- As outlined in our previous update the AFAP, TWU and AIPA recently tabled a revised Joint Union Proposal in a genuine effort to progress bargaining and reach a negotiated outcome.
Previous Joint Union Position
You will recall that in early February the AFAP, TWU and AIPA presented an initial unified Joint Union Proposal to Jetstar for consideration.
Details of this proposal were outlined in AFAP EA Update #26 here.
A summary of the key features of the initial Joint Union position included:
- An 8% uplift on agreement approval
- Roster Stability Pay (RSP) of 4 hours hard credit linked to Level 1 salary
- RSP applying to all displacements, not just those caused by standby callouts
- 100% credit when paxing in economy
- WDO divisor reducing from 231 to 221 over the life of the agreement (reflecting reduced working days)
- A Company Performance Bonus for pilots completing a financial year with Jetstar
- Multi-day re-assignable end time extended to the later of 1pm or sign-off +1 hour when triggered by a single personal leave day
- One year in rank at Captain Level 1 before progression to Level 2
- One year in rank at FO Level 2 before progression to Level 3
Jetstar rejected this package on the basis that it sat hundreds of millions of dollars outside its funding envelope.
As outlined in AFAP EA Update #27 here, and in the interests of reaching a negotiated outcome, the three unions agreed to substantially refine this position.
Revised Joint Union Position
The revised Joint Union proposal included the following changes:
- Initial salary uplift reduced from 8% to 6%, with the staged implementation of further increases.
- Captain Level 1 time-in-rank increased to two years, aligning with the company’s structure for command progression.
- FO Level 2 time-in-rank increased to two years, aligning with the company’s position, while maintaining the <1500 hr / >1500 hr experience triggers that recognise pilot experience.
- Roster Stability Pay (RSP) reduced from a 4 hours hard payment to the equivalent to one day’s pay (based on L1 annual salary ÷ 231).
- RSP limited to displacements caused by standby callouts, rather than applying to all displacement scenarios.
- Training displacements to result in a Duty Free Day (DFD) instead of a RAS payment. Pilots would have the option to either pick up flying on the displaced day or retain it as a duty-free day.
- Paxing credit claim reduced from 100% to 50% (status quo) when travelling in economy, while maintaining improved upgrade priorities (F0, F4, F7). The addition of NO middle seat assignment when positioning on ALL Qantas Group Airlines.
- WDO divisor to remain at Annual Salary ÷ 231, removing the proposed reduction to 221 over time.
- Multi-day re-assignable end time extended to 3pm, aligning more closely with the company claim, while still only applying when displacement is caused by a pilot taking a single personal leave day (1 UFD day).
Why These Changes Were Made
We expect some pilots may be surprised by the level of movement reflected in this revised proposal.
However, these refinements were made deliberately as a genuine effort by the unions to progress bargaining, and secure a negotiated outcome that still delivers on our benchmarking objectives in a credible and achievable way, while avoiding escalation and the potential for a serious industrial dispute.
In refining the joint position, the unions weighed not only what is desirable, but what is realistically achievable, including the risks associated with Protected Industrial Action (PIA).
While PIA can be a powerful bargaining lever, it also carries significant financial and industrial risks. Once industrial action begins, the company’s response becomes difficult to predict. Escalation can harden positions, prolong bargaining, delay improvements, and in some circumstances result in outcomes that are no better, or potentially worse, than what may otherwise be achievable through negotiation.
Industrial action also carries immediate financial consequences for pilots. Lost income during protected action is real and personal, and there is no guarantee that escalation will ultimately deliver a commensurate improvement in the final outcome.
For these reasons, the unions’ priority has always been to pursue a negotiated outcome wherever possible, provided that agreement is capable of being supported by the pilot group.
In refining the joint position, the unions have carefully balanced several considerations:
- The significant improvements already on the table
- What further movement is required to meet benchmarking objectives
- The likelihood of achieving a negotiated outcome
- The very real financial and industrial risks associated with escalation
- These decisions are not made lightly.
Bargaining strategy is informed by extensive industrial experience and a clear understanding of how negotiations in this industry typically unfold. The AFAP negotiating team, supported by experienced industrial and legal staff, has been involved in dozens of pilot enterprise agreement negotiations across Australia, providing valuable insight into the dynamics of bargaining, the risks associated with escalation, and the approaches most likely to deliver successful outcomes for pilots.
Our responsibility is not simply to reflect frustration within the pilot group, but to carefully assess risk against reward and pursue the course most likely to deliver tangible improvements for Jetstar pilots.
