Coronavirus: Qantas stops international flights, stands down workers

Qantas is negotiating with Woolworths to provide temporary jobs for up to 20,000 workers facing months without pay.

Qantas is negotiating with Woolworths to provide temporary jobs for up to 20,000 workers facing at least two months without pay as the airline strives to be the “last man standing” in the coronavirus crisis.

Chief executive Alan Joyce said the decision to stand down two-thirds of the workforce was one he never imagined he would have to make, but it was necessary for the airline’s survival.

He said the coronavirus crisis was the biggest calamity the ­aviation industry had faced, from world wars, to the Great Depression to the global financial crisis.

“We can see all parts of the economy starting to close down,’’ he said.

A near empty plane on a Qantas flight from Sydney to Melbourne. Picture: Toby Zerna

With 150 planes to be grounded by the end of next week and international flights suspended, Mr Joyce said there simply was not enough work for employees, ­including pilots, cabin crew, baggage handlers and customer service staff. “One of the things we’re working on is that we’re the last man standing, and we’re doing everything we can in terms of that drastic action because it’s very ­important for all of our employees that Qantas is around,” he said.

“This is survival of the fittest. Lots of airlines are going to go under. They’re starting to go under in Europe. Airlines in this region will go under. Qantas will not be one of them.”

Cost-cutting moves in the next week would see the suspension of all Qantas and Jetstar overseas flights until the end of May, a significantly pared-back domestic service and the temporary closure of the Chairman’s Lounge.

Qantas Club lounges in airports where there was also a business lounge would close and payment of $201m in shareholder dividends would be deferred from April until September.

Redundancies were not on the table for workers, who would ­instead be allowed early access to long-service leave, as well as four weeks’ paid leave in advance to help them through.

Mr Joyce said Woolworths chief executive Brad Banducci had reached out to him, and he called him back immediately to discuss temporary employment opportunities. “Our customer service people he’d love to have working there, people that are involved in baggage handling could be stacking shelves — there’s a lot of jobs that are pretty similar,” Mr Joyce said.

Jetstar chief executive Gareth Evans said anyone who took up a temporary position would be able to return to the airline when flying resumed, adding that unions were generally supportive.

“There’s a feeling we’re all in this together,” he said.

The ACTU hit out at Qantas for announcing the impact on 20,000 workers a day after welcoming a $715m airlines assistance package from the federal government. “For Qantas to ask workers to donate their leave entitlements in order to pay their own way through the crisis without outlining how the company will support vulnerable members of its workforce is not an acceptable outcome,” said ACTU president Michele O’Neil.

Engineers at the Qantas maintenance facility at Tullamarine in Melbourne.

Transport Workers Union secretary Michael Kaine said the move would mean workers lost benefits they had worked hard to build up. “This plan is designed to wipe the slate clean on worker ­entitlements, including long service leave and accrued benefits,” he said. “This will set the company up for a massive boost when the crisis is over.”

The Australian and Inter­national Pilots Association described the announcement as “disappointing”, with many members facing a long stint without pay as a result of all A380s, 747s and 787s being grounded.

Qantas CEO Alan Joyce. Photographer: Adam Yip

President Mark Sedgwick said the association would work closely with Qantas to prepare for the reinstatement of flights when the time was right.

“We are committed to continuing to work with Qantas to maintain the new level of ser­vices and ensure the long-term ­viability of the airline to protect pilot jobs,” he said.

The cutbacks failed to halt the slide in Qantas’s share price, which hit a five-year low of $2.03 on Thursday, down 19.3 per cent for the day.

In an effort to appease frequent flyers, Qantas announced it would automatically extend members’ status for 12 months so they would retain their silver, gold or platinum ranking.

Virgin Australia did the same for members of its Velocity program, as the airline prepared to suspend all international flights, and cut domestic capacity by half.

In an effort to soften the blow for his workers, chief executive Paul Scurrah wrote to Scott Morrison and Deputy Prime Minister ­Michael McCormack, to ask them to consider using Virgin workers on their coronavirus response teams.