FEDERAL COURT OF AUSTRALIA

Transport Workers’ Union of Australia v Qantas Airways Limited (Settlement Administration) [2026] FCA 1160

ORDERS

THE COURT NOTES THAT:

A.    “Administrator” means the solicitors for the applicant, Maurice Blackburn Lawyers.

B.    “Affected Worker” means each of the employees whose employment was terminated, or who were redeployed to another position within the first or second respondent, as a consequence of the outsourcing decision found by the Court to have contravened s 340(1)(b) of the Fair Work Act 2009 (Cth) (FW Act), including (i) the Test Case Individuals (as that term is defined by Order 3 of the Orders of 19 December 2025) and (ii) the two persons referred to in paragraph 32(h) of the affidavit of Jessica Dawson-Field affirmed 28 July 2026, but excluding any person (other than a Test Case Individual) who had not, as at 6 pm on 6 August 2026, registered to participate in the Settlement Scheme or who had opted out of participation.

C.    “Years of Service Data” means the data produced by the first and second respondents pursuant to the orders made 13 October 2023 and 29 July 2024 and held by the Administrator, recording, in respect of each Affected Worker, that person’s years of service with the first or second respondent as at the date of termination or redeployment, together with the years of service recorded in the records held by the Administrator for any Affected Worker not included in that data.

D.    “Tenure” means the years of service recorded for an Affected Worker in the Years of Service Data.

E.    “Unpaid Worker” means an Affected Worker other than: (i) a person named in the schedule provided by the Administrator to the Associate to Justice Lee on 19 December 2025; and (ii) a Test Case Individual, each of whom is taken to have received an Interim Payment (as that term is defined by Order 4 of the Orders of 19 December 2025).

F.    “Settlement Scheme” means the scheme for the assessment and payment of compensation to affected employees administered by the Administrator pursuant to the Heads of Agreement dated 17 December 2024 and the Deed of Agreement and Release.

G.    “NAB account” means the interest-bearing controlled monies account held with National Australia Bank by the Court into which the balance of the penalty of $40 million was paid pursuant to the orders of 18 August 2025.

THE COURT FURTHER NOTES THE FOLLOWING UNDERTAKINGS ARE GIVEN TO THE COURT BY THE ADMINISTRATOR:

H.    The Administrator undertakes to the Court to pay the reasonable costs of the amici curiae of and incidental to the listings on 29 July 2026 and 6 August 2026, as agreed between the Administrator and the amici curiae or determined by the Court in default of agreement, with such costs to be invoiced by the amici directly to the Administrator and paid by the Administrator.

I.    The Administrator undertakes to the Court that neither the costs referred to in the above undertaking nor its own costs of and incidental to the listings on 29 July 2026 and 6 August 2026 (including the costs of its interlocutory application filed 28 July 2026), will be recovered, directly or indirectly, from the settlement fund established by the Settlement Scheme.

THE COURT ORDERS THAT:

1.    Orders 5 and 6 of the Orders of 19 December 2025 be vacated.

2.    On or by 4 pm on 12 August 2026, the Administrator is to serve on the solicitors for the amici curiae, William Roberts Lawyers (WR), a schedule (Tenure Schedule) which identifies:

(a)    the name of each Affected Worker;

(b)    the Tenure of each Affected Worker;

(c)    the Tenure of each Affected Worker expressed as a percentage of the aggregate Tenure of all Affected Workers, calculated to five decimal places;

(d)    the bank account or other payment details of each Affected Worker (save for the Test Case Individuals) and the last known email address and telephone number of each Affected Worker;

(e)    whether the Affected Worker is an Unpaid Worker; and

(f)    whether the Administrator is aware that the Affected Worker is deceased or subject to a guardianship arrangement and, if so, whether a legal personal representative of the estate or person authorised to manage the Affected Worker’s financial affairs (as the case may be) has been identified.

3.    In preparing the Tenure Schedule, the Administrator may rely on the Years of Service Data and the records it holds without further verification.

4.    For the purpose of preparing the minute referred to in order 5 below, WR may request from the Associate to Justice Lee, and upon such request are to be provided with, a statement of the balance of the NAB account (including accrued interest) as at the date of the request.

