Unions have sharply criticised Qantas as the airline announced it had doubled its profits a week after it said it needed to lay off 1000 workers.
Qantas chief executive Alan Joyce reported a $249 million after-tax profit for 2010-11 — about twice what it earned the previous year. Its before tax profit amounted to more than $550 million, which is a rise of about 50% over the 2009-10 financial year.
On August 16, Qantas announced plans to restructure its business, which would include setting up two new Asian-based airlines and cutting up to 1000 Australian-based jobs.
Despite the doubling of its after-tax profits, Joyce claimed the job cuts were still needed because the result did not give Qantas’ shareholders a big-enough return on their investment.
Unions have reacted angrily to the profit announcement. The Australian Licenced Aircraft Engineers Association said its members would take rolling one-hour work stoppages for the next four months unless an agreement is reached.
The association’s federal secretary Steve Purvinas said on August 24: “Alan Joyce has repeatedly claimed that Qantas International is operating at a loss, and he’s using such statements to argue for increased offshoring and outsourcing.
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“That argument just doesn’t make sense when the company announces a $552 million profit.
“Engineers are sick and tired of the smoke and mirrors and are demanding to know the extent to which Qantas International is subsidising the non-Qantas segments of the business.
“Claims by Alan Joyce that Qantas International is doing so badly that he needs to create a new budget carrier in Japan and a completely new brand of airline based in Asia, just don’t stack up.
“Qantas International is being made the scapegoat here to allow Mr Joyce to expand into Asia, offshore business operations and sack 1000 employees.”
The August 26 Australian said the Transport Workers Union had conducted a ballot of its members that work for Qantas. Two-thirds voted in favour of taking protected industrial action against the planned job cuts.
President of the Australian and International Pilots Association, Barry Jackson, also criticised Qantas management’s plan on August 24. He said: “Joyce’s current strategy of setting up a new ‘mystery brand’ airline based in Southeast Asia and gradually shifting Qantas operations to it over time is definitely unpopular with Australians, but we are now finding that it is completely unjustified as well.”
Australian Council of Trade Unions secretary Jeff Lawrence said Qantas’ profit results was its “best performance since the global financial crisis”.
“Qantas’ overall health weakens arguments for any need for the company to offshore its operations into Asia,” Lawrence said.