The previously fraught relationship between the TWU and new Virgin owners Bain appears to have been rebuilt after the union praised management and new CEO Jayne Hrdlicka.
Speaking exclusively to Australian Aviation on Thursday afternoon, national secretary Michael Kaine said, “They’ve stuck to the arrangements they said they would put in place to keep the scope of the company. And holding to that means the starting points of a bridge of trust being built between us.”
The vote of confidence comes after the TWU in October hit out at the new owner’s “background shenanigans” regarding the exit of former CEO Paul Scurrah.
“She’s engaged, she’s been constructive and she’s listened and responded,” said Kaine of Hrdlicka. “And we can’t ask at this point more than that.
“We want to ensure, of course, that that continues beyond the settlement of industrial arrangements.
“We’ll be vigilant, as we have been vigilant throughout this administration process, because our interest is aligned with that of Bain to the extent that we want the company to get back up in the air and be a successful competitor in the industry because we can’t afford to have an effective Qantas monopoly.
“This is not good for Qantas workers. It’s not good for the Australian flying public either.”
Kaine used the interview to point out what he believes the key differences are between Virgin and Qantas.
Virgin’s deal with the TWU will see employees accept an 18-month to two-year pay freeze in exchange for a guarantee that no jobs will be outsourced. Meanwhile, the TWU is currently preparing for a Federal Court case with Qantas after the airline took the decision to outsource 2,000 ground handling staff.
“I think it’s absolutely logical for people to look at these two airlines now and see some very clear differences emerging,” said Kaine. “And one of the most striking is that Virgin has decided to retain the value that it has always ascribed to the culture that it has built.
“A culture built by its workforce – a direct-hire workforce. They’ve seen the value of that, they’ve acknowledged the value of that and recommitted to maintaining that.
“And I think if you’re looking from the outside, you can see a Qantas that is taking the diametrically opposing approach, which is to say, ‘We’re going to really operate no more than a host company, we’re going to cobble together service providers from different areas, including different service providers, servicing the same function across our network.’
“And, of course, that’s going to result in dislocation, less harmonised service, a workforce that’s not dedicated to Qantas. But one that is jumping from plane to plane, company to company, operation to operation.”
The departure of former CEO Scurrah angered unions because he was synonymous with the airline’s plan to operate as a mid-market ‘hybrid’ rather than reverting back to being a low-cost carrier like predecessor Virgin Blue.
Hrdlicka, meanwhile, also had a notoriously fraught relationship with unions in her earlier role at the Qantas Group.
However, on her first day, she doubled down on the reborn business’ plans to become a mid-market ‘hybrid’ and not a budget airline.
“Australia already has a low-cost carrier and a traditional full-service airline, and we won’t be either,” said Hrdlicka. “Virgin Australia will be a mid-market carrier appealing to customers who are after a great value airfare and better service.”
New owner Bain has always resolutely defended the appointment of Hrdlicka, arguing that she would provide a “different form of leadership” needed to survive.
“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.”
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