5.    On or by 4 pm on 19 August 2026, WR are to provide to the Associate to Justice Lee a minute of order (i) specifying, and seeking the approval of, any further costs of the amici curiae (including WR) beyond the $169,317.50 already approved and paid by the Court, such further costs to be evidenced by invoices accompanying the minute; and (ii) providing for the payment of the balance of the penalty pursuant to s 546(3) of the FW Act to the Affected Workers, being in respect of each Affected Worker a sum calculated by:

(a)    identifying the balance notified under order 4, less the further sum specified under (i) above (excluding the separately identified costs payable by the Administrator) or such other sum as the Court approves (available fund);

(b)    deducting from the available fund a sum equal to $3,333 multiplied by the number of Unpaid Workers (distributable fund);

(c)    applying to the distributable fund the percentage identified for that Affected Worker in the Tenure Schedule; and

(d)    where that Affected Worker is an Unpaid Worker, adding $3,333 to the amount so calculated,

provided that the minute is also to provide for any payment which is rejected or returned, and any balance remaining in the NAB account after the payments are made, to be paid to Mr Robert Ishak, a principal solicitor of WR, to be held in an account “Robert Ishak Qantas Penalty Fund” and applied on the terms provided for in orders 7(d) and 9 below.

6.    For the avoidance of doubt, an Affected Worker is entitled to a payment under order 5 whether or not that person has executed a deed of release in favour of the Qantas Group (as that term is defined in the Deed of Agreement and Release), or has been or will be paid any amount out of the Settlement Sum; and the receipt of a payment under these orders does not affect, and is not conditional upon, any entitlement of that person under the Settlement Scheme.

7.    Where the Tenure Schedule identifies an Affected Worker as deceased or as subject to a guardianship arrangement:

(a)    within 2 business days of service of the Tenure Schedule, the Administrator is to provide to WR all information it holds concerning that Affected Worker’s estate, family or representatives, including the identity and any contact and payment details of any legal personal representative or person authorised to manage the Affected Worker's financial affairs, and a summary of the steps previously taken to identify such a person;

(b)    where such a person has been identified and their payment details are held, the minute provided under order 5 is to provide for payment of the Affected Worker's entitlement to that person on behalf of the Affected Worker or their estate, and such payment is a sufficient discharge of the Affected Worker’s entitlement under these orders;

(c)    where no such person has been identified, pursuant to section 57 of the Federal Court of Australia Act 1976 (Cth), Mr Ishak is appointed, without security, as receiver of the Affected Worker’s entitlement under these orders, for the limited purpose of receiving, holding and (subject to order 7(d)) paying over that entitlement, and the minute provided under order 5 is to provide for payment of that entitlement to Mr Ishak as receiver; and

(d)    Mr Ishak is to hold each amount received by him under these orders (whether under order 7(c) or pursuant to the proviso to order 5) in a separately dedicated interest-bearing controlled money account and is to pay: (i) each amount held in respect of a deceased Affected Worker or an Affected Worker subject to a guardianship arrangement, together with interest accrued and less any costs approved by the Court, to the legal personal representative of the estate or the person authorised to manage the Affected Worker's financial affairs (as the case may be) upon being reasonably satisfied of that person's appointment or authority; (ii) each rejected or returned payment in accordance with order 9; and (iii) any other amount as the Court directs, such payment being a sufficient discharge of the relevant Affected Worker's entitlement under these orders; and Mr Ishak may also pay from interest accrued on the account the reasonable costs of WR of performing the functions under orders 7 and 9, as approved by the Court.

8.    Pursuant to s 545(4) of the FW Act and/or s 23 of the Federal Court of Australia Act 1976 (Cth), a notice substantially in the form of Annexure A to these orders, completed with the contact details of WR, be distributed by the Administrator to the last known email address (or failing that, postal address) of each Affected Worker within one business day of the making of the order for payment pursuant to the minute provided under order 5, and in addition the Administrator is to send a short message by SMS to the last known mobile telephone number of each Affected Worker notifying them that the notice has been sent.

