Qantas Airways has agreed to pay AUD 120 million (USD 79 million) to settle a lawsuit regarding the sale of thousands of tickets on flights that had already been canceled. This settlement marks a critical juncture for the Australian flagship carrier as it attempts to rebuild trust and stabilize its brand.
The settlement, announced by Qantas and the Australian Competition and Consumer Commission (ACCC), involves the airline disbursing AUD 20 million among over 86,000 affected customers and paying an additional AUD 100 million as a fine. This agreement comes after Qantas initially vowed to contest the lawsuit but has now chosen a path that accelerates compensation to its customers.
"We recognize Qantas let down customers and fell short of our own standards," stated Vanessa Hudson, CEO of Qantas, who took the helm in September amid the escalating crisis. She emphasized that settling the case allows the company to "compensate affected customers much sooner than if the case had continued in the Federal Court."
The fine imposed on Qantas is the largest ever for an Australian airline and ranks among the highest globally in the aviation sector. ACCC Chair Gina Cass-Gottlieb remarked on the settlement's broader implications, noting, "This penalty ... will send a strong deterrence message to other companies," signaling a strict stance against consumer rights violations.
The controversy erupted following the ACCC's lawsuit last August, which pointed to a significant lapse in Qantas's operations as it sold tickets on so-called "ghost flights" that were no longer scheduled to operate. This practice became particularly prevalent after Australia reopened its borders in 2022, leading to a spike in cancellations and lost luggage complaints amid global staffing shortages.
Qantas, like many global airlines, was navigating operational challenges due to the pandemic but was found to have breached consumer law by continuing to sell tickets for flights canceled weeks prior. The ACCC's litigation highlighted the need for greater transparency and adherence to consumer protection laws within the industry.
The settlement also includes commitments from Qantas to avoid repeating such conduct, ensuring more robust compliance with consumer protection standards. "Al Jazeera affirms its right to continue to provide news and information to its global audiences," stated the network, underscoring the importance of media freedom, especially in conflict zones.
Financially, the settlement's impact on Qantas appears manageable, as the payout pales in comparison to the AUD 1.47 billion net profit forecast for the airline in the year ending June 2023. Affected customers will receive compensation ranging from AUD 225 for domestic flight bookings to AUD 450 for international fares, in addition to full refunds.
