HOST: The Prime Minister joins me now. Julia Gillard, welcome to Breakfast.
PM: Good morning, Fran.
HOST: Prime Minister, what confidence do you have that Qantas and the unions can sort this out in the next 21 days? The animosity runs pretty deep.
PM: Well, they do have 21 days to sort themselves out, but as a result of the action we took in Fair Work Australia, industrial action has been terminated. That, I believe is a win for the travelling public and for the Australian national economy and the million people who work in tourism.
Now they have 21 days to sort themselves out. If they don't, then our industrial umpire will impose an outcome on them.
HOST: Now, talk of imposing an outcome, Prime Minister, why didn't you intervene? You have the powers, existing powers under the Act to force the parties back to work, don't you?
PM: Let's be very clear about this Fran - under the Fair Work Act there is a section, Section 431, which enables the Minister to make a declaration. It has not been used, not been used under the Fair Work Act and not been used under earlier legislation. It's never been legally tested, and if we had used that power we could have ended up in a world of legal uncertainty with the matter then going to the courts, with all of the potential time delays and confusion that that would have caused.
HOST: Can I just get clarification, though - with all of that that might have unfolded afterwards, in the short term, would it have kept the planes flying?
PM: Well, that would have been a question about what the court did when it ended up before the courts-
HOST: -But before it got to the courts.
PM: Well, let's be clear about the timeframe here Fran, because I think that in part answers your question too, so let's go through the legal issues and the practical issues. Legal issues - section has never been used before, so there is no legal precedent. It could easily have ended up in the courts, with all of the confusion and potential time delays that that would have caused.
What we chose to do instead was to make application to Fair Work Australia and we have succeeded in having the industrial action brought to and end. Now, the parties have an opportunity to sort themselves out, and if they don't the dispute will be fixed by Fair Work Australia.
Can I just say, in terms of the practicalities of this, Fran, as late as Friday Qantas was reassuring that they were in negotiating their way through this dispute. At 2 o'clock on Saturday, Alan Joyce contacts the Minister for Transport, Anthony Albanese, and says he is grounding the planes at 5pm - no ifs, no buts.
I believe that that action by Qantas was an extreme action to take. It has caused chaos for the travelling public and Qantas had other options available at its disposal, including taking the same sort of application to Fair Work Australia that we, the Government, took.
HOST: Well, Alan Joyce just told us that he had three options, one was to sit by and do nothing, one was to struggle on and allow this interrupted industrial action to take place over the next year, or the other was to go on strike effectively itself and force it to this sort of intervention under the Act-
PM: -And one was him and Qantas then making application to Fair Work Australia. The Government determined to make application to Fair Work Australia, and we have got exactly the outcome we wanted and we sought, which is the planes will be back in the sky, the travelling public will be back on the move, employees will be back at work, tourism operators will be back doing what they do best.
HOST: Nevertheless, it's taken what you yourself describe as an extreme action to take. Alan Joyce says in his view it needed to take that extreme action to meet the threshold, if you like, of Fair Work Australia, the Fair Work Act.
PM: Before you go down that path Fran, first and foremost, as late as Friday Qantas was saying that they were negotiating this dispute, so let's be very clear about that.
Then let's be very clear about the provision under the Fair Work Act that is being used here. It is comparable to provisions that have been in earlier pieces of legislation. We've seen in industrial history before - this is not a product of the Fair Work Act - we've seen in industrial history before unions taking protected industrial action, employers engaging in lockouts, the industrial umpire having a jurisdiction when the dispute gets to the stage of jeopardising the national economy.
That is not a new feature of our industrial relations law. It's not newly introduced by the Fair Work Act.
HOST: Prime Minister, Alan Joyce just told us that over the last few weeks he had several conversations with several ministers, on several occasions, saying that the only option ultimately available to them might be ground the fleet. Were you aware of those conversations?
PM: What I was aware of was, as recently as Friday, Qantas was saying it was working its way through to negotiate this dispute, then the first advice to Government that the fleet would be grounded at 5pm on Saturday was at 2 o'clock on Saturday to the Minister for Transport, Anthony Albanese, and I do believe that that was an extreme action by Qantas and that they had other alternatives available to them.
