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Unionbusting at Qantas Causes Global Travel Nightmares

On Saturday, chaos erupted at airports across the world as Australian airline Qantas declared that it was grounding all flights ‘until further notice,’ stranding tens of thousands of travelers who scrambled to make alternate arrangements with no advance warning. Why, one might ask, would an airline do such a thing? Was there possibly a critical safety concern that required evaluation of the entire fleet? Maybe a credible terrorist threat? A need to reroute aircraft for humanitarian reasons, perhaps to carry loads of goods to Turkey, which was recently rocked by a severe earthquake? Why would an airline make a move that would cost it $20 million AUD per day?

The answer? A labour dispute; the airline abruptly halted operations in a bid to heighten the stakes in negotiations over wages and working conditions. Qantas helpfully provided multiple unionbashing updates over the course of the day to keep passengers apprised of the situation:

This is in response to the damaging industrial action by three unions – the Australian Licenced Aircraft Engineers Association (ALAEA), the Australian International Pilots Association (AIPA) and the Transport Workers Union (TWU)…We understand that this will have a significant impact on our customers and apologise for the inconvenience that the damaging union action has caused. (Emphasis mine.)

What, exactly, were these audacious unions asking for? They were concerned about outsourcing of flight services to Asia, fair pay, and reasonable working conditions for employees, including those who are employed by subsidiaries of the airline or who perform outsourced work. This dispute has been ongoing for several months, with recent escalations as the airline has refused to budge. Ground crews had staged a one hour work stoppage on Friday, for example, with threats of more action in the future, while the pilot’s union was in active negotiations with the airline at the time of the lockout, and the ALAEA had pledged to withhold industrial action for at least three weeks in an attempt to reach a settlement. Many of the workers threatened with lock out weren’t even involved in the action and the pilot’s union threatened a suit.

One pilot wrote:

I just woke up in Honolulu to find a note under my hotel room door saying that after I do a Maximum Weight Takeoff (185,000kgs) with 70,000kgs of fuel tomorrow and safely fly 250 passengers home over the Pacific Ocean for 10.5hrs tomorrow (at times up to 3 hours flight time from any runway) I will be locked out of work for an indefinite time. The Pilots HAVE NOT had 1 stop work meeting OR strike, THIS IS THE COMPANY MANAGEMENT INDUSTRIAL ACTION, not ours.  (source, via Definatalie)

Meanwhile, Alan Joyce, CEO of the airline, just received a 71% payraise. At the same time, he was demanding that unions ‘back down‘ or face the consequences. Those consequences were illustrated in a dramatic way with an action in which the airline appeared to shoot itself in the foot; the lockout was going to cost the airline a substantial amount of money that would increase over coming days, while enraging travelers, and the Australian government became involved in the dispute. Critics also worried that the Australian tourism industry could suffer substantially; not only was Qantas hurting itself and its employees, but it was also dealing direct damage to Australians working in various jobs in connection with the industry, which was already faltering after a rough year.

Joyce’s action was a classic act of unionbusting; by escalating the stakes enough to force Fair Work Australia to get involved, he put pressure to resolve the dispute on the government, rather than the airline. As furious and stranded passengers waited word on alternate flights home or an end to the siutation, their eyes turned to an emergency meeting on the 30th to attempt to resolve the situation. Joyce used his position to argue that the government should order a complete stoppage of the industrial action, not just a suspension to allow time for continued negotiations.

Effectively, he was asking the government to crush the union for him, putting a decisive and definitive halt to worker demands for better conditions, fair pay, and long-term security for the airline. Joyce claimed that the airline has been under attack from the unions, and was under threat of closure without intervention, but it rang false from a man who was netting an absurd amount of money every year while callously locking workers out to get his way; and none of those over 7,000 workers would receive pay during the lockout. The Qantas lockout felt like the petulant action of a man who takes hostages first and asks questions later and indeed there were indicators it was retaliatory in nature:

Unions are angry about the timing of the fleet’s grounding. On Friday Joyce was awarded a 70% pay rise at Qantas’s annual AGM. Joyce said his decision was in response to the unions’ increased rhetoric following his pay rise.

