An internal document from 2010 that shows Qantas had planned to outsource its ground handling work by 2020 has been obtained by the media, raising questions over the airline’s recent flagging of potential cuts to in-house ground handling jobs due to the COVID-19 pandemic.
Fairfax outlets The Age and The Sydney Morning Herald obtained the document, which shows that Qantas had long considered the move as a way to simplify the business and cut costs.
It comes after the Qantas Group said in August that the outsourcing of Qantas and Jetstar’s in-house ground operations to third-party contractors at Australian airports would save around $100 million a year as “part of its COVID recovery plan”.
The “private and confidential” document, which was reportedly canvassed by Qantas management internally in 2010, references a “2020 Vision” strategy for the airline, including “BTW (below the wing) ground handling exited” by this year.
Such a strategy would deliver a “quantum reduction in staff numbers” at airports and enable Qantas to be “more focused on process rather than people management”, according to the document.
Transport Workers’ Union national secretary Michael Kaine described the document as “utterly shocking” evidence Qantas wasn’t sacking more because of the pandemic, but as part of a “pre-arranged plan”.
“This revelation shows the outsourcing of Qantas’ entire ground operations is not based on any rational thinking but shows a senior management team out of control and targeting a group of workers,” he said.
The TWU also demanded that Prime Minister Scott Morrison explain what he knew about Qantas’ 10-year-old proposal and Qantas’ allegedly COVID-19-related outsourcing of at least 2,420 jobs.
“If he did know about it [the 10-year-old plan to cut ground handling jobs] then why didn’t he attach conditions to JobKeeper to ensure Qantas retains its workers, since the point of JobKeeper is to keep the connection to workers?” Kaine said.
“If he didn’t know about it, then the Prime Minister has been duped by Qantas management.”
Travel Weekly has contacted Qantas for comment. However, a spokesman for the airline told SMH that the idea the job cuts had been in the works for 10 years was a “conspiracy theory that ignores the reality of what’s happened to aviation in the past six months”.
The spokesman told the Fairfax outlet that “virtually every airline around the world” had outsourced their ground handling work over the past two decades, saying it should not be surprising Qantas considered it in the past.
“But that’s not why we’re considering it now,” he told SMH.
“We were hiring into Qantas ground services as recently as February and making long-term investments in new ground handling equipment. We wouldn’t have done that if we had plan to outsource it.”
Qantas announced 6,000 cuts to jobs as a result of the COVID-19 pandemic, flagging a net loss of $1.9 billion for the group in FY20 and a $4 billion drop in revenue in the second half of the year due to the pandemic and associated border restrictions.
A further $10 billion hit to revenue is expected this financial year, with the Qantas Group now adopting a cost-cutting program intended to deliver $15 billion in savings by 2023.
“We have to find ways to do things more efficiently and outsourcing our ground handling to specialist providers could reduce the cost of this function by around 40 per cent,” Qantas’ spokesman said.
Under their industrial agreement, Qantas’ ground handling workforce can “bid” to keep the work alongside offers from other global aviation service providers.
However, the TWU last week claimed Qantas had made it impossible for workers to take part in the process, and announced it would take action against Qantas in the Fair Work Commission, claiming the company has failed to properly consult with them.
The airline said it would vigorously defend the union’s claims in the Fair Work Commission.
Qantas currently outsources ground handling work at 55 airports across Australia. While Virgin Australia, according to reports, only does its own ground handling at Sydney, Melbourne, Brisbane and Adelaide.
Featured image source: iStock/Ryan Fletcher