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UPDATED: Qantas grounds all flights until unions drop action

written by australianaviation.com.au | October 29, 2011
Qantas is pre-emptively grounding its fleet.

In an extraordinary display of brinkmanship, Qantas CEO Alan Joyce has announced that all Qantas international and domestic services will cease immediately with the airline locking out all employees of the Australian Licenced Engineers Union (ALAEA), the Transport Workers Union (TWU) and the Australian and International Pilots Union (AIPA).

Joyce says the drastic move has been taken under the Fair Work Act in response to industrial action taken by the unions, and will likely cost the airline as much as $20 million per day until the disputes are resolved. The airline has so far lost $68 million due to disruptions caused by industrial action in recent months, and was losing an estimated $15 million per week. The airline says more than 600 flights had been cancelled and about 70,000 passengers had been affected.

In a hastily called media conference on October 29, Joyce said the airline would be grounded from 5.00pm on October 29, but that all employees are required at work as normal and will be paid until the lockout begins at 8.00pm eastern time on October 31. Once the lockout starts, those employees who are locked out will not be required at work and will not be paid. He said he had made the decision that morning, and had consulted the Qantas board before implementing the lockout.

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“I have to activate the one form of protected industrial action that is available to me to bring home to the unions the seriousness of their actions, and to get them to forge sensible deals with us,” Joyce said. “I am using the only effective avenue at my disposal to bring about peace and certainty.”

The action does not affect employees based oversees, or the operations of Qantas Group subsidiaries Jetstar, Jetconnect, QantasLink and Express Freighters Australia.

“They are trashing our strategy and our brand,” Joyce said of the unions. “They are deliberately destabilising the company. And there is no end in sight. They talk about job security, but the unions are on a path that would diminish the job security of their own members. Because the pilots, ramp, baggage and catering staff and licensed engineers are essential to the running of the airline, the lock-out makes it necessary for us to ground the fleet.”

“Key high value domestic bookings on east coast routes are down by 25 per cent on the same period last year,” he added. “That’s the most lucrative part of our flying business and it is bleeding badly.  International bookings have also fallen, with November bookings nearly 10 per cent down on where we expected them to be – when Qantas International is already making significant losses. ”

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The airline says those aircraft in the air will continue to their planned destination, but that no passengers should go to any airports until further notice. Passengers have been advised to monitor the Qantas.com website, or the airline’s Facebook or Twitter accounts.

UPDATE: 6.50PM AEDST 29 OCTOBER

A brief statement from Jetstar said the airline has “limited capacity” on its flights, and that opportunities to increase capacity to accommodate more passengers are currently being investigated.

Federal Transport Minister Anthony Albanese says he was informed of Qantas’s intentions just three hours before the airline announced the grounding, and says the government will make an urgent application to Fair Work Australia that it was in the national interest to order an immediate cessation of industrial action by the unions and by the airline.

The Minister questioned the decision and said he was “extremely disappointed” with the airline’s actions, and that he was disturbed by the fact that he and Joyce had had a number of discussions in recent days and that at no stage had Joyce indicated that the grounding was under consideration. “I certainly indicated my concern to Mr Joyce about the inconvenience to the travelling public,” he said.

Albanese added that he had spoken to Virgin Australia CEO John Borghetti and had been assured that Virgin would do all possible to assist. Virgin Australia quickly announced that it will step in where possible and was in discussions with alliance partners to add extra capacity to the market and will offer special ‘stranded passenger’ recovery fares for those holding a Qantas ticket.

But with Qantas grounding 108 aircraft at 22 ports around the world, Virgin isn’t expected to be able to make a huge dent in the anticipated passenger backlog in the short term.

UPDATE: 9.40PM AEDST, 29 OCTOBER

During a doorstop interview on the sidelines of the CHOGM conference in Perth, Prime Minister Julia Gillard said she had been “kept continuously informed” during the day as the dispute “escalated in a dramatic way.”

“This dispute has implications for our national economy,” she said. “I want to see this dispute sorted out.” While she refused to be drawn on who was to blame for the escalation, Ms Gillard said Qantas is an “iconic Australian brand” and that she was “looking at this dispute as Prime Minister and its implications to the national economy.”

Ms Gillard said an urgent first meeting of Fair Work Australia would take place at 10.00pm AEDST tonight, but was reluctant to speculate on its possible outcome. She said CHOGM delegates who had been booked to fly out of Perth on Qantas has been briefed, and that they are working on alternate arrangements.

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45 Comments

  • pam dichiera

    says:

    I have booked flights today travelling from Mildura to Melbourne on QF2079 departing at 10.05am tomorrow, returning Wed. 2/11 on QF 2084 at 3.10 pm. are these flight still happening? please advise. Pam Dichiera.

    • australianaviation.com.au

      says:

      Those flights are operated by QantasLink, so they should be going ahead still.

  • Andrew Duffin

    says:

    Alan Joyce is the worst thing that’s happened to Qantas in a long time. It appears he is hell bent on shifting jobs off shore. Some of the unions only want minor pay increases that are below or par with inflation. The sticking point is on job security (which the unions want and he won’t give) and this is where all the trouble stems from. Alan Joyce doesn’t care what happens because he’s got nothing to lose. He just got a big pay increase; If the unions give in, he wins; If the company goes into receivership, he can do it anyway under the banner of “saving the company”. I think he needs to be sent back to whence he came.

  • JB

    says:

    I back joyce 100% and his decision – the claims are out of control – you only have to google “qantas and strikes” and see how often this happens. He had no choice … No staff today can expect a job for life or job security – anyone would think they have to work with asbestos everyday!! – get back to work ! I am a qantas customer and support the decision made as a customer I am also a union member in my industry and what this is – is absolutely ridiculous. How dare they hold a whole company to ransom and in a way that effects the public and the loyal staff working through this and covering the wingers shifts. Without this action we may lose qantas for good and your jobs for good.

  • DR

    says:

    Unions will destroy Qantas just like they did Ansett. Remember 3rd cockpit seat on 767 flight deck forced by pilots union. The world has changed in the airline industry but unions still don’t get it.

  • australianaviation.com.au

    says:

    Constructive comments only please folks, thanks.

    If you have an opinion or relevant information, feel free to post it. But NO personal attacks or swearing will be tolerated.

    Andrew McLaughlin
    DEPUTY EDITOR | AUSTRALIAN AVIATION

  • Jim Swanson

    says:

    In some aspects I admire Alan Joyce on his stand against the unions. No union should be as strong as the ones opposing Qantas and basically hoding the country to ransom. I dont think for a minute that the workers are under paid for what they are doing. Has anyone heard how much they are awarded at the moment?___NO!!! BECAUSE THEY ARE PRETTY WELL OFF CONSIDERING SOME OF US. I do however object to the $5 million pay rise he asked the shareholders for. What weak pricks they are in granting it. What are they getting out of it? At the end of the day it is the customer who loses out.

  • Redundant

    says:

    This is just tragic, I think that Monday will be a very interesting day; reaction from the institutional shareholders and also the moves the market will make with regard to the share price. That will determine the fate of QF surely. Can’t help but think now that the timing of this announcement and also the 110 x A320neo’s suggests some level of premeditation of today’s events. Utterly tragic for the airline and particularly the QF workforce.

  • j stevenson

    says:

    I have a booking on flight from Paraburdoo flight number QF 1809 at 18.40pm on Monday 31st october flying into Perth at 20.20 pm with this flight still be flying or will it be on grounded. Could you please advise me. J Stevenson

  • Sam

    says:

    My wife is coming from Brisbane to Sydney tomorrow Sunday 30 October 2011 on the 8.25am flight, is this flight cancelled or still operating, please advice.

  • australianaviation.com.au

    says:

    J Stevenson

    If it’s a Qantas mainline flight which it probably is, it’s unlikely you will be flying.

    My advice is to stay off the Qantas phone number and website tonight as there are people with more urgent needs, but keep an eye on the web and on Qantas’s facebook page etc for more info.

    Good luck

    Andrew

  • australianaviation.com.au

    says:

    Sam

    If it’s a Qantas flight number its highly unlikely sorry.

    Good luck

    Andrew

  • adam mizzi

    says:

    You have destroyed the dreams of a 32 year old man and his best mate adam..sams dream was to fly for the first time to vegas, after being in a wheel chair for nearly 8 years…And now he is walking…yes walking so we planeed a dream holiday for him…..the worst think about this is you forgot about your customers, regardless who is at fauilt..

    i am in tears we were suppose to fly out sunday at 10.30

    i even made planes to for sam to see his dream nas cars in texas and met john force the castrol sponsered fastesest top fuler drag car owner….

    i can not belive what you have done to some one dreams

    regards

    adam mizzi

  • australianaviation.com.au

    says:

    Folks

    As the article says, the entire Qantas mainline domestic and international fleet is grounded until further notice. It is unlikely anything except Jetstar, QantasLink (regional) and Jetconnet (to NZ) will be flying for 24-48 hours at the very least.

    Stay tuned to ABC 24 or SKY News or your news radio station for any breaking news, and we’ll try to update you here as things evolve.

    Cheers

    Andrew

  • Kevan Mullan

    says:

    Well done the Qantas board stranding thousands of passengers in Aust and around the world this action will drive away more passengers at least the unions gave notice of strike action you cant tell me this was,nt preplanned I hope Alan Joyce enjoys his 5mill 71%pay raise pay why would you care what happens to this Icon of ours Go the flying Kangaroo keep it real keep it Australian I dont want any of Aust jobs to go overseas thats why Qantas is so good best Pilots best engineers impecable safty record this is going to be tragic for al of us .

