SYDNEY- Australian flag carrier Qantas Airways (QF) has been embroiled in a massive ghost-flight scandal, deceiving nearly one million customers with non-existent flights.
Court documents reveal the airline’s awareness of the problem and the extensive scale of the misconduct.
Qantas Flight Scandal
The Australian carrier settled the lawsuit in 2023, agreeing to pay A$120 million ($82 million) in fines and compensation for selling tickets on flights it had already canceled. Qantas admitted to misleading ticketholders by failing to disclose that they were booked on phantom services.
These shocking allegations led to the early departure of Chief Executive Officer (CEO) Alan Joyce in 2023. The extent of Qantas’ knowledge about its ticketing deficiencies remained unclear at the time. The Australian Competition & Consumer Commission brought the case against Qantas, initially seeking a record penalty exceeding A$250 million.
A statement of agreed facts and admissions, published on the Federal Court of Australia’s website on Thursday, revealed that ‘senior managers’ at Qantas collectively knew about all passenger impacts. However, no single individual had complete knowledge of the situation.
The court filing, as seen by Bloomberg, stated, “Qantas was aware of the way in which its system operated.” It further emphasized, “Consumers suffered harm due to Qantas’s contravening conduct.”
Misconduct at Mass Scale
The court documents reveal that Qantas Airways’ management was aware of the ghost-flight scandal, though the specific managers involved remain unidentified.
According to the filing, Qantas could manually remove canceled flights from sale immediately but consistently failed to do so. The airline has since updated its systems to address this issue.
The scale of the misconduct is staggering. Qantas continued to sell tickets for 71,000 flights scheduled between May 2022 and May 2024, despite having already decided to cancel these services.
Approximately 87,000 individuals purchased tickets for these non-existent flights or were rebooked onto them. The airline failed to promptly inform up to 884,000 customers that they were booked on flights that would not operate.
The court document reveals that Qantas persisted in selling tickets for canceled flights for an average of 11 days after the cancellation decision. Moreover, the airline typically took the same amount of time to notify passengers about their canceled flights.
$250 Million Fine
Qantas earlier faced severe consequences for illegally terminating an employee who voiced safety concerns during the COVID-19 pandemic. On March 6, 2024, Judge David Russell at the Downing Centre District Court imposed a $250,000 fine on the national airline for its actions against Theo Seremetidis.
Seremetidis, a lift truck driver and elected health and safety representative for Qantas Ground Services, was suspended in February 2020. He had instructed colleagues to stop unsafe work, expressing concerns about potential COVID-19 exposure for employees cleaning aircraft arriving from China.
Judge Russell described Qantas Ground Services’ conduct towards Seremetidis as “quite shameful.” The court found that QGS attempted to fabricate additional justifications for its actions during Seremetidis’ suspension and investigation. The judge characterized Qantas’ behavior as intentional, commercially driven, and discriminatory.
The ruling emphasized the significant power imbalance between senior QGS managers and Seremetidis, a part-time employee with a modest wage. Justice Russell noted that QGS should have been aware of the potentially discriminatory nature of its actions, which were explicitly brought to their attention.
In 2023, Justice Russell had already declared Qantas guilty of “discriminatory conduct” for violating workplace health and safety laws in suspending Seremetidis.
The $250,000 fine will be split equally between the prosecution and Safe Work NSW to cover investigation costs. Additionally, Qantas compensated Seremetidis with $21,000 within 28 days for economic loss and the “hurt and humiliation” caused by the airline’s unlawful actions.
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