Australian airline Qantas has lost its High Court appeal against a ruling that found it had illegally outsourced 1,700 ground handling workers in 2020 during the Covid-19 pandemic.

The High Court of Australia unanimously dismissed the appeal, upholding the original full Federal Court ruling from July 2021, which said that, while the airline had valid commercial reasons for making the decision to outsource the work, it had not managed to prove there were no other unlawful reasons for the action, namely to prevent industrial action from workers.

This decision meant that Qantas had breached Australia’s Fair Work Act according to Federal Court judge Justice Michael Lee. 

Though former Qantas CEO Alan Joyce has already brought forward his retirement following weeks of controversy for the company, the Transport Workers Union (TWU), who brought the case against Qantas, has now called for the replacement of the entire company board following the ruling. 

TWU National Secretary Michael Kaine said the company needed a “fresh start”, saying that “the final act of this board should be to strip Alan Joyce of his bonuses and follow him out the door. 

“The Joyce regime has been toppled, but the airline cannot achieve the reset necessary for its survival under the same board that resided over the largest case of illegal sackings in Australian corporate history. Richard Goyder cannot make it through another day as chair.” 

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The loss is the latest in a number of troubles for Qantas in recent months, including further court action from the Australian Competition and Consumer Commission which alleges that the airline sold tickets for thousands of flights that had already been cancelled between May and July 2022. 

In response to the High Court’s ruling, Qantas said: “The decision to outsource the remainder of the airline’s ground handling function was made in August 2020, when borders were closed, lockdowns were in place and no COVID vaccine existed. 

“The likelihood of a years-long crisis led Qantas to restructure its business to improve its ability to survive and ultimately recover. As we have said from the beginning, we deeply regret the personal impact the outsourcing decision had on all those affected and we sincerely apologise for that.”

Though the airline has already persuaded the Federal Court to rule out the reinstatement of workers, it will now consider penalties for the breach and possible compensation for the affected employees. 

The TWU also claims that following the sackings, complaints about Qantas’ services increased by 70% in 2022, with a focus on high cancellations, delays and lost baggage. 

Kaine said that new CEO Vanessa Hudson should apologise to the affected workers, saying all eyes would be on her as she attempts to fix the airline’s reputation. 

He said: “Hudson must reverse the destructive business model at Qantas that has exploited or attempted to manufacture loopholes to axe and outsource essential workers to 38 different entities. These actions have destroyed the airline and its reputation.”