Virgin Australia and unions find clean air for new takeoff

Virgin Australia workers will be asked to go without a pay rise for two years as the airline rebuilds from administration.

Virgin Australia flight crew celebrating their return to work after Queensland borders reopened to Sydney and Victoria. Picture: Scott Powick

Virgin Australia workers will be asked to accept a pay freeze for up to two years, along with other changes to work practices, in return for job security under new owners Bain Capital.

After weeks of negotiations, unions have reached in-principle agreement on new enterprise deals with the changes to be put to the airline’s workers for a vote.

The move follows the airline’s emergence from administration after collapsing in April with debts in excess of $7bn.

Transport Workers Union national secretary Michael Kaine said negotiations were difficult but he was confident the outcomes would protect jobs and set Virgin on a path to success.

“We’ve been able to craft a settlement that gives the company the best opportunity of getting up in the air,” Mr Kaine said.

“We need good competition, and someone who’s a good counterpoint to Qantas.”

Having strongly opposed the appointment of Jayne Hrdlicka as Virgin Australia chief executive during the airline’s administration, Mr Kaine said “cool heads needed to prevail”.

“Jayne’s been very constructive and that’s all we could ask at this time,” he said.

“We’ve been trying to find a pathway to building trust.”

Ms Hrdlicka said a lot had been asked of employees as a result of the current operating environment, and she was grateful for their understanding and support.

“We have all worked together in a very tight time frame in order to be able to bring certainty to our people prior to the holiday period,” Ms Hrdlicka said.

“We believe the outcome we have achieved working together with the unions will help to create a sustainable future for our airline, and means we can secure more jobs and look to grow again as the aviation market recovers.”

Federal secretary of the Flight Attendants Association of Australia, Teri O’Toole, said pay freezes were never easy for workers, even when temporary.

“The commitment and dedication of workers to ensure that Virgin survives is what has made the in-principle agreements possible,” Ms O’Toole said.

“Workers importantly won commitments on job security and on ensuring that Virgin workers will do the work, instead of contracting work out to external agencies.”

Australian Licensed Aircraft Engineers Association secretary Steve Purvinas said his members would be asked to work fewer hours to help retain more jobs.

“By doing this, we’ll be saving 50 jobs, and buying a better lifestyle for our people,” Mr Purvinas said. “It starts at a 31-hour week, and moves to 34 hours, and then potentially back to 38 hours as the economic recovery unfolds. It’s less pay for our members but everyone who wants a job will get to have one.”

Qantas chief executive Alan Joyce has indicated he will expect unions to provide the same concessions to Qantas and Jetstar, as those given to Virgin Australia.