  • Liz Ingram

    says:

    This is an absolute travesty!! Poor Qantas…….our BRAND and we get a piece of Irish luck losing jobs for good hard working Aussies. Of course he doesn’t care…..would you on his pay???? The jobs MUST stay in AUSTRALIA.

    Get him oootathere!! Please help save Australian jobs, workplace FairPlay, we want this famous flying Kangaroo to remain the GREAT icon it has always been.

    Do we really need a greedy CEO to tell us how much is a GOOD profit at year end?

    Their pay requests pale into insignificance when compared to his salary rise. What are the shareholders thinking…..

  • TM

    says:

    As an outsider to aviation, but with an interest, I’ve been watching this for quite some time. I come from a working-class family with union values. I began with enormous sympathy for the unions and much antipathy for Qantas management. I’ve been noticing a change in my attitude lately with growing feelings of contempt for the unions at the manner in which they have gone about blackmailing Qantas, not through inconvenience to Qantas, but through inconvenience to Qantas’ customers. The customers THEY rely on for their union member’s continued employment.
    Do these [ ] not realise the more they demonise Qantas the more they demonise themselves? The more they claim Qantas is unsafe, the more customers are going elsewhere? I’m wrong, it isn’t a blackmail situation but a hostage situation. The unions hold a gun to the passenger’s heads and goad management to call their bluff, and then they hold the gun to their own heads and threaten to blow their heads off.
    Over my working life so far my industry has changed. My company is in competition with not just other Australian companies but those around the world. The result is that we have to be more competitive in offering goods and services. We have to be flexible according to the needs of the work and the client. If we don’t, we don’t have any more work, and I can apply to flip burgers at McDonalds. I prefer to not work at McDonalds.
    The unions seem to think it is still 1975 and the airline industry is still regulated. My father flew to Europe last year on Emirates. Nothing would get him back on a Qantas flight. It isn’t management that the unions should be worried about, it is not having Qantas around to bully. Look what happened in the US, they all went bankrupt and took the opportunity to restructure and hire back workers on new term. They are doing much better now, but employ fewer union members. I bet their unions wished they were a bit more flexible now.
    Unions used to have a function. It used to be to protect employees from predatory and exploitative employers. We have government watchdogs, commissions and departments for that, so what are unions for? To blackmail and exploit employers? To demand job security that doesn’t exist any more? To demand that employees have veto rights over management decisions?
    Change or die, unions, change or die.

  • Tyson Fordham

    says:

    For God’s sake… the AA website isn’t here so you can ask for your flight’s status! Check the Qantas site!

  • John S.

    says:

    I congratulate Alan Joyce for his brave stance in suspending all Qantas flights. In supporting the Unions false premises, the Australian public are merely joining the bandwagon of an anti foreign leadership. That is, the fact the Alan Joyce is an Irishman – an absolute nonsense. Whether the CEO is a foreigner of not is not the issue. For months now Qantas unions have held the company to ransom on largely trivial issues, trying to use the media to reflect the so called anti Qantas stance when in fact the company is endeavouring to modernise policies to reflect modern day realities.
    If the Unions are allowed to have their way then sooner or later the company will be purchased by a foreign airline. At this rate that is just a matter of time.
    Bravo Alan Joyce, don’t let the Unions grind you down. Continue to stand up for what is right.

  • james t.

    says:

    [POST DELETED]

    Don’t come back thanks James!

    Andrew

  • ANGELA

    says:

    My daughter and granddaughter are booked on flights on Tuesday morning 1st November from Perth to Sydney to visit my husband who is recovering from an operation, he has cancer. I have booked their flights with my frequent flyer points, will they be credited back to me if I go ahead now and book flights with someone else?
    I can’t leave it to see if this is resolved..
    Angela

  • australianaviation.com.au

    says:

    Angela

    You’ll need to contact Qantas regarding this. They have said refunds will be available, so there’s no reason to assume that wouldn’t also apply to FF points.

    Good luck

    Andrew

  • Dominic

    says:

    Suppose to depart sin to Mumbai by QF51 2350hrs
    Please advise flight status

  • australianaviation.com.au

    says:

    Can’t help you Dominic, but it doesn’t look good. Best to check with the local Qantas office.

    Good luck

    Andrew

  • australianaviation.com.au

    says:

    Signing off for the night in Sydney folks, but Ellis Taylor in Perth will be keeping an eye and ear on things and will let us know if there’s anything new.

    Good luck to those who are stranded tonight.

    Cheers

    Andrew

  • Imogen

    says:

    flight to Alice Springs ?? on or off – anyone out there know pretty pls ??

  • australianaviation.com.au

    says:

    Imogen

    Once again, EVERY Qantas domestic flight is grounded. Check http://www.qantas.com.au or call 131313 for more info.

    Good luck

    Andrew

  • Tony Waters

    says:

    The action taken by the Qantas management is deplorable,how can you give a manager 5 million a year and then say the airline is going broke,this is about cutting pay and conditions while sending aircraft maintenance to asia, Qantas has had some very dangerous and lucky escapes in recent years with parts dropping off and engine failures now they are using the excuse that to remain viable they have to even attack the pilots themselves,its only a matter of time before they lose an aircraft, this stunt is also politically motivated Abbott would back these actions all the way, wake up Australia if these thugs get away with this it wont belong before every working person will have to sign master serevant contracts.
    Good on the unions they deserve all the support that they can get after all the most powerful unions in the country are employers associations who have the backing of our mate Murdoch’s media.
    Regards Tony Waters

  • JT

    says:

    Clearly the unions and the government have not learned from the demise of Ansett. Overpaid and selfish wworkers and unions dictating terms that simply cannot be supported. Why should a baggage handler at Mascot get paid more than a defence force member carrying out the same task in a foreign warzone?

    I wonder which union leader had their hand up Albanese’s jacket when he was bagging QANTAS earlier. Someone also needs to explain to him the difference between “planning” and “decision making”. Who cares if QANTAS has been planning alternatives for months, they are entitled to in dealing with those that are strangling the business.

    And we all thought a Labor government was for the workers and the country. Shame on those who thought change was necessary, be careful what you ask for, you may actaully get more than you bargained for

  • Grumpy

    says:

    My husbands flight from Hong Kong to Brisbane has been cancelled will Qantas put them on another flight – how long will this take. I have been on hold for way too long.

  • Anthony

    says:

    Kamusta, only ever flown with Qantas when a Philipines Airlines flight was cancelled, and we got a free flight from Sydney to Manilla, after enduring 8 hour flight with male flight attendants, serving us meals, why didnt they have at leasts a mix of male and female flight attendants on the flight, to ease the mood of the flight? Qantas is out of touch with 2011, I would have expected to be greeted by female flight attendants in the cabin?Every other time we fly with Philippine Airlines, there is a mix of female and male flight attendants! same with Jetstar! anyway, time will tell if Qantas can keep flying, but I doubt it! Ingat, Glory to God, Maybe Alan Joyce needs to Pray more before he makes RASH decisions about Qantas, esp on a Saturday, OMG!!!

  • BrHut

    says:

    This is sadly the confrontation that QF needed to have… it will be damaging for them, but it is needed for their long term international survival.

    In my life I have been a paying member of two unions (and I previously been made redundant)- however in my opinion unions should not be able to direct the strategic direction of a business. Unions should be there to make sure staff are paid well (QF staff are paid higher than Australian competition), are safe and that if the case arises that employees become excess to company requirements, then fair redundancy arrangements are made available. I did not grow up with an expectation that I get a job for life… I, like everyone, believe that job security is important; however, I also know things change and I must be prepared for that change.

    A lot of people make comments about how ‘great QANTAS used to be’… I really don’t think those people understand how much has changed in global aviation. For QANTAS, it faces world-class competition with a lower cost base and continual Government policy which involves ‘opening up’ the skies to competition.

    Additionally, unfortunately for QANTAS, Australia’s geographical location does not make it ‘hub’ friendly (unlike Dubai, Singapore etc).

    QANTAS has to try and compete globally when the foundations of its business place it behind the competition before take-off. Something has to give.

    Here are some ‘facts’ from my point of view:
    *QANTAS staff are paid higher than comparable Virgin staff;
    *Airbus & Boeing both predict massive gains in Asian air travel in the coming decade/s… it would be stupid not to try and get a share of this;
    *QANTAS should be able to start-up an Asian based airline if it wishes (Singapore & Cathay are just as safe as QANTAS and their planes are serviced in Asia. I don’t believe the average joe public believes that QANTAS Australian staff service planes better than staff for Emirates, Ethiad, Singapore or Cathay etc and I don’t believe they will pay premiums for that anymore. As a caveat, if QANTAS moves maintenance to Russia, Iran that may be different story.
    *Mr Joyce has either pulled off one of the greatest pieces of ‘leadership’ in Australian corporate history or written his resignation… in either case its brave and our PM should learn a little from this;
    *Mr Joyce should not be getting pay rises at this time (if he pulls off the Asian expansion and profits increase, he can get paid double then). Getting pay-rises of any form now is really poor form and judgement.
    *QANTAS could have and should have grounded its planes in better fashion;
    *Given that planes are grounded, QANTAS should be jumping over backwards to get passengers onto other carriers… especially international passengers. Refunds are the minimum here.
    *Unions need to re-assess their role in the Australian workplace… the current union model is out-dated. Whilst unions have done some great things, the modern union appears to lack focus and fails to understand global trends. The Greek public sector is a prime example of the dangers of failing to change…
    *The QANTAS Hub and international alliance strategy is not perfect, but overall is sound and should be successful with some tinkering.
    *QANTAS needs to look at more flights out of Melbourne internationally. Joyce misses the point when he mentions tourists dont want to fly to Melbourne, as corporate travel is king and Melbourne is home to some large corporate HQ’s with international links / needs.
    *Asia is a massive opportunity, but so is the emerging Latin America… whilst Santiago is a great first start, one country that QF should be getting into is Brazil (and fast). Sao Paulo is the financial centre of South America, is in the top 10 global cities by GDP and QF would have near zero competition. Combined with Olympics, world cups, mining links and partner LANs impending merger with TAM… Brazil makes sense (as long as K Rudd can get the Brazilians to ease up on Visa requirements).

