These LCCs recognize unions and negotiate collective agreements for at least certain
sections of their workforce, but both also have forms of works councils for
consultation with employees. They have so far avoided the overt industrial conflict
that has sometimes characterized the airline industry. But given changes in labor
market legislation implemented by the Australian government in 2006, these new
airlines might seek to take advantage of opportunities to replace collective labor
contracts with more individual ones. Such a development would probably meet strong
resistance from unions. Both LCCs have recently begun international expansion,
which affords them cost advantages over legacy airlines and opens up new markets.
However, this move may exacerbate tensions between Qantas and its unions, which
fear that Qantas may use JS to "offshore" and to undermine wages and working
conditions of employees in the legacy carrier. Historically, it has proved difficult for
three airlines to survive in the relatively small Australian domestic sector. It remains
to be seen whether two LCCs can survive for long in the same market, alongside
Qantas.