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The Qantas Dispute: An Industrial Action Case Study

Professor Andrew Stewart is Deputy Dean at Adelaide Law School in the University of Adelaide, with a particular interest in employment and workplace law, contracts and intellectual property. He also has a keen interest in sham contracting. Andrew is a high achiever with a foot each planted firmly in academia and in industry using his talents in research, producing a range of publications and teaching in the academic setting; but also working with industry and government organisations he is a consultant with national law firm Piper Alderman, and has been an advisor to the International Labour Organisation, Federal and State Governments, and the Attorney-General of South Australia, to name a few key roles. Andrew has recently been involved in advising the Federal Government on drafting the content and the structure of the Fair Work legislation. This bridging across the ivory tower of academia and the real world is hugely important for all university departments and for all disciplines, and benefits flow in both directions. Explain and analyse Andrew immediately puts you at ease but you are also on the edge of your seat in anticipation of learning something. You feel assured that he will take any subject and answer your question well, comprehensively and in a manner in which you can understand. His goal to explain and analyse. This role of explaining and analysing is reflected in him being sought after by all forms of media when issues break. In relation to the recent high-profile Qantas dispute, Andrew has spoken to a number of newspapers, local and national radio and television outlets. The Qantas dispute has opened up a lot of opportunities for me and many others to press for what we might see as appropriate changes to the law. Says Andrew. The Qantas dispute understanding the legal speak The Qantas dispute has become the accepted reference to the events of October and November 2011 when Australian airline Qantas grounded its fleet and threatened a lockout of its staff in order to terminate any industrial action by labour unions. The ongoing situation made headlines around the world, not least as thousands of Qantas passengers were left stranded. The first and most obvious question is what happened from a legal point of view? The way the system has worked in Australia for the last 20 years or so, with industrial disputes, parties bargain with each other, and if they cant reach agreement nothing happens. They can take industrial action, in other words use economic force against one another to beat the other into submission and either one party gives up and reaches agreement on the other partys terms, or they strike some sort of compromise, or the dispute just goes on and on. However, under our legislation there are some mechanisms for dealing with disputes that threaten public health and safety or that threaten the economy as a whole. Qantas is so big and important to the economy that any prolonged work stoppage at Qantas has significant economic consequences, due to its substantial share of domestic air travel and the impact it has on the tourism industry in particular. Because of that, there was such a significant threat to the economy that our industrial umpire Fair Work Australia (FWA) was forced to step in, to put an end to the industrial action and to send the dispute into arbitration. While Qantas engineered this, the unions could equally have done so if they had decided that they wanted to send the matter into arbitration, if they had called an all-out strike that would have had exactly the same effect.

The average employer cannot do that. If a manufacturing company or a university, for example, had prolonged industrial action it would not result in arbitration, in all likelihood. What are the key legal issues in the Qantas dispute? Andrew breaks this down into three key areas: (i) whether Qantas could do what it did (ii) how the arbitration is resolved; and (iii) how we apply the existing laws to the facts and circumstances of the dispute and seeing whether changes are needed Addressing (i) Could Qantas do what it did and was FWAs response the correct one? One set of legal issues is whether Qantas could do what it did that is to threaten a lockout, ground its fleet, and then use that as a way to terminate any industrial action, and take what was a bargaining dispute and throw it into a process of compulsory arbitration. That is what has ultimately happened. The unions are still arguing about that. There is the prospect of a federal court challenge to the decision by FWA to terminate industrial action and send the matter into arbitration. Addressing (ii) How will it play out and how will it be resolved? The second main issue is how the arbitration will be resolved what FWA can and will do to settle the three disputes. Andrew says: we are now not expecting hearings until March 2012. I have been saying that this process would take months based on how similar arbitrations have gone on before and it will. He refers to three because there are three groups of workers involved the long-haul pilots, the ground crew and the engineers. The three groups have different issues and each is represented by a different union. TWU (Transport Workers Union) represents the ground staff; Australian Licensed Aircraft Engineers Association represents the engineers and the Australian Federation of Air Pilots represents the long-haul pilots. So did all three go on strike? All three took industrial action. For the pilots, their industrial action involved making a few announcements over the intercom of flights and wearing red ties, which is token industrial action. Why red ties? As a symbol of defiance it is not the uniform they are supposed to wear. What are the key legal implications resulting from the Qantas dispute? There is a bigger set of legal issues and that is standing back and looking at the way this dispute has played out, the way our existing laws handle that and asking, well should they be different? That is something that can be analysed from an academic perspective, it can be analysed from the point of view of putting a submission into the current review of the Fair Work legislation, it can be analysed in terms of commenting on the process of the review and the governments options, and then there is the question of what are the flow-on effects for other disputes? A lot of what Ive been doing in the last few weeks is talking about the impact of the Qantas dispute on others. For example, weve seen a big dispute happening in Victoria involving the nurses and Ive been doing a lot of media about that. Many of the questions relate to whether this is being affected by the Qantas dispute and Qantass strategy.

The Qantas matter has resulted in lawyers looking closely at this range of legal issues that have arisen, that could arise, looking at the impact on other disputes now and into the future, and looking at the legislation as a whole. Are we seeing more strike action in Australia? A resounding no! Andrew points out that one of the misconceptions that he has been correcting in light of this dispute is the notion raised by some that there are a lot more strikes happening in Australia in recent times. In fact there are almost no strikes. What is actually happening is that there is almost no industrial action taken in this country compared with what used to be the case. We are at record lows. The only reason people may think otherwise is because virtually every piece of industrial action that is taken is now reported. It is a media-driven perception. It is news because it so unusual that it gets seized on every time, so people think that there is a wave of strikes. That is part of my role, to pour cold water on misconceptions. Interestingly, technically there was almost no industrial action in the Qantas case. Technically there was no industrial action when it grounded its aircraft. Qantas announced a lockout that was due to start on the Monday night. The dispute was over and sent into arbitration before the lockout even started. What Qantas did was to ground their whole fleet ahead of the lockouts starting. Thats another set of legal issues which havent yet been explored. The federal governments stance more open to change From Andrews point of view, the Qantas dispute has been momentous not just because he suddenly found himself talking predominantly about this matter during the second half of 2011, with it being such a big story in the media, but it has also generated some very significant decisions, and has also changed the dynamic around the whole system of labour regulation because its given our current federal government both the opportunity and the excuse to look at more significant changes to its legislation than it would have done otherwise. Partly because of its precarious position as a second-term minority government, the government had locked itself into a view that it didnt want to do too much with the Fair Work legislation. It had committed to having a review, it expected that it would make a few very minor changes, and otherwise it would resist calls from both employers and trade unions for significant changes. Now that the Qantas situation has come along, it has raised some issues about the way in which at least some kinds of industrial disputes are resolved. Its been a bit of a game changer. There is now willingness in the government to look at significant changes. Check out more on Andrew Stewart and his research on sham contracting.