  • Blue angels

    says:

    most companies likes profit mostly which is the base for good production and services
    but program structure like wise if its not working and not profitable on the way its handled properly the company will loose it quality of name -which is the flying kangaroo

    as seen in the past its trying to build profitable services
    but the programs for this structure is NOT balanced with employees

    that means it need to get fix as priorities
    next stage is ,,,, will the CEO can fix it …
    will the union enhanced the workers right to thier needs as a low paid workers to sustain to thier livelihood

    qantas need a “good and balanced infrastructure” that can support
    and manage thier structure program in order the flow of aviation to be successful in goods and services

    qantas needs a succesfulI “infrastructure” that builds and continue to hold the the red kangaroo in sky again

    blue angels

  • Ryan

    says:

    I think someone should put these union bosses into place, its getting out of hand now all they do is encourage workers to strike and basically bribe them.

  • cheryl

    says:

    I have a flight tomorrow, 30 oct to Broom on Quantas then Kununurra on Air North, stupid question I suppose BUT what are the chances I will be flying?

    • australianaviation.com.au

      says:

      It depends if your Qantas flight to Broome is operated by Qantas itself or its QantasLink subsidiary (which is unaffected).

  • John B

    says:

    I am a very proud Australian and would hate to see jobs go overseas, but it is happening everyday in all industries. Our cost base is way to high driven by unions demands and the like for the past god knows how many years.

  • Tiffany

    says:

    I’m wondering why the Qantas flight status page shows there are a handful of flights still estimated to depart on time, some are codeshare (which I understand are not all affected e.g. American Airlines) but some are straight up Qantas flights and some which are codeshare are cancelled as well. Is there any particular logic behind which ones are grounded and which ones are still showing an estimated flight departure time? Thanks.

  • australianaviation.com.au

    says:

    Tiffany – perhaps it’s because Qantas is hoping that a determination by the FWA panel this afternoon to terminate all action will allow the airline to resume flights tonight or tomorrow morning.

    Andrew

  • Glen

    says:

    I just wonder where Qantas would be today if they’d replaced Dixon with Borghetti and Joyce had moved to Tiger instead. Different landscape, different outlook. Too late now, he’s transformed Virgin into a potential flag carrier. Every offshore job denies Australia tax revenue and makes no contribution to national skill levels or national self-reliance. If I’m flying Qantas I want, and expect, to fly an Australian registered and maintained plane flown by Australian trained Australians confident in the knowledge that I’m traveling in the best this country has to offer. Mr Joyce, I’m sure your family think you’re a nice boy but I think you’ve passed your use-by date. If you want to run a successful airline your way, I suggest you start flapping your arms because nobody is flying with you or your hysterical anti-worker spin anymore. Please stop dismantling Qantas.

  • TM

    says:

    I like that Glen @ 10:49am is praising Borghetti and Virgin as a potential flag carrier, when they pay less than Qantas does (or even proposing to) and Virgin does all the things he condemns Qantas for. Hypocrite.

    The double standards on display are sickening. You all want to pay cheap fairs, but you won’t fly Qantas because they are too expensive (I can tell because of Qantas’ falling passenger numbers) with poor service (the whinging level about service is deafening), but you whine and complain when Qantas tries to modernise their procedures and conditions in line with the airlines they are competing with.
    Somehow, Qantas is a special case that doesn’t have to maintain competitiveness, that is has a right (and duty!) to simply exist as an isolated dinosaur, legally protected as an extinct specimen. The loudest protesters are no doubt those who don’t fly Qantas.

    You say that Australian maintenance workers are better, more competent that “foreigners”? Well who has been maintaining Qantas aircraft during all their high profile “incidents”? Those same very competent Australian workers. You complain about foreign maintenance standards, but I don’t see aircraft from Singapore Airlines and Cathay Pacific dropping out of the sky, despite the fact that “foreigners” maintain them.

    I’ll say this for them, the TWA, ALAEA and AIPA really know how to play on the bigotries of Australians. But they’d know all about it because they’re living in a little bubble of the 1980’s when Australian skies were regulated and the only competition was for who wangle the biggest scam into their contracts.

  • Matt

    says:

    A point of interest, all the aircraft owned by QANTAS are built by foreigners. I dont see any aircraft built in Australia that would be suitable for service within QANTAS. Surely if they can build them they know how to maintain them!

  • Jeremy

    says:

    Hands up those who have supported other carriers when flying locally or internationally because they were cheaper than QANTAS.

    … Oh look… Most of you. And yet you sit here cursing and lamenting the man who’s desperately trying to keep our ‘Australian icon’ alive against immense union pressure to prevent them becoming commercially viable.

    You want the cheeper option, you want QANTAS, but you won’t support their effort to survive.

    How typically ‘Australian’ to judge a man who earnt $5m – If he keeps this airline alive and the red kangaroo in the air, he’s worth it.

  • annette smith

    says:

    yes good on you alan …i will stay loyal to quantas and are happy for frree flights to nz at xmas..where do i apply for that..i was one of passengers grounded..last weekend an d couldnt get back to my grandson who has atopic excema ..i had gone to gold coast to travel to redcliff to get him some emu natural oil..i want to take him back to nz to cooler weather and i have a brother dying being this his last xmas so this free flight will be a blessing in disguise…thank you for that ..alan n god bless in your endeavors..my flight is for 22nd dec-7th jan gold coast to hamilton n return hamilton to gold coast..on 7th jan 2012..i will stay a couple days in gc and then fly to townsville where my daughter will pick us up…i know the free flight for me is free but my huuby n grandson will pay their own n b aby is free so thats cool…

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UPDATED: Qantas grounds all flights until unions drop action

written by australianaviation.com.au | October 29, 2011
Qantas is pre-emptively grounding its fleet.

In an extraordinary display of brinkmanship, Qantas CEO Alan Joyce has announced that all Qantas international and domestic services will cease immediately with the airline locking out all employees of the Australian Licenced Engineers Union (ALAEA), the Transport Workers Union (TWU) and the Australian and International Pilots Union (AIPA).

Joyce says the drastic move has been taken under the Fair Work Act in response to industrial action taken by the unions, and will likely cost the airline as much as $20 million per day until the disputes are resolved. The airline has so far lost $68 million due to disruptions caused by industrial action in recent months, and was losing an estimated $15 million per week. The airline says more than 600 flights had been cancelled and about 70,000 passengers had been affected.

In a hastily called media conference on October 29, Joyce said the airline would be grounded from 5.00pm on October 29, but that all employees are required at work as normal and will be paid until the lockout begins at 8.00pm eastern time on October 31. Once the lockout starts, those employees who are locked out will not be required at work and will not be paid. He said he had made the decision that morning, and had consulted the Qantas board before implementing the lockout.

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“I have to activate the one form of protected industrial action that is available to me to bring home to the unions the seriousness of their actions, and to get them to forge sensible deals with us,” Joyce said. “I am using the only effective avenue at my disposal to bring about peace and certainty.”

The action does not affect employees based oversees, or the operations of Qantas Group subsidiaries Jetstar, Jetconnect, QantasLink and Express Freighters Australia.

“They are trashing our strategy and our brand,” Joyce said of the unions. “They are deliberately destabilising the company. And there is no end in sight. They talk about job security, but the unions are on a path that would diminish the job security of their own members. Because the pilots, ramp, baggage and catering staff and licensed engineers are essential to the running of the airline, the lock-out makes it necessary for us to ground the fleet.”

“Key high value domestic bookings on east coast routes are down by 25 per cent on the same period last year,” he added. “That’s the most lucrative part of our flying business and it is bleeding badly.  International bookings have also fallen, with November bookings nearly 10 per cent down on where we expected them to be – when Qantas International is already making significant losses. ”

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The airline says those aircraft in the air will continue to their planned destination, but that no passengers should go to any airports until further notice. Passengers have been advised to monitor the Qantas.com website, or the airline’s Facebook or Twitter accounts.

UPDATE: 6.50PM AEDST 29 OCTOBER

A brief statement from Jetstar said the airline has “limited capacity” on its flights, and that opportunities to increase capacity to accommodate more passengers are currently being investigated.

Federal Transport Minister Anthony Albanese says he was informed of Qantas’s intentions just three hours before the airline announced the grounding, and says the government will make an urgent application to Fair Work Australia that it was in the national interest to order an immediate cessation of industrial action by the unions and by the airline.

The Minister questioned the decision and said he was “extremely disappointed” with the airline’s actions, and that he was disturbed by the fact that he and Joyce had had a number of discussions in recent days and that at no stage had Joyce indicated that the grounding was under consideration. “I certainly indicated my concern to Mr Joyce about the inconvenience to the travelling public,” he said.

