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Virgin unions join together for strong attack on Bain

written by Adam Thorn | September 22, 2020
Virgin Australia Airbus A330-200 VH-XFG at Townsville Airport on May 6 2018. (Dave Parer)
A file image of a Virgin Australia Airbus A330-200 at Townsville Airport. (Dave Parer)

Virgin’s relationship with unions appears to have broken down after eight organisations joined together to issue a strongly-worded rebuke of the airline’s new owner Bain.

The unions, including the TWU and AFAP, said they were “concerned over the direction Virgin is taking” and appeared to suggest they are worried more staff cuts are coming because not enough aircraft are ready to fly.

“The workforce won’t tolerate their working conditions being cut to the bone permanently because of a temporary crisis,” read the letter. “Workers stand ready to negotiate co-operatively but they will not accept a coarse plan to drive down labour, safety and service standards in the medium to long-term.”

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Bain beat out Cyrus Capital Partners in May to become the administrator’s preferred bidder for the airline and the decision was then rubber-stamped at a final creditors’ meeting on 4 September.

The unions’ letter, sent on Tuesday, comes just a day before they will take their seat on a new advisory council along with Bain, which has been set up to give employees more of a voice on the running on the business.

The strongly-worded statement reads: “Workers are concerned over the direction Virgin is taking and over promises Bain made during the sale of the airline.

“Workers are alarmed at the shortfall in aircraft designated and ready for flying. Despite a promise of 75 aircraft there are just 56 ready for flying. They will be questioning Bain on how it plans to keep 6,000 workers employed with less aircraft operating.

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“Workers will also raise concerns over negotiations on new enterprise agreements which the company is using to drive down conditions.

“We have seen some worrying changes at Virgin since Bain Capital secured the sale of the airline. Unions at the first meeting of the advisory council will raise the issue of governance and we will be holding Bain Capital to account over the promises it made.

“We want a collaborative future at Virgin, based on co-operation rather than private equity suits trying to steamroll decisions and fracture relations which have helped build up the airline.

“We will be seeking a plan for how the airline will return to promised capacity in terms of aircraft as soon as possible. If Bain is preparing less aircraft for flying than promised we want to know how it is planning to keep 6,000 workers employed.

“Virgin pilot unions are concerned that the change of culture combined with savage reductions terms and conditions will lead to an erosion of training and safety standards.

“Workers are also concerns at the shift in attitude towards negotiations which is steering away from the culture of collaboration which has always underpinned talks at Virgin.”

It then added it was clear there was a “lack of knowledge at Bain” on Virgin’s culture and brand in Australia.

“It is incumbent on Bain to show it can listen and learn from workers who have helped build Virgin up. Bain must show it can focus on maintaining the community trust that Virgin has created over the years rather than morphing into a dictatorial culture,” it said.

The statement comes after relations with the TWU broke down before the sale was complete because of Bain’s refusal to dismiss speculation former Jetstar chief executive Jayne Hrdlicka could be the new chairman.

Hrdlicka had a notoriously fraught relationship with unions in her role at the Qantas Group.

In fact, the TWU only backed the sale to Bain at the 11th hour, and then warned the new owners “must listen to workers and utilise their skills, energy and experience in rebuilding the airline”.

The letter was jointly signed by eight organisations:

  • TWU (Transport Workers Union)
  • ASU (Australian Services Union)
  • VIPA (Virgin Australia Group Pilots)
  • FAAA (Flight Attendants’ Association of Australia)
  • ALAEA (Australian Licensed Aircraft Engineers’ Association)
  • AFAP (Australian Federation of Air Pilots)
  • ETU (Electrical Trades Union)
  • AMWU (Australian Manufacturing Workers’ Union)

20 Comments

  • Adrian P

    says:

    I refer the AFAP (Australian Federation of Air Pilots) to a previous post.
    VIRGIN PILOT UNION BACKS BAIN DESPITE TWU SILENCE
    written by Adam Thorn August 31, 2020

  • Rod Pickin

    says:

    You would be living under a rock someplace if you didn’t know that Virgin Australia was now under the ownership of an American Company and yes, they do things differently over there, not always better but they now own the outfit and I expect that Bain will advise all parties in-full of the manner and direction that they wish to set course for the future commercially. VOZ will never be the same as it was, it had to change course in order to survive and I would implore staff and their representatives to listen to what Bain has to say, question points and then contribute to a better outcome, not make threats. You will achieve success only together, beating the war drums before the main event will achieve nothing; stop, listen and then consult. I had some great tutors, it works.

