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Monday, October 31, 2011

Qantas flights resume after industrial dispute

At 3.30pm, Australia's air safety regulator CASA cleared Qantas to resume flying. Over the next hour cheers went up at Australian airports as gates finally opened for boarding. The first flight to take off was an Airbusbound for Jakarta from Sydney, followed by a domestic flight from Melbourne to Sydney.


The company warned the 70,000 passengers worldwide that have been affected by the disruption to expect delays, but said a full service was expected to be operating by Wednesday.


In a shock move, Qantas grounded its entire fleet of 108 planes on Saturday, disrupting nearly 70,000 passengers and bringing to a head a bitter battle with trade unions over wages, working conditions and its plan to base more operations in Asia.


The decision forced the government to step in and to demand the tribunal make an urgent ruling on the dispute. In the early hours of Monday morning, the tribunal ruled that all industrial action must cease and gave Qantas and the unions 21 days to reach an agreement or face binding arbitration.


Alan Joyce, Qantas CEO, said he was "delighted" with the outcome, widely considered to be a victory for the airline, but the unions warned they could appeal the tribunal's decision if the company did not negotiate in good faith.


Mr Joyce said that 108 planes would return to the skies over the next 24 hours with the help of extra staff and services to clear the backlog.


Mr Joyce defended the drastic action as "the right decision" and said that he had no other option but to ground the fleet.


But he apologised to passengers for the disruption.


"My message for all of our customers is you can book with confidence because all industrial action now ceases."


In early trade, after opening 0.3 per cent down, Qantas shares rose 6 per cent.


Qantas estimates the grounding has cost the company A$110 million (£72m).


It has also damaged the airline's relationship with the government, which was left fuming at the grounding.


"I do not accept that Qantas' only choice on Saturday was to take the extreme action of grounding all planes and leaving tens of thousands of passengers stranded far from home," Julia Gillard, the prime minister, said.


The dispute has dogged Qantas for months but it escalated recently when it announced plans to cut 1,000 jobs and order $9 billion worth of new aircraft as part of a makeover to salvage its loss-making international business.


Union representatives said they would work with Qantas to resume flights as soon as possible but some accused Mr Joyce of reckless and "megalomaniacal" behaviour.


"The board should immediately sack their out-of-control CEO," said Captain Richard Woodward, vice president of the Australian and International Pilots Association.


But Mr Joyce said the grounding was a successful tactic to end months of rolling strikes and to force a conclusion.


"That was the only way we could bring that to a head," he said.


Qantas said a series of rolling stoppages by unions had cost the airline almost A$70 million since September and driven down bookings, threatening its survival.

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