This week
Earlier this week Jetstar wrote to the unions providing a formal response to the revised Joint Union Proposal.
Jetstar advised that the proposal remains significantly beyond its cost envelope for the life of the agreement and would also result in ongoing annual salary costs in excess of the Company’s proposed salary structure.
Jetstar advised that:
- The remaining gap between the parties is approximately $30 million over four years.
- However, its primary concern relates to the out years of the agreement (beyond FY2030). Under the revised proposal, the cost differential beyond this point is estimated by Jetstar to be $20–$24 million per annum.
On that basis, Jetstar confirmed it was not in a position to agree to the proposal.
Following receipt of this response, AFAP, TWU and AIPA bargaining representatives met in person with Jetstar CEO Steph Tully and COO Matt Franzi to discuss the current state of bargaining.
The discussion was direct and candid.
The unions outlined the fundamental deficiencies with Jetstar’s proposed offer and funding envelope, and reiterated that based on the clear pilot sentiment demonstrated in the recent joint union poll, the current proposal would not be supported by the pilot group.
We made it clear that the unions cannot credibly endorse or recommend a deal that has already been overwhelmingly rejected in principle by pilots.
The CEO questioned whether this sentiment was being driven by the unions rather than simply reflected by them. She noted that she spends several hours each week travelling in the jump seat and that the pilots she speaks with appear happy with their working conditions and do not raise concerns about the current bargaining process.
In response, we emphasised that the results of the recent polling do not represent the views of a vocal minority or “noise”, but rather reflect the clear and overwhelming sentiment of the pilot group - something the unions cannot ignore.
Jetstar’s executive team spoke about the importance of maintaining a sustainable cost base and preserving the differential necessary to support its business model, capital investment and growth, which they argue ultimately underpins job security for employees.
We responded that this argument does not resonate with pilots.
Jetstar pilots perform the same role, operate under the same regulatory framework, and carry the same legal and safety responsibilities as their counterparts at other airlines. Just as aircraft leases and fuel are priced at market rates, pilots reasonably expect wages to also reflect the market, particularly given the strong financial performance of the business to which pilots contribute every day through their professionalism.
The CEO and COO did not dismiss our concerns or the position on behalf of our members. Ultimately, however this remains a point where the unions and Jetstar executive hold fundamentally different perspectives.
While Jetstar views the remaining gap between the parties’ positions as primarily a cost-envelope issue, from the unions’ perspective that gap represents the difference between an agreement capable of being endorsed and recommended to pilots, and one that would be overwhelmingly rejected.
Despite rejecting the Joint Union Proposal, Steph and Matt indicated they were prepared to review whether the business could move closer to the salary structure put forward by the unions.
The executive reinforced its commitment to reaching a negotiated outcome and to rewarding pilots as soon as possible rather than delaying through escalation.
The unions advised that we remain prepared to continue exploring all reasonable avenues to reach a negotiated outcome. However, without meaningful movement in the overall funding envelope, we would ultimately have little choice but to proceed with filing for a Protected Action Ballot Order (PABO).
This is not a step the unions take lightly, but one that may become necessary if bargaining reaches an impasse given the strength of pilot sentiment.
Both Steph and Matt expressed that they would be extremely disappointed if bargaining were to reach that point, noting the significant work undertaken by all parties throughout the process.
Following this discussion, further conceptual discussions were held with the Company’s bargaining representatives to explore potential structural solutions to some of the unions’ concerns.
As a gesture of good faith in response to the willingness expressed by Jetstar’s executive team to further consider its position, the unions have agreed to provide Jetstar until next Tuesday 10th March to present a formal revised offer.
For any proposal to meaningfully progress bargaining, the unions were clear it will ultimately need to include an increased funding envelope.
Should the Company not be able to present a package that demonstrates meaningful movement, the next step will be for the unions to proceed with filing for a Protected Action Ballot Order (PABO). While this is not our preferred path, it may become necessary to help bridge the remaining gap between the parties.
If stability and a negotiated outcome remain the shared objective, the pathway to achieving that outcome remains open.
We will continue to keep members fully informed following next week’s meetings.
Thank you for your continued engagement and support.
If you have any questions, your pilot representatives and AFAP industrial officers Deanna Cain, Pat Larkins or Andrew Molnar are available to assist via jetstar@afap.org.au or call (03) 9928 5737.
Members can also engage constructively with AFAP pilot representatives and industrial staff via the members-only AFAP Telegram forum here.
Regards,
AFAP Jetstar Negotiating Team
Chris Gibson, Dominic Corcoran, Daniel Blakemore, Ben Bollen, Jake Gainger and Paul Hogan