“Unfortunately, after the AGM the unions were more aggressive. They were talking about 48-hour stoppages, ramping it up, baking us for a year,” he said. (source)

While the government initially took a hands-off approach in the dispute, Joyce’s action forced their hand. Thanks to some extremely tough anti-strike laws which have already been used to suppress union actions this year, including an earlier Qantas walkout, the government had the power to wield considerable clout.

The FairWork Act provides some of the strictest anti-strike laws in the West. Strikes are “permitted” only if enterprise agreement negotiations break down every three years — and then only if allowed by the industrial courts. Pattern bargaining, or campaigning industrially for similar conditions and rates throughout industry, is specifically ruled out. (source)

Implemented under the Rudd government, these tough laws have been supported under Gillard as well, and even before she became PM, she had a documented history of limited support for labour; speaking about a strike in 2010, Gillard said ‘They need to sit down, have a think and get back to work,’ so it’s pretty where she stood in the labour relations department. Needless to say, opposition leader Tony Abbott was delighted to have a chance to have a go at the Gillard government over the Qantas situation, claiming that the government was ‘allowing’ industrial actions to continue against the interests of the nation.

Ultimately, the resolution was a suspension of industrial action for 21 days, during which the airline and the unions were ordered to work out their differences or be sent to binding arbitration. Not quite what Joyce demanded, but not exactly a victory for the unions, either. We shall see what happens over the coming weeks as the parties return to the table, which was where the unions wanted to be all along. Joyce’s strategy may have worked; Qantas shares jumped after the order to return to normal operations.

This event matters not just for Australian workers, but on a global level. Anti-union sentiment is on the rise in many regions, as seen in the rash of unionbusting legislation in the US that occurred this year, and increasingly, unions seem to be regarded as the enemy. In this case, Qantas set itself up as the victim in a series of woeful press statements about how sorry it was that things have come to this pass; ‘look what you made me do,’ the airline declared, openly trashing the unions in its announcements to make it clear that this was where passengers should direct their anger. This despite the fact that union workers were fighting to keep Australian jobs, and advocating for the safety of the airline, creating a situation where the government was asked to intervene in a way that protected capital, but went against its own interests, as Emily pointed out when we discussed this case.

Artful misdirection is common in situations like this, where companies taking extreme unionbusting measures that harm their customers and their bottom line attempt to make it look like the unions are at fault for wanting things like fair pay and safe working conditions. The pay raise requested by Qantas employees, incidentally, didn’t even pace inflation. Angry travelers took the bait, claiming that the unions had ‘too much power’ and ‘shouldn’t be allowed.’

These tactics pull attention away from the real problem, which is increasingly unsafe and unpleasant working conditions for people working in vital positions, like the aircraft engineers responsible for making sure that maintenance and servicing are handled appropriately. The unionbashing has been going on for months now as the airline attempts to position unions as the bad guys, and it built to head with this dramatic move, which was calculated to make people attack workers, instead of the airline, and to break down solidarity between workers and the public.

Weakening worker solidarity has real consequences for workers, because it is only through collective strength that workers can hope to achieve a victory against a major company. International unions issued statements of support for the workers involved, providing a glimpse into a world where workers could work in international solidarity to protect everyone’s interests, and there was some public support, but not enough. Qantas just flexed its muscle, making the situation crystal clear for anyone who was in doubt: It’s always had the power in this dynamic, and it’s not afraid to use it.

Tell me, Mr. Joyce, in Qantas was in such dire financial straits that it can’t afford fair wages for its workers, why did you just accept a 71% pay raise? And why do you feel the need to make the workers the enemy?


  1. Li wrote:

    Li. Hey, s.e. Just a minor correction: Fair work Australia ordered a termination of industrial action, not a suspension. Neither party is allowed to resume industrial action after the 21 days. The unions had requested a 90 day suspension, but FWA went with a full termination instead.

