The Treasury’s decision to exclude dnata from JobKeeper payments has put 4,500 jobs at risk, Australian Aviation can reveal.
The catering and ground handling business claims the Tax Office originally said it could apply for the aid, but then reversed its decision because the company is owned by a foreign government.
A dnata spokesperson said, “The application of the scheme was critical to the company’s Australian employees, as it meant that we could reinstate previously stood down workers, and keep the rest of the workforce employed.”
Dnata is owned by the Emirates Group, which is in turn run by the state government of Dubai.
However, an apparent recent change to the JobKeeper package – which provides struggling Australian businesses with $1,500 per employee, per fortnight – means businesses owned by a “sovereign entity” are excluded.
“We are surprised and disappointed by the government’s decision to retrospectively amend the JobKeeper legislation,” said the spokesperson. “This change, at short notice and backdated to 30 March, excludes dnata, an employer of 6,000 Australians from the JobKeeper scheme.
“The exclusion puts over 4,500 jobs at risk, while leaving employees and their families without income with extremely short notice. As a result, we are also forced to review medium, and long-term viability of dnata’s various Australian businesses including catering, cargo, ground handling, retail and hospitality.”
Dnata insisted it pays corporate, employee and social taxes and has invested more than $300 million into Australia over the past 13 years. It also claims the omission has created an uneven playing field against its competitors that are eligible for the scheme.
TWU national secretary Michael Kaine said, “We are writing to the Treasurer today to urgently examine this loophole and its unintended consequences. There are specific cases, such as the Emirates Group, where foreign governments retain a big stake in their aviation sectors which now employ many workers in Australians. We are hopeful the government can recognise this situation and rectify it.
“Not only will this hurt workers in Australia it will also hamper efforts to get air travel back up and running when restrictions lift, impacting on our economy. Companies like dnata carry out behind the scenes work at our airports which gets aircraft into the sky. Their work is vital and thousands depend on it.”
In response, Treasurer Josh Frydenberg’s office confirmed the rule, saying “a sovereign entity is not a qualifying employer for the purposes of JobKeeper payment”.
A partner of 46 airlines, dnata offers ground handling, cargo and catering services in Australia.
Before the COVID-19 outbreak, the business handled 300,000 tons of cargo, supported more than 7 million passengers and uplifted 64 million in-flight meals annually at nine Australian airports.