Embattled airline Qantas had raised the prospect of outsourcing floor companies roles two years earlier than it illegally fired 1700 workers in favour of contractors, a courtroom has heard.
The Federal Court docket dominated in 2021 that the airline had acted unlawfully when it sacked the bottom companies workers a 12 months earlier and outsourced their roles.
Qantas’ makes an attempt to quash the decision have been unsuccessful, and it’s now battling with the Transport Staff Union over the quantity of compensation to be paid to former staffers.
On Thursday, TWU barrister Mark Gibian SC pointed to inner paperwork which confirmed the airline had been contemplating outsourcing floor companies roles in 2018.
He mentioned Qantas proposed to outsource the bottom companies roles amid an bold years-long effort to put in continuous flights from Australia to London and New York.
The paperwork confirmed the proposal had been ready and reached the stage of acquiring exterior authorized recommendation in regards to the dangers of such a choice, Mr Gibian informed the courtroom.
But former Qantas CEO of Home and Worldwide, Andrew David, informed the courtroom he wasn’t conscious of the outsourcing plan throughout his time on the helm.
Two years later, he made the choice to fireplace 1700 floor companies employees and outsource their roles to 3rd occasion contractors.
Mr David mentioned he made the “judgment name” as a result of the airline was “underneath loads of stress” to chop $900 million in prices over three years.
One of many largest dangers for the corporate in making the choice was the attainable response from the federal government, he informed the courtroom.
The previous CEO of Home and Worldwide informed the courtroom Qantas had accepted $850m via the federal government’s JobKeeper program which was “designed to maintain folks in jobs”.
“I used to be very cognisant … that us outsourcing 1700 employees within the context of JobKeeper scheme was a problem that wanted to be managed fastidiously with authorities,” he mentioned.
“The counterbalance to that was the large stress of losses Qantas was enterprise because of Covid on the enterprise.”
By way of negotiations, Mr David mentioned Qantas was capable of get the federal government “to a place to know” the choice earlier than the airline introduced the mass lay-offs in August 2020.
He informed the courtroom he thought the chance of employees launching industrial motion was excessive, however he hadn’t targeted on the chance of a authorized problem.
“What was defined to me was the business causes for outsourcing have been lawful causes,” the previous Qantas government mentioned.
“It was on that foundation I moved ahead with (the outsourcing).”
He informed the courtroom he finally decided the authorized, operational, authorities and industrial dangers have been “manageable within the context of the scale of the business rewards”.
The TWU has estimated Qantas must pay “many, many tens of millions” in compensation for what it has declared to be the most important case of unlawful sackings in Australia’s company historical past.
The airline contends its payout ought to solely lengthen to April 2022 as a result of the staff would have misplaced their jobs in 2021 anyway because of the ongoing results of the pandemic.
Mr David informed the courtroom he would have “reached the identical conclusion” to outsource the 1700 roles in 2021.
“The case for me would have been as compelling because it was in August 2020,” he mentioned.
“If something, the business imperatives had change into extra urgent and extra pressing.”
By August 2021, Qantas had misplaced $16bn in income and was projected to lose $4bn extra over the subsequent 4 months.
Former Qantas Chief Operations Officer Colin Hughes agreed, telling the courtroom he would have made the identical advice to outsource in 2021 to avoid wasting the airline $100m.
Nevertheless Mr Gibian argued it was unlikely the airline would have made the choice when home flights have been projected to return to 80 per cent of pre-pandemic ranges by mid-year.
“You wouldn’t have (really useful outsourcing) in March 2021 as a result of there was rising demand,” he advised to Mr Hughes.
“I reject that,” Mr Hughes replied.
The previous Qantas COO denied his testimony was “self serving (in a bid) to assist Qantas’ case”.
The listening to will proceed earlier than Justice Michael Lee on Friday.
