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Qantas CEO ordered into mediation with union to decide compensation for sacked workers

A federal court judge has ordered the new Qantas chief executive, Vanessa Hudson, to attend mediation proceedings with a union chief to settle compensation and penalty claims, with the bill for illegally outsourcing 1,700 workers potentially running into the hundreds of millions of dollars.

On Wednesday, legal representatives for Qantas and the Transport Workers’ Union (TWU) told the federal court they were open to a mediation process to settle the final compensation stemming from their long-running legal battle. The airline ultimately lost the case last week when the high court unanimously upheld a full federal court decision for laying off staff at 10 airports in November 2020.

In July 2021 the federal court ruled Qantas’s outsourcing of the workers was in part driven by a desire to avoid industrial action, which is a breach of the Fair Work Act.

It is understood that compensation and penalties could enter the hundreds of millions.

On Wednesday, Justice Michael Lee said he was hopeful the parties – who have maintained a combative relationship during the tenure of former Qantas CEO Alan Joyce – could now “resolve their differences” at mediation.

Lee said he wanted Hudson and the TWU national secretary, Michael Kaine, to attend mediation proceedings with lawyers. Lee was open to the union’s request for two affected former employees to also be present at the hearings.

“I have a very strong view about the need for people to be invested in this process at the highest levels … [for] persons with authority to settle the claim of statutory compensation on behalf of all parties, including the secretary of the applicant (Kaine) and the chief executive officer of the first respondent, Ms Hudson,” Lee said.

Richard Dalton KC, representing Qantas, said the orders “should not specifically require the attendance” of Hudson. He asked if Andrew Finch, Qantas group’s general counsel and company secretary, could attend instead.

Lee responded: “I don’t want it to be attended to by a lawyer. I want the chief executive officer to be present together with the person leading the union to be there.”

Lee said requiring Hudson and Kaine to discuss the matter was appropriate “to maximise the prospects of the settlement”.

Mark Gibian SC, representing the TWU, said the union wanted an open court process to determine compensation so it was a transparent process for affected employees, but noted mediation would be less costly and require less resources.

Gibian said the mediation process should deal with compensation for workers and penalties for Qantas separately. “We don’t wish there to be any perception that the resolution of one will be traded off as the resolution of another.”

Richard Dalton KC, representing Qantas, said he believed compensation and penalties could be negotiated together.

Lee ordered that lawyers from each side attend a directions hearing on Monday to determine the mediation process.

If mediation fails, proceedings will continue in the federal court.

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