Qantas boss Alan Joyce warns of possible return to stand-downs as lockdowns bite

Qantas boss Alan Joyce has put the federal government on notice that income support will be needed if Australia’s two biggest cities remain locked down beyond July.

Capital city lockdowns and state border closures have rocked Qantas’s plans for recovery from the Covid crisis. Picture: NCA NewsWire/Jeremy Piper

Qantas boss Alan Joyce has put the federal government on notice that some form of income support will be needed if Australia’s two biggest cities remain locked down beyond July, forcing the airline to stand down more workers on no pay.

In an email to Qantas employees, Mr Joyce raised the possibility of further stand-downs in response to the current low level of domestic and trans-Tasman flying.

Qantas and budget partner Jetstar had expected to be back to pre-Covid domestic capacity in July but were instead operating at under 40 per cent because of lockdowns and border closures.

Melbourne’s lockdown is due to ease next Tuesday, while Sydney’s stay-at-home orders extend to July 30 but there is no certainty either city will reopen on those dates.

“We’re not at the point of requiring stand-downs in our domestic operations at this stage. But to be honest, we can’t rule it out if multiple states keep their borders closed for extended periods,” Mr Joyce wrote.

“Under that scenario, we expect the support packages offered by government would kick in to provide a basic level of income support directly to those eligible, depending on the criteria they set.”

A Virgin Australia spokesman expressed similar concerns, saying the ongoing lockdowns and closures were having a “significant impact on our team”.

He said the airline’s domestic flying activity was about half that of a month ago and “may need to reduce further”.

“So far we have been able to manage these pressures by encouraging staff to take paid and unpaid leave but this is an evolving situation and we will need to continue to adjust settings to ensure we protect the airline for the long term,” the spokesman said.

“We are very conscious of how difficult the lockdowns combined with significantly reduced working hours are for our loyal and dedicated team.”

Virgin Australia had met with state and federal governments in recent days and they were “looking for ways to help the airline manage the rapidly evolving situation across the country”, he added.

At the height of the Covid crisis last year, Qantas and Virgin Australia stood down more than 25,000 employees.

About 7500 people employed by Qantas International have been stood down for the duration of the pandemic – more than 500 days – with many likely to remain so for years to come.

Adding to the growing workforce strife, Regional Express ­announced the temporary suspension of its four-month-old Boeing 737 operations due to the border closures and low demand.

The six jets had been flying on several capital city and Gold Coast routes, competing with Qantas and Virgin.

Outside the aviation industry, Australian Retailers Association chief Paul Zahra said it was safe to assume thousands of workers had been stood down during the Victorian and NSW lockdowns.

A Services Australia spokeswoman reported more than 576,000 claims for the Covid-19 disaster payments were granted in NSW and Victoria so far, with the total value of those grants worth more than $284m.

“Of those, we have granted more than 518,000 claims for the Covid-19 disaster payment to people in NSW, totalling more than $257m since claims opened on 1 July,” she said. “For people in Victoria, we granted more than 58,000 claims totalling more than $26m.”

Workers must have lost between eight and less than 20 hours of work to qualify for a payment of $375. Payments worth $600 are available for workers who lost more than 20 hours of work due to lockdowns.

Unions seized upon the airlines’ comments, saying they highlighted the urgent need for JobKeeper-style assistance to be reinstated to help workers through this period.

“The current state of affairs is as bad if not worse than what we were facing last year. The difference is workers had JobKeeper then, whereas now they don’t,” said Australian Services Union assistant secretary Emeline Gaske. “The government has to stop the uncertainty and reinstate JobKeeper.”

Additional reporting: Angelica Snowden