Albanese added that he had spoken to Virgin Australia CEO John Borghetti and had been assured that Virgin would do all possible to assist. Virgin Australia quickly announced that it will step in where possible and was in discussions with alliance partners to add extra capacity to the market and will offer special ‘stranded passenger’ recovery fares for those holding a Qantas ticket.

But with Qantas grounding 108 aircraft at 22 ports around the world, Virgin isn’t expected to be able to make a huge dent in the anticipated passenger backlog in the short term.

UPDATE: 9.40PM AEDST, 29 OCTOBER

During a doorstop interview on the sidelines of the CHOGM conference in Perth, Prime Minister Julia Gillard said she had been “kept continuously informed” during the day as the dispute “escalated in a dramatic way.”

“This dispute has implications for our national economy,” she said. “I want to see this dispute sorted out.” While she refused to be drawn on who was to blame for the escalation, Ms Gillard said Qantas is an “iconic Australian brand” and that she was “looking at this dispute as Prime Minister and its implications to the national economy.”

Ms Gillard said an urgent first meeting of Fair Work Australia would take place at 10.00pm AEDST tonight, but was reluctant to speculate on its possible outcome. She said CHOGM delegates who had been booked to fly out of Perth on Qantas has been briefed, and that they are working on alternate arrangements.

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45 Comments

  • pam dichiera

    says:

    I have booked flights today travelling from Mildura to Melbourne on QF2079 departing at 10.05am tomorrow, returning Wed. 2/11 on QF 2084 at 3.10 pm. are these flight still happening? please advise. Pam Dichiera.

    • australianaviation.com.au

      says:

      Those flights are operated by QantasLink, so they should be going ahead still.

  • Andrew Duffin

    says:

    Alan Joyce is the worst thing that’s happened to Qantas in a long time. It appears he is hell bent on shifting jobs off shore. Some of the unions only want minor pay increases that are below or par with inflation. The sticking point is on job security (which the unions want and he won’t give) and this is where all the trouble stems from. Alan Joyce doesn’t care what happens because he’s got nothing to lose. He just got a big pay increase; If the unions give in, he wins; If the company goes into receivership, he can do it anyway under the banner of “saving the company”. I think he needs to be sent back to whence he came.

  • JB

    says:

    I back joyce 100% and his decision – the claims are out of control – you only have to google “qantas and strikes” and see how often this happens. He had no choice … No staff today can expect a job for life or job security – anyone would think they have to work with asbestos everyday!! – get back to work ! I am a qantas customer and support the decision made as a customer I am also a union member in my industry and what this is – is absolutely ridiculous. How dare they hold a whole company to ransom and in a way that effects the public and the loyal staff working through this and covering the wingers shifts. Without this action we may lose qantas for good and your jobs for good.

  • DR

    says:

    Unions will destroy Qantas just like they did Ansett. Remember 3rd cockpit seat on 767 flight deck forced by pilots union. The world has changed in the airline industry but unions still don’t get it.

  • australianaviation.com.au

    says:

    Constructive comments only please folks, thanks.

    If you have an opinion or relevant information, feel free to post it. But NO personal attacks or swearing will be tolerated.

    Andrew McLaughlin
    DEPUTY EDITOR | AUSTRALIAN AVIATION

  • Jim Swanson

    says:

    In some aspects I admire Alan Joyce on his stand against the unions. No union should be as strong as the ones opposing Qantas and basically hoding the country to ransom. I dont think for a minute that the workers are under paid for what they are doing. Has anyone heard how much they are awarded at the moment?___NO!!! BECAUSE THEY ARE PRETTY WELL OFF CONSIDERING SOME OF US. I do however object to the $5 million pay rise he asked the shareholders for. What weak pricks they are in granting it. What are they getting out of it? At the end of the day it is the customer who loses out.

  • Redundant

    says:

    This is just tragic, I think that Monday will be a very interesting day; reaction from the institutional shareholders and also the moves the market will make with regard to the share price. That will determine the fate of QF surely. Can’t help but think now that the timing of this announcement and also the 110 x A320neo’s suggests some level of premeditation of today’s events. Utterly tragic for the airline and particularly the QF workforce.

  • j stevenson

    says:

    I have a booking on flight from Paraburdoo flight number QF 1809 at 18.40pm on Monday 31st october flying into Perth at 20.20 pm with this flight still be flying or will it be on grounded. Could you please advise me. J Stevenson

  • Sam

    says:

    My wife is coming from Brisbane to Sydney tomorrow Sunday 30 October 2011 on the 8.25am flight, is this flight cancelled or still operating, please advice.

  • australianaviation.com.au

    says:

    J Stevenson

    If it’s a Qantas mainline flight which it probably is, it’s unlikely you will be flying.

    My advice is to stay off the Qantas phone number and website tonight as there are people with more urgent needs, but keep an eye on the web and on Qantas’s facebook page etc for more info.

    Good luck

    Andrew

  • australianaviation.com.au

    says:

    Sam

    If it’s a Qantas flight number its highly unlikely sorry.

    Good luck

    Andrew

  • adam mizzi

    says:

    You have destroyed the dreams of a 32 year old man and his best mate adam..sams dream was to fly for the first time to vegas, after being in a wheel chair for nearly 8 years…And now he is walking…yes walking so we planeed a dream holiday for him…..the worst think about this is you forgot about your customers, regardless who is at fauilt..

    i am in tears we were suppose to fly out sunday at 10.30

    i even made planes to for sam to see his dream nas cars in texas and met john force the castrol sponsered fastesest top fuler drag car owner….

    i can not belive what you have done to some one dreams

    regards

    adam mizzi

  • australianaviation.com.au

    says:

    Folks

    As the article says, the entire Qantas mainline domestic and international fleet is grounded until further notice. It is unlikely anything except Jetstar, QantasLink (regional) and Jetconnet (to NZ) will be flying for 24-48 hours at the very least.

    Stay tuned to ABC 24 or SKY News or your news radio station for any breaking news, and we’ll try to update you here as things evolve.

    Cheers

    Andrew

  • Kevan Mullan

    says:

    Well done the Qantas board stranding thousands of passengers in Aust and around the world this action will drive away more passengers at least the unions gave notice of strike action you cant tell me this was,nt preplanned I hope Alan Joyce enjoys his 5mill 71%pay raise pay why would you care what happens to this Icon of ours Go the flying Kangaroo keep it real keep it Australian I dont want any of Aust jobs to go overseas thats why Qantas is so good best Pilots best engineers impecable safty record this is going to be tragic for al of us .

  • Liz Ingram

    says:

    This is an absolute travesty!! Poor Qantas…….our BRAND and we get a piece of Irish luck losing jobs for good hard working Aussies. Of course he doesn’t care…..would you on his pay???? The jobs MUST stay in AUSTRALIA.

    Get him oootathere!! Please help save Australian jobs, workplace FairPlay, we want this famous flying Kangaroo to remain the GREAT icon it has always been.

    Do we really need a greedy CEO to tell us how much is a GOOD profit at year end?

    Their pay requests pale into insignificance when compared to his salary rise. What are the shareholders thinking…..

  • TM

    says:

    As an outsider to aviation, but with an interest, I’ve been watching this for quite some time. I come from a working-class family with union values. I began with enormous sympathy for the unions and much antipathy for Qantas management. I’ve been noticing a change in my attitude lately with growing feelings of contempt for the unions at the manner in which they have gone about blackmailing Qantas, not through inconvenience to Qantas, but through inconvenience to Qantas’ customers. The customers THEY rely on for their union member’s continued employment.
    Do these [ ] not realise the more they demonise Qantas the more they demonise themselves? The more they claim Qantas is unsafe, the more customers are going elsewhere? I’m wrong, it isn’t a blackmail situation but a hostage situation. The unions hold a gun to the passenger’s heads and goad management to call their bluff, and then they hold the gun to their own heads and threaten to blow their heads off.
    Over my working life so far my industry has changed. My company is in competition with not just other Australian companies but those around the world. The result is that we have to be more competitive in offering goods and services. We have to be flexible according to the needs of the work and the client. If we don’t, we don’t have any more work, and I can apply to flip burgers at McDonalds. I prefer to not work at McDonalds.
    The unions seem to think it is still 1975 and the airline industry is still regulated. My father flew to Europe last year on Emirates. Nothing would get him back on a Qantas flight. It isn’t management that the unions should be worried about, it is not having Qantas around to bully. Look what happened in the US, they all went bankrupt and took the opportunity to restructure and hire back workers on new term. They are doing much better now, but employ fewer union members. I bet their unions wished they were a bit more flexible now.
    Unions used to have a function. It used to be to protect employees from predatory and exploitative employers. We have government watchdogs, commissions and departments for that, so what are unions for? To blackmail and exploit employers? To demand job security that doesn’t exist any more? To demand that employees have veto rights over management decisions?
    Change or die, unions, change or die.

  • Tyson Fordham

    says:

    For God’s sake… the AA website isn’t here so you can ask for your flight’s status! Check the Qantas site!

  • John S.

    says:

    I congratulate Alan Joyce for his brave stance in suspending all Qantas flights. In supporting the Unions false premises, the Australian public are merely joining the bandwagon of an anti foreign leadership. That is, the fact the Alan Joyce is an Irishman – an absolute nonsense. Whether the CEO is a foreigner of not is not the issue. For months now Qantas unions have held the company to ransom on largely trivial issues, trying to use the media to reflect the so called anti Qantas stance when in fact the company is endeavouring to modernise policies to reflect modern day realities.
    If the Unions are allowed to have their way then sooner or later the company will be purchased by a foreign airline. At this rate that is just a matter of time.
    Bravo Alan Joyce, don’t let the Unions grind you down. Continue to stand up for what is right.

