Negotiations- Study on Qantas Airline

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Negotiations between Airline Company Qantas and Unions groups, Transport Workers Union (TWU) and Australian and International Pilots Association (AIPA)

Task1

Both Trade unions TWU and AIPA both identify their main Substantive issues as an increase in pay. AIPA negotiate with Qantas over pay, pilots have been offered a 2.5% pay increase. AIPA argues that this increase does not match the inflation rates and in real terms the pilots will be going backwards not forwards. Although AIPA is confident that this is more negotiable. Trade Union TWU representing ground workers, who also are in negotiations with Qantas are fighting for a pay rise of 5% pay rise per annum. Qantas stated that this offer is negotiable and they were willing to come to some agreement. Qantas offered a 3% wage increase per annum and an additional 1% for employees in higher tier jobs. This offer was for possibly 3 or 4 years. Another Substantive Issue involved in the Qantas negotiations, TWU are demanding that employees have job security. Not only job security but protection for existing employees terms and conditions. TWU claim that base rate 38,000, overtime, and penalty dependant work has been undermined by contracting out over the past 18 months. Qantas in its October 2011 offer said that no Qantas employee would be made redundant due to the use of contractors, and that any contractors would have to have an agreement with TWU. In October 2011, TWU had a big breakthrough in negotiations when Qantas made a statement that they do not outsource and had no intention to Outsource. Although this statement was made the company and the unions still went into arbitration. AIPA are concentrating their time and efforts upon one of the main substantive issues of outsourcing. Seeking a new clause in the agreements they want all Qantas flight codes QF to be operated by Qantas Pilots not outsourced alternatives. Qantas management and AIPA unable to reach any agreement the only action possible is that Fair Work Australia (FWA) will resolve the dispute through arbitration. The Ground workers and Pilots have subsidiary issues also. AIPA are also interested in trying to obtain the maximum work hours allowed by Australian safety regulations. Which haven’t been offered due to management not roistering them properly. This was under negotiations with Qantas. Trade union TWU also wants protection for Qantas employees in the terms of safety and training. TWU want Qantas to solve long-standing aviation security issues and lack of safety protocols. As agreements were put at a standstill FWA stepped in and published a fair work agreement, which states that safety, and training is mandatory and that tanning must be provided to TWU members.

Task 2

(Andreas et al 2010, P.563)
As suggested in the table above ‘Typology of Negotiating Tactics’ both Qantas and the Unions fit into these categories at the beginning of the negotiation. Qantas displays ‘Hard bargaining’ tactics as throughout the negotiation process Qantas doesn’t agree to any demands from the unions and refuses to negotiate on certain issues. Qantas uses environmental and economical information to back-up their reasoning. Whilst Qantas stands firm ground the unions make efforts to negotiate terms with them regarding pay and job security. You could say that the union use more of a ‘soft bargaining’ tactic. When a 5% wage increase was proposed and Qantas made a much less attractable offer, TWU said that the offer was negotiable. In light of these tactics the union can see that a change in tactic was needed to get the negotiation to work in their favour. Trade Union TWU uses a ‘Hard-ball’ tactic, by adding pressure to Qantas through threats of strikes. This tactic was used due to the demands of the Union were not being met. This tactic had to be followed out, as empty threats would have strengthened Qantas. These strikes were followed out. The response to the strikes were damaging not only to the company’s...
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