Bulatlat - The Philippines's alternative weekly newsmagazine

It may be an uphill battle, but the 4,000 workers of Hacienda Luisita, Inc. decided to take matters into their own hands by declaring a strike last Nov. 6. Armed with a sense of history and social justice, their leaders vow to continue the protest and now they are demanding the land which should have been distributed to them in the past.

HACIENDA LUISITA, Tarlac – Sugarcane workers in Hacienda Luisita, Inc. (HLI), the country’s biggest sugar plantation owned and managed by the family of former Philippine President Corazon Cojuangco-Aquino, used to look forward to kabyaw or the plantation’s milling season that starts in October and ends in six months. At this time, however, operations at HLI have ground to a halt.

Instead of reporting for work, around 4,000 sugarcane workers and milling operators trooped to the main gates of the Central Azucarera de Tarlac (CAT), the Cojuangcos’ sugar mill located in Barangay (village) Central inside the family’s compound in Tarlac City at exactly 12 noon on Nov. 6 to declare a strike.

Both the United Luisita Workers’ Union (ULWU, the sugarcane workers’ union) and the Central Azucarera de Tarlac Labor Union (CATLU, the milling operators’ union) declared a work stoppage after their separate Collective Bargaining Agreement (CBA) negotiations reached a deadlock.

ULWU President Rene Galang said that they gave the following demands to the management: 1) that retired seasonal and permanent workers be replaced by their next of kin or by casual workers; 2) that daily wages be increased by P100 ($1.77, based on an exchange rate of P56.35 per US dollar) for permanent workers, P75 ($1.33) for seasonal workers and P60 ($1.06) for casual workers; 3) that laboratory and other hospital fees at the St. Martin de Porres Hospital inside the hacienda be waived as stated in the Stock Distribution Option (SDO) agreement; and 4) that additional benefits such as two-month Christmas and service bonuses be granted.

But the HLI management, represented by Tess Liwanag and three other lawyers, rejected the workers’ demands which resulted in a deadlock in the CBA negotiations. To add insult to injury, 327 permanent and seasonal workers were retrenched effective Oct. 1, including Galang and eight other union officers.

On the other hand, CATLU President Ricardo Ramos said they had the following CBA demands: 1) that management implement an across-the-board increase; 2) two months gratuity pay or the amount twice their salary rate multiplied by their number of years in service as their retirement benefit; and 3) a P30,000 ($532.39) signing bonus for each union member after the signing of the CBA.

Ramos said that CAT management gave the following counter-proposals: 1) a P12 ($0.21) increase per day to be added to the CAT workers’ current daily wage of P309; 2) a lump sum of P2 for two years; and 3) a signing bonus of P 12,500.

Reyes said that the management’s stand was unacceptable because according to government standards, a family of five would need a minimum of P14,000 a month to provide for three meals a day.

But while the Cojuangcos gave a counter-proposal to CATLU, they did not do the same in negotiating with ULWU. Galang said that the management told them that it would not give in to any of their demands because it is losing money. Challenging this, the union leaders demanded that the company’s financial statement for 2003 and its operational expenses in the last five years be presented for scrutiny but management has not produced the documents, Galang said.

The HLI’s audited financial statement shows that it incurred losses amounting to P165,782,608 ($2,942,016.11) in 2004 despite posting gross sales of P 307,784,093 ($5,462,006.97).

However, in a Bulatlat interview Nenita Mahinay, lawyer of both ULWU and CATLU, said that the losses of the plantation were due to the bloated figures of the sugarcane workers’ salaries.

While the HLI financial statement showed that P226,944,903 ($4,027,416.20) went to the salaries of the sugarcane workers, Mahinay said that this was based on 423,393 guaranteed mandays (total number of workdays in a year).

According to Galang, the actual number of mandays was only 341,852 based on the actual number of days worked by all sugarcane workers in 2004. The total salary of the sugarcane workers actually amounted therefore to P110,042,767.50 ($1,952,844.14), representing only 26 percent of the company’s expenses. (See Table)

This means that HLI’s total losses only amounted to P48,880,472.50 ($867,444.06) in 2004.

