Building a stronger Qantas

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Yep, and not forgetting that a lot of employees are actually (indirect) owners of small parts of many companies as well through their invested superannuation, so it is a complicated world!

Certainly.

I guess powerful yet conflicting interests are probably the only way to get any sort of balance. The old M.A.D theory hehe. Once fuel prices rise high enough to stop casual imports being cost effective we'll see the balance shift back in favour of local workforces. Until then I fear, ultimately, if global sized companies want to play hardball they simply shut down local operations and move.
 
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I have to admit, I've never understood this type of thing. I don't mean that I don't agree, or that I do agree, I just don't actually understand. Management says "we want to go this way", and the employees say, "No, we don't want to do that". Hmm. Companies in most of the western democracies are not collectives, I'd have thought that the obvious way for employees who don't agree with their own management to go is out the door and on to a new (and probably better) job ... what am I missing?

I get the social impact, but for-profit companies are not built and run for the benefit of employees ... surely? I'm not trying to be a smartass, and I'm cautious because I know how easy it is to be mistaken in writing posts where so much human interaction is missing.

Companies are run to make money, and more money, and the way to do that is to use the least amount of resources (human and otherwise) possible to generate the greatest return. To argue this point is to argue the whole idea of capitalism as realised in recent times. I'm not sure there is ever a point, in law at least, where we collectively tell a company to stop increasing profit and start running for the benefit of society (which actually sounds like a good idea!!).

Look at banks - some of the lowest paid workers you will find slave away in the bowels of the big banks, this despite staggering profit and year on year growth in that profit. At what point do we decide to nationalise the banks for the good of the working class?

Note that the sterile vision of flesh and blood humans toiling to feed 'the machine' is by no means my own ideal or utopian dream, but it seems to be the reality of accepted capitalism in modern times. To single out single companies for a more socially resposible measure does not seem realistic.

No no, you make good points, I'm happy to respond - I understand your not being a smartarse.

The first thing i'll say is employee's don't decide the companies direction (well the bulk of the work force, obviously the top bosses do) so i'll assume that you meant in regards to pay conditions etc. In Australia we have Industrial Relations laws - sure laws that have been subject to ALOT of change over the last 10 years, but laws never-the-less. The bulk of issues occur around EB's

PAY/EB negotiations:

Even at (my opinion) their worse, workchoices and AWA's, enshrined in legislation, was the fact that employers MUST negotiate. That is, essentially an employer can't say, this is it, if you don't like it eff off. The reason this was even in Howards legislation is because it recognises that the employer will always want whats best for the company - low employee costs. The Employee will always want whats best for the employee - high employee costs.

The answer, in Australia at least, lies somewhere inbetween - that's why we have EB negotiations.

If a company doesn't negotiate, they can be taken to the Fair Pay Commission, who will independently value the work done and make a legally binding assesment. Both sides can loose here, i've seen cases go against Unions and i've seen cases go against Employers.

Now the question is why?

Because any employer worth their salt (or has any business sense), knows that a good employee who is happy, is worth far more than a underpaid employee who isn't happy nor committed to the business. You have less sick leave, higher productivity and generally better results.

What's happening with Qantas though is a different kettle of fish.

Retrenchment/redundency:

Quite often companies will lay off staff. Most don't like to do it for the reasons above, but it is a reality in business. Now I as a person who believes in the Labour Movement (not ALP although I am a member, I mean the worldwide movement that supports the worker) believe that redundencies are a nescessity in good business. Lets face it, they have to happen.

But they should be for the right reasons, not the wrong ones. And when they happen, they should be fair and at the right price. They should also be a last resort as they are not cheap.

So why is the TWU and other unions threatening to take Industrial action over this?

Because the very core function of a union is to protect the masses. That is you pick on one, you pick on all. Solidarity. It's not about holding a company to ransom, or being thugs, it's about getting what is fair for the worker. (i'll admit sometimes it can go too far, but this is the exception, not the rule).

The fact is with the 1000 lay off's there will be sackings. I agree with MileHigh, there will be some VR's, maybe even as much as half, but there will still be people getting sacked. Union members are angry, because it could be one of them, they might be the one laid off.

Now this is where it comes down to the matter of principal. You can either believe an individuals worth, and not worry about others (but when your the one being sacked, dont go looking for support), or you can look at the greater worth of all the employees - we're getting a bit deep now for AFF, but its the very core of what it means to be a member of a union - a united group, fighting to protect the bloke or woman next to them, as much as themselves.

Standing up for your mate - isn't that the real spirit of Australia? Isn't that what made Australia what it is today? (I don't expect an Irishman to get it..)

