"We are deeply sorry": Qantas faces record-breaking penalty ruling

Qantas could be forced to pay more than $121 million in penalties after the High Court unanimously rejected its appeal over the illegal outsourcing of more than 1,800 ground workers during the COVID-19 pandemic.

A three-day Federal Court hearing began in Sydney on Monday to determine the financial penalty for the airline’s 2020 decision, which has been ruled to contravene the Fair Work Act.

During the hearing, Qantas People Manager Catherine Walsh acknowledged the company’s wrongdoing and expressed regret over the years-long legal battle and its impact on affected workers. “We are deeply sorry, and we apologise for the impact on the workers, the TWU, to the court for their time, and to the family and friends that felt the impacts,” she said. “We hope we can get to the stage where there can be some finality for them in this.”

However, the Transport Workers’ Union (TWU) continued to press Qantas on its internal decision-making and corporate culture. Barrister Noel Hutley SC challenged Walsh over the airline’s motives and the role senior managers played in the decision to outsource jobs, suggesting the move was driven by a desire to sidestep potential protected industrial action.

“It is extraordinary that nothing was said about a matter that was obviously an illicit reasoning for outsourcing,” Hutley said, questioning whether Qantas leadership ever scrutinised the justification for the move.

Hutley argued that the outsourcing had caused “massive or irreparable harm” to workers, many of whom had been loyal, long-serving employees. He described the case as the “largest ever instance” of contravening the Fair Work Act and urged the court to impose the highest penalty available.

The TWU has formally called for Qantas to be fined the maximum $121 million, in addition to a $120 million compensation fund already being administered to affected workers.

“Not only was it an appalling act to get rid of a loyal workforce, it was the biggest case of illegal sackings in Australian corporate history,” said TWU national secretary Michael Kaine in a statement. “The penalty to Qantas must reflect this and send a message to every other company in Australia that you cannot sack your workers to prevent them from using their industrial rights.”

Kaine also criticised current outsourcing arrangements, citing severe understaffing and high turnover among external contractors like Swissport. “This cannot be a business case for outsourcing,” he said. “Qantas should not only pay the maximum legal penalty for its actions but commit to funding fair standards throughout its supply chain.”

The Federal Court had previously found that Qantas’ outsourcing was driven, at least in part, by a desire to avoid industrial action – a motivation that breached employee protections under the Fair Work Act. The airline lost its appeals in both the Federal and High Courts.

Following the High Court’s ruling, the airline entered mediation with the TWU to determine the extent of financial compensation owed to the dismissed workers. The hearing before Justice Michael Lee continues this week.

Image: Qantas