Qantas boss Alan Joyce has announced the airline is grounding its entire fleet in response to unions' industrial action.
Aircraft currently in the air will complete the sectors they are operating but there will be no further Qantas domestic or international departures anywhere in the world.
Jetstar, QantasLink and Qantas flights operated by Jetconnect across the Tasman will however continue.
The airline is fighting with its pilots, ground staff and licensed engineers over pay, conditions and the outsourcing of jobs overseas.
Mr Joyce says all domestic employees involved with the dispute will be locked out as of 8pm Monday (Australian eastern time), but the fleet will be grounded immediately.
"We are locking out until the unions withdraw their extreme claim and reach an agreement with us," says Mr Joyce, explaining that his hand has been tipped by what he calls the impossible demands of three unions.
"They are trashing our strategy and our brand," he says. "They are deliberately destabilising the company and there is no end in sight."
Refunds and transfers available
Mr Joyce says he's sorry this course of action has become necessary but the ball is now in the unions' court.
"They must decide just how badly they want to hurt Qantas, their members... and the travelling public."
The airline will offer hotel accommodation and alternative flights to those who are mid-journey and cannot get home when the grounding takes effect; and refunds and ticket transfers will be available to passengers whose flights are cancelled.
Government seeking to intervene
Australian transport minister Anthony Albanese says the government will take action to intervene in the dispute.
"We are very concerned about Qantas's actions, of which we were notified only mid-afternoon, with no advance notice from Qantas at any stage," he says.
"The government is making an urgent application to Fair Work Australia [an industrial court] to terminate all industrial action at Qantas. This will be aimed at both actions by unions and by Qantas management."
Mr Albanese says Qantas's action is a disappointing breach of faith.
Deterioration since August
The BBC reports that relations between the unions and Qantas management started deteriorating in August after the airline announced plans for restructuring and moving some operations to Asia.
The restructuring is expected to cut 1000 jobs from the airline's 35,000-strong workforce.
Qantas has a 65% share of the domestic Australian market but has been making heavy losses on its international flights.