Aussie Air Case Study Essay Example
In the employment sector, many companies are always keen on making profits and ensuring that their company remains ahead of the competition in terms of the different technicalities that exist in a particular industry. In the aviation industry, the important factor is always ensuring that there is enough time and legal backing to implement the different growth strategies in a particular area. This paper will look at Aussie Air as an aviation industry case study where different pilots and other staff members were paid their redundancy entitlements and consequently offered opportunity to work for PNG Air which was established in Papua New Guinea as an Australian country. One issue pertinent to this discussion is the manner in which the parent company – Aussie Air chose to treat their staff and subject them to a salary cut in the disguise of a new employment contract. In the new arrangement, PNG Air has implemented the 25% salary cut contrary to what the pilots had vouched for.
In the argument, the Corporations Act has provisions into how corporations will treat their employees. In the arguments, the Act under Section 256 B provides for methods under which a company may change the way they deal with the issue of payments and the issue of extensive employment contracting. Further, the Act is very instrumental in determining the manner in which different people can claim an unfair employment bargain from the employee standpoint. From the facts of the case, it is important to note that the management and the board through their canvassing tirades added themselves bonuses at the detriment of the services offered by pilots.
Section 95A (1) of the Corporations Act 2001, provides for how a company may wind up their services and how they should treat their employees in the event that a wind up is necessary. In the illegal redundancy payments that were made, any court will conclude that the company had no facility to continue employing the pilots anymore. For the benefit of fair labor arrangements, a company that conducts itself in such a manner must be on the road to winding up. For Aussie Air however, this was another gimmick to not competitively remunerate their pilots. It is for this reason that they acted illegally and unfairly against the pilots.
In Australia, it is not feasible to remove any entitlements due to the employee in their employment contract for flimsy reasons. The Fair Work Act and the NES properly provide for ways in which the employees might be paid. In the event that the payment and the benefits are deemed in excess of what is recommended in the industry, then they may be reduced. In the current case however, the same cannot be said of Aussie Air. In addition, the National Employment standards have set down the minimum standards of pay and the reduction that had been sought will be illegal under the Minimum Wage Order. In the case of Queensland Mining Corporation Ltd v Howard Victor Renshaw & Ors it was concluded that the shareholders cannot benefit on the fact that former employees are being manipulated.
Lastly, the argument for a successful suit regards the operations by Aussie Air and PNG Air. The two companies are similar and share the same board of management. That being the case, it should be noted that they are one company. Logically speaking, a company cannot seem to pay redundancy benefits to the employees and later turn out to employ the same individuals under a new regime. Furthermore, the pilots were to be situated in Australia, contrary to the pay regime they were subjected to for Papua New Guinea. It is unfair, illegal and unacceptable as provided under Part 2F.1 of the Corporations Act 2001 (Cth). The chances for success are high for this case.
CORPORATIONS ACT, 2001
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