KMU, Anakpawis Slam PAL’s Planned Layoff of Employees via Spin-off

News Release
April 19, 2010

Labor center Kilusang Mayo Uno blasted today Philippine Airlines’ (PAL) plan to spin off its three departments, saying the measure will retrench one-fourth of the airlines’ total workforce to maximize company profits rather than reduce losses.

PAL has announced that it will spin off the inflight catering services, airport services (including ground handling, cargo terminal/handling, and ramp handling), and call center reservations.

KMU belied claims of the airlines company owned by business tycoon Lucio Tan that it is suffering from losses. KMU revealed Tan is even ranked by Forbes as the second richest Filipino in the world, with his net profit jumping to P83 billion in 2009 from P74 billion the previous year.

“If PAL is really suffering from major losses, then why is it that it has even opened new international flights and has purchased new Boeing 777 jets? Such claim of cost-cutting measures are actually meant to lay off thousands of workers and replace them with contractuals via spin-off,” said KMU chairperson Elmer “Bong” Labog.

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Labog said by spinning what it claims as “non-core units,” the company will earn millions more as it will free itself of wage and benefits obligations to an estimated 2,000 employees that it will lay off on May 31.

“PAL should stop implementing cost-cutting measures at the detriment of employees, whose labor rights and collective bargaining rights are already seriously denied,” Labog said.

In 2000, it laid off hundreds of employees in the Maintenance and Engineering Department under a spin-off. In September last year, it offered measly early retirement packages (ERP) to 400 employees. “It most recent spin-off plan stands to be the most disastrous to PAL employees in recent years.”

70th anniversary’s black mark

Anakpawis Partylist Rep. Joel Maglunsod also criticized PAL’s spin-off plan, saying it contrasts the company’s hefty promos for its 70th anniversary next year.

“As part of the run-up to its 70th anniversary next year, PAL is offering 70,000 free seats to its customers, which ironically stands in contrast to the looming retrenchment of thousands of its employees.

“It is ironic how PAL celebrates its anniversary. Instead of repaying and recognizing the contribution of employees to its success, it has chosen to leave them behind through retrenchment. It is definitely a black mark to its 70th anniversary,” said Maglunsod.

KMU called on all PAL employees in different units to unite under the common cause of asserting job security.

“We call on all PAL employees to manifest their opposition to the highly unjust and anti-worker plan of the company in whatever necessary means,” Labog said.

Elmer “Bong” Labog
KMU Chairperson

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