  • james t.

    says:

    [POST DELETED]

    Don’t come back thanks James!

    Andrew

  • ANGELA

    says:

    My daughter and granddaughter are booked on flights on Tuesday morning 1st November from Perth to Sydney to visit my husband who is recovering from an operation, he has cancer. I have booked their flights with my frequent flyer points, will they be credited back to me if I go ahead now and book flights with someone else?
    I can’t leave it to see if this is resolved..
    Angela

  • australianaviation.com.au

    says:

    Angela

    You’ll need to contact Qantas regarding this. They have said refunds will be available, so there’s no reason to assume that wouldn’t also apply to FF points.

    Good luck

    Andrew

  • Dominic

    says:

    Suppose to depart sin to Mumbai by QF51 2350hrs
    Please advise flight status

  • australianaviation.com.au

    says:

    Can’t help you Dominic, but it doesn’t look good. Best to check with the local Qantas office.

    Good luck

    Andrew

  • australianaviation.com.au

    says:

    Signing off for the night in Sydney folks, but Ellis Taylor in Perth will be keeping an eye and ear on things and will let us know if there’s anything new.

    Good luck to those who are stranded tonight.

    Cheers

    Andrew

  • Imogen

    says:

    flight to Alice Springs ?? on or off – anyone out there know pretty pls ??

  • australianaviation.com.au

    says:

    Imogen

    Once again, EVERY Qantas domestic flight is grounded. Check http://www.qantas.com.au or call 131313 for more info.

    Good luck

    Andrew

  • Tony Waters

    says:

    The action taken by the Qantas management is deplorable,how can you give a manager 5 million a year and then say the airline is going broke,this is about cutting pay and conditions while sending aircraft maintenance to asia, Qantas has had some very dangerous and lucky escapes in recent years with parts dropping off and engine failures now they are using the excuse that to remain viable they have to even attack the pilots themselves,its only a matter of time before they lose an aircraft, this stunt is also politically motivated Abbott would back these actions all the way, wake up Australia if these thugs get away with this it wont belong before every working person will have to sign master serevant contracts.
    Good on the unions they deserve all the support that they can get after all the most powerful unions in the country are employers associations who have the backing of our mate Murdoch’s media.
    Regards Tony Waters

  • JT

    says:

    Clearly the unions and the government have not learned from the demise of Ansett. Overpaid and selfish wworkers and unions dictating terms that simply cannot be supported. Why should a baggage handler at Mascot get paid more than a defence force member carrying out the same task in a foreign warzone?

    I wonder which union leader had their hand up Albanese’s jacket when he was bagging QANTAS earlier. Someone also needs to explain to him the difference between “planning” and “decision making”. Who cares if QANTAS has been planning alternatives for months, they are entitled to in dealing with those that are strangling the business.

    And we all thought a Labor government was for the workers and the country. Shame on those who thought change was necessary, be careful what you ask for, you may actaully get more than you bargained for

  • Grumpy

    says:

    My husbands flight from Hong Kong to Brisbane has been cancelled will Qantas put them on another flight – how long will this take. I have been on hold for way too long.

  • Anthony

    says:

    Kamusta, only ever flown with Qantas when a Philipines Airlines flight was cancelled, and we got a free flight from Sydney to Manilla, after enduring 8 hour flight with male flight attendants, serving us meals, why didnt they have at leasts a mix of male and female flight attendants on the flight, to ease the mood of the flight? Qantas is out of touch with 2011, I would have expected to be greeted by female flight attendants in the cabin?Every other time we fly with Philippine Airlines, there is a mix of female and male flight attendants! same with Jetstar! anyway, time will tell if Qantas can keep flying, but I doubt it! Ingat, Glory to God, Maybe Alan Joyce needs to Pray more before he makes RASH decisions about Qantas, esp on a Saturday, OMG!!!

  • BrHut

    says:

    This is sadly the confrontation that QF needed to have… it will be damaging for them, but it is needed for their long term international survival.

    In my life I have been a paying member of two unions (and I previously been made redundant)- however in my opinion unions should not be able to direct the strategic direction of a business. Unions should be there to make sure staff are paid well (QF staff are paid higher than Australian competition), are safe and that if the case arises that employees become excess to company requirements, then fair redundancy arrangements are made available. I did not grow up with an expectation that I get a job for life… I, like everyone, believe that job security is important; however, I also know things change and I must be prepared for that change.

    A lot of people make comments about how ‘great QANTAS used to be’… I really don’t think those people understand how much has changed in global aviation. For QANTAS, it faces world-class competition with a lower cost base and continual Government policy which involves ‘opening up’ the skies to competition.

    Additionally, unfortunately for QANTAS, Australia’s geographical location does not make it ‘hub’ friendly (unlike Dubai, Singapore etc).

    QANTAS has to try and compete globally when the foundations of its business place it behind the competition before take-off. Something has to give.

    Here are some ‘facts’ from my point of view:
    *QANTAS staff are paid higher than comparable Virgin staff;
    *Airbus & Boeing both predict massive gains in Asian air travel in the coming decade/s… it would be stupid not to try and get a share of this;
    *QANTAS should be able to start-up an Asian based airline if it wishes (Singapore & Cathay are just as safe as QANTAS and their planes are serviced in Asia. I don’t believe the average joe public believes that QANTAS Australian staff service planes better than staff for Emirates, Ethiad, Singapore or Cathay etc and I don’t believe they will pay premiums for that anymore. As a caveat, if QANTAS moves maintenance to Russia, Iran that may be different story.
    *Mr Joyce has either pulled off one of the greatest pieces of ‘leadership’ in Australian corporate history or written his resignation… in either case its brave and our PM should learn a little from this;
    *Mr Joyce should not be getting pay rises at this time (if he pulls off the Asian expansion and profits increase, he can get paid double then). Getting pay-rises of any form now is really poor form and judgement.
    *QANTAS could have and should have grounded its planes in better fashion;
    *Given that planes are grounded, QANTAS should be jumping over backwards to get passengers onto other carriers… especially international passengers. Refunds are the minimum here.
    *Unions need to re-assess their role in the Australian workplace… the current union model is out-dated. Whilst unions have done some great things, the modern union appears to lack focus and fails to understand global trends. The Greek public sector is a prime example of the dangers of failing to change…
    *The QANTAS Hub and international alliance strategy is not perfect, but overall is sound and should be successful with some tinkering.
    *QANTAS needs to look at more flights out of Melbourne internationally. Joyce misses the point when he mentions tourists dont want to fly to Melbourne, as corporate travel is king and Melbourne is home to some large corporate HQ’s with international links / needs.
    *Asia is a massive opportunity, but so is the emerging Latin America… whilst Santiago is a great first start, one country that QF should be getting into is Brazil (and fast). Sao Paulo is the financial centre of South America, is in the top 10 global cities by GDP and QF would have near zero competition. Combined with Olympics, world cups, mining links and partner LANs impending merger with TAM… Brazil makes sense (as long as K Rudd can get the Brazilians to ease up on Visa requirements).

  • Blue angels

    says:

    most companies likes profit mostly which is the base for good production and services
    but program structure like wise if its not working and not profitable on the way its handled properly the company will loose it quality of name -which is the flying kangaroo

    as seen in the past its trying to build profitable services
    but the programs for this structure is NOT balanced with employees

    that means it need to get fix as priorities
    next stage is ,,,, will the CEO can fix it …
    will the union enhanced the workers right to thier needs as a low paid workers to sustain to thier livelihood

    qantas need a “good and balanced infrastructure” that can support
    and manage thier structure program in order the flow of aviation to be successful in goods and services

    qantas needs a succesfulI “infrastructure” that builds and continue to hold the the red kangaroo in sky again

    blue angels

  • Ryan

    says:

    I think someone should put these union bosses into place, its getting out of hand now all they do is encourage workers to strike and basically bribe them.

  • cheryl

    says:

    I have a flight tomorrow, 30 oct to Broom on Quantas then Kununurra on Air North, stupid question I suppose BUT what are the chances I will be flying?

    • australianaviation.com.au

      says:

      It depends if your Qantas flight to Broome is operated by Qantas itself or its QantasLink subsidiary (which is unaffected).

  • John B

    says:

    I am a very proud Australian and would hate to see jobs go overseas, but it is happening everyday in all industries. Our cost base is way to high driven by unions demands and the like for the past god knows how many years.

  • Tiffany

    says:

    I’m wondering why the Qantas flight status page shows there are a handful of flights still estimated to depart on time, some are codeshare (which I understand are not all affected e.g. American Airlines) but some are straight up Qantas flights and some which are codeshare are cancelled as well. Is there any particular logic behind which ones are grounded and which ones are still showing an estimated flight departure time? Thanks.

  • australianaviation.com.au

    says:

    Tiffany – perhaps it’s because Qantas is hoping that a determination by the FWA panel this afternoon to terminate all action will allow the airline to resume flights tonight or tomorrow morning.

    Andrew

  • Glen

    says:

    I just wonder where Qantas would be today if they’d replaced Dixon with Borghetti and Joyce had moved to Tiger instead. Different landscape, different outlook. Too late now, he’s transformed Virgin into a potential flag carrier. Every offshore job denies Australia tax revenue and makes no contribution to national skill levels or national self-reliance. If I’m flying Qantas I want, and expect, to fly an Australian registered and maintained plane flown by Australian trained Australians confident in the knowledge that I’m traveling in the best this country has to offer. Mr Joyce, I’m sure your family think you’re a nice boy but I think you’ve passed your use-by date. If you want to run a successful airline your way, I suggest you start flapping your arms because nobody is flying with you or your hysterical anti-worker spin anymore. Please stop dismantling Qantas.