  • Paul

    says:

    Well that marriage lasted whar all of 2 months? Unions show their true colors. Wonder how long Bain will put up with this nonsense.

  • Emb

    says:

    F***K the unions… Let the company rebuild without the help of these airline destroying idiots. They seem to think that the airlines should just keep forking out for 6000 workers regardless of negative income due to Covid. These blood sucking Union leeches should be run out of Australia starting with that Simon Lutton clown at AFAP. All they are interested in is maintaining as many subscriptions as they can without a single thought for the welfare of the airline. Never a good thing has come from unions for either company or employee in the long term

  • Lee

    says:

    I have completely lost interest in this saga now.

  • Wayne Sinclair

    says:

    How naive these unions are. Times have changed dramatically and so have conditions. A business will only survive with a cost structure that meets the new revenue base. Businesses unlike governments cannot afford to be “sheltered workshops”…

  • Steve A

    says:

    Surprise, surprise! The unions are dumber than “Dumb and Dumber ” if they thought that Bain were a white knight. ‘Be careful what you wish for’ as they say.
    Bain are asset-strippers, and they leverage up the businesses that they buy in order to pay for themselves. History shows this clearly. Have the unions not done their due diligence on Bain?
    Next, they will get rid of Paul S, and install their own choice, and in this case it looks suspiciously like Jane H.
    I did offer to show the unions an alternative, but how many of them actually bothered to contact me? Zero.
    The Queensland Government will soon find out that they have been duped too. All of that QLD taxpayer’s money given to Bain, and Bain will will keep the VA HQ in BNE, for sure, but it will be a shadow of its former self. And how the Queensland government actually believed that Bain were able to service Regional Queensland and tourism without their regional E-jets or ATR’s is a wonder in itself.
    I personally wrote to every Queensland MP and told them what would happen and that I could show them a plan to do it themselves and to be in full control of Queensland’s tourism and economy instead of being constantly blackmailed by airlines, but how many MP’s actually even bothered to acknowledge my email? Three. Wow, they really are interested in what happens in the state, aren’t they?
    And, of course, I got my second ” Dear John” letter back from QIC. Yes, my second one, because they sent me one back in 2016 too, after I sent the Premier a proposal to set up an airline based in Queensland because both QF and VA weren’t doing what was needed to properly take care of Queensland’s economy, jobs, and tourism sectors.
    QIC told me that it wasn’t the Government’s role to get involved with an airline. What? It’s not the Government’s role to ensure that it’s economy, jobs and tourism sectors have the proper support that is need?
    Of course, I did the same with the Victorian Premier and Treasurer too after they said that they wanted a piece of the action for Victoria and a MEL hub. Did they even bother to reply? Definitely not! ZILCH ZIP ZERO.
    And I sent every Federal MP and Senator a similar letter, emploring them to do something. Only seven of them even acknowledged my email. The rest? Well …. maybe they have more important things to concern themselves with than growing the economy, jobs growth, and tourism growth?
    But I did get a nice “Dear John” letter back from the Deputy PM, to go with the one that I received back from Darren Chester back in 2016.
    So, is it me who is naive thinking that politicians would actually care about growing the economy, growing jobs, and growing tourism?
    Or is it the politicians who are naive in believing that either QF or VA are going to do what is needed?
    It’s very hard not to get just a little bit cynical as I deal with more and more pollies. What ever happened to the ones who actually want to get off their chuffs and do things?

  • Matt

    says:

    I worked for VA a couple of years ago as pitcrew. The TWU was a joke and most of us at the Mel port left after they gave us no support during the EBA negotiations. They had to give us a new rep because there were so many complaints that he just accepted the deal VA offered and couldnt be bothered fighting. VA had been doing dodgy shit for years bringing in Roster Optimization Shifts telling people they owed the company hours and had to cone in and work for free 1 day every 9 weeks. The union did SFA, just accepted it and walked off.

