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1. Labor Panel Dismisses Qantas Union Claims Over Jetconnect

An Australian labor court has rejected a long-running challenge by Qantas pilots against the carrier’s use of a New Zealand-based subsidiary.

Fair Work Australia dismissed the Australian and International Pilots Association’s application to allow it to represent pilots employed by Jetconnect. Jetconnect is a Qantas Group subsidiary that operates New Zealand-based Boeing 737s between New Zealand and Australia.

Jetconnect has about 600 employees, of whom 100 are pilots. Most of the pilots are covered by a contract negotiated with the New Zealand Airline Pilots Association. Jetconnect operates 737s leased from Qantas on behalf of Qantas. The AIPA argued that this was a “sham” arrangement aimed at circumventing Australian labor laws.

The AIPA says it is considering appealing the decision. It also highlights the labor panel’s 2-1 split decision, with one member issuing a minority opinion that Jetconnect is totally controlled by Qantas and that its establishment as a separate company is “smoke and mirrors.”

Meanwhile, limited strike action by Qantas engineers is disrupting some of the carrier’s operations out of Brisbane. Engineers belonging to the Australian Licensed Aircraft Engineers Association (ALAEA) stopped work for an hour on Sept. 5 at the carrier’s Brisbane base, which caused up to one-hour delays for 15 flights, Qantas says.

Similar hour-long strikes are scheduled to occur at Qantas bases in other cities this week. Each day a different base will be affected. The strikes will continue in this fashion through mid-December, the ALAEA says. The union is also initiating overtime bans and work-to-rule action. The industrial action was prompted by stalled contract talks between the airline and the union.

2. Unisys signs contract to provide international airlines with airport system

In time for the 2011 Rugby World Cup, thirteen international airlines operating to and from New Zealand have signed contracts with Unisys to provide an advanced baggage reconciliation system for their international flights operating from Auckland, Christchurch, Queenstown and Wellington international airports. The baggage reconciliation system links passengers with their bags, tracking both as they move through the system to help the airlines comply with aviation industry security requirements.

The Board of Airline Representatives New Zealand (BARNZ), an industry representative organisation for airlines, manages the engagement with Unisys on behalf of the airlines. The contracted period is four years and eight months.

Each year these airlines must secure and validate up to 3 million bags for approximately 2.4 million air travellers on international flights to and from New Zealand. These volumes are expected to increase significantly during the Rugby World Cup being hosted by New Zealand in September-October 2011.

The Unisys baggage reconciliation system helps airlines comply with the Civil Aviation Authority’s (CAA) national aviation security program which covers International Civil Aviation Organisation (ICAO) regulations relating to baggage handling so that unaccompanied baggage does not travel ahead of the passenger.

When passengers check in, each bag receives a barcode, which is then scanned and reconciled with a passenger record before it can be loaded onto the aircraft. As the airline has a record of the baggage loading order, bags can be quickly identified and recovered if passengers fail to board. This process prevents take-off with a mismatch of passengers, crew and baggage. It also provides a tool to assist in delivering enhanced security levels to avoid unaccompanied baggage being loaded on the flight.

The Unisys baggage reconciliation system was chosen after a detailed evaluation co-ordinated by BARNZ involving four potential BRS suppliers, with key evaluation criteria including value for money, proven solution and capability, local support and ability to implement the solution before Rugby World Cup.

“The Unisys baggage reconciliation system helps achieve efficiencies by using standardised processes to avoid lengthy processing or flight delays when baggage needs to be found and removed from flights,” said Mr John Beckett, Executive Director, Board of Airline Representatives New Zealand. “It also helps our member airlines comply with compulsory security requirements for baggage handling and, just as importantly, improve their customers’ air travel experience by preventing passenger processing delays and enabling tight flying schedules.”

The new contract with BARNZ builds on Unisys’ credentials for delivering baggage reconciliation systems for the Asia Pacific aviation industry. Unisys has provided a baggage reconciliation system for the Board of Airline Representatives Australia (BARA) since 2004. In 2010 Qantas selected Unisys to provide an innovative solution for its Australian domestic flights using Radio Frequency Identification (RFID) technology to track and verify bags. Qantas introduced Australia’s first self-service baggage check-in facility as part of the airline’s Next Generation Check-in initiative to streamline and speed up a passenger’s journey through domestic airports using technology such as RFID bag tags, called Q Tags.
“An additional benefit is that as Unisys already provides similar services in Australia to the Board of Airline Representatives Australia (BARA) and Qantas Airways, the airlines have access to trans-Tasman baggage reconciliation information providing visibility of in-bound cargo loads so that the destination airline can better plan and schedule their baggage handling resources.”