9.    Where a payment made pursuant to the minute provided under order 5 is rejected or returned, WR are to take reasonable steps to contact the Affected Worker using the contact details in the Tenure Schedule to obtain corrected payment details, and Mr Ishak is thereafter to pay the Affected Worker’s entitlement from the funds held by him under these orders.

10.    The Tenure Schedule, and any information provided under order 7(a), are to be provided to WR and to the Court on a confidential basis, are not to be published, and are to be used only for the purposes of these orders.

11.    The matter be re-listed on a date to be fixed in the first week of December 2026 for the purpose of the Administrator reporting to the Court on the status of the Settlement Scheme, including the progress of finalising assessments of economic and non-economic loss, and providing a proposed timetable for the completion of the administration, and any affidavit or other material on which the Administrator intends to rely for that purpose is to be filed at least 2 business days before the date fixed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

(Delivered ex tempore, revised from the transcript)

LEE J:

A    INTRODUCTION

1    In Transport Workers’ Union of Australia v Qantas Airways Limited (Administration Extension Application) [2026] FCA 1013, I explained the circumstances in which an interlocutory application seeking a variation of orders I made on 19 December 2025 came to be listed before the Court today. These reasons assume familiarity with that judgment.

2    Prior to explaining the orders I propose to make, it is worth making a broader point. This is because what has happened in this matter, which has affected third parties to this litigation adversely, provides a good illustration of matters I addressed as a member of the Full Court in Elliott-Carde v McDonald’s Australia Ltd [2023] FCAFC 162; (2023) 301 FCR 1 (at 55 [354]) and as the primary judge in Elliott-Carde v McDonald’s Australia Ltd (Stay Application) [2023] FCA 1210; (2023) 301 FCR 84 (at 113 [117]ff). Some of what is set out below is taken from those judgments.

B    THE REPRESENTATIVE CHARACTER OF THE PROCEEDING

3    Registered employee organisations play an important role, when needed, in enforcing and being seen to enforce the rights of employees through access to litigation in a cost-effective way. Organisations such as the applicant (Union) have long been recognised as a “party principal”, and more than a mere “agent” or “figurehead” for the employees they represent.

4    This is reflected in s 5(4) of the Fair Work (Registered Organisations) Act 2009 (Cth), which states Parliament’s intention to assist employers and employees to promote and protect their economic and social interests through the formation of employer and employee organisations, by providing for the registration of those associations and according rights and privileges to them once registered. One of those privileges of registration is that it unlocks rights as to standing, including under s 539 of the Fair Work Act 2009 (Cth) (FW Act), to bring proceedings to enforce certain contraventions of that Act.

5    In the Elliott-Carde judgments, I explained in some detail that, faced with a common issue of substance affecting persons they are entitled to represent, unions should at least consider entering the arena by becoming representative applicants under Pt IVA of the Federal Court of Australia Act 1976 (Cth) (FCA Act) or assisting a member in conducting Pt IVA litigation. I expressed the view that this would not diminish, but enhance, cost-effective access to justice for employees: see generally Hogan and Hynard, ‘The Modern Industrial Class Action’ (2024) 98 Australian Law Journal 108.

6    In performing the role it has in this proceeding, the Union might superficially be thought to be performing a representative function comparable with the role of a representative applicant in Pt IVA of the FCA Act. One important difference, however, is that the representative procedure adopted by the Union preserves the possibility of a legitimate disjunct between the interests of affected workers (or a subset of them) and the interests of the Union, whereas a representative applicant in a class action has a duty to act in the interests of group members.

7    A registered employee organisation is a body separate and distinct from its members, acts in an independent capacity, and is given standing to pursue its legitimate industrial objectives. An employee organisation such as the Union conducts litigation as a “party principal” and is entitled to act on its own account and in its own interests, subject to the requirements of the registered organisations legislation.

8    None of this is meant to gainsay that the Union has performed a valuable service in this proceeding. As the order for the part-payment of the penalty to the Union reflects, the Union exposed itself to considerable expense and risk in taking on this case which was not instigated by the regulator and then conducted the case skilfully. But although conflict has not been an issue in the circumstances of this case, the reality is that the interests of an employee organisation may not necessarily align with those of a particular subset of employees whose industrial interests it is entitled to represent. One can readily conceive of circumstances in which it would legitimately further the organisation’s aims to compromise litigation in return for what it perceives to be more valuable concessions for others, including employees in future enterprise bargaining. Such a settlement would, of course, be put in place absent Court scrutiny.

