Former Qantas boss Alan Joyce has had his final pay packet docked by almost $10 million following a scathing internal review at the airline.

Other executives and directors also face a cut after action from the competition watchdog and reputational turbulence triggered Joyce’s decision to quit as chief executive last September, two months before his planned departure.

Joyce had been due to leave in November, which would have marked 15 years after he landed in the role in 2008.

He took home $21.4 million in pay for the 2023 financial year and was set for a further top-up this year, including salary and bonuses.

In a decision announced on Thursday, Qantas said Joyce would forfeit a tranche of incentive-based shares, valued at $8.36 million at the start of the financial year. His scheduled bonus will also be cut by $900,000.

Other Qantas executives, including Joyce’s replacement as CEO Vanessa Hudson, will have short-term bonuses cut by 33 per cent.

It follows a review the airline launched last October after a 12-month period in which Qantas was accused of advertising tickets for flights it had already cancelled and found to have illegally sacked more than 1600 workers during the Covid-19 pandemic.

It has agreed to a $100 million penalty for the ghost flights, which is awaiting Federal Court approval. The airline’s breaches of the Fair Work Act are also being determined.

Labor senator Tony Sheldon, a former Transport Workers’ Union official, welcomed the decision.

“Under Alan Joyce, Qantas metamorphosed from a proud national icon to a criminal enterprise. Executives who illegally rip off their customers and workers, to the tune of hundreds of millions of dollars, should be held personally accountable,” he said on Thursday.

“The decision to claw back more than $9 million of Joyce’s final bonus is the correct decision. It ensures he experiences at least a small fraction of the suffering Qantas inflicted upon its workers and customers throughout his tenure.”

But Sheldon said that the recognition that other senior Qantas executives should lose parts of their bonuses emphasised they were not fit to remain.

“Their continued presence is a stain on Qantas. Anyone directly involved in illegal misconduct and exploitation should be swept out of the executive team to give Qantas a truly fresh start,” he said.

Qantas said on Thursday that mistakes made by the airline’s board and management contributed to significant reputational and customer service issues.

“The events that damaged Qantas and its reputation and caused considerable harm to relationships with customers, employees and other stakeholders were due to a number of factors,” it said.

The review did not identify any deliberate wrongdoing.

Qantas chairman-elect John Mullen said the review has charted a path to restore pride in the airline, which describes itself as the “Spirit of Australia”.

“It’s clear that we let Australians down,” he said.

“As the national carrier, it is our duty to make sure we always act in the best interest of stakeholders and hold ourselves to the highest level of accountability.

“There is still a significant amount of work to be done to rebuild the trust of all stakeholders.”

Qantas said its board had committed to addressing the 32 recommendations in independent adviser Tom Saar’s review.

Saar said many of those actions were complete or well under way.

“While some of the recommendations will take some time to embed across the organisation, if the current momentum is maintained, my expectation is that tangible benefits will occur within a short period,” he said.

–with AAP