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Qantas International Seeks Termination of Crew Agreement, Cuts Domestic Capacity on Border Delays

Qantas International has applied to the Fair Work Commission to terminate their Long Haul Cabin Crew Agreement to change rostering processes, without impacting jobs. The carrier will also cut domestic capacity on delayed Western Australia border reopening.

Qantas International Seeks Termination of Unwieldly Crew Agreement, Cuts Domestic Capacity on Western Australia Border Reopening Delays - Courtesy Qantas

On Thursday (January 20, 2022), Qantas International announced that they have applied to the Australian Fair Work Commission to terminate their Long Haul Cabin Crew agreement, in order to resolve critical rostering challenges. The company has taken the decision as a last resort to change restrictive and outdated rostering processes, and no job losses will be associated with the proposed termination. This is the first time in the carrier’s history that they have sought to terminate an enterprise agreement and the move follows six months of negotiation with the Flight Attendants’ Association of Australia (FAAA) and other bargaining representatives for a new agreement that was rejected by both the union and 97 percent of crew who voted.

The rejected four-year deal included a pay increase and increased allowances, and also sought to simplify outdated rostering conditions, which meant that around 20 percent of 2,500 long haul crew could only be used on a single aircraft type. The FAAA’s counter offer represented an unworkable $60 million cost increase over four years.

In Thursday’s announcement, Qantas International’s CEO, Andrew David, said,

“Asking to terminate the current agreement is the last thing we want, but we’re stuck between a rock and a hard place. Our best offer, which incorporated several union demands, was rejected by 97 per cent of crew who voted. We’re seeking termination because we can’t effectively run our business without the rostering changes, we desperately need to properly restart our international network in a post-COVID world. The challenges facing airlines are pretty obvious and, even though we’re flying internationally again, it’s clear that we have to operate in a more agile and flexible way than we did pre-COVID in order to recover and match customer demand. The level of complexity we’re dealing with is huge.

“The FAAA ran a scare campaign against the new deal, claiming it would mean redundancies and offshoring despite the fact that we’re currently hiring new crew in Australia. The union’s default position is that the company can’t be trusted and should always give more. That’s simply wrong. Termination of the agreement would see crew revert to the modern award, which is the safety net for the industry, while a new agreement is negotiated. Given both the current agreement and the offer we put on the table have pay and conditions significantly higher than the modern award, we clearly don’t want to cut people’s pay. Unfortunately, the process doesn’t let us pick and choose which bits of the current agreement are terminated in order to get the crucial rostering flexibility we need.

“I know our people will be disappointed that it has come to this and so are we. We’re open to putting the same deal that was rejected back on the table, but that would require a change of heart from a union that has continually misrepresented the facts. We have sold land, mortgaged aircraft and raised money from shareholders to get through this pandemic. The government has provided hundreds of millions in direct funding to our employees while they were stood down. We don’t think the flexibility we’re asking from our international crew is unreasonable given the challenges we continue to face.”

Qantas expects the Fair Work Commission to evaluate their termination application over the coming weeks on an expedited basis. Qantas International’s flying is expected to remain at around 20 percent of pre-pandemic levels for the next few months, increasing from April onwards as Omicron-related restrictions overseas are eased.

In a separate press release on Friday (January 21, 2022), Qantas further announced that following the decision of the Western Australian Government to indefinitely delay reopening its borders, the Group will cut domestic capacity by around 10 percent from February 5th through March 2022. Although capacity remains at only a fraction of pre-pandemic levels, the carrier will maintain core connections between Perth and the rest of Australia, with up to 15 weekly flights from Sydney, Melbourne, Adelaide, Brisbane and Darwin. For the third quarter FY22, Group Domestic capacity will be approximately 60 percent of pre-COVID levels. Additionally, Qantas is currently reviewing the timeframe for reinstating their Perth-London route, which is currently operating via Darwin and was scheduled to return to Western Australia in late March 2022.

Source: Qantas

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