Qantas Management Cleanout

More management jobs to go at Qantas
Matt O'SullivanMarch 26, 2009
QANTAS will make further cuts to lower management ranks within the coming months, once it completes the axing of 90 senior management roles.
The confirmation yesterday that it will slash its senior management team by 20 per cent is also expected to give the company an upper hand in negotiations with staff and unions about further cost-cutting.
The latest management changes are part of plans by the chief executive, Alan Joyce, to operate the company under four core businesses: the Qantas airline, Jetstar, Frequent Flyer and Freight. Under his predecessor, the group operated under stand-alone businesses that had their own corporate centres.
But it leaves unchanged the top tier of senior executives Mr Joyce has corralled since before he took over last November. The commercial side of the business falls under the auspices of John Borghetti while the operational area is the domain of Lyell Strambi. A Coca-Cola Amatil executive, John Scriven, will take over as the human relations boss on April 6.
The latest management cuts will save the airline up to $24 million a year. Qantas tapped 68 senior managers yesterday after earlier making 10 people redundant. The remaining 12 managers will be offered new positions within the group.
Asked whether the changes would lead to further job cuts, the corporate affairs chief, David Epstein, said the airline anticipated "further consequential changes" to other layers of management but "how they will work out is yet to be determined".
Qantas has been seeking to slash costs in recent months in a desperate bid to offset a slump in demand. Last month it axed loss-making routes to China and direct flights to India, as well as handing over domestic services in New Zealand to its low-cost subsidiary, Jetstar.
Qantas also laid off 1500 workers late last year and shelved plans to hire 1200 staff in response to the weakening passenger demand.
The International Air Transport Association's latest forecast says airlines around the world to post losses of $US4.7 billion ($6.7 billion) this year because of the global slowdown.
Virgin Blue has also shed up to 400 staff and grounded five aircraft while Air New Zealand made 200 full-time workers redundant late last year.
An industry insider said the cuts to Qantas management would give Mr Joyce a way to restart negotiations with unions about lowering labour costs. "It potentially gives him more room to manoeuvre with the Qantas staff if the global market continues to get worse," he said.
But a union spokeswoman, Linda White, said there would be significant resistance from workers to any attempts to cut costs further at Qantas.
Qantas shares fell 1c to $1.745 yesterday, taking the decline so far this year to 33 per cent.