Federal Court picks up torch in Qantas' stand-down test case

The Federal Court will decide whether Qantas and Jetstar illegally stood down engineers during the COVID-19 pandemic in a case that could have widespread ramifications for companies across the country.

Granting the airlines interlocutory relief from having the matter heard in the Fair Work Commission, the court last week took over the case due to jurisdictional concerns and its broader ramifications.

Justice Anna Katzmann noted the stand-down clauses in the industrial agreements that the Qantas Group relied on for its decisions would be similar to those used at other businesses.

"While there is no evidence about the stand-down clauses in any other enterprise agreement, it is more than likely they are similar in terms," she said.

"As the Airlines submitted, most stand-down provisions in enterprise agreements have common historical roots and use common language.

"It is in the interests of justice that questions of such general and widespread application and importance be determined by a superior court and not left to private arbitration."

Qantas has stood down more than 20,000 employees without pay across its operations during the coronavirus crisis, including two-thirds of its mainline licensed engineers and 70 per cent of Jetstar's licensed engineers.

However, Justice Katzmann pointed out that several other businesses had taken the same route.

Under the Fair Work Act, employers can stand down staff without pay only if there is a stoppage of work for which the employer cannot reasonably be held responsible and as a result staff cannot be usefully employed.

Some lawyers have argued businesses cannot stand down workers if they close shop during a trade slump, as the employer would have caused the interruption in work even if the closure is an indirect consequence of the pandemic.

But the provision is mostly untested, and previous stand-down challenges by the education union during the crisis have resulted in schools reinstating employees rather than risk a ruling.

RMIT University professor Anthony Forsyth said while many employers, such as cafes, restaurants and cinemas, would have made out their case, others were in a grey area.

"If the Federal Court finds that Qantas has stood down more engineers than it was lawfully able to, that could open up other groups of workers contesting the basis for their stand-downs too – possibly resulting in back pay," he said

Qantas, for its part, reckons rival airline Virgin Australia would also be affected by the Federal Court ruling. Others believed to be at risk are casino operator Star Entertainment, retailer Premier Investments and travel agency Flight Centre. All have stood down thousands of staff.

Professor Forsyth said challenges were likely in unionised sectors "and the fact that few unions have been contesting stand-downs to date makes it even less likely".

Employers receiving JobKeeper are also able to use enhanced powers to stand down staff under changes brought in with the scheme.

ALAEA takes the fight to Qantas

Qantas Group engineers, represented by the Australian Licensed Aircraft Engineers Association, argue there is work for them in routine and non-routine aircraft maintenance.

They say heavy maintenance, time-deferred deft repairs and corrosion repair work are also available.

The ALAEA further argues that the stoppage of work was in Qantas' control, saying stand-downs are a cause of last resort and not available as a response to an economic downturn.

It initially took the case to the Fair Work Commission, but Qantas challenged the ability of the commission to hear the matter.

Qantas said the ALAEA did not take steps to resolve the dispute with supervisors or senior management, which the union is required to under the industrial agreement before elevating it to the FWC.

Justice Katzmann agreed. "I am satisfied that the Airlines have made out their case for interlocutory relief," she said.

But ALAEA federal secretary Steve Purvinas was unconcerned. "The ALAEA does not care which court hears our case. Our prime concern is having it heard promptly," he said.

Qantas said there was only enough work for the 1000 engineers it kept on during the coronavirus crisis. The remaining engineers are working on the 220 planes the airline grounded in response to the pandemic and others that are still operational.

"Due to circumstances out of everyone's control, there is no work for the vast majority of our employees to do," a Qantas spokesman said. "It's unfortunate that we need to divert resources to make this point in court."

A case management hearing will take place on Thursday.