•    HOME   
•    NEWS   
•    BUSINESS   
•    INTERNATIONAL   
•    TECH   
•    SPORTS   
•    LIFE & TIMES   
•    OPINION   
•    MY JAKARTA   
•    BLOGS   

Sydney. Australian flag carrier Qantas on Saturday took the “unbelievable” step of grounding its entire domestic and international fleet indefinitely in an escalating industrial dispute.

The airline, which has been hit by a series of strikes, said all employees involved in the action would be locked out from Monday evening and flights grounded from 0600 GMT on Saturday.

“Pilots, licensed engineers and baggage, ground and catering staff are essential to Qantas operations and the lock-out will therefore make it necessary for all Qantas aircraft to be grounded,” the airline said.

“Aircraft currently in the air will complete the sectors they are operating. However, there will be no further Qantas domestic departures or international departures anywhere in the world.”

Months of strikes by baggage handlers, engineers and pilots were costing the company 15 million Australian dollars ($16 million) per week, it said, with the total financial impact so far hitting 68 million Australian dollars.

Approximately 70,000 passengers had been affected ahead of the announcement and more than 600 flights canceled.

The embattled company’s shock decision to ground all aircraft will affect 108 planes at 22 airports, it said.

“The airline will be grounded as long as it takes to reach a conclusion on this,” said chief executive Alan Joyce in a hastily called press conference, adding that he could not take “the easy way out” and agree to union demands.

“That would destroy Qantas in the long term,” he said.

“I’m actually taking the bold decision, an unbelievable decision, a very hard decision, to ground this airline.”

Unions have been protesting against pay and restructuring plans and the decision to ground the planes came a day after a fiery annual general meeting.

At the AGM, Qantas management came under fire for plans to refocus the airline on Asia which will see it launch two new airlines and axe 1,000 jobs.

Joyce was accused of running the carrier into the ground while reaping massive personal rewards.

Engineering union chief Steve Purvinas had warned that protests could stretch until mid-2012 while ground staff leader Tony Sheldon threatened crippling 48-hour strikes.

Joyce Saturday blasted the unions for running “utterly destructive industrial campaigns against Qantas and our customers, hurting all our employees and undermining Australian business.”

“They are trashing our strategy and our brand,” he said. “They are deliberately destabilizing the company and there is no end in sight.”

The airline will offer hotel accommodation and alternative flights to those who are mid-journey and can’t get home because of the grounding.

And there will be refunds and ticket transfers available to passengers whose flights are canceled.

“They [the union] talk about job security, but the unions are on a path that would diminish the job security of their own members,” added Joyce.

“Customers are now fleeing from us.”

Prime Minister Julia Gillard has warned the parties to resolve the deadlock and said she was “maintaining regular briefings” about the issue but is yet to respond to the latest dramatic development.

Agence France-Presse