The AI layoff question: Are Australian companies telling the full story?

As Australian companies accelerate their artificial intelligence (AI) adoption, a growing number of corporate job cuts are being linked to automation and technological transformation.

However, unions and workplace experts are questioning whether AI is genuinely replacing workers or becoming a convenient explanation for cost-cutting and shifting jobs to lower-cost offshore markets.

The debate has intensified following Qantas' announcement that it will cut 850 jobs and outsource some corporate functions overseas as part of an AI-driven overhaul in partnership with consulting firm Accenture.

The decision has drawn criticism from unions, which have accused the airline of using AI as a justification for moving Australian jobs offshore.

The controversy has also brought renewed attention to the practice of 'AI washing', where companies attribute workforce reductions to artificial intelligence when broader business decisions, including cost reduction and outsourcing, may be the underlying drivers.

Qantas is among several major Australian companies facing scrutiny over workforce reductions linked to AI adoption.

Technology companies WiseTech and Atlassian have also cut jobs this year, citing AI as a factor in their restructuring plans. Telecommunications company Telstra has similarly reduced roles within its AI joint venture with Accenture, with some work being moved to India.

Beyond these announcements, several Australian businesses have reduced their domestic workforces while expanding operations in India, the Philippines and Vietnam.

Although these companies have not explicitly attributed their decisions to AI, the developments have added to concerns about the relationship between automation, outsourcing and employment.

The Australian Services Union, which represents affected Qantas employees, accused the airline of "using AI to launder their cuts to Australian jobs."

Australian Council of Trade Unions Secretary Melissa Donnelly also raised concerns about companies using technology to justify workforce reductions without sufficient accountability.

"Unions are concerned about the risk of companies using AI simply as a cover to cut Australian jobs with no accountability," Donnelly said.

"From Qantas to the big banks, workers deserve transparency and genuine consultation over decisions that impact their jobs and lives."

The distinction between automation and outsourcing has become central to the debate.

Uri Gal, a professor at the University of Sydney Business School, said companies were increasingly attributing job cuts to AI, but cautioned against accepting technology as the primary explanation.

"There are real incentives to engage in AI washing," he said. "A company that announces job cuts to reduce costs may face criticism, whereas one that presents the same decision as part of an AI transformation can appear innovative and forward-looking."

Gal pointed to Qantas' restructuring as an example of how traditional outsourcing decisions could be presented as part of a broader technological transformation.

"The company has announced that some corporate functions will be transferred to Accenture, primarily in India, and explicitly states that these functions will subsequently be transformed through AI and automation," Gal said. "This raises an obvious question: if AI is making these jobs redundant, why does the work first need to be transferred to another group of employees?"

His assessment raises a wider question about how organisations communicate the relationship between technology investments, workforce restructuring and the relocation of business functions.

The growing debate over AI-linked redundancies could create additional challenges for Australia's Labor government as it attempts to support employment amid a cooling economy.

The country's unemployment rate reached 4.7% in September, its highest level in nearly five years, while persistent inflation and higher interest rates have added pressure to businesses and households.

Senator Barbara Pocock of the Australian Greens also expressed concern about companies engaging in AI washing and using the technology as an excuse to cut jobs.

"AI is transforming our workplaces and economy but that's no excuse to let it run rampant," Pocock said.

Responding to the Qantas announcement, a company spokesperson said the airline would continue consulting with unions and was focused on "redeployment opportunities" and support for affected employees. Qantas did not respond to the specific concerns surrounding AI washing.

The Australian Services Union also warned that the practice could encourage further outsourcing and workforce reductions if companies continued to adopt similar approaches.

"We expect to see more of this cost cutting and race to the bottom if corporate Australia continues to copy this failed tactic," said Assistant National Secretary Scott Cowen.

Meanwhile, the Reserve Bank of Australia (RBA) has said AI has not yet resulted in widespread job losses across the country, although there are early indications of adjustments in certain occupations.

The central bank noted that job advertisements were weakening in occupations more exposed to AI, while employment growth remained stronger in roles less affected by the technology.

A government spokesperson said Australian workers should benefit from the adoption of new technologies and that employers should invest in upskilling employees to help them adapt to AI.

As businesses continue to integrate automation into their operations, the debate is shifting beyond whether AI will replace jobs to how organisations make decisions about their workforce.

For employees, the bigger concern is whether technological transformation will create new opportunities or become another route for companies to reduce domestic employment costs. For employers, transparency around restructuring decisions, meaningful consultation and investment in workforce skills will remain central to managing the transition.