  • TM

    says:

    I like that Glen @ 10:49am is praising Borghetti and Virgin as a potential flag carrier, when they pay less than Qantas does (or even proposing to) and Virgin does all the things he condemns Qantas for. Hypocrite.

    The double standards on display are sickening. You all want to pay cheap fairs, but you won’t fly Qantas because they are too expensive (I can tell because of Qantas’ falling passenger numbers) with poor service (the whinging level about service is deafening), but you whine and complain when Qantas tries to modernise their procedures and conditions in line with the airlines they are competing with.
    Somehow, Qantas is a special case that doesn’t have to maintain competitiveness, that is has a right (and duty!) to simply exist as an isolated dinosaur, legally protected as an extinct specimen. The loudest protesters are no doubt those who don’t fly Qantas.

    You say that Australian maintenance workers are better, more competent that “foreigners”? Well who has been maintaining Qantas aircraft during all their high profile “incidents”? Those same very competent Australian workers. You complain about foreign maintenance standards, but I don’t see aircraft from Singapore Airlines and Cathay Pacific dropping out of the sky, despite the fact that “foreigners” maintain them.

    I’ll say this for them, the TWA, ALAEA and AIPA really know how to play on the bigotries of Australians. But they’d know all about it because they’re living in a little bubble of the 1980’s when Australian skies were regulated and the only competition was for who wangle the biggest scam into their contracts.

  • Matt

    says:

    A point of interest, all the aircraft owned by QANTAS are built by foreigners. I dont see any aircraft built in Australia that would be suitable for service within QANTAS. Surely if they can build them they know how to maintain them!

  • Jeremy

    says:

    Hands up those who have supported other carriers when flying locally or internationally because they were cheaper than QANTAS.

    … Oh look… Most of you. And yet you sit here cursing and lamenting the man who’s desperately trying to keep our ‘Australian icon’ alive against immense union pressure to prevent them becoming commercially viable.

    You want the cheeper option, you want QANTAS, but you won’t support their effort to survive.

    How typically ‘Australian’ to judge a man who earnt $5m – If he keeps this airline alive and the red kangaroo in the air, he’s worth it.

  • annette smith

    says:

    yes good on you alan …i will stay loyal to quantas and are happy for frree flights to nz at xmas..where do i apply for that..i was one of passengers grounded..last weekend an d couldnt get back to my grandson who has atopic excema ..i had gone to gold coast to travel to redcliff to get him some emu natural oil..i want to take him back to nz to cooler weather and i have a brother dying being this his last xmas so this free flight will be a blessing in disguise…thank you for that ..alan n god bless in your endeavors..my flight is for 22nd dec-7th jan gold coast to hamilton n return hamilton to gold coast..on 7th jan 2012..i will stay a couple days in gc and then fly to townsville where my daughter will pick us up…i know the free flight for me is free but my huuby n grandson will pay their own n b aby is free so thats cool…

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UPDATED: Qantas grounds all flights until unions drop action

written by australianaviation.com.au | October 29, 2011
Qantas is pre-emptively grounding its fleet.

In an extraordinary display of brinkmanship, Qantas CEO Alan Joyce has announced that all Qantas international and domestic services will cease immediately with the airline locking out all employees of the Australian Licenced Engineers Union (ALAEA), the Transport Workers Union (TWU) and the Australian and International Pilots Union (AIPA).

Joyce says the drastic move has been taken under the Fair Work Act in response to industrial action taken by the unions, and will likely cost the airline as much as $20 million per day until the disputes are resolved. The airline has so far lost $68 million due to disruptions caused by industrial action in recent months, and was losing an estimated $15 million per week. The airline says more than 600 flights had been cancelled and about 70,000 passengers had been affected.

In a hastily called media conference on October 29, Joyce said the airline would be grounded from 5.00pm on October 29, but that all employees are required at work as normal and will be paid until the lockout begins at 8.00pm eastern time on October 31. Once the lockout starts, those employees who are locked out will not be required at work and will not be paid. He said he had made the decision that morning, and had consulted the Qantas board before implementing the lockout.

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“I have to activate the one form of protected industrial action that is available to me to bring home to the unions the seriousness of their actions, and to get them to forge sensible deals with us,” Joyce said. “I am using the only effective avenue at my disposal to bring about peace and certainty.”

The action does not affect employees based oversees, or the operations of Qantas Group subsidiaries Jetstar, Jetconnect, QantasLink and Express Freighters Australia.

“They are trashing our strategy and our brand,” Joyce said of the unions. “They are deliberately destabilising the company. And there is no end in sight. They talk about job security, but the unions are on a path that would diminish the job security of their own members. Because the pilots, ramp, baggage and catering staff and licensed engineers are essential to the running of the airline, the lock-out makes it necessary for us to ground the fleet.”

“Key high value domestic bookings on east coast routes are down by 25 per cent on the same period last year,” he added. “That’s the most lucrative part of our flying business and it is bleeding badly.  International bookings have also fallen, with November bookings nearly 10 per cent down on where we expected them to be – when Qantas International is already making significant losses. ”

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The airline says those aircraft in the air will continue to their planned destination, but that no passengers should go to any airports until further notice. Passengers have been advised to monitor the Qantas.com website, or the airline’s Facebook or Twitter accounts.

UPDATE: 6.50PM AEDST 29 OCTOBER

A brief statement from Jetstar said the airline has “limited capacity” on its flights, and that opportunities to increase capacity to accommodate more passengers are currently being investigated.

Federal Transport Minister Anthony Albanese says he was informed of Qantas’s intentions just three hours before the airline announced the grounding, and says the government will make an urgent application to Fair Work Australia that it was in the national interest to order an immediate cessation of industrial action by the unions and by the airline.

The Minister questioned the decision and said he was “extremely disappointed” with the airline’s actions, and that he was disturbed by the fact that he and Joyce had had a number of discussions in recent days and that at no stage had Joyce indicated that the grounding was under consideration. “I certainly indicated my concern to Mr Joyce about the inconvenience to the travelling public,” he said.

Albanese added that he had spoken to Virgin Australia CEO John Borghetti and had been assured that Virgin would do all possible to assist. Virgin Australia quickly announced that it will step in where possible and was in discussions with alliance partners to add extra capacity to the market and will offer special ‘stranded passenger’ recovery fares for those holding a Qantas ticket.

But with Qantas grounding 108 aircraft at 22 ports around the world, Virgin isn’t expected to be able to make a huge dent in the anticipated passenger backlog in the short term.

UPDATE: 9.40PM AEDST, 29 OCTOBER

During a doorstop interview on the sidelines of the CHOGM conference in Perth, Prime Minister Julia Gillard said she had been “kept continuously informed” during the day as the dispute “escalated in a dramatic way.”

“This dispute has implications for our national economy,” she said. “I want to see this dispute sorted out.” While she refused to be drawn on who was to blame for the escalation, Ms Gillard said Qantas is an “iconic Australian brand” and that she was “looking at this dispute as Prime Minister and its implications to the national economy.”

Ms Gillard said an urgent first meeting of Fair Work Australia would take place at 10.00pm AEDST tonight, but was reluctant to speculate on its possible outcome. She said CHOGM delegates who had been booked to fly out of Perth on Qantas has been briefed, and that they are working on alternate arrangements.

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45 Comments

  • pam dichiera

    says:

    I have booked flights today travelling from Mildura to Melbourne on QF2079 departing at 10.05am tomorrow, returning Wed. 2/11 on QF 2084 at 3.10 pm. are these flight still happening? please advise. Pam Dichiera.

    • australianaviation.com.au

      says:

      Those flights are operated by QantasLink, so they should be going ahead still.

  • Andrew Duffin

    says:

    Alan Joyce is the worst thing that’s happened to Qantas in a long time. It appears he is hell bent on shifting jobs off shore. Some of the unions only want minor pay increases that are below or par with inflation. The sticking point is on job security (which the unions want and he won’t give) and this is where all the trouble stems from. Alan Joyce doesn’t care what happens because he’s got nothing to lose. He just got a big pay increase; If the unions give in, he wins; If the company goes into receivership, he can do it anyway under the banner of “saving the company”. I think he needs to be sent back to whence he came.

  • JB

    says:

    I back joyce 100% and his decision – the claims are out of control – you only have to google “qantas and strikes” and see how often this happens. He had no choice … No staff today can expect a job for life or job security – anyone would think they have to work with asbestos everyday!! – get back to work ! I am a qantas customer and support the decision made as a customer I am also a union member in my industry and what this is – is absolutely ridiculous. How dare they hold a whole company to ransom and in a way that effects the public and the loyal staff working through this and covering the wingers shifts. Without this action we may lose qantas for good and your jobs for good.

  • DR

    says:

    Unions will destroy Qantas just like they did Ansett. Remember 3rd cockpit seat on 767 flight deck forced by pilots union. The world has changed in the airline industry but unions still don’t get it.

  • australianaviation.com.au

    says:

    Constructive comments only please folks, thanks.

    If you have an opinion or relevant information, feel free to post it. But NO personal attacks or swearing will be tolerated.