  • mike

    says:

    be VERY careful what you wish for.

    Have heard that union activists would be re-employed at virgin & they are looking at who has taken the most sickies.

    Pay & perks have to be reduced drastically or Virgin Mark2 will go the way of Virgin Mark 1. Remember Rex is going after the big money maker, the golden triangle.

    Virgin used to get most of Rex’s regional passengers connecting in BNE, SYD or MEL to other cities (BNE, SYD, MEL) & come March, they will get none.

  • John Phillips

    says:

    I can’t believe that the Unions really expected anything else, or if they did, they had no idea of what would really happen.

  • Jamie

    says:

    I’m sure they can apply for the tens of thousands of jobs that will be available in aviation post-COVID. Unfortunately, times change and whilst Virgin started off with the right business model, it quickly became a cumbersome behemoth, beset by similar inefficiencies that felled Compass (I&II), Ansett, Tiger etc. etc.

    The reality is that cost is what drives customers and airlines that don’t make cost their number two priority (after safety) are going to quickly become a page in a history book.

  • Dave

    says:

    Did I detect an eye-roll in the headline ;-/

  • Sash Despotovski

    says:

    Without the Unions, you all would be screwed! Excuse my language. The airlines can play their games now, but when they need to ramp up and grow, NO one will be there. VA is a company lacking in proper leadership for many years and Management that does not listen. The only thing that saved VA was, Covid. So before you all denigrate the Unions, take a step back and realise that if it was not for the unions, you all would have been out of work many years ago! Appalling!

  • Peter

    says:

    No airline ever made safety their number one priority !!

  • James

    says:

    Oh boy!
    Unions’ doing what they do best ie being pains in the a$$.
    Bain has no time for unions’, so their threats will fall on deaf ears’.
    As others’ above have commented, ‘be careful what you wish for’.
    These union morons’ are going about the right way to have Bain vamoose back to USA.
    Their VA final paperwork won’t be signed until 31/10/2020.
    The unions’ should be happy that someone has possibly bought the airline, thus giving a number of staff, jobs.
    All they’re doing now is threatening those jobs, & a possible VA future.

  • Vannus

    says:

    To Peter, above…….

    So the fact that QANTAS has been voted World’s Safest Airline’ SEVEN years’ in a row now, means what you said???
    So the fact that QANTAS is the ONLY Airline to win the coveted ‘Cumberbatch Trophy’, (Google it) TWICE, means what you said???

    Maybe best to check your facts before commenting.

  • Julianna

    says:

    I have never seen a sense of entitlement amongst unionized employees the way I have seen at Virgin. So many of their colleagues have lost their jobs, the company was near no longer existing and yet they still want more. Given what is going on in the airline industry, 56 planes flying in the sky is better than none. Not only our jobs being lost, lives have been lost as well; the amount of suicides that have taken place amongst pilots and flight attendants globally that no one is acknowledging is astonishing. There is no shortage of airlines workers in the world right now, they should be grateful to be still employed.
    “Virgin pilot unions are concerned that the change of culture combined with savage reductions terms and conditions will lead to an erosion of training and safety standards.” – it will only lead to an erosion of training and safety standards if the pilots allow for it; the safety of 150 passengers on board an aircraft should not be compromised because they don’t like the way Bain operates. If that’s the case, then leave. There is no shortage of pilots in the world right now.

    Before you cm

  • Free

    says:

    I took my money and ran. Good luck to you silly buggers who stayed. Toodles. #18years

  • Linda Weaving

    says:

    Of course safety standards and working conditions will fall. That’s how budget airlines make it in the USA. That’s why you couldn’t pay me to get on one of those budget American regional airlines. You never know the next time a door or propeller is going to fall off!

  • Adrian P

    says:

    The federal government has announced plans to an option of voluntary administration that allows the owners some control over assets to be disposed of to fix their financial problems (Companies with debts of less than a million).
    A type of Chapter 11 protection that Bain Capital used to protect its ownership of Toys R Us from predation.
    With out Chapter 11 the only option available to Virgin Australia was to put it self at the mercy of one of the big four global accountancy companies.

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