    Monday, October 31, 2011 at 12:38 pm | Permalink
  2. Caitiecat wrote:

    Good analysis – the attacks on unions, widespread as you noted in the Western dems, are a direct action in the class war of the stratosphere of wealth against…well, everyone else. We need to go back and strengthen the links between labour and progressivism: the unions have worked hard to implement a lot of progressivist goals, and they can use our help now fighting for their very existence.

    Good as always to see labour issues brought to light.

    Monday, October 31, 2011 at 3:30 pm | Permalink
  3. Kat wrote:

    Thanks for this article – I didn’t know anything about this situation, so it’s great to read a really thorough analysis of it.

    Monday, October 31, 2011 at 4:51 pm | Permalink
  4. Grace wrote:

    Thanks for posting about this, s.e. I am so outraged over the whole thing but this is definitely not new for Qantas.

    Monday, October 31, 2011 at 7:11 pm | Permalink
  5. Megpie71 wrote:

    While the QANTAS management industrial action hurt their international travel, I suspect their aim was more at their domestic customers. QANTAS and its subsiduaries are the major domestic carrier here in Australia – and in many cases, the ONLY domestic carrier on certain routes. This includes a lot of the FIFO (fly-in, fly-out) traffic which ships workers to the mining sites in the north-west of Western Australia or northern Queensland. If those routes are interrupted, all of a sudden the mining industry is hit hard – they literally cannot get their staff up there for shift changes.

    This might not seem like much on the surface of it, but remember that Australia is actually a continent approximately the same size as the continental United States. While we don’t look that big on a standard Mercator projection map, there’s actually a lot of distance between a lot of the capitals. I can state from personal experience that the distance between Perth (the capital of Western Australia) and Karratha (a port town near the mine sites in the north-west) is approximately four or five days by road. The mine sites are about a further half a day’s journey from Karratha. At present, the big miners rely very heavily on fly-in, fly-out labour, because there isn’t the infrastructure in places like Karratha, Dampier, Roebourne, etc to handle the population of workers needed to keep the mines running. The big miners also don’t want to go the old-fashioned road of starting mining towns out in the middle of the North-West (as they did with places like Tom Price and Paraburdoo back in the 1970s) because this means they have to pay the expense of dismantling the towns at the other end of things. Plus there’s always the example of Wittenoom to remind them of why it’s sometimes safer in the long term to keep the families away from the mine sites.

    FIFO has some other advantages for the mining companies as well. For one thing, it stops a lot of union activity at the mines dead. I can still remember hearing regular items on the television news growing up in the 1970s and 1980s in Western Australia about this or that mine’s workers going on strike over one thing or another – sometimes about trivial stuff, it must be said, but often all we’d hear down in Perth is that a strike was happening. By having a workforce which is much more atomised outside of shift times, and where their worker’s families aren’t in regular contact on a daily basis, there’s less basis for comparison of duties, managers and payslips, as well as less chance of union organisation happening outside of working hours. Indeed, by making access to various mine sites only possible through FIFO, the big mining companies are effectively able to shut out certain “undesirable elements” (such as union organisers) from their worksites.

    So, back to the QANTAS lock-out, with this context. QANTAS and QANTAS subsiduaries supply most of the transport for FIFO mineshifts. Indeed, that’s the majority of the domestic travel happening from a lot of the smaller rural airports, and even a lot of the capital city domestic terminals are largely occupied by FIFO miners on certain days. I’d suspect that a lot of the screaming to get the QANTAS lockout resolved quickly came from the CEOs of some of the big mining companies – none of whom have any particular reason to be union-friendly. Given the mining industry is the 410kg (900lb) gorilla in the Australian industrial scene, and that our governments have shown an unsettling tendency to bend over backwards in order to keep the mining companies happy, I would be more than willing to suspect a certain amount of collusion in this matter between the management of QANTAS (who are the 410kg gorilla in Australian air travel) and the management of the various mining companies (or at the very least, a certain amount of forewarning).

    I suspect things are going to start getting very interesting on the Australian industrial front in the next twelve months or so.

