Statement on Australian Airlines FAAA

SYDNEY, 14 January 2005

Australian Airlines said today it would not negotiate any further with the Flight Attendants Association of Australia (FAAA) International Division on a new enterprise agreement until the union withdrew its threat to take industrial action.

Qantas Executive General Manager People, Kevin Brown, said: "The claim by the union for a 17 per cent wage increase cannot be taken seriously and is completely out of step with conditions in the airline industry, where many major carriers are agreeing wage reductions with their staff.

"Both the claim and the threat to take strike action are highly irresponsible in an industry that is still reeling from repeated international shocks.

"Australian Airlines is a small leisure based carrier that faces significant commercial challenges. It is only marginally profitable and the claims being pursued by the union are simply undeliverable."

Mr Brown said Qantas understood that the union had also applied for conciliation by the Australian Industrial Relations Commission. This would provide an opportunity for Australian Airlines to outline to the Commission the fair and comprehensive offer Australian Airlines had made to its cabin crew. This offer included wage increases of three per cent a year for three years and other benefits.

"Australian Airlines has asked the union to agree to lift the current restriction in the EBA on flying to destinations with a time zone change of more than four hours from eastern standard time.

"While there are no current plans to use this change, with the EBA running for three years, we must be in a position to take advantage of new market opportunities that may arise.

"Such opportunities are the way for crew to ensure a more secure future for themselves and the airline. By using this change as a bargaining chip the union is simply limiting opportunities for Australian Airlines to grow and succeed."

Mr Brown also said Australian Airlines would not be increasing its offer for wage rises or doing anything else that undermined the airline's future as a viable international leisure carrier.

"In the meantime, we will be taking steps to ensure that our passengers' travel plans are not disrupted," Mr Brown said.

Australian Airlines is a Cairns based airline, with five aircraft and 450 staff, including 320 cabin crew.

Issued by Qantas Corporate Communication (3200)