Australia’s largest airline has been ordered to pay a record-breaking penalty of $90 million for its “ruthless” decision to illegally sack more than 1800 workers.
Qantas outsourced 1820 baggage handling, cleaning and ground staff roles in 2020, a move the Federal Court ruled was designed to curb union bargaining power in wage negotiations.
The embattled airline’s appeal to the High Court was unsuccessful, paving the way for the penalty to be awarded on Monday.
The Transport Workers Union sought the maximum penalty of $121 million, while Qantas urged Justice Michael Lee to impose a “mid-range” penalty between $40 million and $80 million.
Justice Lee ordered Qantas to pay $90 million in penalties, $50 million of which is to be paid directly to the union that brought the proceedings and highlighted the illegal conduct.
He cited the “sheer scale of the contraventions, being the largest of their type” as a reason to impose a penalty that would deter other businesses from similar conduct.
“To deprive someone of work illegally is to deprive someone of an aspect of their human dignity and this is not assuaged simply by mouthing expressions of regret,” Justice Lee said.
Transport Workers’ Union national secretary Michael Kaine welcomed the result as the largest penalty handed down in Australia’s industrial history.
“(These employees) weren’t just sacked, they were told by Qantas that they were delusional for questioning it,” he said.
“This ruthless, self-interested and illegal calculation to kick them to the kerb has rightfully merited the largest ever penalty of its kind.”
Mr Kaine said the decision sent a strong message they would be held accountable for breaking the law.
“This was an egregious wrong that had to be righted,” he said.
“Unless we challenged this decision, we were effectively providing a permission slip for this to happen in future.”
Justice Lee was scathing about the embattled airline’s conduct after the outsourcing, pointing to efforts to place a “less than candid” picture of the decision before the court.
The conduct of Qantas executives to allow “error to creep into the process” of documenting the decision-making process demonstrated the need for change within the company, he said.
Justice Lee noted Qantas had apologised publicly but then had attempted to deny compensation payments to the affected workers.
“I accept Qantas is sorry, but I am unconvinced that this measure of regret is not … ‘the wrong kind of sorry’,” the judge said.
Qantas will have to pay the hefty bill on top of a $120 million compensation payment it has made to the affected ground staff for their economic loss, pain and suffering following the outsourcing.
Qantas CEO Vanessa Hudson said the judgment held the airline accountable for its actions, for which she apologised.
“The decision to outsource five years ago, particularly during such an uncertain time, caused genuine hardship for many of our former team and their families,” she said.
“Over the past 18 months we’ve worked hard to change the way we operate as part of our efforts to rebuild trust with our people and our customers.
“This remains our highest priority”.
The court was told the scandal-plagued airline began to accept responsibility and begin corrective actions in 2023, which coincided with the departure of former CEO Alan Joyce.
Illegally sacked employee Don Dixon said it was time for Qantas to regain its status through actions instead of words.
“If you want to be the spirit of Australia, then back Australians,” he said.
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