PAL shuts door on further talks with union

Manila Standard Today
October 1, 2011

PHILIPPINE Airlines on Friday defended the implementation of its outsourcing program, saying the company was well within its rights to restructure operations to ensure the airline’s survival and to save the jobs of its 5,000 remaining employees.

The program’s critics were harping on the layoff of 2,400 ground workers, but were turning a blind eye on the 5,000 office staff, cabin crew and the pilots that the carrier was trying to save, airline president Jaime Bautista said in a statement.

“The law is on our side,” Bautista said.

“We’re implementing the outsourcing program not on mere whim or caprice, but on the basis of legal and valid orders from the Department of Labor and Employment and the Office of the President. We’re doing it to save the airline from financial ruin.”

Bautista made the statement as the members of the Philippine Airline Employees Association protested at the airport on the last day of work for the 2,600 ground crew.

The group challenged the management to open talks to resolve its dispute with it in the face of the continuing flight disruptions.

“It is clear as day that the outsourcing plan is a failure, and PAL does not have the manpower to normalize its operations,” group president Gerry Rivera said.

“We call on PAL to end the lockout of its employees and halt the premature implementation of the outsourcing plan pending the final decision of the courts.”

But Bautista said the management would not return to the negotiation table.

“The [Labor Department] and the President have spoken,” he said.

“[The union] has filed their appeal with the appellate court. Let’s just wait for the [court’s] action on this matter. We have nothing more to talk about. The time for diplomacy is long over, especially after the union’s wildcat strike.”

Meanwhile, Bautista said the airline was looking at another loss in the quarter ending in September as a result of high fuel prices and lower passenger demand for seats.

“The second quarter is always a losing [one] because this is a lean season,” he said.

The airline reported a net loss of $10.6 million in the quarter to March compared with a profit of $31.6 million the year before.

Fuel makes up 45 percent of the airline’s operating expenses, and fuel costs went up by 36 percent to $210.8 million. Jet fuel prices averaged $138.11 a barrel in the quarter to June this year against $100.47 a barrel in the comparable quarter last year.

Bautista said the flight cancellations resulting from the ground crew’s wildcat strike would also affect the bottomline.

“It will take a few days before we can normalize operations,” he said.

“Hopefully, the second half will be [profitable] since the third and the fourth quarter are usually profitable seasons.”

Eric B. Apolonio, Vito Barcelo, Jeremiah F. de Guzman