Industrial arbiter Fair Work Australia will now decide on new contracts for Qantas Airways employees as failed to hit agreements with the Australia's biggest airline by yesterday's deadline.

Last month, the labor regulator had given the airline 21 days to reach an agreement with the unions representing pilots, engineers and ground crew.

Qantas Chief Executive Officer Alan Joyce ended talks to allow the labor regulator to settle the dispute. He expects the regulator to announce a more favorable deal for Qantas than the airline could get from unions.

Announcing their decision to take the dispute to the regulator, Joyce said, "We will now let the independent umpire decide."

But, the Fair Work Australia could take several months to complete the process.

On October 29, Qantas grounded his main fleet ahead of a lockout of employees as a part of its efforts to put an end to frequent strikes and a drop in bookings.

Shares in Sydney-based Qantas slipped 2.7 per cent to A$1.595 in the recent trading. The stock has shed 37 per cent of its market value so far this year.