HOST: If Fair Work Australia forces the implementation of arrangements which Qantas says would make it financially unviable, will the airline have any recourse? What then?
PM: Well, the industrial umpire resolves the dispute. Qantas has got the ability, within the 21-day period, to get round a table and to work through this dispute. If they are unable to do that, if Qantas and the unions are unable to reach agreement during those 21 days, then Fair Work Australia as the industrial umpire will impose a solution upon them.
HOST: So you say this is an extreme action. Assistant Treasurer Bill Shorten says the Qantas grounding was over the top. Labor Senator Glen Searle has said previously Alan Joyce should resign. If you think it shouldn't have come to this, what do you think is going on here? Do you believe this was a planned, predetermined strategy by Qantas management to achieve something longer term?
PM: Look, it's for Qantas to answer what its strategy is, how long it's been planning it, and why it was that as recently as Friday they were saying they were negotiating and then we saw this happen on Saturday.
HOST: You keep talking about on Friday Qantas was saying they were negotiating. Alan Joyce has said to us now, and previously on Friday they were upbeat after the AGM, but then the unions came out and said they were going to continue this, a slow bake, effectively, is what one of the unions described it. Can you accept that that might change Qantas's position in this?
PM: Well, I accept that all of this is a matter for Qantas to explain and it's particularly a matter for them to explain why they chose to act on Saturday, on Darby Day, Melbourne Cup weekend, with effectively no notice to the travelling public.
HOST: Have you, yourself, spoken to Alan Joyce yet about this?
PM: No, I haven't. I thought it was proper Fran, once I took the decision on Saturday that we were going to Fair Work Australia not to engage in conversations with any of the parties to the Fair Work Australia proceedings.
HOST: Is it proper and perhaps appropriate for the Prime Minister to engage with conversation before that action is taken, to actually have a phone call once you knew that this was what Qantas was planning? I know you're involved in CHOGM, but this is a significant event that's going to cause a lot of chaos around the country, and around the world, in fact.
PM: And so what I did, Fran, was immediately to take the application to Fair Work Australia, to ensure that the industrial disputation was at an end. That was the thing that I could do to do something that would, in effect, get the planes back in the sky, get the travelling public on the move again and no longer inconvenienced and in the grip of this chaos that had been caused by Qantas's grounding of the fleet-
HOST: -So you think the prime ministerial blast to Alan Joyce might have been in order?
PM: Well, let's be very clear here Fran - when Alan Joyce contacted Minister Albanese he said the planes would be grounded. The matter was not up for discussion. It was happening.
I responded to the actuality it was happening by getting the matter before Fair Work Australia and we have succeeded in getting done at Fair Work Australia exactly what we wanted, which is an order to terminate industrial action, and that means the planes will be back in the sky, Qantas will be working, its employees will be working, the travelling public will be on the move and our tourism operators will know that the people who want to come and use their services and stay in their beautiful hotels and resorts and bed and breakfasts and go to their restaurants will be able to get there.
HOST: Prime Minister, just a couple of quick ones before the news in a minute or so, do you think it was unhelpful for Alan Joyce to get an effective pay rise of $2 million on Friday?
PM: I'm not commenting on Mr Joyce's salary packaging and I think it's a matter for him to explain how that fits in with Qantas' negotiating strategy in this dispute.
HOST: And just briefly, Prime Minister, plenty of industrial agreement coming up. Do you think we could see this kind of action across other industries, ending up in more centralised arbitration?
PM: Well, let's looks at the record of the Fair Work Act - we have not seen, in general, industrial disputes on the rise. The Fair Work Act has been there, it's been working, we've not seen a general rise in industrial disputation, but what we have seen, Fran, and this is very important, we've seen an end to the rip offs which used to see under WorkChoices: workers at most risk in our workforce, young people, women, people with low skills, walk into work one day and be told ‘you're not getting your penalty rates anymore, you're not getting your overtime anymore'. That is what used to happen under WorkChoices, a gross unfairness to working people and the Fair Work Act ended that.
HOST: Prime Minister Julia Gillard, thank you very much for joining us on Breakfast.
PM: Thank you.