Australian Court Fines Qantas US$59 Million for Illegal Layoffs

An Australian court on Monday imposed a fine of Aus$90 million (US$59 million) on Qantas for the illegal dismissal of 1,800 ground staff during the Covid-19 pandemic, concluding a five-year legal battle over workers’ rights.

Federal Court Justice Michael Lee stated that the penalty was intended to serve as a “real deterrence” to other companies tempted by the financial gains of breaching employment laws.

Qantas had decided to terminate the workers and outsource their jobs in August 2020, amid nationwide lockdowns and border closures, when no Covid-19 vaccine was yet available.

Australia’s Federal Court ruled that Qantas acted illegally, despite citing “commercial imperatives,” and subsequently dismissed the airline’s appeal. The court emphasised that the carrier had prevented staff from accessing their rights to collective bargaining and industrial action.

Qantas, known as the “Spirit of Australia”, has spent the last several years attempting to repair its reputation, which was damaged by the illegal sackings, soaring ticket prices, service complaints, and selling seats on flights that were later cancelled.

Vanessa Hudson, who became CEO in 2023, pledged to improve customer satisfaction. She succeeded Alan Joyce, who faced heavy criticism over the airline’s treatment of employees and passengers, despite record profits for shareholders.

The court ordered that Qantas’ fine be paid in two parts:

• Aus$50 million to the Transport Workers Union
• Aus$40 million reserved for future payments to former employees

This penalty is in addition to Aus$120 million in compensation agreed to last year for the affected workers.

Anne Guirguis, a former Qantas employee who had worked for 27 years cleaning aircraft, described the ruling as a victory for all Australian workers: “It has been five long years. Today is a victory, not just for our colleagues but for all Australian workers. We can close this chapter and move on now.”

Transport Workers’ Union National Secretary Michael Kaine called the court’s decision a “final win”: “Qantas was not sorry to workers when it illegally outsourced these employees, many of whom learned they had lost their jobs over a loudspeaker in the lunchroom. Qantas is only sorry now that it has to pay the largest penalty fine of any employer in Australian corporate history.”

The ruling marks a historic penalty in Australia, reinforcing the importance of workers’ rights and lawful employment practices in corporate governance.