Federal government departments spent $427 million on travel in 2016. Credit:Peter Braig The staff who have already agreed to 18-month wage freezes include aircraft engineers, ground staff, Jetstar pilots and Qantas' short-haul pilots who fly mostly domestic routes. The payments to eligible employees will be made shortly after Qantas posts its annual results on August 20. While several union leaders welcomed the news, Transport Workers Union national secretary Tony Sheldon said Qantas was throwing staff a "bone in the form of a cynical bonus" and its plans were about replacing "quality jobs with part-time work on low wages". "It doesn't hide the fact that most jobs at the airline now do not allow people to provide for their families," he said. "While Qantas executives are sipping on champagne celebrating this cynical move to tear down the living standards of Qantas workers all for a 5 per cent bonus, it's the workers who are forced to live with the long-term cost."

Australian Licensed Aircraft Engineers Association president Paul Cousins said it was great to hear front-line staff would receive some recognition from management for their contributions. "However, increases in real-time earnings are what staff want. Most have undertaken an 18-month pay freeze, so for them it is bitter sweet," he said. Qantas last made bonus payments to staff in 2002, after a wage freeze the previous year. Australian and International Pilots Association president Nathan Safe said the pilots welcomed the airline's willingness to pay a one-off bonus and hoped it would be the first of many opportunities for staff to share in the company's profits now that it had turned the corner. Qantas chief executive Alan Joyce said the bonus payments were recognition of the contribution from all employees to "strengthening the group's long-term competitive position through the wage freeze and the delivery of all Qantas transformation targets on or ahead of schedule".

"The rapid turnaround of the Qantas Group has only been made possible through the dedication and hard work of all our people," he said in a statement. "Our ability to make these bonus payments reflects a bright future for the Qantas Group, provided we stay focused on fully delivering the transformation program that has brought us this far." The expected bonuses for staff who are part of management pay schemes will be determined separately. Mr Joyce received a 40 per cent fall in his take-home pay to just over $2 million last year because he did not gain any bonuses in a year in which Qantas posted a $2.8 billion loss, the largest in its history. However, the turnaround in Qantas' financial fortunes means Mr Joyce and the rest of his senior executive team are set to hit the targets they need to meet in order to gain sizeable bonuses this year. It puts Mr Joyce on track to gain $1.7 million in short-term bonus payments, which he will receive on top of his base pay of more than $2 million in cash.

Qantas expects to have realised at least $875 million of its targeted $2 billion in cost savings this financial year. The airline has already cut most of the 5000 jobs it revealed early last year would go. In May, it flagged a resumption of dividend payments in the coming year as part of bullish comments from senior management, which included expectations that its fuel bill in 2014-15 would be $550 million lower than the previous year. Shareholders have not received a dividend since early 2009. Shares in Qantas reached a near seven-year high of $3.68 in May as it benefited from the cost cutting, lower fuel prices and a truce in its so-called "capacity war" with Virgin Australia in the domestic market. However, the stock was trading down 6¢ at $3.21 early on Friday.