Qantas will also respond to any request from the government for emergency transportation for ex-pat Australians wishing to travel home and some strategic transport links,though it is expected that most Australians will heed the government's warnings and will choose to travel home before the end of March.
The sweeping measures came after the federal government announced a $715 million mini-bailout for the aviation sector on Wednesday,which includes the waiving of certain fees and levies associated with air travel. Qantas has a $4 billion annual wage bill.
Qantas chief executive Alan Joyce told reporters on Thursday that Qantas would reassess its position in April.
"We will have to assess then whether to dig further deeper,or to put capacity back on,"he said.
"This is a terrible day,"Mr Joyce said."I never thought as CEO I would have to stand down two thirds of our people... and there may even be more.
"This is the biggest crisis aviation has ever been through."
Asked whether the airline would ask for more support from the government in addition to the levy waiver,Mr Joyce pointed to Qantas'"really strong balance sheet. We have a strong cash balance and an investment grade rating."
"We'll be okay financially,"he said.
"Airlines will go under in this region,Qantas will not be one of them. We're doing everything we can to make sure we're the last man standing."
Airlines will go under in this region,Qantas will not be one of them. We're doing everything we can to make sure we're the last man standing.
Qantas CEO Alan Joyce
Qantas rival Virgin Australia has already cut capacity as it bats off speculation that it is in severe financial strife. Virgin Australia on Wednesday grounded its entire international fleet and is running a slimmed down domestic service.
In regards to the stand-down of thousands of staff,Mr Joyce said that amid the restrictions on international travel the airline did not have enough financial capacity to pay its staff while it wasn't flying planes.
"For many,a period of unpaid leave will be inevitable,"Mr Joyce said,adding the airline was"having constructive dialogue with the unions".
Pilots,cabin crew,baggage handlers and workers within Qantas's lounges will be hit hard by the mass stand-down of staff.
All Qantas chairmans'lounges will be shut and there will be a consolidation of other lounges and all international lounges will close.
The Qantas announcement today amounts to workers bailing out the airline.
TWU national secretary Michael Kaine
Qantas said it was working with Woolworths to see if any of the supermarket's additional temporary employment positions could be made available for stood-down airline staff,particularly baggage handlers which could aid the supermarket's ramped up restocking program. Stood-down staff who took temporary employment would not place their future employment at Qantas in jeopardy.
The airline will also delay the payment of its dividend from April 9 until September 1,and senior executives and the board will take a 100 per cent pay cut until at least the end of the financial year,up from 30 per cent earlier,joining the chairman and CEO in taking no pay.
More than 150 aircraft will be temporarily grounded by Qantas's capacity cuts. This includes all of the airline's A380s,747s and B787-9s and Jetstar’s B787-8s. Discussions are progressing with airports and government about parking for these aircraft.
Transport Workers Union national secretary Michael Kaine slammed Qantas’ decision.
"The brunt of this crisis has been pushed into workers,"Mr Kaine said.
"When this crisis is over,Qantas will have leave balances of zero or less,"Mr Kaine said.
"We are robbing from the future of airline workers who have built this airline and this industry."
He called on the Morrison government to step in with financial support for all affected workers.
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"Scott Morrison has a window of opportunity to support Australian workers and if he does not he may never been forgiven,"Mr Kaine said.
He said about 7500 frontline aviation workers would be affected and said the airline’s efforts to help workers get temporary supermarket work should be supported,but amounted to only"window dressing"in the context of the airline’s overall treatment of its workforce.
And Steve Purvinas,federal secretary of the airline engineers’ union,said the cuts would be devastating to workers who ran out of paid leave. “People who don’t have any leave,won’t be able to pay their mortgages or even buy a toilet roll,” Mr Purvinas said.
The welfare system,Mr Porter said,was well set up to provide income support for workers who have to go without pay. But he said the government was looking to add “further flexibility” to that system as workers use provisions that allow them to stand down their workers without pay.