The Qantas Airways Ltd (ASX: QAN) share price is in the red today.

Shares in the S&P/ASX 200 Index (ASX: XJO) airline stock closed yesterday trading for $10.29. In late morning trade on Wednesday, shares are changing hands for $10.27 apiece, down 0.2%.

For some context, the ASX 200 is up 0.9% today, with investors in a bullish mood following yesterday's RBA interest rate cut.

Today's underperformance may be linked to the latest legal woes playing out for the airline this week.

Here's what's happening.

Qantas share price facing legal headwinds

The Qantas share price could be under some pressure today, with the three-day Federal Court hearing in Sydney, which commenced on Monday, due to finish this afternoon.

Qantas is in court facing a potential fine of up to $121 million for illegally outsourcing more than 1,800 ground handling workers.

As you may recall, that happened during the first year of the global pandemic in 2020, when border closures brought domestic and international air travel to a screeching halt and knocked the stuffing out of the Qantas share price.

In regard to its illegal sacking of the workers, Qantas previously agreed to pay $120 million in compensation. The potential legal fine it's facing this week would come on top of that payout.

And the Transport Workers Union (TWU) is adamant that the judge hand out the maximum penalty of $121 million.

According to TWU secretary Michael Kaine (quoted by news.com.au):

Not only was it an appalling act to get rid of a loyal workforce, it was the biggest case of illegal sackings in Australian corporate history.

The penalty to Qantas must reflect this and send a message to every other company in Australia that you cannot sack your workers to prevent them from using their industrial rights.

Qantas people manager, Catherine Walsh, acknowledged that Qantas was "in the wrong".

"I want to reinforce that we are deeply sorry, and we apologise for the impact on the workers, the TWU, to the court for their time and to the family and friends that felt the impacts, we are deeply sorry," Walsh said.

How has the ASX 200 airline been performing?

Legacy pandemic-era legal issues aside, the Qantas share price has been a stellar performer this past year, with shares hitting new all-time closing highs on Tuesday.

At the current level, shares in the ASX 200 airline stock are up 62% over 12 months.

And that doesn't include the 26.4 cents per share fully franked interim dividend the company paid out on 16 April. With revenue and profits soaring, this marked the first Qantas dividend since 2019.