9    By contrast, a representative applicant cannot properly represent a class of persons if the applicant’s interests are antagonistic to, or in conflict with, those of group members. It is inconsistent with the duties of a representative applicant to act contrary to the interests of the group members represented. Part IVA of the FCA Act contains safeguards directed to protecting group members, most notably the requirement for Court approval of a settlement or discontinuance under s 33V and the ability to replace a representative applicant under s 33T.

10    Those sorts of safeguards are absent from the representative procedure employed in this case. There is an additional and presently important difference. When it comes to a class action settlement, an administrator ordinarily operates under specifically designed orders of the Court and is responsible to the Court for efficient administration. There is also no doubt as to the ability of such an administrator to approach the Court to invoke judicial power to resolve issues which arise at short notice, as they often do, in the distribution of settlement funds to a large number of persons.

11    What is notable about this case is that problems of this kind did arise in the compensation administration, but the administrator of the settlement scheme (Scheme), Maurice Blackburn (Administrator), regarded it as inappropriate or unnecessary to seek the intervention of the Court to resolve them (as the Administrator was not appointed by the Court). In my view, early intervention by the Court, which would have occurred in a Pt IVA class action, could have allowed the Scheme to be administered with far greater despatch.

C    DELAY IN THE SETTLEMENT SCHEME

12    The evidence read on this application disclosed two principal problems which have left the Administrator, despite the orders made in December 2025, unable to say when compensation will be paid to the affected workers.

13    The first concerns reports prepared by independent medical examiners for the purpose of barristers assessing non-economic loss. I will not wade into the detail. From 17 June 2026, the Administrator engaged in discussions with the external medico-legal provider as to how to address 111 reports said to be deficient. Those reports formed part of a cohort of 171 reports prepared by one examiner and, in turn, of approximately 600 reports required for the assessment of non-economic loss.

14    If I had been supervising the Scheme, I would have sought to bring to a prompt resolution the apparent difference between the medico-legal provider and the barrister assessor as to the sufficiency of the reports, so as to allow the assessment process to be completed. The evidence is that the medico-legal provider took a different view from the Administrator as to the sufficiency of the reports.

15    In any event, by about 3 July 2026, the Administrator determined that 60 affected workers could be assessed on the reports already obtained, 58 had reports containing unclear diagnoses which could be cured by supplementary reports, and 53 required entirely new assessments. This was communicated to the external medico-legal provider on about 7 July 2026. The significance of the issue is obvious: unless and until the relevant non-economic loss assessments have been completed, the Scheme cannot reach the point at which a final distribution is made.

16    The second problem is one I have seen arise before in the context of class actions. On 11 July 2025, Maurice Blackburn wrote to Services Australia concerning potential repayments under the Health and Other Services (Compensation) Act 1995 (Cth) (HOSC Act). Section 3 contains the definition of “compensation payer”. Section 32 provides, in substance and subject to its terms, that where a judgment or settlement has been made in respect of an amount of compensation, a compensation payer must not pay the compensable person any part of the compensation before the requisite notice has been issued. A failure to comply with the statutory prohibition is a criminal offence.

17    The Administrator has consistently maintained that neither it nor Qantas has a repayment obligation under the HOSC Act in the circumstances of this case. The compensation deed was drafted, no doubt, with this end in mind. Despite that position, there has been what can only be described as a vast number of communications between Maurice Blackburn and Services Australia concerning the issue over the course of the last year.

18    That process included a conference on 14 May 2026 between the Administrator, Qantas, Services Australia and solicitors from the Australian Government Solicitor. Following further communications, the Commonwealth indicated in July 2026 that it was open to entering into a tripartite bulk payment arrangement with Qantas and Maurice Blackburn. The evidence as it stands is that the Administrator expects it will still take some months to resolve any such arrangement. The Administrator has decided, with the benefit of legal advice, not to seek a determination of its contention that no relevant repayment obligation exists, but instead to pursue a “negotiated arrangement”.

