The Transport Workers Union (TWU) has won a historic court battle against Qantas over the dismissal of more than 2,000 ground handlers whose roles were outsourced.
The Federal Court delivered the verdict on Friday morning, and largely found in favour of the union. It means outsourced employees could potentially regain their jobs or receive compensation, though that has yet to be determined.
Both Qantas and Jetstar removed ground handling operations this year at the Australian airports where the work was done in-house, which included Sydney, Melbourne and Brisbane, shifting them to external businesses including Swissport and dnata.
The TWU hired Waterfront dispute lawyer Josh Bornstein to argue the airline’s actions contravened the Fair Work Act because employees at the new companies are now no longer entitled to terms secured through enterprise agreements. Qantas had consistently denied it has done anything unlawful.
In his ruling, Justice Michael Lee said, “Although I do not think that the intent of the outsourcing decision was to hobble the industrial influence of a perceived ‘militant’ industrial organisation, given the nature of the Union’s membership and its members’ roles, outsourcing ground operations to third party contractors would be an effective way of going about the fulfilment of such an aim.”
However, he also said, “I am reasonably satisfied on the balance of probabilities, that the fact affected employees were members of the Union was not, in itself, a substantial and operative reason for deciding to make the impugned outsourcing decision. That aspect of the Union’s case fails as a consequence.”
Finally, he concluded he was not satisfied that Qantas had proved on the balance of probabilities that its domestic and international chief, Andrew David, did not decide to outsource the ground operations for reasons which included the “Relevant Prohibited Reason”.
“As will already be obvious, this conclusion reflects my unease as to the state of the evidence on this fact in issue and, in particular, Mr David’s evidence when viewed in the light of all the other evidence to which I have made reference.”
Bornstein called the decision a legal first.
“The Federal Court has found for the first time that a major employer has sacked over 2000 workers because it was seeking to deprive them of the ability to collectively bargain with the company for a new enterprise agreement,” he said.
“It is also the first successful challenge to a major corporate outsourcing exercise in 20 years. We put Qantas’ outsourcing on trial and Qantas lost. Large companies have used outsourcing for decades to prevent employees from being able to collectively bargain with them.
”As a result, employees have lost the ability to obtain proper wage rises. Once Qantas outsourced its workers and sourced them indirectly from labour hire agencies, it did not have to bargain with ground staff again.”
Qantas has yet to respond to the ruling, but has previously said in response that COVID has meant it has had to make major changes in order to survive.
“We recognise that this was a difficult decision that impacted a lot of our people but outsourcing this work to specialist ground handlers who already do this work for us in other cities across the country is not unlawful,” it said in a statement.
Qantas has previously accused the TWU of not telling the truth. In particular, it has rejected accusations that it has transferred ground handling roles to “labour hire firms” and denied it has abused JobKeeper subsidies. It’s also hit back at the central claim that it removed in-house roles to avoid collective bargaining agreements.
The case has been controversial because Qantas forged ahead with outsourcing the roles before the outcome of today’s case. It said it was able to do this because the union didn’t obtain an ‘interlocutory injunction’.