Company making money:

Your right. A companies job is to make money - after all if QF doesn't make money, then the other 34,000 employees are in serious cough - so its a fine line. But all companies, as a member of society, have an obligation to their employees and the wider community (not in law, but morally) - not to mention its good business practise.

So you're right. Qantas don't have to look after their employee's. They don't have to worry about the social impact of sacking 1000 staff. They certainly don't have to give two flips about what happens here or to those people that are impacted by the decision, but if they are going to call themselves The Spirit of Australia, they damn well should!
 
It will be interesting to see how the International Ops changes affect the market share of the two main airline groups in Australia:

int.jpg
 
Sure. No argument from me. I'm aware of the effect of the industrial revolution and the guilds and unions that struggled to keep some humanity in society for those that actually live in it.

Nevertheless, I can't see what can be done, in a practical sense, without tearing down capitalism as we have come to know it post WWII. There's probably a discussion, and a mighty good one, right there, but in light of this threads discussion, what can be done? Limit company profits by legislation and demand a 'super tax' on any margins above that preset level which then must be fed back in a sort of profit sharing agreement with the employees?

Lets not even get into the Super tax.... aside from the fact mining companies have been lobbying sucessive governments for YEARS to get it... what is better than, you don't make a profit, you don't pay (just like you and I in income tax) - At the moment, mining companies pay royalties, regardless if they make a profit or not!

Its certainly a balancing act, but without interfering in running businesses, essentially government intervention in profit taking and business direction, what can honestly be done?

The theory with a reasonably free and open market place linked with a reasonably democratic and free society is that folk are free to set up socially responsible business models any day of the week. The staff of QF, (as I try to tie into the conversation by a thin thread indeed), could stage an employee/management buyout and run the business to profit and benefit themselves. After all, shareholder (owners) appoint boards who then run companies in any manner they like (within the law).

So here we are, all pondering if pilots are 'worth' 400K a year, and whether its 'right' to sack 1,000 employees when a week later you announce a 250M profit.

My point, I guess, if I even really have one, is that our current model for companies in the west is devoid of empathy and social responsibility (whatever that even means). Boards are appointed, with a legal obligation, not to improve the lot of the employees, but to act in the best interests of the owners, despite how that sometimes seems to pan out for us poor working class (yep, and I'm one of those).

I agree. Companies, especially when they claim to be the spirit of Australia, should be socially responsible.

I don't believe an employee buyout is the answer though - that in essense is Communism, and communism will never work! lol


If, collectively as a country, we don't like this, then politicians and law change is the first port of call in my opinion. Imposing some sort of faux morality on companys who are governed by current corporate law is just screaming at the wind I think.

Ha! I'm glad of the smiley. 'cause I live and work in Australia, and my life work balance is bad :)

Hey, alot of people blame the Government for alot of stuff.

Let's be fair, this is nothing to do with them.

11sjw said:
Qantas doesn't exist to keep your mates employed as much as my company doesn't exist to keep me employed. Redundancy provisions exist so that these people are treated properly.

Imagine myself you say. Been made redundant a couple of times. Always a shock and a P.I.T.B. However life moves on and you get another job.

FYI $250M represents a pretty small % on any measure you care to run over Qantas. It could be severely reduced by another downturn or a decent fuel price hike.

Mate, demonise me as much as you want. Call me a union thug is that makes you happy, but I bet when you got made redundent you were pissed off and wanted an explanation, especially if the company was posting massive profits.

You know damn well what i'm saying and it's nothing like QF is there for the employees. Take your rose coloured glasses off.
 
Hi Really enjoying this discussion

What sort of profits do you consider to be reasonable ? and what would be a reasonable factor to trigger this type of Restructuring givein Qantas in its current position?
 
Hi Really enjoying this discussion

What sort of profits do you consider to be reasonable ? and what would be a reasonable factor to trigger this type of Restructuring givein Qantas in its current position?

If you were an investor what amount would you consider reasonable, considering the risky nature of aviation? Clearly 4% is not good, in fact you could get better than that almost every bank. For me personally if I were to invest in aviation I would be looking at closer to 15-20%, clearly with the knowledge that some years will be worse. If investing in something else without the volatility I would be looking at 10-15%.
 
It will be interesting to see how the International Ops changes affect the market share of the two main airline groups in Australia:

int.jpg

It will be interesting to see the further reduction in OW market share say in a years time (given the VA Announcement today).
 
Mate, demonise me as much as you want. Call me a union thug is that makes you happy, but I bet when you got made redundent you were pissed off and wanted an explanation, especially if the company was posting massive profits.

