APA Qantas bidders refuse to guarantee job security

Unions have failed to secure an iron-clad guarantee that jobs will be retained if the $11 billion bid for Qantas succeeds, with Airline Partners Australia telling the unions that it was not prepared to sign a legal agreement protecting jobs as part of the takeover.

The Transport Workers Union launched a campaign on the issue this week, but APA maintains a binding agreement is unnecessary, because unions will retain the existing rights under the new ownership.

In a letter sent to the airline workers yesterday, the consortium said Qantas would continue as one of Australia’s biggest employers.

The letter from spokesman Bob Mansfield said the new owners would continue to uphold the airline’s reputation “as a responsible employer with a track record of jobs growth and career opportunities”.

It also said the consortium strongly supported Qantas’s training program and its status as one of the nation’s biggest employer of apprentices.

The acquisition would have no effect on employee entitlements, existing employee travel benefits or benefits received by former workers.

APA also intended to honour the commitments already made by Qantas management to employees and unions, such as continuing maintenance operations in Australia, with Mr Mansfield telling workers, “Should our offer for Qantas succeed, as Geoff Dixon has previously said, it will be business as usual”.

“We recognise that Qantas has to remain strong and competitive and expand to meet fierce international competition from other airlines, often subsidised by their governments.”

The letter came as APA denied reports it was planning to appoint former Westpac chief Bob Joss and Rothschild Australia Trevor Rowe to the Qantas board, but Mr Mansfield confirmed the consortium was actively looking to appoint three independent directors who were also Australian citizens, adding, “The individuals will be selected based on their standing in the Australian business community and their ability to add value to the Qantas and Airline Partners Australia boards”.  

APA also continues to resist pressure from Treasurer Peter Costello to lodge a formal application under the Foreign Acquisitions and Takeovers Act, because it believes the bid’s structure means it does not trigger the need for formal applications under either the takeovers legislation or the Qantas Sale Act.  Details of the bid have already been provided to Federal Government departments and consortium members have met senior bureaucrats in the lead-up to the release of a bidder’s statement on the $5.60 per share cash bid late this week or early next week. The statement is expected to outline a detailed strategy for the airline’s long-term future as well as its management structure and details on how the bid will be funded.

However, the Government has indicated it expects to place conditions on the deal, with on Friday, Prime Minister John Howard saying that restrictions would be imposed on the location of the company’s headquarters, its operations and its staff.

Report by The Mole