Queensland-based ground handling firm Aerocare says it will create hundreds of jobs from a Virgin Australia contract in New Zealand but a union warns that workers' rights are threatened.

Aerocare won the Virgin contract off Air New Zealand for the ground handling work and says it will support about 5000 Virgin Australia flights per year from Auckland, Christchurch, Wellington, Queenstown and Dunedin to six international destinations.

Chief executive Glenn Rutherford said the company would create up to 220 new jobs in New Zealand, invest more than $1 million in training and skills development and spend $5m on specialist aircraft handling equipment.

But the E tu union questions the number of jobs created.

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"First, we would challenge Aerocare's claim that it is creating up to 220 jobs as a result of securing the Virgin Australia contract. Until now the work has been done by Air New Zealand ground staff, so there are no new jobs as such," said Savage, the union's aviation lead organiser.

He said the union estimated the Virgin Australia contract involved about 90 to 100 full time equivalents, but the number quoted by Aerocare reflected the company's labour practices, which included a reliance on part-time, casual staff with minimum entitlements.

"This is in stark contrast to the reliable wages and conditions offered by companies like Air New Zealand.

Aerocare has been operating in New Zealand since 2000, servicing a range of airlines.

"Companies like Aerocare don't provide employees with job security, career development or decent pay and that's not good for NZ.

Aerocare relied on unstable rosters, split shifts and wages of only $16 to $18 an hour," said Savage.

In the last three years, the proportion of its workforce who are permanent employees has risen from 40 per cent to about 90 per cent

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But Aerocare hit back at E tu's response and said it had a "proud history" of job creation and had tripled its workforce from about 1000 to 3000 in the last three years.

"It has been at the forefront of providing greater job security, by encouraging workers to move from the insecurity of casual labour, to the security of permanent roles. In the last three years, the proportion of its workforce who are permanent employees has risen from 40 per cent to about 90 per cent.

The jobs in Virgin Australia's New Zealand operations would be a mix of full and part-time work, depending upon the work needed by airline scheduling.

"While it is Air New Zealand's decision what it does with its staff, we understand it will be retaining all those who currently perform the work on behalf of Virgin Australia," a spokesman said.

Aerocare has operations at Auckland, Wellington, Queenstown, Napier, Nelson, New Plymouth and Palmerston North airports, supporting carriers such as Jetstar, Fiji Airways, Qatar Airways and Hawaiian Airlines.

Ground handlers provide services including baggage loading, aircraft cleaning, servicing aircraft water and lavatory systems and completing customer check-in at boarding gates.

Aerocare said it was the only Australian-owned ground handler with the top global safety accreditation and figures showed it had one tenth the accident rate of other ground baggage operators in Australia.

The Aerocare spokesman said it paid above the union-approved industry award in Australia, providing $9000 on average more to each workers per year than those on the award.

Aerocare currently handles Virgin Australia flights from 17 locations in Australia, and with the new services this will grow to 22 locations.

Savage, who is known by only one name, said the travelling public needed to understand what is behind the low air fares offered by airlines which used Aerocare.

Those low airfares comes at a cost to Kiwi aviation workers in terms of low wages and poor quality working conditions

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''Those low airfares comes at a cost to Kiwi aviation workers in terms of low wages and poor quality working conditions.''

E tu was keen to discuss the issues with the company.

"E tū Aviation is interested in building a high wage, high productivity economy and we want to talk with Aerocare and Virgin Australia about the best way to achieve that. We are hopeful the new government's policy of fair pay agreements will help us halt the race to the bottom in aviation contracting," he said.

Air New Zealand still has a code share agreement with Virgin Australia but has sold its equity stake in the airline which is facing tough competition in the Australian domestic market.

Virgin Australia general manager ground experience, Roger Lindeman, said Aerocare had been a partner of Virgin Australia since its very first flight across the Tasman.

"Aerocare was chosen after a rigorous selection process which found the company continues to meet Virgin Australia's very high standards for safety, compliance whilst delivering the exceptional service for which Virgin Australia is renowned," he said.