Virgin staff call pay offer ‘insulting’ as airline rejigs team to prepare for possible re-listing

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Virgin Australia employees announced they will meet soon to discuss their options, including potential industrial action, after the multibillion-dollar airline offered a pay rise of just 2.5 percent – significantly below the rate of inflation.

The Australian Services Union (ASU) has warned that workers, who have endured a lengthy pay freeze as the airline sought to turn around its fortunes in recent years, would consider a full range of options in order to secure a fair deal.

“In a climate of 7 percent-plus inflation and with mortgages, rents and the general costs of living soaring, this unsatisfactory offer is effectively a pay cut – and a significant one at that,” said ASU Assistant National Secretary Emeline Gaske. “Virgin staff are well aware that the airline has recently posted a $3.7 billion profit and that its private equity owners are now considering floating the business on the Australian Securities Exchange in a move that will likely enrich them considerably. Quite frankly, Virgin’s offer to workers is insulting and we will be meeting this week to discuss next steps. All options remain on the table.”

The call for a better deal for workers comes after a survey of Virgin staff last month found that 88.6 percent were having difficulty paying basic living expenses and 21 percent said they had gone without meals to get by financially. Another 81 percent said they had put off seeing a doctor because of the cost, while financial pressure was driving 70 percent of workers to consider looking for a new job. More than 10 percent said they were behind in their mortgage or rent payments.

“Virgin has emerged from the pandemic in a strong position, and a lot of this is due to the workers who bent over backwards to keep costs down and forgo pay rises during a challenging period,” Gaske said. “Virgin is now in a strong position, both operationally and financially, and can afford to ensure that workers are no longer short changed; that they can afford to pay their rent and bills, put food on the table and care for their families.”

Meanwhile, Virgin Australia said in a note to staff that it is adding new members to its board  as it prepares to  re-list on the Australian sharemarket about three years after it collapsed into administration.

Former Macquarie Bank chairman Peter Warne will join the airline’s board of directors alongside Pippa Downes, a former banking executive at firms including Goldman Sachs, who now holds several directorships, Virgin’s chief executive, Jayne Hrdlicka, said in a note to staff.

The appointments coincide with the company’s chief financial officer, David Marr, moving to a new role focussed on preparing the carrier for a sharemarket listing, according to Australian media reports. Race Strauss, a former chief financial officer of Jetstar and Qantas, will replace Marr in his former role.

Hrdlicka said the airline had performed well over the summer. “Whilst our financial results remain subject to normal half-year auditor review, we expect to deliver revenue of roughly $2.5 billion and a profit margin of roughly 5 percent,” she wrote in the note to staff. “Given this is the first time in many years that Virgin Australia has made a profit, it is certainly a milestone to quietly celebrate.”


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