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Qantas bombshell as it says 2,500 more jobs could go

written by Adam Thorn | August 25, 2020
Qantas has been retiring older aircraft such as the Boeing 747-400. (Seth Jaworski)

Qantas dropped a bombshell on Tuesday and announced nearly 2,500 more jobs are at risk because the business plans to outsource its remaining ground handling operations.

The proposed cuts, in addition to the 6,000 already announced, would include 370 job losses at Jetstar and more than 2,000 at Qantas.

The news comes a week after the wider company blamed a “near-total collapse in travel demand” for recording a statutory loss before tax of $2.7 billion for the last financial year.

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The Qantas brand is proposing to outsource its ground handling operations at the 10 Australian airports where the work is done in-house, which includes Adelaide, Alice Springs, Brisbane, Cairns, Canberra, Darwin, Melbourne, Perth, Sydney and Townsville.

This plan, not yet confirmed, would take place after a review that would compare the efficiencies of using external ground handlers versus doing the work in-house.

Jetstar, meanwhile, has already decided to outsource ground handling at the six remaining Australian airports – Adelaide, Avalon, Brisbane, Cairns, Melbourne and Sydney Domestic – leading to 370 job losses, subject to union consultation.

The business said “customer-facing team members” at airports are not affected by the moves.

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In addition, Qantas is looking to outsource bus services for employees and customers at Sydney Airport that could affect 50 members of staff.

Jetstar chief executive Gareth Evans said, “We realise this decision will be extremely difficult news for our ground handling team and their families at what is already a very challenging time.

“Every major airline around the world uses these specialist providers to support their operations. These ground handlers provide these services to many airlines at airports, rather than just one, and provide scalable resources, which makes them very cost effective.

“Contracting this work out also reduces the capital spend required each year. As an example, Qantas and Jetstar would need to invest a further $100 million on ground handling equipment over the next five years, such as tugs and bag loaders, if the work is kept in-house.

“The Qantas Group sets the safety standards through our safety management system – whether work is done in-house or [by] external suppliers. We expect some unions will come out and say these suppliers are unsafe, despite the fact they are used by every other airline in this country.

“We would never compromise on safety. We’ve already worked with some of these suppliers for decades and we know their track record on safety is consistent with work done in-house.”

The business predicts the move will save them $100 million in operating costs each year.

In June, the wider Qantas group announced it would cut 6,000 jobs altogether, or nearly 20 per cent of its workforce, and continue stand-downs for a further 15,000 employees.

Two months later, its full-year financial results revealed a loss before tax of $2.7 billion and an underlying profit before tax of just $124 million.

Joyce said the results were “shaped by extraordinary events that have made for the worst trading conditions in our 100-year history”.

“To put it simply, we’re an airline that can’t really fly to many places – at least for now,” he said.

Steer your own in-flight experience – available on print and digital Whether our classic glossy magazine in your letterbox, daily news updates in your inbox, peeling back a few layers in the podcast or our monthly current affair reports, you can count on us to keep you up to date. Sign up today for just $99.95 for more exclusive offers here. Subscribe now at australianaviation.com.au.

18 Comments

  • Ian

    says:

    here we go. Qantas has been setting the scene for this for a while.

    BUT if govt gives them a zillion dollars, minimal job losses.

    It’s just all about money & getting those borders open ASAP.

  • AgentGerko

    says:

    Pardon my ignorance but if they get rid of 2,000 QF jobs by outsourcing, doesn’t that mean that 2,000 jobs are created within the companies that the work goes to?

    • Adam Thorn

      says:

      Not necessarily because right now most of these people are stood down. Eventually, however, some jobs will likely be recovered, but not all.

      Thanks,

      Adam

  • Hilton

    says:

    Its time for the Governments to nationalise Qantas .. they don’t give a dam about their workforce.
    The only thing Qantas chiefs care about is their fat bonus payments and increasing profits.
    Having all workers on contracts in an outsourced organisation is just another way of cutting the wages of workers. While jobs are scarce Qantas is using the situation to cut wages. How cynical is that !!!
    STOP paying Qantas Covid help money ….

  • Graham Haxell

    says:

    So much for loyalty! It’s always those at the coal face who are hit the hardest! Will the management receive a big bonus for cutting costs? This is a time to pull together, one for all and all for one.

