In a historic judgment, Australia’s Federal Court has imposed a AU$90 million (US$59 million) fine on Qantas Airways for illegally terminating over 1,800 ground staff during the COVID-19 pandemic.
The ruling, delivered by Justice Michael Lee, marks the largest penalty ever levied under Australia’s Fair Work Act and underscores the seriousness of the airline’s breach of labor laws.
The court found that Qantas’s decision in late 2020 to outsource 1,820 baggage handler and cleaner roles at major airports was not only unlawful but constituted the most significant contravention of workplace legislation in the country’s 120-year industrial history.
Compensation and Accountability Measures
The penalty comes in addition to the AU$120 million (US$78 million) in compensation Qantas had already agreed to pay its former employees following a unanimous High Court ruling in December 2024.
That decision upheld a lower court’s finding that the outsourcing move was illegal and rejected Qantas’s appeal.
Justice Lee emphasized that the fine was intended to serve as a real deterrent, stating that it should not be perceived as a mere “cost of doing business.”
He noted that Qantas executives had anticipated annual savings of AU$125 million through outsourcing, a figure that factored into the court’s decision to impose a substantial penalty.
Union’s Role in Legal Victory
The Transport Workers Union (TWU), which initiated the legal proceedings, played a pivotal role in bringing Qantas’s actions to light.
Justice Lee ordered Qantas to pay AU$50 million of the fine directly to the TWU, recognizing the union’s role in exposing the unlawful conduct when no government agency took action.
TWU National Secretary Michael Kaine described the ruling as a landmark victory for workers. “This is the most significant industrial outcome in Australia’s history.”
“It sends a clear message to every employer: treat your workforce illegally, and you will be held accountable,” Michael said.
Qantas Response and Public Apology
Following the ruling, Qantas CEO Vanessa Hudson—who served as Chief Financial Officer during the layoffs—issued a public apology.
“We sincerely apologize to each and every one of the 1,820 ground handling employees and to their families who suffered as a result,” Vanessa said.
She acknowledged that the decision to outsource during an uncertain time caused genuine hardship and pledged to rebuild trust with employees and customers.
However, Justice Lee questioned the sincerity of Qantas’s remorse, pointing to the airline’s earlier attempts to deny compensation.
“The litigation strategy adopted by Qantas was unrelenting and aggressive,” he noted, suggesting that the company’s regret may stem more from reputational damage than genuine concern for affected workers.
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