Prime Minister Julia Gillard had wanted to intervene in the country's biggest labor row involving Qantas and its three labor unions. However, the Prime Minister said those involved in the dispute are still willing to resolve the matter without the government. Qantas management claims it remains duty-bound to continue talks with the pilots' union.

A report from the Sydney Morning Herald said that Qantas management has been very patient in dealing with the labour unrest for the past 14 months. However, according to Qantas President Alan Joyce, the unions had been asking unrealistic demands.

The Australian government on Friday announced that it is willing to intervene to resolve the case.

However, Mr Joyce said he would prefer to deal with the unions directly.

"We've not been calling on the government to intervene," he said.

"We've been saying to the unions, 'We need to sit down, we need to talk, we need to get this resolved'."

However, the unions were sticking by "unrealistic, outdated demands", Mr Joyce said.

Qantas only wants the union to pull out its unworkable and detrimental demand that Jet star and Jet connect pilots should be given the same high wages and privileges as Qantas pilots.

"If Qantas were to agree to this claim it would increase airfares for our customers and endanger the jobs of other employees within Qantas," key officials of the firm said.

AIPA president Barry Jackson insists that management walked out on the meeting.

Captain Richard Woodward, vice president of the pilots' union said in a exclusive interview with ABC News that they received a letter from Qantas indicating that "it is disproving their "claims on their new Qantas flight, flight flaws and therefore they couldn't see any point on in going on with further negotiations in the Fair Work Australia."

This is a clear signal that management has pulled out from the arbitration, according to Woodward.

Woodward clarified that there is no intention from their end to resort to a work stoppage and cause inconvenience to travellers.

Their alternatives include "behind the scene actions that would hopefully get the company's attention and bring them back to the table."

However, Qantas spokesperson Olivia Wirth asserts that the demands of the union are beyond reason.

Wirth said this action would hurt their business even more and ruining schedules with passengers bearing the brunt of these protest moves.