Wednesday, November 23, 2011

Alan Joyce:1 Unions:0

I see that yet again, with the referral of the Qantas pay and conditions dispute to FWA, a stupid and greedy union management has quite effectively fucked both themselves and their members by insisting on having their cake and eating it too.


While some of the pay claims themselves were not unreasonable, the TWU pushing for 5% PA for baggage handlers is taking the piss.  Even the pilots were only asking for a couple of percent, and the ground engineers not much more.  Where the unions have really overstepped the bounds of what would be tolerated is in thinking they can tell management how to run the airline.  Offshoring maintenance functions and using contract ground staff is an operational decision and nothing to do with pay, benefits and conditions, and while the unions might not like it, it’s none of their damn business.


I don’t like seeing jobs go offshore any more than anyone else does, but Qantas is currently the Telstra of the aviation industry.  It’s used to being the incumbent player and generates a certain amount of brand loyalty from having been there more or less forever, but with Virgin and Jetstar (I don’t consider Tiger a realistic option) offering significantly cheaper pricing, Qantas needs to re-evaluate how it operates if it is stay relevant and profitable in the industry.  Also like Telstra, Qantas doesn’t really know how to do things cheaply, but Alan Joyce is teaching it to do so, and this is lesson one.


Ultimately, air travel is air travel.  It’s not something to be enjoyed, it’s something people endure to get to where they want or need to be.  It’s expensive, annoying, uncomfortable, intrusive and restrictive (thanks, CASA) – there’s not a lot of lipstick you can put on that particular pig.  At least when Telstra charge like wounded bulls for access to their network, you actually get something for it in return – performance and coverage.  Only an idiot would expect to pay Vodafone prices for Telstra network quality (although there are demonstrably plenty of idiots about the place who do), but an airline seat is a pretty homogenous product.  The inflight (alleged) meal on a Qantas flight isn’t going close to justifying the extra $100 a seat either in input cost or impact on my wallet, so there are obviously some significant improvements that need to be made other than dropping the cardboard chicken to get competitive.


Because of competition and the opening up of the industry to cheaper foreign carriers, the airline flight buying public of Australia is now used to paying cheap, globalised prices for their travel.  Qantas needs to be able to compete on a similar footing to survive, which means lowering prices, which means lowering costs to the same levels as its competitors can operate at.  The unions need to deal with this.  However, like ticks on a dog, the unions would rather see the host bleed to death rather than make any sort of sacrifice themselves.  Hmm, I’m sure I’ve seen a very similar situation somewhere else recently… oh yeah, that’s right – the Greek economy.  That’s in the shitter too, and isn’t it surprising that nobody wants to make any sacrifices for the good of the corporate entity there, either?


Ultimately, a lot of the dispute is not so much about pay and conditions here and now, but future security – and that’s something that both the unions and Qantas are fighting for.  Qantas wants the right to run its business the way it wants to, and to have the right to restructure their operations in such a way they will be commercially viable in the future.  The unions want Qantas to commit to not offshoring and contract outsourcing work because it diminishes their role in the future – stuff their members here and now!  In a very similar matter to the CEPU failing their members for years in their fight with Telstra, the TWU, AIPA and ALAEA are failing their members now by acting in their own narrow self-interest.


Fair Work Australia isn’t going to care less about the union’s concerns about offshoring and outsourcing, because they are not there to tell Qantas how to run their business, and nor do they have the right to.  I predict they will look at the pay and conditions claims, strike a balance somewhere towards the middle, announce a determination (which is legally binding on all parties), ignore the rest of the union claims, and tell everyone to get back to work.  Qantas will get pretty much what it wants, the staff will get less that they would have gotten had the unions not been acting in their own self-interest, and the unions themselves will no doubt put out a blustery press release claiming it as a “win for their members”.  Yeah, right.


Nice one, unions.  Well done.  If you had to devise a way of alienating your members and highlighting your increasing lack of relevance to the modern world I don’t think I could do a better job myself.

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