TWU slams Bain’s ‘shenanigans’ over Scurrah exit

written by Adam Thorn | October 15, 2020

The TWU has said it has “serious concerns about the future of Virgin” and lashed out at “background shenanigans” after the business announced Jayne Hrdlicka would be the new chief executive.

However, it also added it was “encouraged” that new owner Bain reiterated it was committed to keeping the airline as a mid-market ‘hybrid’ rather than reverting back to being a low-cost carrier.

The TWU’s statement came hours after administrator Deloitte announced that current chief executive Paul Scurrah apparently resigned on Thursday.

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His departure is significant because he is synonymous with the airline’s plan to operate as a mid-market ‘hybrid’ that would potentially ensure more jobs are retained. Hrdlicka, meanwhile, also had a notoriously fraught relationship with unions in her earlier role at the Qantas Group, where she headed low-cost carrier Jetstar.

National secretary Michael Kaine said, “Yesterday the TWU flagged serious concerns regarding the CEO’s position at Virgin, which have now been confirmed. It is encouraging that today Virgin has made a statement on a full-service airline.

“This is an important step forward but we still have serious concerns about the future of Virgin. The statement makes no mention of previous commitments to regional routes, the international division, 6,000 jobs or fleet numbers.

“We are seeking a meeting with Bain Capital to discuss these issues and our delegates will decide in the coming days about the future of industrial talks with the airline.

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“We sincerely hope that the veil of secrecy and background shenanigans on display over the past few days is not repeated. Trust must be at the heart of Bain’s dealings.”

The TWU’s public comments came minutes after Bain attempted to reseize control of the narrative and said Hrdlicka would provide a “different form of leadership”.

“We need a hands-on CEO with deep aviation, commercial, operational and transformation experience,” said Bain Capital managing director Mike Murphy in a statement. “She has extensive airline experience and I know she, alongside Bain Capital, wants nothing more than to see Virgin Australia prosper and thrive well into the future.”

Both Hrdlicka and Bain were quick to emphasis that the appointment would not result in a new strategy.

“I appreciate Virgin Australia’s unique culture and I want to protect and build on it,” Hrdlicka said. “And I am determined that Virgin Australia reinvigorates its strong brand and its passion for customer service, while embracing the diversity, talent and strength of its people.”

Murphy added that while this year had been the “toughest in global aviation history”, the business was “committed to the strategy Virgin Australia announced in August, when the company outlined its plans to protect thousands of jobs, invest in technology and honour all employee entitlements”.

The handover will take place in early November, when the formalities of Virgin’s sale to Bain are completed.

The news comes despite Scurrah exclusively telling the Australian Aviation Podcast just weeks ago that Bain was “a really good owner” and that the relationship between the investors and the existing management team was like “a good marriage”.

At the end of the show, Scurrah signalled he was keen to appear on the show again to talk through how his plans were developing, suggesting his decision to apparently resign is a recent one.

The announcement of Hrdlicka as the new boss is likely to infuriate the TWU, which had a high-profile falling out with the airline when rumours of her appointment swilled months ago.

Just yesterday, the TWU suspended negotiations with the business over new working terms for its members until it received clarification that Scurrah would not be fired. However, relations were unravelling before that and the union only backed Bain’s acquisition at the last minute.

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14 Comments

  • Shayne

    says:

    The unions’ are worried for THEIR futures’, not about any future VA staff.
    This has be proven multiple times’ since 21-4-2020.
    Bain is the owner now, so they’ll do what THEY want to, as their monies’ are now in use, & that includes not kow-towing to unions’.
    They’ve appointed a new CEO, who has a reputation of being a hard-#@&, & takes no c*=+ from them.
    Interesting times ahead, that’s for sure.

