The Crest of the Commonwealth of Australia Treasury Portfolio Ministers
Picture of Bill Shorten

Bill Shorten

Assistant Treasurer and Minister for Financial Services & Superannuation

14 September 2010 - 14 December 2011

Transcript of 31/10/2011

NO.016

Interview with Ali Moore

ABC Lateline

31 October 2011

SUBJECTS: Qantas

ALI MOORE, PRESENTER:

A short time ago I was joined by Assistant Treasurer Bill Shorten, who sat through the Fair Work Australia hearing over the weekend. He was in our Parliament House studio. Bill Shorten, I know it was a long night last night, so many thanks for joining Lateline.

BILL SHORTEN, ASSISTANT TREASURER:

It's my pleasure, Ali.

ALI MOORE:

Alan Joyce says he had no other option under the Fair Work Act other than the option that he took. You've said repeatedly he did have other options. What were they?

BILL SHORTEN:

Well let's be clear here: what the Government wants is for the flying public to be able to fly, for the economy to be able to function. That's our agenda. We're not interested in picking sides in this argument.

But when I have a look at what happened on Saturday and the grounding of the whole Qantas fleet, the stranding of tens of thousands of passengers, you've got to ask yourself: surely there was a better way to do business than this.

I sat through 12 hours of evidence by Qantas and the other parties, the unions, with the Government on - on behalf of the Government last night and throughout yesterday, and what the Qantas proposition was in essence was that, "We're a large company, but we can't convince some of our employees to agree to the changes we want, so therefore because we can't convince them, we'll damage the economy and we'll go to arbitration." I don't think that that was the only course of action.

ALI MOORE:

But in fact they didn't go to arbitration; you went to arbitration. What they did was ground the airline and threaten to lock out their employees. So what did you see as their other courses of action, potential courses of action, if they felt, as they obviously did, that they were getting nowhere with negotiations?

BILL SHORTEN:

Well, one, the first course of action is you run your company. When you're a sophisticated business - and Qantas is sophisticated - when you have many, many smart leaders in that corporation - and I know a lot of them personally and they are smart - I just can't believe that it's not possible to help lead your employees on a path of change.

Qantas workers are smart; they understand the issues of the international aviation industry. They understand the cost bases. A lot of these people absolutely love the fact they work for the Qantas airline.

I - the first step therefore in answer to your question is I find it hard to believe that a modern large company, publicly listed, doesn't have the capacity to work with intelligent people.

ALI MOORE:

Well that aside, Bill Shorten, clearly they believed they couldn't and they wanted to I suppose force the issue and certainly create a situation where there was going to be a timetable for negotiations. So, under those conditions, from their point of view, what else could they have done? Is the argument that they should've gone to Fair Work Australia?

BILL SHORTEN:

But Ali, this is - and I guess I'm being - taking too long to get to the point and I know that's annoying. But what I'm trying to do here is explain the time you start negotiating change in a business isn't when an enterprise agreement expires. It's the day after you commence the three years of the previous agreement.

Qantas has had 1,150 days to persuade some of their workforce, who are intelligent, educated, dedicated professionals, that things need to be done differently.

ALI MOORE:

Are they the sort of options you're talking about, when you say they had other options? Is that ...

BILL SHORTEN:

Not just that, but I don't - I think that Qantas - and I listened to 12 hours of evidence. I've done a thousand enterprise agreements. I've seen change occur in big companies and little companies in Australia.

The first point is: Qantas hasn't in my opinion done the homework to convince its workforce that the direction it's taking is in the best interests of the employees.

ALI MOORE:

That's your opinion though and clearly it's not the opinion of management. So my question to you is: if you argue they had other options now on the table with the position they're currently in, what were they?

BILL SHORTEN:

Well they could've looked at Section 240 of the Fair Work Act, which allows if parties consent to go to arbitration. They also had Section 424 of the Act themselves, where any party to a negotiation, if they feel that the action's causing damage, great damage, significant damage, that they can take this action and seek termination of the bargaining period.

Other companies ...

ALI MOORE:

Do you believe they would've been able to approve significant damage prior to grounding the airline? Would they have had that threshold met?

BILL SHORTEN:

Let's be clear: I would rather try that than strand 100,000 passengers and cause damage to the economy. Don't - when you run an airline and a corporation, it's not just the shareholders who matter and it's not just even the employees; there's the customers.

Companies operate in Australia and we're very lucky to have a very successful private sector in Australia. But companies don't operate with a licence independent of the society they work in. I would've thought there's an obligation to try and work through these processes - as I said, one, for three years before it gets to this; two, using all means that you have available before you take industrial action as a last resort.

I was brought up in the old school where industrial action is the last resort. Qantas took industrial action and they affected all their clients and customers. I just think there's a smarter way to do things.

ALI MOORE:

Well of course Qantas is not here to answer, but their argument is that industrial action and the threat thereof was hurting their business. But let me ask you: the Transport Workers Union for one is considering a possible legal action on this ban to all industrial action for the next 21 days. Is there any grounds for legal action, as you understand it, to this Fair Work arbitration decision?

