Qantas chief: law change threatens airline

Qantas chief Alan Joyce said Friday proposed legal changes would threaten the Australian firm's viability and cost jobs at the carrier, whose entire fleet he grounded in a shock move last weekend. The airline boss was being grilled by a senate parliamentary committee over proposed changes to the Qantas Sales Act, which seeks to ensure the iconic airline remains Australian-owned and -controlled. The inquiry was called after Qantas announced an Asia-focused restructuring in August, which has led to a bitter industrial dispute that culminated in Joyce ordering all his aircraft out of the skies on Saturday. Qantas services only returned to normal Tuesday after an extraordinary 46-hour shutdown that stranded 70,000 passengers in 22 cities worldwide and threatened to damage Australia's economy. Among the legal proposals, all Qantas subsidiaries and related company entities would need to have their principal operational centre in Australia, with most heavy maintenance conducted on Australian soil. If approved the changes could seriously impact Qantas's plans to start two new Asian airlines in a bid to salvage its sinking international business. "This is protectionism," said Joyce. "If you want to survive and succeed we must be free to pursue global opportunities. The vast majority of our operations are here and always will stay here." Any tightening of the Act would put the business in jeopardy and threaten jobs by locking the company even further inside Australian borders, he said. The government had recently acknowledged that nothing the company was doing contravened the spirit or intent of the current legislation, he added. Last weekend's grounding dramatically escalated a long-running feud with airline unions who oppose the Asia-focused restructuring plans, claiming labour will be outsourced. Joyce Friday took full responsibility for ordering the shutdown, saying it was the only way to bring matters to a head. "That was my decision absolutely," he said, adding that he had "complete operational discretion" but had later called a board meeting which endorsed what he planned to do. After months of industrial action by baggage handlers, ground staff and pilots, he said forward flight bookings had "collapsed" as the market lost confidence in the airline's reliability. "We knew we were losing our customers rapidly. The only alternative to me was to bring it to a head," he said. Early Monday the government's industrial tribunal ordered a halt to the grounding, giving the airline and unions 21 days to settle their dispute or undergo forced arbitration.