ALAN JOYCE: 'If There's Ever A Case For A Pay Freeze, It's Now'

Alan Joyce at the AICC / Business Insider Australia

Qantas boss Alan Joyce has urged workers to support it freezing wages until the company returns to profitability, arguing that the airline faces even worse conditions now than when a precedent was set in 2002.

Qantas workers accepted a 12-month pay freeze in January 2002, as the airline struggled with falling passenger numbers in the wake of the September 11 terrorist attacks. Competitor Ansett went into liquidation shortly afterwards.

The 2002 freeze reportedly saved Qantas $40 million a year. Qantas posted a net profit of $428 million in the 2002 financial year and a before-tax profit of $631 million, exceeding its before-tax target of $550 million.

“The unions agreed back then to do the pay freeze. But interestingly, back then, the company still made money throughout the pay freeze,” Joyce told the Australia-Israel Chamber of Commerce this afternoon.

“This time, it’s very different – we’re actually losing a lot of money.

“So if there’s ever a case for a pay freeze, the case is stronger today than it was in 2002 and that’s what we’re talking to the unions about.”

Qantas last week posted a $252 million half-year, before-tax loss.

Its credit rating was earlier downgraded to “junk” status by Moody’s and Standard & Poor’s.

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