Qantas says it will initially offer voluntary redundancies as it seeks to shed 5000 workers, but unions want greater assurances.
As Virgin Australia announced its own massive loss, more job cuts and changes could still come at Qantas as the airline strives to turnaround its struggling finances.
Qantas has not guaranteed unions the 5000 jobs it will axe within three years will be the only ones to go, while the airline and the federal government warned that industrial action will only make the matter worse.
Qantas chief executive Alan Joyce held talks with unions in Sydney on Friday, a day after the national carrier announced a $252 million half-year loss and details of its $2 billion cost-cutting exercise.
The airline is cutting jobs, freezing wages, retiring old planes, slashing capital spending and ceasing some routes over three years.
But ACTU secretary Dave Oliver says he left the meeting with more questions than when he entered.
“The company was not able to justify how they came up with the 5000-jobs number,” he said.
Following the meeting, Qantas’ domestic chief executive Lyell Strambi indicated the airline has not ruled out further job cuts in the future.
“We refused to make specific guarantees sought by unions on future changes,” he said in a statement.
Mr Joyce cautioned unions against industrial action which he said would only add “oil to the fire” and Employment Minister Eric Abetz said strikes would “make a very, very bad situation for Qantas just so much worse”.
But Mr Oliver said strikes weren’t being considered.
“The unions aren’t pushing for strike action and would rather continue consultation,” Mr Oliver said.
It also was unclear what would happen to the company’s pilots.
“I’m hopeful that we can avoid any compulsory redundancies,” said Qantas pilot Nathan Safe, who is the Australian and International Pilots Association president.
Mr Joyce again called on the federal government and opposition to agree to change the Qantas Sale Act to allow more foreign investment, while he still wants a debt guarantee from Canberra.
But Virgin Australia’s boss John Borghetti blamed Qantas for the air war that has left both airlines bleeding money, and says its rival does not deserve government help.
Virgin announced a first-half net loss of $83.7 million on Friday.
Mr Borghetti said the government or opposition should think very carefully before deciding to pick winners in the industry.
While Virgin Australia says it has no problem with repealing the Qantas Sale Act, any government debt guarantee must be made available to all airlines.
“If Australia is to prosper in the age of globalisation, then the age of entitlement needs to go,” Mr Borghetti said.
“We have had to earn every gain we have made against a dominant player who has not hesitated to use its scale to try to continue its privileged position in the market.”
Qantas dwarfs Virgin, employing more than 32,000 employees to Virgin’s 9500.
Both airlines blame each other for the capacity war, but Mr Borghetti said Qantas had flooded the market with 7.1 million new seats in three years, compared with Virgin’s 2.8 million.
The unions want Qantas to agree to have an independent expert review the company’s operation to see where cuts could be made.
Mr Oliver said the airline disagreed because it already had a number of processes under way.
Qantas declined to agree not to shed workers while it consulted with unions, with more meetings scheduled for next week.
Prime Minister Tony Abbott said the government would do all it could to reduce Qantas’ costs and give it a level-playing field.