Unisys Baggage Reconciliation System team will provide a full managed service to the BARNZ member airlines. This service includes managing network infrastructure and security architecture, training and onsite support, application management and round-the-clock help desk support.

3. Ten years on: Ansett's flying doctors have landed

FOR Mark Korda, the ethos of the nation's largest firm of receivers is grounded on one name: Ansett.

The demise of the famous airline a decade ago next week was life-changing, not only for its thousands of employees but for the two men eventually appointed to sort out the mess.

Mark Korda and Mark Mentha's firm was born out of Ansett's death.

Last week, they delivered to former staff a $14 million final payment for their redundancy and leave entitlements.

The former staff have now received $727 million of the $758 million they were owed.

"I sat down with all our staff at the time and said: 'We're setting up Korda Mentha. We don't have a vision statement. We have to deliver on the outcome for Ansett, and everything will flow from that.

Deal with difficult situations, have a strategy, treat everybody with empathy, remember it's other people's money, and deliver an outcome'.

It would have been so much easier, so much quicker, to have rolled over to the demands of corporate creditors and embarked on an immediate fire sale of Ansett's extensive assets.

Mentha estimates it would have taken about three years and delivered 40-50c in the dollar.

"I had a team of five or 10 supervising hundreds of Ansett people helping us. We took the view to realise the assets in an orderly manner, to get past the September 11 aviation crisis," he says.

"Sure, its taken a while. But thousands of people have been paid. The average employee has 96c."

It's history now that Ansett's then-owner, Air New Zealand, put the airline into receivership the day after the September 11 airborne terror attacks in the US -- the second shock for an already shocked nation.

Mentha still queries the wisdom of taking such a momentous decision within hours of such an epoch-changing and industry-changing event.

The initial receiver, PriceWaterhouseCoopers, was replaced within days by creditors, including unions, owing to its links with Air NZ.

But by the time Messrs Korda and Mentha arrived, the airline was grounded.

They got Ansett Mark II flying on a limited basis, as the best chance of a sale was for an continuing concern.

Beneath that was feverish activity, as Mentha consolidated 20 EBAs into one, new aircraft deals were brokered, and operations were reconstructed for a potential new future.

Within weeks, Korda and Mentha wrangled capital of $160 million, plus expense write-offs, out of Air New Zealand - itself on the verge of receivership, and fearing the threat of legal action - then used it to restructure the airline.

Kiwi management insisted the tense settlement meeting be held in strict secrecy in Melbourne, as they feared for their safety from angry demonstrators. Treasurer Peter Costello was miffed even he wasn't told.

But the receiver later had its own dramas as the parent firm of its employer, Arthur Andersen, was in crisis owing to fallout over the Enron affair in the US.

Full-time trying to sort out its employees' futures.

"When we packed up to finally leave Arthur Andersen, the newspapers from September 11 were still sitting on our desks. We hadn't been back in six months.

By that time the attempt by businessmen Lindsay Fox and Solomon Lew to re-launch the airline had folded at the final minute. A lack of government support was blamed.

Difficulties over the duo's gaining access to a retail lease at Sydney terminal has been cited as contributing, but Korda rejects this.

"We could have solved the terminal issue. We owned the terminal. All we had to do was transfer the lease," he says. "At the end of the day, the Tesna consortium got cold feet."

The task of disposing of assets is now complete. The only aircraft in Ansett livery is the model in Korda's office.

He still wonders how the Tesna syndicate airline would have flown.

"We did a business plan in six weeks with Ansett's employees. The two years before, the company had spent $32 million on consultants," he says.

"Our strategy was, basically you had to operate a mainline airline with a low-cost airline. As it transpires, that looks exactly like Qantas-Jetstar.

"Amazing, isn't it?

"If Ansett had've survived, Ansett-Virgin would have ended up the Qantas-Jetstar model. And that was the plan."

But he says operationally, the airline industry is the most difficult in the world.

"You can have large capital commitments for planes, significant security issues, volatility of jet price fuel, extreme competition, and highly restricted work practices. Work practices are managements' fault, not the unions' fault.

Government owned-airlines in competition with you.

"Australia is probably a '2.something' company airline country. Think of Compass - it went twice; Impulse...it seems like there's never been enough room for three airlines."

The failure to resurrect it prompts Mentha to repeat an observation of Warren Buffet's.

"Give me a good management team in a very difficult industry, and the industry always wins," he says.

"Look at the issues Qantas faces right now. Aviation is a difficult, difficult industry."

Aviation NEWS By
Neha Jain
Aviation NEWS Reporter