Australia's government said it could force an end to a bitter dispute between unions and Qantas Airways after the airline warned it will ground aircraft and cut around 100 domestic flights a week due to rolling industrial action.

Qantas said a prolonged dispute involving baggage handlers, ground staff, engineers and increasingly pilots, would disrupt thousands of passengers, with flights to and from the major cities like Sydney and Melbourne most affected.

"The sooner the parties get in a room and sort it out the better. If they don't, then there are options for the government to actually require the parties to resolve these issues under the umbrella of the Fair Work Act," Tourism Minister Martin Ferguson told reporters.

Ferguson, a former head of Australia's peak union body, added the belligerence of the Licensed Aircraft Engineers union in recent days had been particularly "un-Australian" and a "sad reflection" on its national secretary Steve Purvinas.

Earlier this month, the industrial fight with unions turned violent, with racist threatening letters sent to Qantas' chief Alan Joyce and other management, while the cars and homes of Qantas staff were damaged after they refused to strike.

Four Boeing 737 aircraft and one Boeing 767 aircraft would remain grounded for at least a month, Joyce said on Thursday, as strikes continued including stoppages by Qantas engineers.

"You can have a dispute with employers, but there is a responsibility on trade union leaders to never set out to damage Australian industry, not only Qantas but in doing so many struggling small and medium sized Australian tourism businesses," Ferguson said.

The government's industrial relations institution Fair Work Australia, introduced by ruling Labor, can exercise statutory powers of compulsory arbitration in work disputes.

Fair Work Australia can issue a final order in disputes involving employers, employees and unions and employer associations who are covered by the national workplace relations system.

Qantas has been hit by a series of strikes triggered by a dispute over pay and conditions and plans to cut domestic job cuts as the airline expands in Asia.

Joyce earlier this month called on union leaders to "desist from inflammatory language and to encourage their members to exercise restraint. (Reuters)