BILL SHORTEN:

Well, let me be clear: what we're interested in is the economy and the passengers and the aviation industry and tourism and mining. We believe that Qantas and the unions involved should get on with negotiating and not focus on what their legal or industrial remedies are and focus on finding a settlement.

I think - and I know that the individuals in this workforce, the humble, you know, baggage ramp attendants, the caterers, the flying crews, the licensed engineers, they're focusing on getting the planes in the air. I think that what people want from both the unions and management is leadership. Not conflict, but leadership.

ALI MOORE:

And if it doesn't go well, if it does end up with binding arbitration, will Fair Work Australia be able to adjudicate on all the issues on the table? We've heard tonight suggestions that the power of arbitration may be limited. Is it limited?

BILL SHORTEN:

There are some matters I suppose which can't be included in arbitration. I'm not privy to all the details of all the negotiations. Like most Australians, I was surprised when Qantas took de facto strike action against its workforce and its customers on Saturday.

I - but I tell you what, I do know some of the negotiators of Qantas on both sides of this issue. They are smart enough to fix this issue and they also understand what's at stake. We trust, the Government trusts that the parties involved, the leadership of the company, the leadership of the unions to focus on an outcome which achieves mutuality of outcome for employer and employee. This is a completely fixable issue.

ALI MOORE:

Clearly they've been having trouble fixing it to date though.

BILL SHORTEN:

That's true.

ALI MOORE:

There has been a lot of discussions today about the fact that the Government referred to this Fair Work Australia and didn't use the clause that was available to you for a ministerial determination.

Now that clause has been - it's never been used and it's in legislation and the Prime Minister says that had you deployed it, you would've ended up in a world of legal uncertainty. I guess it raises the question that any industrial relations crisis that would require that clause to be implemented would be time-sensitive, so given that you need a situation where you could have this clause tested so you don't end up in a world of legal uncertainty, why have the clause in the first place?

BILL SHORTEN:

Well, my question is: why have the lockout in the first place? There's been a bit of a ...

ALI MOORE:

No, but I'm going now to the heart of the Fair Work legislation and the clauses available to you.

BILL SHORTEN:

Well, but - OK, and I'll do that, but I'm going to the heart of what makes good industrial relations in Australia. Good industrial relations in Australia - I know what I'm talking about, I've done it for 15 years myself - it involves leadership from both sides.

In terms of which clause was the right clause, the Government took timely action. We were notified after 2pm that the fleet was grounded by five o'clock. The Prime Minister didn't waste any time.

You have a look at the various sections. You pick the best section. That doesn't mean other sections are bad sections. That doesn't mean because you go down one path, you immediately rip up the other path. But we took them on the best advice available with absolutely no notice. We achieved the outcome, which has got the planes flying again.

ALI MOORE:

Let me ask you though: do you worry that this could set a precedent? Unions take industrial action, companies threaten to shut down their business to end that action. I guess it's notable in that context that Alan Joyce says he's had a letter of support from virtually every major CEO in the country.

BILL SHORTEN:

Do you think? I don't think every company in Australia is happy with what happened. I'm sure - I don't believe that what we've seen Qantas do will be a major precedent for some sort of new wave of radical employer militancy. I think that a lot of people will have a look at this and have a bit of a reaction after a cyclone's been through and gone, "My goodness, what just happened?" You know, some people ...

ALI MOORE:

Do you think Alan Joyce is a liar?

BILL SHORTEN:

Oh, I'm not going to start casting aspersions on him. Absolutely not. I'll tell you another thing about industrial relations: you start getting personal, you never get back on to the main issues.

ALI MOORE:

We are almost out of time, but I do want to ask you one last question because one of the complaints about Qantas was the lack of forewarning that this was the action they were going to take.

Under the Act as I read it, employees have to give three days' notice, 72 hours, of any industrial action. Employers don't have the same requirement for advance warning; they simply have to give written notification. Is that a loophole in the Act that needs to close?

BILL SHORTEN:

No, I think what we need to have here is better leadership in terms of industrial relations.

ALI MOORE:

But why the differentiation? Why should employers and employees be treated differently?

BILL SHORTEN:

Historically the system was that employers could lock you out if there was industrial action already underway. If the employer wanted to lock you out and there was no industrial action then they would have to give 72 hours' notice.

But - so in fact the system has some consistency to it. My point though is - and no-one's saying Qantas didn't have the right to take industrial action. My point is one - if you're a smart, big global company, you're probably smart enough to work with your employees.

Two - where there is intransigence and you feel you can't get anywhere, there's plenty of people around willing to help. Three - if you're going to take the sort of radical, extreme action of grounding half the planes in Australia, I think you should give people some notice.

And the other reason Qantas said that they didn't want to give notice is because they were worried that some of their staff would sabotage the planes. I think that is a dreadful statement and I don't think that's borne out by the dedication of 34,000 Qantas employees.

ALI MOORE:

Bill Shorten, many thanks for joining Lateline tonight.

BILL SHORTEN:

Thanks, Ali.