Court orders Qantas to resume flights
Thousands of passengers stranded across globe
Action seen as test case for industry's union relations
Qantas has called off the dramatic grounding of its entire fleet after a tribunal ordered the Australian airline and trade unions to end a dispute that has stranded thousands of passengers.
Fair Work Australia, an independent arbiter, ordered that rolling industrial action be halted in a ruling that forces Qantas and three unions to return to the negotiating table.
It also ends one of the most extraordinary acts of industrial brinkmanship of recent times, which had seen the world's second oldest airline ground its entire fleet on Saturday in apparent exasperation at union behaviour, catching the Australian government and passengers by surprise.
Alan Joyce, Qantas chief executive, said the airline aimed to have some planes in the air by the early hours of Monday morning, UK time. "We will be getting our aircraft back up in the air as soon as we possibly can," he said. "It could be as early as Monday afternoon (Australia time) on a limited schedule with the approval of the regulator. I apologise to all Qantas passengers that have been impacted by the industrial action by unions over the past few months and, in particular, the past few days."
The airline's Heathrow services are expected to resume by Monday evening or Tuesday morning , but a full restoration of global operations is complicated by the fact that the carrier has more than 108 aircraft parked around the world.
Qantas said 68,000 passengers had been affected, nearly 500 flights had been cancelled, and that keeping its planes on the ground had cost the airline A$20m (13m) a day. However, economists fear the cost to the Australian economy could have been 10 times as much. There was tangible relief that the furore had not dragged beyond the weekend. The Australian government, which appointed the tribunal, after Qantas grounded planes on Saturday, welcomed the ruling.
But the prime ministe! r, Julia Gillard, reiterated her unhappiness with the timing of Qantas's decision to ground its fleet. "In terms of the practicalities of this, as late as Friday Qantas was reassuring the government that they were in negotiations in this dispute. At 2pm on Saturday they told the transport minister, Anthony Albanese, the fleet would be grounded at 5pm. No ifs, no buts," she told ABC radio.
The Qantas dispute is taking place against a backdrop of industrial tension across an airline industry that is struggling to cope with higher fuel costs and the rise of Asian and middle eastern carriers operating out of booming markets with lower cost bases. Qantas in particular has been affected by competition with the likes of Emirates and Singapore Airlines, prompting the airline to announce a restructuring in August with the loss of 1,000 jobs and moving some operations to Asia. Industrial action ensued and had been going for weeks when Joyce unexpectedly pulled the plug on operations.
Experts warned that Qantas is not alone in facing challenges that will need tough responses, with inevitable consequences for trade union relations. Air France cancelled one in five flights on Sunday after cabin crew stopped work for a second consecutive day to protest against employment conditions, while Iberia the merger partner of British Airways has received stern warnings from unions over its plan to launch a low-cost carrier. BA is viewed by many aviation executives as the standard bearer, having endured 22 days of strike action last year over a drive to cut cabin crew costs in what it said at the time was a "fight for survival" for the then loss-making carrier.
Chris Tarry, an industry consultant, said airlines operating in oversubscribed markets, such as the US and Europe, had to cut costs. The entire industry operates on a collective profit margin of just over 1%. "Business as usual is not an option for any airline," Tarry said.
John Strickland, a consultant and former BA manager, said: "There are still lega! cy carri ers that need to be dragged kicking and screaming into the 21st century. If fuel prices are going to remain high and airlines are to maintain long-term profitability, then they have to change."
One of Britain's most influential industrial relations lawyers, Marc Meryon of Eversheds, said: "In any sector where cost pressures demand greater flexibility to remain competitive, employers will encounter resistance if they try to implement flexibility without union consent."
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