Qantas 747-400. Courtesy, Qantas

In an unprecedented move, Qantas (QF) grounded its entire domestic and international fleet Saturday evening, in a move designed to force the Australian government to end a nine-month industrial dispute with three key unions over pay and security (ATW Daily News, Oct. 28). The strike action has cost the airline A$68 million.

The grounding affects 447 flights a day and an average of 60,000 passengers who are now stranded across the world. The grounding does not affect QantasLink or Jetstar.

The airline's action comes as a result of an impasse with the Australian and International Pilots Assn. (AIPA), the Transport Workers Union (TWU) and the Australian Licensed Aircraft Engineers Assn. (ALAEA). QF has had more than 200 meetings with the three unions to try and hammer out a deal.

QF had hoped the overwhelming vote of support of the company’s strategy at the airline’s annual general meeting (AGM) Friday would send a clear signal to the unions, but instead it received further threats of increased industrial action.

QF’s forward bookings have plunged as the ALAEA warned passengers not to book with the airline because the dispute would drag on for 12 months.

On Friday, Australian prime minister Julia Gillard said she would not get involved, possibly because it would upset the unions, which are her power base. As a result, QF held a special board meeting Saturday morning and decided to lock out the members of the three unions from Monday at 8 p.m. However, the airline decided to ground the airline owing to safety concerns.

In Australia, the industrial arbitrator Fair Work Australia (FWA) has the power to terminate labor contracts and force the parties into a 21-day negotiation phase, followed by binding arbitration.

QF and the government have argued for a termination of the contracts and binding arbitration, whereas the unions have been fighting the move, fearing the arbitrator’s decision.

FWA may only grant a suspension of contracts with a 90-day cessation of action, with negotiations but no binding arbitration.

However, ATW understands that FWA will only grant a suspension under “a damage to the economy clause” and force binding arbitration. 

FWA heard submissions from Saturday night through Sunday evening and was expected to announce its decision late Sunday night or early Monday morning.

QF said the earliest it could get it fleet back in the air was Monday lunch time.