19    In a Court-supervised process, the Court would have been apprised throughout of the ongoing difficulty. At least for my part, I would have done what I could to resolve the controversy promptly, whether by facilitating a curial determination and making appropriate declarations, or by ensuring there was supervised mediation directed to bringing the matter to a speedy conclusion. In my view, both courses were, with a little imagination, open to be taken in this case, but were not pursued.

20    In any event, that is the position in which we find ourselves. Unlike Lot’s wife, we must not look back. We are in the situation we are in. The question is where we go from here.

D    “UNCOUPLING” THE RESIDUAL PENALTY

21    As I explained in the Administration Extension Application, the reason this matter remains before me is that the orders made on 19 December 2025 “coupled” the distribution of the residual penalty amount to the completion of the compensation administration. I adopted that course because, if the compensation administration were completed with some alacrity, distributing the penalty pro rata by reference to assessed compensation appeared rational and equitable: Administration Extension Application (at [16]–[17]).

22    I am satisfied that a different course is now required. Any continuing method of distributing the penalty that is tethered to the Scheme will have embedded in it the Scheme’s timetable and all its now inestimable contingencies.

23    As the amici curiae submitted, there is no difficulty as to power in now taking a different course.

24    Section 546(3) of the FW Act empowers the Court to order that a penalty, or part of a penalty, be paid to a particular organisation or person. The orders made on 19 December 2025 provided interlocutory machinery for completing that exercise and may be varied or replaced.

25    Nothing I propose to do affects the compensation sums. The present discretionary power being exercised is penal, not compensatory (the purpose of a civil penalty is, of course, primarily, if not solely, the promotion of the public interest in compliance by deterrence: Australian Building and Construction Commissioner v Pattinson [2022] HCA 13; (2022) 274 CLR 450 (at 457 [9], 459–460 [15]–[16] per Kiefel CJ, Gageler, Keane, Gordon, Steward and Gleeson JJ). Compensation is provided for separately by s 545 of the FW Act and, in this case, through the Scheme.

26    Although, for reasons I have previously explained, the affected workers are the fitting destination of the residual penalty, no worker has a legal entitlement to a share measured by his individual loss. The method of division is a matter for the Court’s discretion. Proportionality to assessed compensation was a means previously selected by the Court, but was not an end commanded by the statute.

27    I recognise that a degree of approximation is the price of uncoupling, but it is an acceptable price. Where precise measurement is unattainable, or attainable only at disproportionate cost in time and money, imprecision is not necessarily a reason for inaction. In Hepworth v Hepworth [1963] HCA 49; (1963) 110 CLR 309 (at 318), Windeyer J adopted the observation of Devlin LJ in Short v Short [1960] 1 WLR 833 (at 849) that courts have power to arrive at a broad conclusion and, from time to time, to do “rough justice”, while recognising the different position where strict proprietary rights are in issue.

28    The aphorism against allowing the perfect to be the enemy of the good is apt in these circumstances. Distribution by reference to assessed compensation was, and in theory remains, the optimal means of reflecting fairly the relative impact of the contraventions upon the affected workers; but the premise on which that method depended has failed. To persist with it now would be a counsel of perfection at the cost of practical justice and further delay in getting a very substantial sum into the hands of the workers. I am fortified in this view by recognising that even where a settlement fund is compensatory (and each share is meant to approximate a legal entitlement), courts accept schemes that simplify and average.

29    It follows that the existing machinery tying distribution of the residual penalty to completion of the Scheme should be replaced, and the penalty distributed by a method which can be implemented immediately. The remaining question is the appropriate mode of distribution.

E    DISTRIBUTION BY TENURE

30    It is apparent that the Administrator holds, for the affected workers, data recording years of service at termination or redeployment, to nine decimal places, produced by Qantas pursuant to discovery orders. The Administrator also holds last-known contact details and bank payment details.

31    Mr Perrett, who appeared today, is a 43-year-old affected worker who has conscientiously engaged in the process of seeking to advance his claim with the Administrator. He sought a range of orders, including decoupling, but parted company with the amici curiae on the method of distribution. He submitted it would be fairer for the residual amount to be distributed equally among the affected workers. In oral submissions he made the point that younger workers, or workers with only a limited tenure at Qantas before the contravening conduct led to the termination of their employment, may have expected a long career at Qantas and have been deprived of that opportunity.