You know damn well what i'm saying and it's nothing like QF is there for the employees. Take your rose coloured glasses off.

You certainly read plenty into my previous post. I'll assume you've been labelled a union thug in your past which is why you dropped that moniker into your post.

My main points were:
1. $249M is a measly profit (app 3.5-4%, you get better returns in a term deposit). Especially considering it dropped from $240M in the 1st half of the fin year to $9M in the 2nd; and
2. Qantas (like any other company) have no responsibility to keep any person employed. You seem to think that because they made $249M that they shouldn't be looking at ways of improving their balance sheet. Well having come close to making a loss in the 2nd half of the fin year should sound a warning bell to most that something needs to change.

Was I happy when I was made redundant? Truthfully, first time no as I was still reasonably young and didn't have much behind me. Second time I was given a reasonable severance and knew what it was about and enjoyed the break.
 
A lot of comments about qantas being allowed to improve their balance sheet. A couple of numbers in the investor presentation struck me. First 7% revenue increase for QF with a 240% increase in profit. Something like a 19% revenue increase for JQ with a 29% profit increase. If I was only on about balance sheet I'd focus on the area that provides the greatest impact on profit.

I would also look to rapidly turn around a $200 million loss. Just on that another number was the 10% reduction in fuel cost from using the A380. So why are QF sticking with 747s and not trying to get that 10% saving. :confused: 10% of a $3 billion fuel bill must surely help the balance sheet.
 
You certainly read plenty into my previous post. I'll assume you've been labelled a union thug in your past which is why you dropped that moniker into your post.

My main points were:
1. $249M is a measly profit (app 3.5-4%, you get better returns in a term deposit). Especially considering it dropped from $240M in the 1st half of the fin year to $9M in the 2nd; and
2. Qantas (like any other company) have no responsibility to keep any person employed. You seem to think that because they made $249M that they shouldn't be looking at ways of improving their balance sheet. Well having come close to making a loss in the 2nd half of the fin year should sound a warning bell to most that something needs to change.

Was I happy when I was made redundant? Truthfully, first time no as I was still reasonably young and didn't have much behind me. Second time I was given a reasonable severance and knew what it was about and enjoyed the break.

Your missing my point mate.

Some of those 1000 ppl that are going to get laid off, are the same ppl that stuck with QF through the GFC, they are the ppl that took reduced shift, went from 5 days to 3 days, just so they could have a job, do the right thing by the company and now they get the cough.

Actually I take back that you miss the point. You said it yourself -
Second time I was given a reasonable severance
would you be willing to bet your house on it that QF don't try and screw staff on the severence? I wouldn't.

My point is the loss of 1000 "domestic" jobs, when QF is saying its doing well domestically, but bad internationally, is a bit rich.

And yes. I have been called a Union Thug, but I sure fixed up the little prick that said that......

























That was a joke by the way.....
 
And yes. I have been called a Union Thug, but I sure fixed up the little prick that said that......


That was a joke by the way.....

I had to laugh. :D You reminded me of an ex who thought of doing industrial relations. Her dad (miner) asked if she liked carrying a shotgun in the boot of her car.

Anyway it's the QLD Nationals who were the bad ones. My dad (lifetime ALP member) reckoned for years that they killed our dog.
 
I can't see how the business is sustainable when it is paying pilots a package of $325k pa. It just seems way to high for the level of education and skill involved. I know doctors who are on less money than that.
 
I can't see how the business is sustainable when it is paying pilots a package of $325k pa. It just seems way to high for the level of education and skill involved. I know doctors who are on less money than that.

And I know truck drivers that get paid a lot more than that, the comparison is moot, after all I don't know of any doctor role where a mistake could kill 300 people in seconds.

I believe crew costs represent less than 1% of hourly running costs of an aircraft.
 
I can't see how the business is sustainable when it is paying pilots a package of $325k pa. It just seems way to high for the level of education and skill involved. I know doctors who are on less money than that.

You are kidding aren't you? That is for someone with 20 years experience. I know a doctor with that experience who has phone calls with their insurance company about what happens if they earn more than $500k. By the time I have 15 years experience I expect to be on $200k+ with vastly less education than a doctor or pilot. Btw I'm not a Dr
 
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I can't see how the business is sustainable when it is paying pilots a package of $325k pa. It just seems way to high for the level of education and skill involved. I know doctors who are on less money than that.

