Qantas fined record $90m for illegal pandemic layoffs

Australia’s Qantas has been hit with a record AU$90 million (€50m) fine after the Federal Court ruled that the airline illegally sacked 1,820 baggage handlers in 2020 during the COVID-19 pandemic. The court stated that the outsourcing decision constituted a breach of industrial law, as it bypassed union protections and limited staff’s rights, imposing a fine “slightly less than 75% of the maximum penalty” allowed under Australia’s employment laws, with AU$50m to be paid to the Transport Workers’ Union (TWU). 

Qantas has agreed to settle the fine, admitting the court’s decision underscores the “real harm” their actions had on impacted employees. “We sincerely apologise to each and every one of the 1,820 ground handling employees and to their families who suffered as a result,” Qantas Group chief executive Vanessa Hudson said. “Over the past 18 months, we’ve worked hard to change the way we operate … This remains our highest priority as we work to earn back the trust we lost.”

Justice Michael Lee characterised the protracted legal fight between the Transport Workers’ Union and Qantas as “no ordinary case,” noting his hesitation in deciding whether the airline was genuinely remorseful or just “performing”, motivated more by reputational concerns than by the impact on displaced workers. Expressing a “sense of disquiet and uncertainty” about what occurred within the airline’s leadership before the outsourcing decision, he ultimately described Qantas as being “the wrong kind of sorry.”

“It will send a message to Qantas and other well-resourced employers that not only will they face potentially significant penalties for the breach of the act, but those penalties will be provided to trade unions to resource [them] to fulfil their statutory roles as enforcers of the act,” said the judge. 

Lee further criticised Qantas for deploying an “unrelenting and aggressive” legal strategy, withholding key testimony and failing to address the wrongdoing transparently. He also expressed frustration that Vanessa Hudson, Qantas’s former chief financial officer and current chief executive, did not testify during the proceedings. 

The remaining AU$40 million’s allocation will be determined in a later hearing. The union is advocating for that sum to go directly to the affected employees. This ruling comes atop a separate AU$120 million compensation agreement previously secured for the impacted workers, bringing the total cost of Qantas’s 2020 outsourcing decision above AU$200 million.

TWU national secretary, Michael Kaine, hailed the decision as a landmark victory for workers’ rights, calling it a “David and Goliath” battle win that set “the most significant industrial outcome in Australia’s history”. Speaking to the media, Kaine suggested using the AU$50 million windfall for other industrial campaigns representing and supporting its members. “We will keep fighting our industrial fights,” he added.

In the judgment, Federal Court Justice Michael Lee said the fine was meant to serve as a “real deterrent” to other employers. Some legal experts praised the unprecedented size of the fine as a strong warning to employers who might break industrial laws, while others disagreed. Dan Trindade, an employment law expert at Clayton Utz, told The Guardian that the fine may not be sufficient to deter other companies, as the airline could have saved even more money by outsourcing its staff during the pandemic. 

Despite the ruling’s heavy toll, Qantas continues to report strong profits — fueling criticism that the company prioritised financial resilience over ethical labour practices. With the five-year legal battle now concluded, the decision sends a clear message: courts are prepared to penalise even major corporations when they violate workplace laws.