Recomputed salaries of HLI workers (in Philippine peso)
Item	Cost
Masterlist 341,852 mandays x P194.50/day	66,490,214.00
Permanent 150 workers x P5,800/m0 x 12 months	10,440,000.00
Seasonal 176 workers x P5,800/mo x 5 months maximum work load	5,104,000.00
Benefits – 25% of salaries	20,508,553.50
Supervisors and managers 25 x P20,000/mon x 12 mons	6,000,000.00
Benefits of supervisors and managers 25% of salaries	1,500,000.00
Total Estimated Salaries as recomputed by HLI workers	110,042,767.50

The Cojuangcos have a reason to disregard the HLI, Reyes said, because it does not determine the profitability of their milling and refinery business. The HLI contributes only 200,000 tons or less than 25 percent of the CAT’s sugarcane supply because 750,000 tons or almost 75 percent of the supply comes from other plantations in the same province.

“Talagang babalasubasin lang ng mga Cojuangco ang mga taga-plantation dahil wala naman silang masyadong pakinabang diyan” (The Cojuangcos will really oppress workers from the plantation since they do not benefit much from it), he said.

The only time the plantation area becomes profitable, he added, is when it is sold and converted to industrial enclaves. Documents acquired by the sugar farm workers show that the Cojuangcos earned not less than P750 million ($13.31 million) from 1998 to 2002.

If it is true that the HLI is not profitable for the Cojuangcos, the HLI workers demand that the land be distributed to them rather than have the plantation converted to industrial enclaves, Mahinay said.

Demanding the Cojunagcos to distribute the land to the sugarcane workers is not an ambitious undertaking, Mahinay said, because this would only mean the fulfillment of the past governments’ agrarian reform program.

Mahinay explained that Don Jose Cojuangco was able to purchase Hacienda Luisita and the CAT, collectively known then as the Tarlac Development Corporation (TADECO) on March 31, 1958 by loaning funds from two government agencies, the Central Bank of the Philippines (CBP) and the Government Service Insurance System (GSIS). Their loan, however, stated several conditions, among them the distribution of the land to small farmers in line with the government’s social justice program, Mahinay added.

Since 1967, government officials have inquired from the Cojuangcos as to what has been done to implement the conditions, Mahinay said. But, she added, the Cojuangcos often answered that the fulfillment of the condition cannot be enforced.

In 1980, the Marcos administration, the political archrival of the Cojuangcos and Aquinos, filed a case against the owners of the hacienda (Civil Case No. 131654, Regional Trial Court (RTC) of Manila, Branch XLIII) to comply with the terms of the CBP and the GSIS to turn over the hacienda to the then Ministry of Agrarian Reform (MAR) for the purpose of distributing the land to the hacienda’s small farmers or tenants.

Court records showed that the Cojuangcos contended that the order was unenforceable because: 1) the hacienda is outside the scope of any land reform program; 2) there were no tenants or small farmers in the hacienda; and 3) that there was no agrarian unrest in Hacienda Luisita.

On Dec. 2, 1985, the Manila RTC handed down the verdict in favor of the government, compelling the hacienda owners to turn over the land to the MAR for appropriate land distribution.

One of the Cojuangcos’ heirs, Corazon Cojuangco-Aquino, became president of the country after Marcos was toppled by a popular uprising in 1986. During her term, agrarian reform became her centerpiece program and thus paved the way for the institution of the Comprehensive Agrarian Reform Program (CARP).

Through the CARP, Mahinay said, Cojuangco-Aquino expanded the agrarian reform coverage to include sugar farms. It was also the former president who introduced stock distribution option (SDO) as a means of artificially distributing the land that, Mahinay said, was actually her way to evade the order of the Manila RTC in 1985 to distribute actual parcels of land to small farmers and tenants.

On Aug. 23, 1988, the Hacienda Luisita, Incorporated was established and served as a spin-off corporation of the TADECO for the purpose of operationalizing the SDO in Hacienda Luisita. In effect, the SDO meant that the sugarcane workers’ right to land distribution has been exchanged for shares of stock and made them co-owners of the hacienda, Mahinay explained.

However, the SDO agreement only meant to give 33.3 percent share to sugar farm workers, Mahinay said, and indicated that the Cojuangcos have virtual control of the corporation with 66.7 percent shares.

To make matters worse, court records showed that the CA dismissed the case against the Cojuangcos on May 18, 1988 or two years after Cojuangco-Aquino became president, Mahinay said.

Since the incorporation of the hacienda, however, Galang said sugar farm workers experienced greater hardships due to their diminishing mandays caused by mechanization of sugar cane production and the land use conversion.

According to Galang, they will continue to campaign for the scrapping of the SDO and for the distribution of the land to small farmers and tenants. Bulatlat

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