    Andrew McLaughlin
    DEPUTY EDITOR | AUSTRALIAN AVIATION

  • Jim Swanson

    says:

    In some aspects I admire Alan Joyce on his stand against the unions. No union should be as strong as the ones opposing Qantas and basically hoding the country to ransom. I dont think for a minute that the workers are under paid for what they are doing. Has anyone heard how much they are awarded at the moment?___NO!!! BECAUSE THEY ARE PRETTY WELL OFF CONSIDERING SOME OF US. I do however object to the $5 million pay rise he asked the shareholders for. What weak pricks they are in granting it. What are they getting out of it? At the end of the day it is the customer who loses out.

  • Redundant

    says:

    This is just tragic, I think that Monday will be a very interesting day; reaction from the institutional shareholders and also the moves the market will make with regard to the share price. That will determine the fate of QF surely. Can’t help but think now that the timing of this announcement and also the 110 x A320neo’s suggests some level of premeditation of today’s events. Utterly tragic for the airline and particularly the QF workforce.

  • j stevenson

    says:

    I have a booking on flight from Paraburdoo flight number QF 1809 at 18.40pm on Monday 31st october flying into Perth at 20.20 pm with this flight still be flying or will it be on grounded. Could you please advise me. J Stevenson

  • Sam

    says:

    My wife is coming from Brisbane to Sydney tomorrow Sunday 30 October 2011 on the 8.25am flight, is this flight cancelled or still operating, please advice.

  • australianaviation.com.au

    says:

    J Stevenson

    If it’s a Qantas mainline flight which it probably is, it’s unlikely you will be flying.

    My advice is to stay off the Qantas phone number and website tonight as there are people with more urgent needs, but keep an eye on the web and on Qantas’s facebook page etc for more info.

    Good luck

    Andrew

  • australianaviation.com.au

    says:

    Sam

    If it’s a Qantas flight number its highly unlikely sorry.

    Good luck

    Andrew

  • adam mizzi

    says:

    You have destroyed the dreams of a 32 year old man and his best mate adam..sams dream was to fly for the first time to vegas, after being in a wheel chair for nearly 8 years…And now he is walking…yes walking so we planeed a dream holiday for him…..the worst think about this is you forgot about your customers, regardless who is at fauilt..

    i am in tears we were suppose to fly out sunday at 10.30

    i even made planes to for sam to see his dream nas cars in texas and met john force the castrol sponsered fastesest top fuler drag car owner….

    i can not belive what you have done to some one dreams

    regards

    adam mizzi

  • australianaviation.com.au

    says:

    Folks

    As the article says, the entire Qantas mainline domestic and international fleet is grounded until further notice. It is unlikely anything except Jetstar, QantasLink (regional) and Jetconnet (to NZ) will be flying for 24-48 hours at the very least.

    Stay tuned to ABC 24 or SKY News or your news radio station for any breaking news, and we’ll try to update you here as things evolve.

    Cheers

    Andrew

  • Kevan Mullan

    says:

    Well done the Qantas board stranding thousands of passengers in Aust and around the world this action will drive away more passengers at least the unions gave notice of strike action you cant tell me this was,nt preplanned I hope Alan Joyce enjoys his 5mill 71%pay raise pay why would you care what happens to this Icon of ours Go the flying Kangaroo keep it real keep it Australian I dont want any of Aust jobs to go overseas thats why Qantas is so good best Pilots best engineers impecable safty record this is going to be tragic for al of us .

  • Liz Ingram

    says:

    This is an absolute travesty!! Poor Qantas…….our BRAND and we get a piece of Irish luck losing jobs for good hard working Aussies. Of course he doesn’t care…..would you on his pay???? The jobs MUST stay in AUSTRALIA.

    Get him oootathere!! Please help save Australian jobs, workplace FairPlay, we want this famous flying Kangaroo to remain the GREAT icon it has always been.

    Do we really need a greedy CEO to tell us how much is a GOOD profit at year end?

    Their pay requests pale into insignificance when compared to his salary rise. What are the shareholders thinking…..

  • TM

    says:

    As an outsider to aviation, but with an interest, I’ve been watching this for quite some time. I come from a working-class family with union values. I began with enormous sympathy for the unions and much antipathy for Qantas management. I’ve been noticing a change in my attitude lately with growing feelings of contempt for the unions at the manner in which they have gone about blackmailing Qantas, not through inconvenience to Qantas, but through inconvenience to Qantas’ customers. The customers THEY rely on for their union member’s continued employment.
    Do these [ ] not realise the more they demonise Qantas the more they demonise themselves? The more they claim Qantas is unsafe, the more customers are going elsewhere? I’m wrong, it isn’t a blackmail situation but a hostage situation. The unions hold a gun to the passenger’s heads and goad management to call their bluff, and then they hold the gun to their own heads and threaten to blow their heads off.
    Over my working life so far my industry has changed. My company is in competition with not just other Australian companies but those around the world. The result is that we have to be more competitive in offering goods and services. We have to be flexible according to the needs of the work and the client. If we don’t, we don’t have any more work, and I can apply to flip burgers at McDonalds. I prefer to not work at McDonalds.
    The unions seem to think it is still 1975 and the airline industry is still regulated. My father flew to Europe last year on Emirates. Nothing would get him back on a Qantas flight. It isn’t management that the unions should be worried about, it is not having Qantas around to bully. Look what happened in the US, they all went bankrupt and took the opportunity to restructure and hire back workers on new term. They are doing much better now, but employ fewer union members. I bet their unions wished they were a bit more flexible now.
    Unions used to have a function. It used to be to protect employees from predatory and exploitative employers. We have government watchdogs, commissions and departments for that, so what are unions for? To blackmail and exploit employers? To demand job security that doesn’t exist any more? To demand that employees have veto rights over management decisions?
    Change or die, unions, change or die.

  • Tyson Fordham

    says:

    For God’s sake… the AA website isn’t here so you can ask for your flight’s status! Check the Qantas site!

  • John S.

    says:

    I congratulate Alan Joyce for his brave stance in suspending all Qantas flights. In supporting the Unions false premises, the Australian public are merely joining the bandwagon of an anti foreign leadership. That is, the fact the Alan Joyce is an Irishman – an absolute nonsense. Whether the CEO is a foreigner of not is not the issue. For months now Qantas unions have held the company to ransom on largely trivial issues, trying to use the media to reflect the so called anti Qantas stance when in fact the company is endeavouring to modernise policies to reflect modern day realities.
    If the Unions are allowed to have their way then sooner or later the company will be purchased by a foreign airline. At this rate that is just a matter of time.
    Bravo Alan Joyce, don’t let the Unions grind you down. Continue to stand up for what is right.

  • james t.

    says:

    [POST DELETED]

    Don’t come back thanks James!

    Andrew

  • ANGELA

    says:

    My daughter and granddaughter are booked on flights on Tuesday morning 1st November from Perth to Sydney to visit my husband who is recovering from an operation, he has cancer. I have booked their flights with my frequent flyer points, will they be credited back to me if I go ahead now and book flights with someone else?
    I can’t leave it to see if this is resolved..
    Angela

  • australianaviation.com.au

    says:

    Angela

    You’ll need to contact Qantas regarding this. They have said refunds will be available, so there’s no reason to assume that wouldn’t also apply to FF points.

    Good luck

    Andrew

  • Dominic

    says:

    Suppose to depart sin to Mumbai by QF51 2350hrs
    Please advise flight status

  • australianaviation.com.au

    says:

    Can’t help you Dominic, but it doesn’t look good. Best to check with the local Qantas office.

    Good luck

    Andrew

  • australianaviation.com.au

    says:

    Signing off for the night in Sydney folks, but Ellis Taylor in Perth will be keeping an eye and ear on things and will let us know if there’s anything new.

    Good luck to those who are stranded tonight.

    Cheers

    Andrew

  • Imogen

    says:

    flight to Alice Springs ?? on or off – anyone out there know pretty pls ??

  • australianaviation.com.au

    says:

    Imogen

    Once again, EVERY Qantas domestic flight is grounded. Check http://www.qantas.com.au or call 131313 for more info.

    Good luck

    Andrew

  • Tony Waters

    says:

    The action taken by the Qantas management is deplorable,how can you give a manager 5 million a year and then say the airline is going broke,this is about cutting pay and conditions while sending aircraft maintenance to asia, Qantas has had some very dangerous and lucky escapes in recent years with parts dropping off and engine failures now they are using the excuse that to remain viable they have to even attack the pilots themselves,its only a matter of time before they lose an aircraft, this stunt is also politically motivated Abbott would back these actions all the way, wake up Australia if these thugs get away with this it wont belong before every working person will have to sign master serevant contracts.
    Good on the unions they deserve all the support that they can get after all the most powerful unions in the country are employers associations who have the backing of our mate Murdoch’s media.
    Regards Tony Waters

  • JT

    says:

    Clearly the unions and the government have not learned from the demise of Ansett. Overpaid and selfish wworkers and unions dictating terms that simply cannot be supported. Why should a baggage handler at Mascot get paid more than a defence force member carrying out the same task in a foreign warzone?

    I wonder which union leader had their hand up Albanese’s jacket when he was bagging QANTAS earlier. Someone also needs to explain to him the difference between “planning” and “decision making”. Who cares if QANTAS has been planning alternatives for months, they are entitled to in dealing with those that are strangling the business.

    And we all thought a Labor government was for the workers and the country. Shame on those who thought change was necessary, be careful what you ask for, you may actaully get more than you bargained for

  • Grumpy

    says:

    My husbands flight from Hong Kong to Brisbane has been cancelled will Qantas put them on another flight – how long will this take. I have been on hold for way too long.