  • Rod Pickin

    says:

    At this stage the operative words are, ” jobs could go” but one would have to say that it is more than likely it will happen either in part or full. In stark reality, what can QF do? – one has to seriously question the validity of border closures, not a QF cause but the huge game of poker by some state premiers clearly reflects upon both QF and the nation’s business survival in the short to medium term. I am rather surprised that QF has not investigated more use of it’s fleet and staff skills within the Freight business centre, others seem to have been quite successful, why not QF? – again, I can understand QF’s business motives here but they have completely forgotten or disregarded their national responsibility to understand that QF is a national vital communications entity, it is just not a “business centre” with a 13 period business reporting system with which to either please or appall us all. AJ has displayed his ruthless and expensive unnecessary actions in the past, – (Close Down) , – the time is now for maybe the P.M. to have a little fireside chat with AJ and we can all move on. In any event, what businessman at this time would invest in a startup of a ground handling company, even DNATA would be less than enthusiastic. AJ, stay out of the politics, you will not win.

  • Matt B

    says:

    $100 million on ground handling equipment? I’ll take that with a grain of salt. Perhaps it’s true, as most of the equipment they use now looks 30 years old. Most companies are using this years situation to ram through previous objectives for the future advantage of their shareholders whilst claiming poor and doing a disservice to hard working tax payers.

  • Marum

    says:

    Terrible news But one can’t blame QANTAS entirely. Their revenue is down so far for the EOFY, that huge cuts were inevitable What now for all the poor workers involved?

    Everywhere I go, everything is damn near stuffed. Even the local Barber-shop has closed down – after 55 years of trading. Small business is only existence, one never makes a fortune. In fact you often earn less than your key staff when you add up overtime, holiday pay, sick leave, superannuation, etc.. Your “Super” is when you sell the business. What will happen when everyone runs down their savings to nil?

    Australia – perfect one day, stuffed the next….Marum

  • Begs the question as to what happens if you just keep “hollowing out” an airline??? Eventually it just becomes a confidence trick on the passenger who puts their trust in “the brand”. The use of that term in itself says it all…

  • stuart lawrence

    says:

    qantas should start flying to bring over australians stranded overseas

  • Erik Sherwin

    says:

    Not for the first time has business confused effiency with effectiveness! A business may be efficient and yet be utterly ineffective. Outsourcing is case in point: you cannot control what you do not own!

  • Erik Sherwin

    says:

    Not for the first time has business confused effiency with effectiveness! A business may be efficient and yet be utterly ineffective. Outsourcing is case in point: you cannot control what you do not own!

  • stuart hearn

    says:

    well if you do not like it start your own airline, Bolshie unions stopped me starting a Business in Au

  • Td

    says:

    Especially the skills in baggage handling, loading , towing, unloading and taking pride in ones work looking after the behind the scenes stuff and more importantly the safety and security of company and passenger baggage, cargo, pets, equipment including the aircraft. If you aren’t part of the company from check in to departure of a passenger or are fatigued due to outsourcing (and cutting corners as a company or worker) do you care as much as the company only treats you as a statistic that’s supposed to do a job. It doesn’t take much of an issue to ground or delay an aircraft which equated to revenue lost and inconvenience to all would incur more expense in the long run by outsourcing.

  • Pete

    says:

    100 million? That’s only 4 years of work for Joyce! Maybe he should go! He is the highest paid airline CEO in the world

  • Ray

    says:

    To Stuart Lawrence’s comment…..

    The Federal Govt has already organised multiple flights for QANTAS to bring back citizens’ since March 2020.
    There’s still a cap, set by the Fed Govt, on how many people can Internationally enter Australia, per day.

    QANTAS just can’t send an aircraft into the ‘wide blue yonder’, land at a foreign port, & bring back Aussies’, at this time.
    A chartered QANTAS aircraft is only permitted to operate, in this instance, at Fed Govt direction.

    If you’re so concerned about getting people back here, why don’t you approach your Fed Govt Member?

  • Naiya

    says:

    I work for Qantas and we are all shocked off the outcome, to be made Redundant. We have told the company many times over that their loading equipment is still the same from the 80’s just old rubbish being repaired time after time, but we have to deal with what we got. Surely with the highest paid CEO should see that ground services are the ones that are getting the planes up in the air.by loading customers personal belongings and freight..!! I feel very Sad of the outcome and disgusted how a top CEO makes his Decision in breaking up those below him who have served with Qantas for a long time. End of the day we are just a number to them and meaning less to company workforce, very disappointed.

  • Charles

    says:

    I cannot believe how silent the government has remained over the selling off and outsourcing of Qantas and Qantas jobs to foreign owned companies, how disappointing.

