A specific case I was involved in quite a number of years ago, involved someone who had been charged and convicted of a crime but it was later determined their were some unusual circumstances - meaning that the fact of the criminal record was not, legally, a bar to holding an ASIC (it wasn't Qantas, but another major Australian airline) and the security department advised they did not want to issue an ASIC in any case. I was told at the time that they had to discretion to do so. One of them, an ex Police Officer, told me that the person would be working on what effectively would be the company's property and the company has even a common law right to refuse entry to anyone it sees fit but more specifically in this case, they just didn't want someone who had ANY sort of criminal record.
You can't deny an ASIC for other than the prescribed reasons, you can however have a work protocol that prohibits anyone with a criminal record. They are two different things. If someone is barred from an ASIC for improper reasons you can ask for a review and then take it to the AAT, this is all written in the transport security act so no company or individual can over-ride that.