Qantas, Australia’s flagship airline, has been hit with a $90 million penalty over its illegal outsourcing of workers during the pandemic, bringing the total cost of the scandal to $210 million. The decision, handed down by the Federal Court, follows the airline’s controversial sacking of over 1,800 ground staff in 2020 – a move deemed to cripple union bargaining power.
Federal Court Issues Landmark Ruling
At the height of the pandemic, Qantas replaced baggage handlers, cleaners, and ground staff with contractors. The Federal Court ruled this was a calculated tactic to undermine unions during wage negotiations. After a protracted legal battle, culminating in a loss at the High Court, the airline has been ordered to pay significant penalties.
Justice Michael Lee declared the $90 million fine necessary to deter similar misconduct. “The sheer scale of these contraventions demands a response that sends a clear message to Qantas and other employers,” he said. Of the penalty, $50 million will be provided directly to the Transport Workers Union for enforcement purposes, while the remaining $40 million is pending further hearings.
Leadership Under Fire
Justice Lee reserved strong criticism for Qantas’ leadership, including CEO Vanessa Hudson, who avoided testifying. Although portrayed as a symbol of change after the resignation of former CEO Alan Joyce, Hudson’s reluctance to face the court raised questions about accountability. “New leadership does not absolve the company of its actions,” Justice Lee stated.
Former Chief Executive Alan Joyce, who departed amidst growing controversies, had earlier defended Qantas’ resilience. However, the airline’s reputation has suffered heavily, further tarnished by claims it sold tickets for canceled flights, resulting in a $100 million fine by the Australian Competition and Consumer Commission (ACCC).
Union Praises Legal Victory
The Transport Workers Union celebrated the court’s decision, calling it a vindication for the wronged workers. National Secretary Michael Kaine highlighted the ruling as a major step toward holding corporate giants accountable. “Under Alan Joyce, Qantas became synonymous with low pay, insecure work, and illegal sackings,” he said.
Adding to public outrage is the revelation that Qantas received $2.7 billion in taxpayer support during the pandemic, none of which was repaid. Meanwhile, Joyce exited with a $24 million payout, a move described by Labor Senator Tony Sheldon as “the swindle of the century.”
A Costly Era of Controversy
The financial damage extends beyond penalties, with Qantas already compensating affected workers $120 million for economic loss, pain, and suffering. Despite public apologies, the court found the airline’s remorse disingenuous, motivated by image preservation rather than genuine accountability.
This case serves as a stark warning to other companies considering similar actions. With mounting legal and reputational costs, Qantas’ handling of the pandemic-era crisis underscores the importance of ethical corporate governance.