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Qantas bombshell as it says 2,500 more jobs could go

written by Adam Thorn | August 25, 2020
Qantas has been retiring older aircraft such as the Boeing 747-400. (Seth Jaworski)

Qantas dropped a bombshell on Tuesday and announced nearly 2,500 more jobs are at risk because the business plans to outsource its remaining ground handling operations.

The proposed cuts, in addition to the 6,000 already announced, would include 370 job losses at Jetstar and more than 2,000 at Qantas.

The news comes a week after the wider company blamed a “near-total collapse in travel demand” for recording a statutory loss before tax of $2.7 billion for the last financial year.

Advertisement
Advertisement

The Qantas brand is proposing to outsource its ground handling operations at the 10 Australian airports where the work is done in-house, which includes Adelaide, Alice Springs, Brisbane, Cairns, Canberra, Darwin, Melbourne, Perth, Sydney and Townsville.

This plan, not yet confirmed, would take place after a review that would compare the efficiencies of using external ground handlers versus doing the work in-house.

Jetstar, meanwhile, has already decided to outsource ground handling at the six remaining Australian airports – Adelaide, Avalon, Brisbane, Cairns, Melbourne and Sydney Domestic – leading to 370 job losses, subject to union consultation.

The business said “customer-facing team members” at airports are not affected by the moves.

PROMOTED CONTENT

In addition, Qantas is looking to outsource bus services for employees and customers at Sydney Airport that could affect 50 members of staff.

Jetstar chief executive Gareth Evans said, “We realise this decision will be extremely difficult news for our ground handling team and their families at what is already a very challenging time.

“Every major airline around the world uses these specialist providers to support their operations. These ground handlers provide these services to many airlines at airports, rather than just one, and provide scalable resources, which makes them very cost effective.

“Contracting this work out also reduces the capital spend required each year. As an example, Qantas and Jetstar would need to invest a further $100 million on ground handling equipment over the next five years, such as tugs and bag loaders, if the work is kept in-house.

“The Qantas Group sets the safety standards through our safety management system – whether work is done in-house or [by] external suppliers. We expect some unions will come out and say these suppliers are unsafe, despite the fact they are used by every other airline in this country.

“We would never compromise on safety. We’ve already worked with some of these suppliers for decades and we know their track record on safety is consistent with work done in-house.”

The business predicts the move will save them $100 million in operating costs each year.

In June, the wider Qantas group announced it would cut 6,000 jobs altogether, or nearly 20 per cent of its workforce, and continue stand-downs for a further 15,000 employees.

Two months later, its full-year financial results revealed a loss before tax of $2.7 billion and an underlying profit before tax of just $124 million.

Joyce said the results were “shaped by extraordinary events that have made for the worst trading conditions in our 100-year history”.

“To put it simply, we’re an airline that can’t really fly to many places – at least for now,” he said.

Steer your own in-flight experience – available on print and digital Whether our classic glossy magazine in your letterbox, daily news updates in your inbox, peeling back a few layers in the podcast or our monthly current affair reports, you can count on us to keep you up to date. Sign up today for just $99.95 for more exclusive offers here. Subscribe now at australianaviation.com.au.

18 Comments

  • Ian

    says:

    here we go. Qantas has been setting the scene for this for a while.

    BUT if govt gives them a zillion dollars, minimal job losses.

    It’s just all about money & getting those borders open ASAP.

  • AgentGerko

    says:

    Pardon my ignorance but if they get rid of 2,000 QF jobs by outsourcing, doesn’t that mean that 2,000 jobs are created within the companies that the work goes to?

    • Adam Thorn

      says:

      Not necessarily because right now most of these people are stood down. Eventually, however, some jobs will likely be recovered, but not all.

      Thanks,

      Adam

  • Hilton

    says:

    Its time for the Governments to nationalise Qantas .. they don’t give a dam about their workforce.
    The only thing Qantas chiefs care about is their fat bonus payments and increasing profits.
    Having all workers on contracts in an outsourced organisation is just another way of cutting the wages of workers. While jobs are scarce Qantas is using the situation to cut wages. How cynical is that !!!
    STOP paying Qantas Covid help money ….

  • Graham Haxell

    says:

    So much for loyalty! It’s always those at the coal face who are hit the hardest! Will the management receive a big bonus for cutting costs? This is a time to pull together, one for all and all for one.

