A traveller waiting for luggage at the Qantas baggage carousel after flight cancellations at Sydney Airport on October 10, 2011
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Qantas cancels flights amid dispute with ground crews

Australia's Prime Minister Julia Gillard stepped back from possible government intervention in a continuing dispute between Qantas and its unions, urging both sides to sort out their differences.

Qantas grounded some of its aircraft on Monday because of its industrial dispute with maintenance engineers, and cancelled dozens of flights this week.

The unions are concerned the airline plans to move jobs offshore.

Amid all the cancellations, a Sydney-bound Qantas Airways Boeing 747 jumbo jet returned to Bangkok due to an engine problem on Monday. From Sydney, Duncan Kennedy reports.