Qantas sued over “sham” employee bonus scheme

Sydney, Australia - March 4, 2016: Boxes being loaded onto a Qantas domestic 737 aircraft. Ground staff are visible in the shot. Qantas is the major domestic and international airline operating in and out of Australia.

The Australian Council of Trade Unions (ACTU), on behalf of seven unions representing workers at Qantas, has lodged a legal challenge to the airline’s “sham” bonus scheme.

Qantas CEO Alan Joyce announced a $2,500 bonus for non-executive, full-time employees in the company’s FY18 results in August last year.

“In years when the business has achieved a truly standout result, we’ve been able to reward our non- executive employees with a bonus,” he said at the time.

“This year, we have set aside a further $67 million to reward up to 27,000 non-executive employees with a bonus of $2,500 each.”

The bonus is made up of a $500 staff travel credit and a cash component of $2,000 for full-time employees and $1,500 for part-time employees.

While the $500 credit was available to employees immediately, Qantas has withheld the cash component of the bonus for all non-management staff until they sign onto a new company-endorsed employment agreement.

For some people at Qantas, this point is likely to be at least two years away, while staff who leave or are made redundant during that time will be denied the bonus entirely, according to the ACTU.

Meanwhile, workers not employed on an enterprise agreement – mainly management staff – were immediately given the cash component of their bonus, the ACTU is arguing.

The ACTU is challenging Qantas’ decision via the Fair Work Commission on the grounds that it discriminates against workers covered by agreements, while delivering the bonus immediately to managers.

The largest peak body representing workers in Australia and airline unions is arguing that this bonus scheme leaves working people at Qantas feeling pressured into accepting subpar wages and conditions.

“Qantas is trying to pressure people into supporting an as-yet unseen agreement in return for a bonus payment freely given to managers,” ACTU secretary Sally McManus said.

“People working at Qantas have endured pay freezes and huge staff reductions. The company has lifted its financial performance on the back of their work, yet Qantas management want to use their bonus reward as leverage instead of recognition.

“Union members at Qantas are outraged at this decision and see it as a sign of disrespect.”

Michael Kaine, national secretary at the Transport Workers’ Union (TWU), said: “Workers accepted pay freezes when Qantas was suffering losses. From the backs of these workers, Qantas is now making billion-dollar profits.

“It is without doubt that workers earned these bonuses, but rather than acknowledging and appreciating their efforts Qantas has imposed conditions that did not apply to other workers, including management, who received their cash immediately.

“Bonuses are historically a reward for hard work, not a bribe to pressure workers into quietly accepting their next agreement and sticking around long enough to receive their reward.”

A Qantas worker who asked to remain anonymous told the TWU that the airline is “dangling a half-eaten carrot in front of workers who’ve already lost more than this bonus is worth”.

“I’m proud of my company and my job, but Qantas should reflect our efforts through direct wage increases, superannuation and other entitlements rather than conditional one-off bonuses,” the worker said.

“Otherwise, it’s all a sleight of hand that will allow Qantas to continue reaping profits from our hard work.”

In a statement to Travel Weekly, a Qantas spokesperson said: “It’s bizarre that the ACTU is taking action against an employer who is setting aside almost $70 million for discretionary bonuses, especially when it’s in addition to wage increases of up to three per cent.

“Of course, we understand that people would prefer to receive their bonuses straight away, but the condition that it’s linked to signing a new EBA isn’t new and it’s the same thing we’ve done for the past four discretionary bonuses. It’s something we’re well within our rights to do.

“This is ultimately shareholders’ money and the ACTU is doing a good job encouraging us to abandon these discretionary bonuses and simply return the money to shareholders in future.”

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ACTU Australian Council of Trade Unions bonus bonus scheme employee bonus scheme Michael Kaine qantas Sally McManus Transport Workers Union