Virgin Australia notches a win with cabin crew, but faces a title fight with pilots

The airline’s pilots are threatening to strike over an ‘unrealistic’ pay offer, after they accepted cuts to help it through the pandemic.

Virgin Australia has been warned not to underestimate the anger among its pilots, after a new pay offer was rejected as “unrealistic”.

Negotiations for a new enterprise agreement began last year, and last week an updated offer of a 15.2 per cent increase over three years was presented to the Australian Federation of Air Pilots.

AFAP senior industrial officer Patrick Larkins said pilots accepted a 17 per cent cut in guaranteed pay to help Virgin recover during the pandemic, which had put them behind even Jetstar.

With the airline reporting a $129m profit for 2023, AFAP was seeking a return to pre-Covid-19 pay and conditions with cost of living increases factored in.

Mr Larkins said such an agreement would give Virgin an opportunity to “reset its relationship with pilots and move away from the current deal negotiated during the pandemic”.

“We met regularly with Virgin in the lead up to Christmas, however, Virgin did not table an offer that was acceptable to the AFAP,” he said.

“Virgin delayed providing an updated proposal until February this year. The updated offer was completely unrealistic and demonstrated that the business was not listening, nor that it understood the level of anger among its work force.”

With the current agreement due to expire on June 30, Mr Larkins said Virgin had a short window of opportunity to reach an agreement with AFAP, which represents 75 per cent of the airline’s pilots.

“AFAP members at Virgin are closely watching bargaining across the industry and Virgin should take heed as to what happens when airlines do not properly value their pilots,” he said, in a reference to the ongoing industrial action by Qantas’ Network Aviation pilots in WA.

A Virgin Australia spokesman noted the airline had successfully negotiated seven new EBAs with its workforce in this bargaining round with pilots, the last major one to be finalised.

He said negotiations began last August “reflecting our genuine commitment to listen to our people”.

“We are currently negotiating constructively with the pilot work group, the AFAP and the Transport Workers Union, and this week we have put forward another strong offer, which includes salary increases of 9.2 per cent 3 per cent and 3 per cent over three years,” said the spokesman.

“Our offer also retains key elements of Virgin Australia’s industry-leading pilot work rules and conditions, including the highest number of designated days off in the industry.”

Virgin Australia cabin crew have voted yes to a new agreement which locks in higher pay, new and improved allowances and other benefits.

On Wednesday, cabin crew voted overwhelmingly in favour of a new deal which locked in higher salaries, new or improved allowances, overtime and other work and lifestyle benefits.

The offer agreed to by cabin crew followed months of negotiations and a protected industrial action ballot, which was supported by a majority of flight attendants.

Strike action timed for the busy December period was averted when Virgin returned with a much improved offer key unions supported.

Flight Attendants Association of Australia federal secretary Teri O’Toole said the desired outcome was reached because high union membership and changes to industrial relations laws made it easier for low-paid workers to get better results.

“We still have a long way to go in Australia to ensure professional cabin crew are appropriately recognised by regulators and airlines alike,” said Ms O’Toole.

“These are aviation’s first responders in the sky, and this agreement is a step in the right direction.”

The deal came as Virgin Australia embarked on a search for a new CEO following last week’s shock announcement Jayne Hrdlicka would transition out of the role.

No date has been set for her departure, which comes after a period of poor operational performance and a lack of progress on an initial public offering.

Late last year, Ms Hrdlicka said the airline was targeting May for an IPO, but it’s understood it is now unlikely in 2024.