Money
Qantas could be forced to reinstate 2,000 workers
Australia’s leading airline could be made to reinstate 2,000 ground staff
The Transport Workers Union has asked Australia’s Federal Court to make orders to reinstate 2,000 crew sacked by Qantas.
The positions of the redundant staff were outsourced, in a method that would save the airline $100 million a year.
The TWU’s request came after the court ruled on Friday the outsourcing was unlawful, because Qantas took into consideration the risk those workers would strike in 2021 during new enterprise agreement negotiations.
Qantas boss Alan Joyce earlier stated the airline would save $100 million dollars by outsourcing ground crew roles, / Image: File
Qantas pledged to appeal the ruling
Qantas has pledged to appeal the ruling after insisting the outsourcing was done purely for commercial reasons, arguing the airline had continued to hire ground workers prior to the Covid pandemic which hit Australia around March 2020.
Qantas suggested that it was not practical to decide on “relief” in the case until the appeal was heard.
The court warned it could take years for the “Full Court” to hear an appeal and questioned whether it was fair to leave 2000 workers in doubt for that long.
Justice Michael Lee of the court also however suggested the TWU’s request for the reinstatement of the former employees was “unworkable”
Given the time that had elapsed, the redundancies paid and the likelihood some had taken new jobs, the Justice Lee says the reinstatement of staff wasn’t likely to happen.
“I’m struggling to see how you could deal with this matter … in a way that’s contemplated by the proposed orders,”
said Justice Lee.
A Qantas plane takes off from the Sydney International airport on May 6, 2021, as Australia’s competition regulator said it would block a pricing, code-sharing and scheduling deal between Qantas and Japan Airlines because it would likely mean higher fares for passengers. (Photo by Saeed KHAN / AFP)
Matthew Follett for Qantas agreed that it would be problematic to make orders for reinstatement of the baggage handlers, ground crews and cleaners.
“You would need to look at where in the life cycle of employment each individual was, potentially what their state of health was, because if your honour is contemplating compensation for loss of opportunity to earn future earnings then contingencies need to be brought into account,”
said Mr Follett.
“We’re talking about a period of time since employment was lost and the circumstances of individuals in terms of alternative employment,”
Why Qantas outsourced jobs:
In August 2020, Qantas announced its plans to outsource ground handling – which involves services like baggage handling and aircraft cleaning – at 10 ports as part of its response to the COVID-19 crisis. This work has already been outsourced for several years by Qantas at 55 ports across the country.
A competitive tender process, which included inhouse bids put forward by employees and the TWU, confirmed that outsourcing these services would save in excess of $100 million a year because of the efficiencies delivered by specialised companies that provide similar services to scores of airlines.
Outsourcing also avoided Qantas spending $80 million over the next five years to replace aging equipment such as tugs and bag loaders, and allow it to better match resourcing with fluctuating levels of demand.
The decision to outsource was made in November 2020. It resulted in around 1,700 Qantas employees receiving redundancy packages as the handover to external companies was progressively completed by March 2021. Many of these employees were already on COVID-related stand downs.
Money
Inflation rise reduces chances of Reserve Bank rate cut
Inflation spikes, drastically reducing chances of a Reserve Bank rate cut amid economic pressures and rising costs
Inflation spikes, drastically reducing chances of a Reserve Bank rate cut amid economic pressures and rising costs
– Rate cut likelihood by the Reserve Bank has decreased due to a rise in annual inflation to 3.2 per cent.
– Significant price increases in housing, recreation, and transport are raising concerns for the Reserve Bank.
The likelihood of a rate cut by the Reserve Bank has decreased significantly after a surge in annual inflation.
The Australian Bureau of Statistics reported that inflation for the year ending September rose to 3.2 per cent, reflecting a 1.1 per cent increase.
Trimmed mean inflation, a crucial measure for the Reserve Bank, was recorded at 1 per cent for the quarter and 3 per cent for the year. The bank anticipates inflation to reach 3 per cent by year-end, while trimmed mean inflation is expected to slightly decrease.
