Australian Shareholders to Question Qantas Chief Executive’s Pay Raise

Qantas is expecting another day of turbulence as it canceled 18 flights and delayed 32 more due to a schedule engineers strike.

However, while job walk-offs have become a regular event the past few weeks as unions seek higher pay and better work conditions, a large battle looms ahead in the boardroom. The Australian Shareholders' Association (ASA) is not happy about another round of salary increase for Qantas Chief Executive Alan Joyce.

Mr Joyce is scheduled to get a 71 per cent salary adjustment which will boost his yearly compensation to $5 million, ABC News reports.

It seems that shareholders also have an axe to grind against Mr Joyce because they have not received a dividend in the past two years and share price is at historical lows.

The shareholders will share their concern at the yearly general meeting about Mr Joyce's pay amid complaints of Qantas workers that their salaries are not keeping up with the inflation rate. They are also expected to express their thoughts about the impact of the ongoing labor dispute which is damaging the Qantas brand.

The engineers, besides striking, are planning to file a lawsuit against Qantas. Members of the Australian Licensed Aircraft Engineers Association (ALAEA) and Qantas management will have a hearing at Fair Work in the morning. The ALAEA has accused the air carrier of leaking details of negotiations over an employees' deal.

The four hours of strike scheduled in the afternoon after the Fair Work hearing is expected to disrupt travel plans of about 7,000 Qantas passengers. The engineers are seeking a 15 per cent wage increase.

Ahead of more work stoppages being planned by the ALAEA, the Transport Workers Union (TWU) and pilots' union, Qantas announced it would ground five planes from and reducing 97 domestic flights beginning Monday because of a maintenance backlog due to the engineers' strikes.

Qantas group executive Olivia Wirth admitted that the engineers' strike is taking its toll on Qantas's operations since the job walk-offs have resulted in lack of enough man hours to maintain the air carrier's fleet.

"Well unfortunately it's getting worse, not better," Ms Wirth told The Sydney Morning Herald.

Since the TWU has warned that the industrial action could last until Christmas and has even urged air travelers to buy their tickets from other airlines if they do not want their yearend holiday plans disrupted, Qantas admitted the current labor row could be worse than the 1998 strikes.

"We will be voting against the remuneration report and we will be voting against one of the directors. As member of the remuneration committee, Richard Goodmanson, presided over effectively $22 million worth of payments to Geoff Dickson in 2008 and 2009 on the basis that Qantas's international operations were profitable," ABC News quoted Vas Kolesnikoff of ASA.

"This is clearly a concern for the Australian Shareholders' Association and should be of concern for all Australians, that one of our national brands, our national carriers, has the potential to be taken from underneath out feet," Mr Kolesnikoff said.

Besides the engineers' strike which starts 4 p.m., the Australian Services Union will also not collect excess baggage fees from Jetstar passengers at the Sydney, Melbourne, Brisbane, Gold Coast, Cairns and Avalon Airports as their way of protesting the breakdown of their year-long pay negotiations.

Cleaners at Melbourne's Qantas domestic terminal are also protesting the refusal by their employer, Spotless, to pay the same rates as cleaners for ISS in the Virgin and international terminals. As a result, 400 travelers have complained about the filthy state of Melbourne's terminals.