Ties that bind: how Alan Joyce called Labor's bluff

IF Qantas chief executive Alan Joyce wanted Julia Gillard to intervene and force arbitration - always his preferred option to the fleet being grounded while Fair Work Australia spent two days poring over evidence - it begs the question: why didn't he simply flag that option with the government before acting as he did? The answer, I have no doubt, is because Joyce could not be sure the government wouldn't tell the union movement about his intentions, stealing the element of surprise.

Who can blame him for such a calculation. Many Labor MPs previously held senior positions in the union movement, including the ministers with portfolio responsibilities affecting Qantas. The PM only remains where she is, despite poor polls, because of the backing of union figures such as AWU national secretary Paul Howes.

Gillard herself is a former union lawyer. The TWU's national secretary, Tony Sheldon, is the frontrunner for the ALP presidency. Unions control ALP preselections and party conferences.

I suspect Joyce's political advisers warned him that once the government knew Qantas was prepared to ground its fleet it would be only a matter of time before the unions knew. It was a risk he couldn't take.

Instead he took advantage of the government in its weakened political state, an admittedly risky move because of the implications it would have on travelling customers. Labor was unlikely to intervene in the way Joyce might have liked, even if he had used back channels to signal his intentions. But it had to send the dispute to Fair Work Australia once the fleet was grounded because it could not afford a protracted industrial dispute.

Qantas told the government at 2pm on Saturday that at 5pm it would ground its fleet. The unions knew the grounding was imminent well before it went public. You don't need to be a conspiracy theorist to conclude the information was passed on to the unions by the government.

In fact, Joyce warned Workplace Relations Minister Chris Evans that he would consider grounding the fleet earlier if news of his intention leaked. That it did leak to union leaders would have confirmed in Joyce's mind that he made the right decision not to go to the government earlier.

Before the grounding, the three unions at war with Qantas - representing pilots, engineers and baggage handlers - garnered little sympathy from the remaining dozen-plus unions representing Qantas workers. Nor from the government and the public, for that matter. That's because their demands were seen as unreasonable and their public rhetoric over-the-top. But once Qantas showed a preparedness to ground its fleet, things changed. It galvanised the unions because it showed how far Qantas was prepared to go to get its way. It put all unions dealing with Qantas on notice.

It also put the government in a more awkward position, which is why we have seen it walk a fine line since: using tough talk to condemn Qantas (a show of support for the unions) while using its powers to send the dispute to the umpire, in the knowledge such actions would favour Qantas over the unions.