The quarterly rise of 1.3 per cent in September exceeded expectations. Governor Bullock noted that a deviation from the Reserve Bank’s projections could have material implications.
Financial markets reacted promptly, with the Australian dollar rising against the US dollar, while the ASX200 index fell.
The most significant price increases were observed in housing, recreation, and transport, indicating widespread price pressures that concern the Reserve Bank.
Despite the unexpected inflation rise, some economists believe the Reserve Bank may still consider rate cuts in December, viewing current price spikes as temporary due to the winding back of subsidies.
Economic Pressures
Broad-based economic pressures suggest that the Reserve Bank may not reduce interest rates at its upcoming meeting. Analysts highlight the need for ongoing support for households facing cost-of-living challenges.
Money
Wall Street hits record highs on low inflation
Wall Street hits record highs on cool inflation and strong earnings ahead of key Federal Reserve interest rate decision
Wall Street hits record highs on cool inflation and strong earnings ahead of key Federal Reserve interest rate decision
– U.S. stocks rose to record highs on Friday due to lower inflation and strong corporate earnings.
– Key earnings reports from major companies are expected next week, influencing market trends.
The Labor Department reported that the Consumer Price Index was slightly cooler than analysts’ predictions, easing concerns about inflation impacts from tariffs. This development suggests a likely interest rate cut by the Federal Reserve at its upcoming meeting.
Ryan Detrick from Carson Group noted the positive inflation news may facilitate forthcoming Fed rate cuts. Despite the ongoing government shutdown affecting data releases, this CPI report provided much-needed clarity.
Earnings reports are continuing, with 143 S&P 500 companies having reported results. Growth expectations for third-quarter earnings have risen to 10.4%. Detrick indicated a strong opening to the earnings season with a significant percentage of companies exceeding expectations.
This coming week, key earnings will be reported from Meta Platforms, Microsoft, Alphabet, Amazon, and Apple, alongside industrial companies like Caterpillar and Boeing.
The Dow rose 472.51 points to 47,207.12. The S&P 500 increased by 53.25 points to 6,791.69, while the Nasdaq gained 263.07 points, reaching 23,204.87.
Alphabet gained 2.7% following a deal expansion with Anthropic. Coinbase saw a 9.8% increase from a JPMorgan upgrade. In contrast, Deckers Outdoor’s shares fell 15.2% after lowering sales forecasts.
Market Trends
Advancing stocks on the NYSE outnumbered decliners by 2.18 to 1. The S&P 500 had 34 new highs, with the Nasdaq recording 124.
Trading volume was 19.04 billion shares, lower than the average of the past 20 days.
Money
US stocks face tests from Tesla, Netflix earnings
US markets brace for Tesla and Netflix earnings amid rising volatility and delayed inflation data
US markets brace for Tesla and Netflix earnings amid rising volatility and delayed inflation data
– Earnings reports from Tesla and Netflix might affect U.S. stock performance next week amid high inflation concerns.
– Increased market volatility arises from U.S.-China trade tensions and fewer S&P 500 stocks in an uptrend.
The S&P 500 entered its fourth year of growth amidst these fluctuations, having previously experienced a period of calm. Experts suggest market risks are intensifying as valuations reach peak levels.
Market Volatility
Concerns regarding U.S.-China trade relations escalated last week when the U.S. threatened to raise tariffs by November 1 over China’s rare-earth export policies. President Donald Trump is scheduled to meet with President Xi Jinping in two weeks to discuss these issues.
Despite these challenges, major stock indexes gained ground over the week, with the S&P 500 up 13.3% year-to-date. However, a noticeable decline in the number of S&P 500 stocks in an uptrend raises caution among investors about underlying market weaknesses.
The upcoming third-quarter earnings will be closely monitored, especially as the government shutdown halts economic data releases. Companies like Procter & Gamble, Coca-Cola, RTX, and IBM are due to report. The delayed U.S. consumer price index is also expected to provide crucial insights ahead of the Federal Reserve’s monetary policy meeting on October 28-29.
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