I don't see how a business is sustainable when it is paying pilots a package of $25k pa. It just seems way to low for the level of education and skill involved. I know people on the dole who are on more money than that... (yes apparently this level of pay happens for FO's on some US Regional airlines)

It seems funny, but education and skill (along with danger) have little bearing on what a persons worth actually it. Basically it's a combination of what people are normally prepared to pay for a task to be completed compared to what people will normally accept as pay for to complete that task.

For example, the amount I get paid there are people who sit at a computer the same as I do and yet earn a quarter of what I do (and doing the same job in some cases) and yet I know that there are people who do a similar job to me and get paid much more than I do. It all comes down to what people are prepared to part with for the work to be completed.

Education \ skills certain reduce the number of people who are capable of doing the work, but again has little bearing on end pay.
 
Is the problem really that pilots are paid to much? or that Qantas like all firms has to adapt and change to accomadate changing consumer needs and a competitive market place? (some of you might disagree with these consumer needs)
 
This thread is going too far and too long. It should be divided into following topics:

1>, Creative Accounting Parctise by QF (Looking into the flaws on the accounting and AJ's statement)
2>, Does AJ present Australian Spirit (Simple answer: NO)
3>, What a hell QF not to use QANTAS name for new not-so-premium Asia airline (Apparently Minority Holding)
4>, Will QF choose KUL or SIN for new hub (Anyone want to put on the book?)
5>, coughking deathStar (No more to be said)
6>, Depressed about QF and its future (really?)
7>, Debate: Will QF follow Ansett (Good point, have a pint of Foster?)
8>, The ultimate choice: V Australia or Qantas (Where is the Spirit?)
9>, Declaration: I am leaving QF (Oh yeah. I see later back in QF forum or QF Club...)
10>, Industrial relation and Qantas (Screw the union)
11>, Is QF pilots worth the pay package? (I am jealous but I try to be cool...)
 
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the comparison is moot, after all I don't know of any doctor role where a mistake could kill 300 people in seconds.

A pilot is not being paid to avoid a mistake... the pilot is being paid to get the plane out of trouble when something unexpected occurs and the computer can't handle it.

A junior doctor working 12-hour emergency room shifts has to see something like 4 patients an hour or something? Each one of those patients is potentially presenting with something unexpected and complicated. There are computers to help... but none that can actually make the final diagnosis (unlike the auto-pilot which quite happily flies the plane most time).

i would sincerely hope a pilot is not dealing with 48 unexplained and unexpected incidents on any given flight...
 
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Lets not even get into the Super tax.... aside from the fact mining companies have been lobbying sucessive governments for YEARS to get it... what is better than, you don't make a profit, you don't pay (just like you and I in income tax) - At the moment, mining companies pay royalties, regardless if they make a profit or not!

Actually looking at the way movie studios apply creative accounting, has any movie actually made a profit in the last 30 years? The only way to be sure that you actually get money from organisations like mining companies is to make them pay royalties.

Good luck to pilots for getting paid well. As I am sure many pilots here can confirm, I believe that many pilots have to pay for their own initial training, therefore no risk to the employer. Get enough experience and then try and get a job with the main air lines. All at the same time continuously passing tests and health checks.

Fail some tests and/or health checks and your career is over. So start again.

Employers seem to be getting meaner and with the union movement in many industries best described as moribund then there is little protection for many workers. Good luck to those of you with strong unions, you've earnt the protection you worked hard for.

I wonder why we forget that unions are merely groups of workers seeking strength in numbers? Yes there have been union excesses just as there have been employer excesses. Bluescope paying bonuses to its executives while the company is going broke is not unique. Indeed it seems to be fairly common.

It is time for some real leadership in Australian industry and rather than complaining that life is too hard and they need government support (i.e. money) we need leaders who can look for opportunities and support their employees and country and of course their share holders.
 
A pilot is not being paid to avoid a mistake... the pilot is being paid to get the plane out of trouble when something unexpected occurs and the computer can't handle it.

The pilot is paid to get the plane loaded with pax and cargo safely from A to B

(unlike the auto-pilot which quite happily flies the plane most time).

I'm pretty sure that JB (and some of the other pilots on this forum) would agree with me here, but no... The autopilot is a aid which assists the pilot in flying the plane. It's used to reduce workload in the coughpit, not to take over the role of the pilot.


i would sincerely hope a pilot is not dealing with 48 unexplained and unexpected incidents on any given flight...
Depending on the length of the flight they could easily have to make 48 different decisions each with possible life \ death consequences if they get it wrong, those are decisions such as "do we fly around this particular cloud or continue through it?" or "is this landing within safe margins or should I abort it and go around?" or "should the seatbelt sign be turned on?". Of course their training means that they will usually make the right decisions which is why planes don't fall out of the sky more oftan.
 
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