It was a bad day for Qantas workers on Wednesday as Chief Executive Alan Joyce announced the loss of 2,800 jobs and Fair Work Australia (FWA) ruled in favour of the air carrier in its long-standing labour row with the Transport Workers Union (TWU).

Mr Joyce explained to the American Chamber of Commerce that most of the job losses, part of Qantas's five-year transformation plan, have actually been gone since the air carrier initiated the transition in 2011.

"It is the price we pay for a rapid and massive transition in our business, in making it stronger and better," Mr Joyce said.

The axing of 2,800 positions saved Qantas $300 million yearly, but Mr Joyce said the company would still declare a statutory loss when it releases its yearly results in the later part of August as a result of its labour problem, soaring jet fuel prices and losses in its international operations.

The changes include the split of Qantas into four independent units each run by a chief executive, reduction of heavy maintenance bases to two from three and sale of two of seven catering centres.

While Qantas said that most of the redundancies were voluntary, the changes further strained its relationship with employees who protested the initiatives by launching several industrial actions in 2011 which culminated in Mr Joyce's unilateral grounding of the airlines' fleet for two days.

The grounding resulted in FWA taking over the industrial row. On Wednesday, FWA favoured Qantas by ruling that the air carrier could bring in as many contract staff as it likes. In deciding for Qantas, FWA turned down the call by TWU for a 20 per cent ceiling on use of contract ground staff and the pay of nonpermanent workers to be on the same level as fulltime employees.

"To interfere with management's decision on such a matter would require clear and strong evidence of unfairness. No such case has been established with respect to current employees or otherwise," FWA said in its decision.

In response to the FWA decision in favour of Qantas, TWU National Secretary Tony Sheldon said the union will launch a multi-million dollar campaign to pursue industry-wide outcomes and legislative change.

However, there were some minor victories for the TWU. FWA also backdated to July 1, 2011 the 3 per cent pay increase that Qantas offered to TWU employees and ruled that Qantas cannot outsource to labour-hire companies and force compulsory redundancies.

Mr Joyce insisted that Qantas is pursuing the right strategy in implementing its transformation plan which he said would bear early results with the benefits expected to flow within the next 12 months.

"What you have seen in media headlines may have left you with the impression that our response to the challenges before Qantas is to retreat, or just cut back. That's not the case. We are undertaking a wholesale transformation of Qantas to make it better and stronger, the premium Australian airline for our times," The Australian quoted Mr Joyce.

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