Qantas is facing a hefty compensation bill expected to exceed $100m as it braces for the fallout of its decision to illegally sack almost 1,700 baggage handlers in 2020.
Justice Michael Lee ruled on Monday that three test cases should receive $30,000, $40,000 and $100,000. They suffered varying amounts of “non-economic loss”, the court ruled, which refers to hardship and distress caused by the airline.
Many workers will also be able to claim economic losses, linked to lost wages.
Lee ordered Qantas and the Transport Workers’ Union into mediation using the test-case amounts to inform a total payout, with the parties due to report back early next month.
He found that the workers would have been retrenched one year later in 2021 anyway due to the airline’s “laser-like” focus on cutting costs, capping the economic component of compensation calculations.
The federal court found the outsourcing move to be illegal because it acted against protections in the Fair Work Act and was in part driven by a desire to avoid industrial action.
Qantas unsuccessfully appealed against the decision to the full bench of the court and later the high court.
About 20 former Qantas workers were in the court room to hear the judgment in Sydney on Monday, where Lee noted the extreme cost of the proceedings and use of court resources.
“Vast legal costs have been expended, and particularly by Qantas, who have retained no less than five senior counsel during the course of the matter and numerous solicitors from one of Australia’s pre-eminent law firms,” Lee said.
Qantas had previously made a provision of $70m in its accounts to meet any liabilities.
Transport Workers’ Union national assistant secretary Nick McIntosh said the total compensation bill would likely exceed $100m.
The union was also seeking penalties to be imposed on Qantas in addition to a compensation payout.
The TWU national secretary, Michael Kaine, said Qantas needed to prove it has “turned over a new leaf”.
“After relentlessly prolonging this case and denying workers justice, Qantas must do everything in its power to ensure appropriate compensation to workers,” Kaine said.
“They should not have to suffer a day longer after the last four years of anguish.”
The Qantas chief executive, Vanessa Hudson, said in a statement the airline would “work to expedite the payments”.
“We sincerely apologise to our former employees who were impacted by this decision and we know that the onus is on Qantas to learn from this,” Hudson said.
“We recognise the emotional and financial impact this has had on these people and their families. We hope that this provides closure to those who have been affected.”
Compensation hearings leading up to the judgment focused on what would have occurred if the illegal outsourcing did not occur.
The court also heard that some of the workers had suffered significant psychological distress after losing their jobs and had to take medication to cope.
Former Qantas worker Damien Pollard said outside court that over the last four years he had taken hundreds of calls from colleagues “that are going through personal problems and mental health issues” caused by Qantas’ actions.
He said the court’s decision “goes some way to facilitating a little bit of recovery from all that and hopefully allowing for us to move on with our lives”.
Australia’s biggest airline emerged from the pandemic disruptions to post record profits but its reputation was tarnished by a string of scandals that precipitated the early retirement of its chief executive Alan Joyce.
This month the federal court approved a regulator-imposed penalty on Qantas of $100m for selling thousands of tickets for already-cancelled flights.
