Due to domestic coronavirus border closures, over 2,500 Qantas and Jetstar staff will be laid off for two months, a move that unions have criticized for coming just one day after the government announced a wage assistance package.
Domestic pilots, cabin crew, and airport personnel, predominantly in New South Wales, will be stood down but will not lose their employment.
Due to the knock-on effects of greater Sydney's protracted Covid-19 crisis and lockdown, Qantas CEO Alan Joyce anticipates borders to be closed for at least two more months.
Employees who are laid off will be given two weeks' notice and will be paid until the middle of August.
The news comes just a day after the Morrison government announced a $100 million scheme to help domestic airlines keep their employees during lockdowns and border closures.
Domestic airlines can claim $750 per week for half of their aircrew provided they can show a 30% drop in business since Sydney was declared a national hotspot and was unable to retrench staff under the government plan.
The dual programs mean that the 2,500 Qantas employees in domestic operations and 6,000 in overseas operations who have been laid off would receive varying degrees of help from either Covid catastrophe payouts or the new program, according to Joyce.
Engineers would not be stood down because they are needed for jet maintenance, but he did admit that outsourced ground personnel would not be eligible for the compensation - just days after a federal court ruled against Qantas outsourcing being allowed.
“This is clearly the last thing we want to do,” Joyce said on Tuesday, “but we're now facing an extended period of reduced flying, which means no work for a number of our people.”
Despite missed flights, Qantas has "absorbed a significant amount of cost" as a result of the lockdowns, he added, by continuing to pay personnel their full rosters.
“Fortunately, we know that once borders reopen, people will want to travel, and flying will return quickly, so we can get our employees back to work.”
Joyce defended standing down the personnel at a press conference later Tuesday morning, citing the enormous government backing it has received throughout the pandemic, which is on course to cost $2 billion.
Joyce called the manner government assistance was reported "misleading," explaining that the majority of it came through job keeper payments, repatriation flights, and continuous freight – services that "benefit the economy," he added.
He repeated that the airline was still working on its vaccination pass and that it planned to reward customers with frequent flyer miles and prizes if they got vaccinated.
However, Joyce admitted that there was no assurance that foreign flights would restart by December as planned.
The Qantas decision has enraged unions. The Transport Workers' Union claimed in a tweet that the timing of the government's wage subsidy and Qantas' announcement on Tuesday suggested the package was "tailored" for the airline.
The union declared, "This is the Republic of Qantas."
In May, Qantas had about 100% of its normal domestic flights operational, but by July, it had dropped to fewer than 40%.
More than 20,000 people were laid off at this time last year.
