Qantas boss Alan Joyce denies he hid his plan to shut down the airline's global operations from the company's shareholders.
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The chief executive also warned a parliamentary committee yesterday against protectionism, saying moves to limit the airline's ability to compete in Asia would cost Australian jobs.
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Qantas, which is embroiled in a heated dispute with its staff over its future structure, held its annual general meeting on Friday last week, a day before Mr Joyce grounded its fleet and locked out 27,000 workers.
The decision affected at least 70,000 passengers worldwide but was lifted two days later, when the workplace watchdog ordered the airline and its unions to end their industrial action.
Mr Joyce told the Senate's transport committee yesterday that Qantas had planned for the possibility of a staff lockout well beforehand as part of its normal risk-management processes, saying ''there's nothing wrong with that''.
But he said he made no decision until the day it was announced.
''The unions believed that the management of the board were going to be rolled by the shareholders at the meeting. At that meeting, we had overwhelming support of the shareholders ... We did think that that would act as a watershed.''
Mr Joyce said that only after shareholders endorsed him and the board did he decide to act.
''And it was only then, when we felt that it [union industrial action] was escalating, and there was talk again of 48-hour strikes, and talk again of this thing lasting for another year, that I decided on Saturday to call a board meeting, and I made the decision to ground the airline.''
He said the board supported his decision unanimously.
The committee is considering two Bills proposed by Independent Senator Nick Xenophon that could hamper Qantas's plans to move parts of its business to Asia.
If passed, the legislation would ensure that foreign staff who work for an Australian airline receive the same pay and conditions as their Australian co-workers. The legislation would also force Qantas to keep its headquarters and most of its maintenance operations in Australia.
Mr Joyce told senators the airline ''proudly calls Australia home and we will always do so''.
But he added, ''If you want to survive and succeed, we must be free to pursue global opportunities.''
He denied giving advance warning of last week's shutdown to any politicians, though he said he had told frontbenchers from both main parties he might ground the fleet ''at short notice''.
Labor senator Doug Cameron accused Mr Joyce of deliberately escalating the dispute with its staff.
He said the airline could have approached Fair Work Australia and asked it to terminate all industrial action without grounding the fleet, on the grounds that the dispute was damaging the national interest.
''You could threaten to do the lockout and the grounding and satisfy [the Fair Work Act] without actually grounding the fleet and having 70,000 Australians and overseas visitors stranded,'' Senator Cameron said.
Mr Joyce said he had been advised that was not possible at the time. He also said Qantas would compensate customers who were inconvenienced ''above and beyond'' what the Australian Competition and Consumer Commission has recommended.
The committee grilled Mr Joyce for almost three hours - twice as long as scheduled - and told him he would be asked to give more evidence at a later date.