  • 2xDecades

    says:

    So happy I took my money and ran! BYEEEEEE

  • Rod Pickin

    says:

    Sadly the departure of P.S. from VOZ was always going to happen; – Bain would have regarded his profile as the problem for the enterprise going into administration and thus, as they may have thought, how can he possibly therefore lead them out of the mire. Bain, as the owners of VOZ have a right and responsibility to set the enterprises policy flightpath which is something that the many unions involved must understand and accept. I am sure that they will be given ample time to consider and contribute to any changes Bain deem needed but, no union has the right to dictate their terms and or conditions upon the business owner and or its operations. I don’t think the incoming CEO will have an easy time; Bain will have an agenda, not all yet revealed, which will have to be fully understood and acceptable to the new CEO for her to successfully complete her tasks, now, as is reported, if she thinks that Noodles, coke and crackers is an acceptable refreshment for JCL pax, I don’t think she will be around for too long. To me, there is a lot of the “plan” yet to unfold and I’ll wager REX is watching very closely.

  • Mark

    says:

    Strangely the most successful low cost carrier has excellent relations with their unions. In fact a president of the company was let go due to friction with the unions. Southwest.

  • Paul B

    says:

    The unions should be grateful that there is still a Virgin airline in Australia. Go Jayne.

  • John Phillips

    says:

    The TWU leadership has failed their members on so many occasions.

    Played for fools by QANTAS when he grounded the fleet, and now by Virgin.

    Somebody needs to tell them – money doesn’t grow on trees.

  • Gary

    says:

    The TWU are going to reap what they sow…. years of ambit claims, agitation and adversity in the workplace, failure of workers to innovate and lean up needs to be addressed. At the end of the day (and with all respect), the work TWU members do is not highly technical and the rates of pay they have enjoyed in the past is not sustainable. Especially when airlines bottom end is reflected in ticket prices.

  • Alan

    says:

    Everyone is worried about THEIR future, that’s a no-brainer. A lot of public money has been given to all major airlines, including Virgin, so for ‘Shayne’ to state that Bain can now do as they please with THEIR airline is naive and unrealistic.
    The new CEO may have a reputation of being a hard ? (whatever ‘-#@’ means), but if she is that good for owners and shareholders, one may ask why is she no longer running Jetstar?
    No airline will be successful without a social/industrial compact with ALL stakeholders. As Richard Branson once famously said: “Take care of your employees, and they’ll take care of your business”.Ms. Hrdlicka would do well to remember this if she hopes to be successful.

  • Rocket

    says:

    The company would have to have been one of the most poorly run companies in the country and certainly one of the worst run airlines I’ve ever come across.
    I don’t know the new CEO or the old one but if she gets in there and starts a clean out, it will be LONG overdue.

  • Marum

    says:

    AHA! Bain have brought in a “Headkicker ” to counter the Union Bully Boys.

    I’ll bet this signals a new era at Virgin, I think Skurrah was a bit too nice for his own good. Isn’t a week a long time?

    Time will tell….Marum.

  • Jonathan

    says:

    When will these unions’ realise a Company does NOT take its’ business practice actions’ from them?
    What Bain does is NONE of the unions’ business.
    Suggest they butt out now, as a more positive reject is coming to them.

  • Travel

    says:

    I can only agree to a certain extent Rod.

    Bain’s negotiations with the unions was critical to achieve shareholder approval for the takeover. It could well be the case, if the plan to replace Scurrah was made evident in the early stages of the administration process other player s for the airline could have been in a better bargaining position. As such, the outcome of the sale process could have been very different to what we see today.

    Who knows what Bain’s plans are and what VA Mk2 will end up being.

    What we do know, is that Bain have successfully negotiated the purchase of the airline at very favourable terms. As VA will most probably be one of the most financially healthy airlines coming out of the Covid-19 crisis, the value of VA can’t be under estimated.

  • Peter

    says:

    Hrdlicka was a total waste of time at Jetstar, she did nothing to improve the business so good luck to Virgin with her at the helm.

  • Shayne

    says:

    Hey Alan, above……
    By your comment, you’ve no idea what Bain’s business model is.
    Actually, you’ve no idea at all, as your comment is lacking so much, especially airline knowledge.

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