Australia’s government via Fair Work Australia has ended the QANTAS lockout and ended the work actions being done by QANTAS’ unions and made everyone go back to work.   The parties involved will be engaged in intensive negotiations for about a month and if no agreement(s) are reached, then the parties will go to binding arbitration.

As you can imagine, both sides are claiming wins.  Both obviously have good reason to spin this in their favor.  While I don’t think the unions got off completely from being scolded, it was fairly obvious that the current government of Australia was highly unamused by QANTAS’ actions.

QANTAS forced a very hot potato onto the government’s hands and its not very wise to cause politicians to feel that pain as they tend to remember it as they settle things you  forced onto them.  It’s clear the government felt that QANTAS’ actions were a bit premature to say the least.

QANTAS is now forced into a situation where they have to hope that the worst outcome is that binding arbitration results in no change in the status quo in terms of labor agreements but which removes the work actions being taken by the unions.  Because the really bad outcome is binding arbitration finding in favor of the employees and causing new contracts to be done where QANTAS finds jobs and wages even more protected than before. 

Consider that the current government of Australia is the equivalent of a very liberal Democrat administration here and you see where things might get a bit dicey.  In fact, consider that the current Prime Minister of Australia is closer to Congresswoman Nancy Pelosi than President Obama in terms of liberalness.  Now you get the picture.

I don’t see QANTAS getting what they hope for and I do think that Alan Joyce has now earned the ire of travelers, the general public of Australia (because it is hard for people to understand such actions when the airline is earning a profit) and the great ire of very liberal (worker oriented) politicians. 

So, was this the right move for QANTAS to make?  I honestly don’t think so.  I think QANTAS has a legitimate point about labor costs and clearly QANTAS employees are some of the best paid in the world industry.  But the point would have been far better made in a nuanced manner as opposed to acting like a genuine do or die crisis was taking place.  I’ve said it before and I’ll say it again:  Airlines are horrificially bad at politics and QANTAS is no exception.

The problem with this ploy is that QANTAS has now got no “friends” in this fight and making a nuanced argument for cost controls will be 10 times more difficult than just a week ago.  Now they have to fight a public relations battle on multiple fronts and those are always hard to win no matter how much “right” is on your side.

This is where I admire Willie Walsh more.  He was stubborn and he made a point over and over again in his fight with Unite.  Even then, I think that Willie Walsh got a bit emotional about the fight at one point and hurt his chances at concluding the problems at a few points of time.  That said, Willie Walsh laid out his argument better, made his nuanced points in the press patiently and with care and never once shut down his airline.  To the contrary, he made contingency plans to keep doing business through Unite strikes and managed to keep customers happy (or at least interested in remaining loyal to BA) and did not earn the enmity of politicians while doing it. 

I continue to believe that for real resolution and practical change when it comes to costs at QANTAS, Alan Joyce will have to depart and more moderate, less dramatic person will have to take over to try to steer that airline’s course in a better direction. 

You have to believe that former QANTAS executive, John Borghetti of Virgin Australia has got to be enjoying this show immensely.

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