Fears for Qantas Workers
Apr. 17, 2007
Qantas unions want the Australian Government to follow up on commitments made in the wake of the Ansett collapse to strengthen the ability of employees to claim entitlements in corporate bankruptcies.
The unions are worried that the higher debt burden the airline will shoulder if bought by the Airport Partners Australia (APA) consortium will make it more susceptible to external shocks. They want to protect workers' entitlements in case of collapse.
Those fears increased after APA revealed earlier that it wanted to rip AU$4 billion out of the airline in the first year and significantly increase its debt levels. Qantas estimates it has AU$678 million of annual and long-service leave on its books but unions believe the figure could run closer to AU$2 billion if redundancy payouts are factored in.
Australian Services Union assistant national secretary Linda White said on April 16 that the Australian Government could not sit back and accept the consortium's "don't worry, be happy" spin on the deal.
"And in the next breath they are telling the world that it's all volatile and anything could happen," she said. "Well, if you're so highly geared, your exposure to volatility is much higher."
Ms White said APA was asking workers to shoulder the uncertainties of their plans for Qantas by risking their entitlements.
She said alternatives for securing workers' entitlements included securing them against assets, putting money aside or taking out insurance.
The Australian Government should also introduce legislation guaranteeing that employees were first in the line of creditors in cases of corporate collapses.
Employees in the Ansett collapse received most of their entitlements because the assets were unsecured.