    Tuesday, November 1, 2011 at 7:10 am | Permalink
  6. hitcher wrote:

    Thank you for this analysis. The most unsettling aspect of this dispute is, from my view, the degree to which it reveals the inherently self-serving nature of corporate interests. In Australia I feel there is the sense that we are heading closer and closer towards complete privatisation of essential services – electricity, communications, healthcare and not yet but probably not far off (and most alarmingly), water. The prospect that a future corporate owner of such services could pressure a government into quashing legitimate industrial action by cutting off essential services, does not seem entirely far-fetched, in light of what Qantas and Joyce have done. Qantas is a major carrier in a country which, as another commentator has pointed out, depends to a very large degree on reliable air services to facilitate the major driver of our economy – the mining sector. If that isn’t enough to stop a corporate anti-union tantrum, then what hope in hell would ordinary consumers have.

    Tuesday, November 1, 2011 at 7:51 am | Permalink
  7. Megpie71 wrote:

    As Hitcher pointed out, Australian corporate interests are starting to close in on sectors which were (until the late 1980s) regarded as being pretty much exclusively government territory.

    One of Australia’s quirks which has shaped the way our various commercial and industrial sectors have shown up is the dichotomy of the Australian landmass being large (approximately the same size as the continental USA) but our population being very small (approximately the same size as the population of Greater London), and very much concentrated in approximately seven or eight locations, mostly on the eastern seaboard. Prior to the mid-1980s, a lot of the essential infrastructure services (transport, power, communications, water, health care) were pretty much wholly and solely the province of the various state and federal governments, and there was much more acceptance of government involvement in things like the banking sector (for example, the Commonwealth Bank was originally a sub-branch of the department of finance, and wholly owned by the federal government. Westpac started out as the Bank of New South Wales – owned by the NSW state government).

    During the 1980s, one of the economic reforms which was pushed through by the Hawke & Keating Labor governments was the privatisation of certain commonwealth-owned service organisations, along with a certain degree of deregulation of the markets for these organisations. Among the various governmental bodies which were privatised during that time were the Commonwealth government’s domestic air carrier (Trans Australian Airways, or TAA), the Commonwealth Bank, Australia Post (formerly known as the post office) and Telecom (which we now know as Telstra). The rhetoric of privatisation was that government provision of services was inefficient and ineffective, that the commercial sector could provide the same services, and that the commercial sector could do so at a lower cost, and with better customer service. State governments were strongly encouraged to follow through with the practice of privatisation as well. Australian voters were told this would provide us with greater consumer choice and better quality of service overall.

    In the extreme short term, it appeared that privatisation was a Good Thing for Australia. A lot of unnecessary bureaucratic mumbo-jumbo was removed from business practices, and some of the more egregious abuses appeared to halt overnight. However, as time went on, we started to see a loss of these small benefits. In the case of Australia Post, a lot of the smaller rural post offices were closed, because they “weren’t profitable”. Ditto a lot of the smaller rural branches of the Commonwealth bank, and the Bank of New South Wales (now calling itself Westpac) closed, because they cost more to run than they brought in as revenue. In a rural village prior to the age of the ATM, closing the bank and the post office effectively closed down the town – and once the bank and the post office closed, other businesses soon followed suit.

    The main push behind privatisation was always ideological. In the beginning, the government sectors which were privatised were the ones which were doing well, and raising money for the government (thus saving Australians money on their tax bill by effectively subsidising those which weren’t doing as well). Thus the bank, the post office, and the airline. These days, there’s less and less left to sell off, but the ideological push which says a corporation can always do things cheaper or better than a government department is still present, even though there’s a lot of evidence mounting up which points in the opposite direction.

    Tuesday, November 1, 2011 at 9:38 am | Permalink
  8. orlando wrote:

    What happened to uni-student Gillard, who was a diehard lefty labour rights activist? I just hate what the poisoned chalice of leadership has done to her.

    Tuesday, November 1, 2011 at 7:13 pm | Permalink