  • Rod Pickin

    says:

    At this stage the operative words are, ” jobs could go” but one would have to say that it is more than likely it will happen either in part or full. In stark reality, what can QF do? – one has to seriously question the validity of border closures, not a QF cause but the huge game of poker by some state premiers clearly reflects upon both QF and the nation’s business survival in the short to medium term. I am rather surprised that QF has not investigated more use of it’s fleet and staff skills within the Freight business centre, others seem to have been quite successful, why not QF? – again, I can understand QF’s business motives here but they have completely forgotten or disregarded their national responsibility to understand that QF is a national vital communications entity, it is just not a “business centre” with a 13 period business reporting system with which to either please or appall us all. AJ has displayed his ruthless and expensive unnecessary actions in the past, – (Close Down) , – the time is now for maybe the P.M. to have a little fireside chat with AJ and we can all move on. In any event, what businessman at this time would invest in a startup of a ground handling company, even DNATA would be less than enthusiastic. AJ, stay out of the politics, you will not win.

  • Matt B

    says:

    $100 million on ground handling equipment? I’ll take that with a grain of salt. Perhaps it’s true, as most of the equipment they use now looks 30 years old. Most companies are using this years situation to ram through previous objectives for the future advantage of their shareholders whilst claiming poor and doing a disservice to hard working tax payers.

  • Marum

    says:

    Terrible news But one can’t blame QANTAS entirely. Their revenue is down so far for the EOFY, that huge cuts were inevitable What now for all the poor workers involved?

    Everywhere I go, everything is damn near stuffed. Even the local Barber-shop has closed down – after 55 years of trading. Small business is only existence, one never makes a fortune. In fact you often earn less than your key staff when you add up overtime, holiday pay, sick leave, superannuation, etc.. Your “Super” is when you sell the business. What will happen when everyone runs down their savings to nil?

    Australia – perfect one day, stuffed the next….Marum

  • Begs the question as to what happens if you just keep “hollowing out” an airline??? Eventually it just becomes a confidence trick on the passenger who puts their trust in “the brand”. The use of that term in itself says it all…

  • stuart lawrence

    says:

    qantas should start flying to bring over australians stranded overseas

  • Erik Sherwin

    says:

    Not for the first time has business confused effiency with effectiveness! A business may be efficient and yet be utterly ineffective. Outsourcing is case in point: you cannot control what you do not own!

  • Erik Sherwin

    says:

    Not for the first time has business confused effiency with effectiveness! A business may be efficient and yet be utterly ineffective. Outsourcing is case in point: you cannot control what you do not own!

  • stuart hearn

    says:

    well if you do not like it start your own airline, Bolshie unions stopped me starting a Business in Au

  • Td

    says:

    Especially the skills in baggage handling, loading , towing, unloading and taking pride in ones work looking after the behind the scenes stuff and more importantly the safety and security of company and passenger baggage, cargo, pets, equipment including the aircraft. If you aren’t part of the company from check in to departure of a passenger or are fatigued due to outsourcing (and cutting corners as a company or worker) do you care as much as the company only treats you as a statistic that’s supposed to do a job. It doesn’t take much of an issue to ground or delay an aircraft which equated to revenue lost and inconvenience to all would incur more expense in the long run by outsourcing.

  • Pete

    says:

    100 million? That’s only 4 years of work for Joyce! Maybe he should go! He is the highest paid airline CEO in the world

  • Ray

    says:

    To Stuart Lawrence’s comment…..

    The Federal Govt has already organised multiple flights for QANTAS to bring back citizens’ since March 2020.
    There’s still a cap, set by the Fed Govt, on how many people can Internationally enter Australia, per day.

    QANTAS just can’t send an aircraft into the ‘wide blue yonder’, land at a foreign port, & bring back Aussies’, at this time.
    A chartered QANTAS aircraft is only permitted to operate, in this instance, at Fed Govt direction.

    If you’re so concerned about getting people back here, why don’t you approach your Fed Govt Member?

  • Naiya

    says:

    I work for Qantas and we are all shocked off the outcome, to be made Redundant. We have told the company many times over that their loading equipment is still the same from the 80’s just old rubbish being repaired time after time, but we have to deal with what we got. Surely with the highest paid CEO should see that ground services are the ones that are getting the planes up in the air.by loading customers personal belongings and freight..!! I feel very Sad of the outcome and disgusted how a top CEO makes his Decision in breaking up those below him who have served with Qantas for a long time. End of the day we are just a number to them and meaning less to company workforce, very disappointed.

  • Charles

    says:

    I cannot believe how silent the government has remained over the selling off and outsourcing of Qantas and Qantas jobs to foreign owned companies, how disappointing.

Leave a Comment

Your email address will not be published. Required fields are marked *

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