Amelia McGuire
New Qantas chief executive Vanessa Hudson has vowed to restore the trust of its customers after weeks of damning publicity forced the early departure of longstanding boss Alan Joyce and sparked calls for chairman Richard Goyder to resign.
In a shock move on Tuesday, Joyce announced he would step down two months earlier than expected after 15 years at the helm in an attempt to help the airline rebuild its battered reputation.
As critics called for Joyce to be stripped of his multimillion-dollar bonuses and for heads to roll from the board, Hudson admitted the company had fallen short of customers’ expectations. She signalled a different approach to her predecessor, saying her focus was “getting the balance right” between the expectations of staff, customers and investors.
“Right now, it feels like we’re facing a challenging time,” Hudson said in a video to staff. “We know that post-COVID-19 we haven’t always delivered to what our customers expect. But we are listening, and we hear what they’re saying. As a company, our job is to get the balance right between looking after our customers, you our people, and the business itself.”
Qantas has been thrown into turmoil in the past fortnight, with much of the focus on Joyce.
The airline has faced an onslaught of scrutiny over its record profits at a time of high-cost airfares, blockbuster allegations that it advertised and sold tickets for already cancelled flights, and the company’s payment of a $10 million bonus to Joyce last week.
Goyder, the chairman, said it was a challenging time for the business, and the board was used to criticism, particularly on executive remuneration.
“The board gets a lot of customer feedback on bonuses, some fair and some not,” he said, adding that he had no plans to step down. Goyder said he would not comment on the allegations lodged by the Australian Competition and Consumer Commission (ACCC) on Friday as the matter was before the Federal Court.
Joyce is expected to be paid about $24 million this financial year, including bonuses and his base salary, but the total figure will not be known until the company issues its annual report later this month.
The Transport Workers’ Union – long-standing critics of Joyce – called for him to be stripped of his bonuses, and the board has recently been pressured by Labor MPs and institutional advisers to consider withholding Joyce’s short-term bonus.
Goyder said the Qantas board had “clawback provisions” it could use to reduce Joyce’s remuneration for the year “if necessary”.
Joyce, who in May announced he would retire in November, said in a statement the events of the past few weeks made it clear the company needed to move ahead with its renewal. “The best thing I can do under these circumstances is to bring forward my retirement and hand over to Vanessa and the new management team now, knowing they will do an excellent job,” Joyce said.
Goyder defended Joyce’s time in charge of the airline group – which controls 60 per cent of the market through Qantas and Jetstar – but acknowledged the confidence of the public had plummeted since COVID-19.
“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, and that’s what the board is focused on, and what the management under Vanessa’s leadership will do.”
The intense scrutiny of Qantas over the past 10 days has caused multiple state and federal MPs from all sides of politics to accuse Qantas of behaving anti-competitively, with many also accusing the federal government of failing to curb the carrier’s influence following its rejection of Qatar Airways’ attempt to double its flights last month.
Labor senator Tony Sheldon – a fierce critic of Joyce and former Transport Workers’ Union stalwart – said Joyce’s retirement was welcomed, but Goyder should also step down.
“Alan Joyce’s legacy is a workforce split across 38 companies and a brand now synonymous with low pay, insecure work, illegal sackings and consumer rip-offs,” Sheldon said.
“The board has backed Joyce’s behaviour at every step and must be held equally accountable for the disgraceful state of the company.”
Multiple senior fund managers, who spoke with this masthead on Tuesday but declined to be named, said Goyder should also step down after failing to exercise proper governance of Qantas for too long.
Federal Transport Minister Catherine King said Joyce’s departure “provides an opportunity for new leadership”.
“The decision by Alan Joyce to stand down as chief executive officer of Qantas marks the end of one era and the start of a new one with both major Australian airlines led by women,” she said in a brief written statement.
Workplace Relations Minister Tony Burke took aim at the airline’s reliance on labour-hire arrangements that put its workforce on different pay rates as the government clamps down on the loophole.
“I’ve been very conscious that when we talk about the labour-hire loophole, most companies don’t use it. But Qantas is a company that has been using the labour-hire loophole in a pretty extraordinary way,” Burke said, adding he would work with Hudson to ensure her staff were paid fairly.
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