Qantas and Jetstar Evaluate Outsourcing Ground Handling Services, Could Impact 2,000 Employees
Qantas announced on Tuesday that, to deliver services more efficiently, they are considering the outsourcing of ground handling services at 10 Australian airports where the work is done in-house. Jetstar will outsource ground handling services at six Australian airports.
On Tuesday (August 25, 2020), Qantas reported that as part of their COVID-19 recovery plan they are considering the outsourcing of certain ground handling operations such as baggage handling and aircraft cleaning. Employees and unions have been informed and the carrier is evaluating three initiatives. First, Qantas is proposing to outsource ground handling operations at 10 Australian airports where the work is done in-house. The company will assess both external ground handlers and an in-house bid in their search to make this function more efficient. If the work is outsourced, it could impact up to 2,000 employees. Next, the company is proposing to outsource their bus services for customers and employees in and around Sydney Airport, which could impact a further 50 employees. Thirdly, Qantas Group subsidiary Jetstar has taken the decision to outsource ground handling at six Australian airports which will impact 370 jobs, subject to union consultation. In Today’s announcement, Qantas Domestic’s CEO, Andrew David said,
“This is the greatest challenge the aviation industry has ever faced, and airlines have to change how they operate to ensure they can survive long-term. We’ve already taken drastic action, with more than 220 aircraft grounded, the vast majority of our workforce stood down and assets mortgaged to raise cash. Right now, our domestic capacity is at 20 percent of pre-COVID levels and international travel is expected to take years to recover. We know travel restrictions will lift eventually, but the market will be very different. Every airline will come through this much leaner and more efficient, and we have to be able to compete if we’re going to survive. Outsourcing this work to specialist ground handlers would save an estimated $100 million in operating costs each year. Today’s announcement will be tough for our hard-working teams, most of whom have already been stood down for months without work. This obviously adds to the uncertainty, but this is the unfortunate reality of what COVID-19 has done to our industry.”
Qantas has already announced at least 6,000 job losses as part of the rightsizing and restructuring of their business and today’s announcement could result in up to 2,500 additional redundancies. The proposed outsourcing of ground handling services at Qantas would impact employees at 10 airports including Adelaide, Alice Springs, Brisbane, Cairns, Canberra, Darwin, Melbourne, Perth, Sydney and Townsville. Qantas’ efficiency review of ground handling services will take place over the next few months and as part of their enterprise bargaining agreement, employees will have the opportunity to provide a bid. Jetstar already outsources at 17 Australian airport terminals and the carrier will outsource ground handling at Adelaide, Avalon, Brisbane, Cairns, Melbourne and Sydney Domestic. Impacted Jetstar employees will receive a redundancy package and support for transitioning to new jobs outside the business.