  • Anthony

    says:

    Kamusta, only ever flown with Qantas when a Philipines Airlines flight was cancelled, and we got a free flight from Sydney to Manilla, after enduring 8 hour flight with male flight attendants, serving us meals, why didnt they have at leasts a mix of male and female flight attendants on the flight, to ease the mood of the flight? Qantas is out of touch with 2011, I would have expected to be greeted by female flight attendants in the cabin?Every other time we fly with Philippine Airlines, there is a mix of female and male flight attendants! same with Jetstar! anyway, time will tell if Qantas can keep flying, but I doubt it! Ingat, Glory to God, Maybe Alan Joyce needs to Pray more before he makes RASH decisions about Qantas, esp on a Saturday, OMG!!!

  • BrHut

    says:

    This is sadly the confrontation that QF needed to have… it will be damaging for them, but it is needed for their long term international survival.

    In my life I have been a paying member of two unions (and I previously been made redundant)- however in my opinion unions should not be able to direct the strategic direction of a business. Unions should be there to make sure staff are paid well (QF staff are paid higher than Australian competition), are safe and that if the case arises that employees become excess to company requirements, then fair redundancy arrangements are made available. I did not grow up with an expectation that I get a job for life… I, like everyone, believe that job security is important; however, I also know things change and I must be prepared for that change.

    A lot of people make comments about how ‘great QANTAS used to be’… I really don’t think those people understand how much has changed in global aviation. For QANTAS, it faces world-class competition with a lower cost base and continual Government policy which involves ‘opening up’ the skies to competition.

    Additionally, unfortunately for QANTAS, Australia’s geographical location does not make it ‘hub’ friendly (unlike Dubai, Singapore etc).

    QANTAS has to try and compete globally when the foundations of its business place it behind the competition before take-off. Something has to give.

    Here are some ‘facts’ from my point of view:
    *QANTAS staff are paid higher than comparable Virgin staff;
    *Airbus & Boeing both predict massive gains in Asian air travel in the coming decade/s… it would be stupid not to try and get a share of this;
    *QANTAS should be able to start-up an Asian based airline if it wishes (Singapore & Cathay are just as safe as QANTAS and their planes are serviced in Asia. I don’t believe the average joe public believes that QANTAS Australian staff service planes better than staff for Emirates, Ethiad, Singapore or Cathay etc and I don’t believe they will pay premiums for that anymore. As a caveat, if QANTAS moves maintenance to Russia, Iran that may be different story.
    *Mr Joyce has either pulled off one of the greatest pieces of ‘leadership’ in Australian corporate history or written his resignation… in either case its brave and our PM should learn a little from this;
    *Mr Joyce should not be getting pay rises at this time (if he pulls off the Asian expansion and profits increase, he can get paid double then). Getting pay-rises of any form now is really poor form and judgement.
    *QANTAS could have and should have grounded its planes in better fashion;
    *Given that planes are grounded, QANTAS should be jumping over backwards to get passengers onto other carriers… especially international passengers. Refunds are the minimum here.
    *Unions need to re-assess their role in the Australian workplace… the current union model is out-dated. Whilst unions have done some great things, the modern union appears to lack focus and fails to understand global trends. The Greek public sector is a prime example of the dangers of failing to change…
    *The QANTAS Hub and international alliance strategy is not perfect, but overall is sound and should be successful with some tinkering.
    *QANTAS needs to look at more flights out of Melbourne internationally. Joyce misses the point when he mentions tourists dont want to fly to Melbourne, as corporate travel is king and Melbourne is home to some large corporate HQ’s with international links / needs.
    *Asia is a massive opportunity, but so is the emerging Latin America… whilst Santiago is a great first start, one country that QF should be getting into is Brazil (and fast). Sao Paulo is the financial centre of South America, is in the top 10 global cities by GDP and QF would have near zero competition. Combined with Olympics, world cups, mining links and partner LANs impending merger with TAM… Brazil makes sense (as long as K Rudd can get the Brazilians to ease up on Visa requirements).

  • Blue angels

    says:

    most companies likes profit mostly which is the base for good production and services
    but program structure like wise if its not working and not profitable on the way its handled properly the company will loose it quality of name -which is the flying kangaroo

    as seen in the past its trying to build profitable services
    but the programs for this structure is NOT balanced with employees

    that means it need to get fix as priorities
    next stage is ,,,, will the CEO can fix it …
    will the union enhanced the workers right to thier needs as a low paid workers to sustain to thier livelihood

    qantas need a “good and balanced infrastructure” that can support
    and manage thier structure program in order the flow of aviation to be successful in goods and services

    qantas needs a succesfulI “infrastructure” that builds and continue to hold the the red kangaroo in sky again

    blue angels

  • Ryan

    says:

    I think someone should put these union bosses into place, its getting out of hand now all they do is encourage workers to strike and basically bribe them.

  • cheryl

    says:

    I have a flight tomorrow, 30 oct to Broom on Quantas then Kununurra on Air North, stupid question I suppose BUT what are the chances I will be flying?

    • australianaviation.com.au

      says:

      It depends if your Qantas flight to Broome is operated by Qantas itself or its QantasLink subsidiary (which is unaffected).

  • John B

    says:

    I am a very proud Australian and would hate to see jobs go overseas, but it is happening everyday in all industries. Our cost base is way to high driven by unions demands and the like for the past god knows how many years.

  • Tiffany

    says:

    I’m wondering why the Qantas flight status page shows there are a handful of flights still estimated to depart on time, some are codeshare (which I understand are not all affected e.g. American Airlines) but some are straight up Qantas flights and some which are codeshare are cancelled as well. Is there any particular logic behind which ones are grounded and which ones are still showing an estimated flight departure time? Thanks.

  • australianaviation.com.au

    says:

    Tiffany – perhaps it’s because Qantas is hoping that a determination by the FWA panel this afternoon to terminate all action will allow the airline to resume flights tonight or tomorrow morning.

    Andrew

  • Glen

    says:

    I just wonder where Qantas would be today if they’d replaced Dixon with Borghetti and Joyce had moved to Tiger instead. Different landscape, different outlook. Too late now, he’s transformed Virgin into a potential flag carrier. Every offshore job denies Australia tax revenue and makes no contribution to national skill levels or national self-reliance. If I’m flying Qantas I want, and expect, to fly an Australian registered and maintained plane flown by Australian trained Australians confident in the knowledge that I’m traveling in the best this country has to offer. Mr Joyce, I’m sure your family think you’re a nice boy but I think you’ve passed your use-by date. If you want to run a successful airline your way, I suggest you start flapping your arms because nobody is flying with you or your hysterical anti-worker spin anymore. Please stop dismantling Qantas.

  • TM

    says:

    I like that Glen @ 10:49am is praising Borghetti and Virgin as a potential flag carrier, when they pay less than Qantas does (or even proposing to) and Virgin does all the things he condemns Qantas for. Hypocrite.

    The double standards on display are sickening. You all want to pay cheap fairs, but you won’t fly Qantas because they are too expensive (I can tell because of Qantas’ falling passenger numbers) with poor service (the whinging level about service is deafening), but you whine and complain when Qantas tries to modernise their procedures and conditions in line with the airlines they are competing with.
    Somehow, Qantas is a special case that doesn’t have to maintain competitiveness, that is has a right (and duty!) to simply exist as an isolated dinosaur, legally protected as an extinct specimen. The loudest protesters are no doubt those who don’t fly Qantas.

    You say that Australian maintenance workers are better, more competent that “foreigners”? Well who has been maintaining Qantas aircraft during all their high profile “incidents”? Those same very competent Australian workers. You complain about foreign maintenance standards, but I don’t see aircraft from Singapore Airlines and Cathay Pacific dropping out of the sky, despite the fact that “foreigners” maintain them.

    I’ll say this for them, the TWA, ALAEA and AIPA really know how to play on the bigotries of Australians. But they’d know all about it because they’re living in a little bubble of the 1980’s when Australian skies were regulated and the only competition was for who wangle the biggest scam into their contracts.

  • Matt

    says:

    A point of interest, all the aircraft owned by QANTAS are built by foreigners. I dont see any aircraft built in Australia that would be suitable for service within QANTAS. Surely if they can build them they know how to maintain them!

  • Jeremy

    says:

    Hands up those who have supported other carriers when flying locally or internationally because they were cheaper than QANTAS.

    … Oh look… Most of you. And yet you sit here cursing and lamenting the man who’s desperately trying to keep our ‘Australian icon’ alive against immense union pressure to prevent them becoming commercially viable.

    You want the cheeper option, you want QANTAS, but you won’t support their effort to survive.

    How typically ‘Australian’ to judge a man who earnt $5m – If he keeps this airline alive and the red kangaroo in the air, he’s worth it.

  • annette smith

    says:

    yes good on you alan …i will stay loyal to quantas and are happy for frree flights to nz at xmas..where do i apply for that..i was one of passengers grounded..last weekend an d couldnt get back to my grandson who has atopic excema ..i had gone to gold coast to travel to redcliff to get him some emu natural oil..i want to take him back to nz to cooler weather and i have a brother dying being this his last xmas so this free flight will be a blessing in disguise…thank you for that ..alan n god bless in your endeavors..my flight is for 22nd dec-7th jan gold coast to hamilton n return hamilton to gold coast..on 7th jan 2012..i will stay a couple days in gc and then fly to townsville where my daughter will pick us up…i know the free flight for me is free but my huuby n grandson will pay their own n b aby is free so thats cool…

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