Qantas staff land $ 90m pay bonus
QANTAS is sharing the spoils of its estimated $ 1.6 billion turnaround by paying $ 90 million in bonuses to staff who’ve taken an 18- month pay freeze.
The airline will gift a one- off payment to up to 28,000 staff, equal to 5 per cent of their salary, in recognition of the significant improvement in its fortunes.
Qantas is spending about $ 90 million on the bonuses, which equates to an average of $ 3200 per employee.
The payment will initially only be available to the 7000 staff who have so far agreed to the 18- month wage freeze in their enterprise bargaining agreement, with the re- mainder to receive the bonus when they move onto a new EBA within the next two years.
Analysts say Qantas is on track to post an almost $ 1 billion pre- tax profit for the 2014/ 15 financial year, a huge turnaround from its record $ 646 million underlying loss in the prior year. The improvement is due in part to efforts to strip $ 2 billion from the airline’s costs, but also lower fuel prices and the end of its battle for market share with Virgin Australia.
Chief executive Alan Joyce said wage freeze agreements had helped Qantas carve out $ 875 million worth of benefits in the past year.
“This has only been possible be- cause of the contribution by our people,” he said in a note to staff.
“Key to this has been our wage freeze policy that has made us more competitive and sustainable.”
Transport Workers Union secretary Tony Sheldon welcomed the bonuses, but said Qantas did not deserve any credit for generosity.
“The company has used the money that they’ve taken off the employees to turn around and pay it back to them and say they’re Father Christmas,” he said.
“Well Scrooge is alive and kicking.”
He also hit out at the airline for increasingly favouring part- time workers, claiming many of the union’s members were not paid enough to provide for their families and were living below the poverty line.
BT Investment Management analyst Sondal Bensan said the bonus payment was a sensible move, given the airline’s turnaround. But the dramatic improvement in profitability doesn’t mean Qantas should stop pressing ahead with a wage freeze for remaining employees, he said.
“You’ve got to remember these businesses are still cyclical and things can turn down as well as up and you have to align your business and your cost base for that,” Mr Bensan said.