32    That point has real substance.

33    On balance, however, I am persuaded that it is better to proceed by reference to tenure, as proposed by the amici curiae and supported by the Union. First, it introduces no complication. Tenure is a matter of record, requiring no assessment, examination, or further step by the workers, and there is no reason why using it should create administrative difficulty.

34    Secondly, it is important to repeat for emphasis that the payment is not compensation. I am required to adopt a broad brush to secure a result which I consider fair. One matter which has loomed large in my assessment is that tenure is a relatively good proxy for age.

35    The prospect of a 60-year-old worker losing employment without any realistic prospect of securing alternative employment seems to me qualitatively different from that of a younger 30-year-old worker who, experience would tell us, is more likely to obtain alternative employment. Even though the order is not compensatory, my intuitive view is that it is fairer for the distribution of the penalty to have regard to that consideration.

36    I accept that any method is an approximation and will be imperfect. But distribution by tenure seems to me the preferable alternative among those available, each of which has something to commend it.

37    Orders will be made accordingly.

Associate:

Dated: 17 August 2026

ANNEXURE A

NOTICE TO AFFECTED WORKERS

FEDERAL COURT OF AUSTRALIA

TWU v QANTAS CASE (NSD1309/2020)

YOUR SHARE OF THE QANTAS PENALTY WILL BE PAID WITHIN DAYS

1.    What has happened. In August 2025 the Court ordered Qantas to pay a $90 million penalty for unlawfully outsourcing its ground handling operations. $50 million was paid to the TWU, and the remaining $40 million was set aside for affected workers, with $3,333 paid in December 2025 to each worker who had then registered for the Compensation Scheme. The rest — about $35 million plus interest — was to be paid once the Compensation Scheme assessments were finished. The Scheme has been delayed, and on 6 August 2026 the Court decided workers should not have to wait any longer.

2.    How your share has been worked out. The Court ordered that the remaining penalty (plus interest, less costs approved by the Court) be distributed now among the workers registered in the Scheme, based on each worker's length of service with Qantas, as recorded in data Qantas itself produced under Court orders: Your Payment = $3,333 + [(Your Years of Service ÷ Total Years of Service of all workers) × the rest of the Penalty Fund]. If you were paid $3,333 in December, nothing is deducted for it — you now receive the service-based part. If you were not, the $3,333 is added to your payment now.

3.    What you need to do. Nothing. Your payment will be made within the next few business days into the bank account you previously provided to Maurice Blackburn. No one will contact you asking for bank details. If your payment does not arrive within a few business days, contact William Roberts Lawyers (details below), who may also contact you if a payment to your account cannot be delivered.

4.    Deceased workers and workers who cannot manage their own affairs. Their share is being paid to a person appointed by the Court to hold it, being Robert Ishak of William Roberts Lawyers, who will pay it (with interest) to the estate’s legal personal representative, or the person authorised to manage the worker's affairs, once identified.

5.    The Compensation Scheme continues. This payment is a share of the penalty imposed on Qantas — it is separate from, and in addition to, your compensation, which will still be assessed and paid under the Scheme. It is not conditional on signing any release. The Administrator expects to send estimated notices of assessed compensation around October 2026.

6.    Tax and Centrelink. This payment is not wages and not compensation for your loss. Neither firm can give you personal tax or Centrelink advice — if unsure, speak to your adviser, the ATO or Services Australia.

7.    Beware of scams. No one will ask you to provide or confirm bank details by text or email link for this payment. If you receive such a message, do not reply — phone William Roberts Lawyers or Maurice Blackburn and check.

8.    Questions. About this payment: William Roberts Lawyers — QantasWorkers@williamroberts.com.au / 02 9552 2111. About the Compensation Scheme: Maurice Blackburn — qantascase@mauriceblackburn.com.au / 1800 716 855. The Court's orders were made in open court on 6 August 2026 after hearing from Maurice Blackburn and from independent barristers appointed to represent workers' interests; the reasons will be published on the Federal Court's website.