A bleak Christmas awaits some 3,000 employees of the Philippine Airlines (PAL) after the Department of Labor and Employment (DOLE) upheld its earlier decision allowing the national flag-carrier’s mass layoff. The decision came even as PAL’S employees’ union argued that the mass retrenchment is illegal and a form of "union-busting," and not for cost-cutting as claimed by the PAL management. Referring to the act that came on the eve of All Souls’ Day, union leader Gerry Rivera said the vacated jobs will become "zombie positions" filled by non-unionized contractuals who "will have cheaper wages, less benefits, no security of tenure and no protection by a union." Labor Secretary Rosalinda Baldoz ordered last Friday that the department is affirming its March 2010 decision to allow the retrenchment, which is expected to cut PAL’s workforce to 4,000. According to a report over GMA News’ “24 Oras Weekend," the department’s order stated it is a “management prerogative" if PAL decides to drop its employees as it plans to close down at least three of its departments.
In her decision, Baldoz, in effect, denied the motion for reconsideration filed by the Philippine Airlines Employees’ Association (PALEA), the PAL ground crew union, and affirmed the previous order by then Acting Labor secretary. Romeo Lagman. In its June 15, 2010 decision, the DOLE said the closure of PAL’s “inflight catering operations, airport services operations, and call center operations and the consequent severance from employment of all affected employees...as well as the contracting out of these operations to the named service providers, are based on lawful ground." The decision, issued by Lagman, also said that PAL’s outsourcing strategy “was a valid exercise of a managerial prerogative and as such valid and lawful in all respects."
‘Zombie positions’ In a
statement, PALEA slammed the recent DOLE decision, saying it will mean the “death of job security" at the flag carrier. “Baldoz’ order means the green light for contractualization at PAL via a retrench-rehire scheme. PAL will retrench 3,000 regular unionized workers, who will be rehired as contractual workers by service providers that are partly owned by Lucio Tan. The loss of 3,000 regular jobs cannot be compensated by the creation of 3,000 new contractual positions," said PALEA president Gerry Rivera. Rivera likewise disclosed that Baldoz’s order provides for a gratuity of P50,000 per employee and 125 percent separation pay instead of 100 percent as contained in the June decision of Lagman. He, however, maintained the decision disregarded the unions’ arguments and just reiterated PAL’s position that it must outsource work to service providers in order to be financially viable. “The order is not a win-win solution that balances the interest of workers for job security and management for financial viability. Instead it is simply management’s slightly improved offer disguised as DOLE’s decision," Rivera said. Rivera said the union intends to appeal the decision before the Court of Appeals, and will hold a protest action at the DOLE main office in Intramuros to condemn the order. The “24 Oras Weekend" report quoted PAL spokesperson Cielo Villaluna as saying that affected employees will get due benefits.
Notice of strike PALEA in January this year filed a notice of strike, citing as the reason the “intended mass layoff of union members and officers by April 2010, illegal outsourcing of regular positions, direct negotiation with union members to avail of ERP with promise of re-employment, unresolved issues during preventive mediation," among others. In April, the DOLE assumed jurisdiction over the dispute. In an earlier report, Villaluna said the company
is planning to outsource “non-core" positions to save about P500 million to P1 billion in monthly salary costs. The company claimed it incurred losses of at least P15 billion during its last two fiscal years, blaming high oil prices, competition, and reduced number of passengers due to the global economic crisis, among other reasons. Employees who will be retrenched – coming from the airlines’ departments for airport services, inflight catering and call center operations – are expected to be absorbed by PAL’s partner service providers. Should the retrenchment push through, about 70 percent of the members of 64-year-old PALEA, arguably the country’s oldest labor union, will be affected.
- DM/KBK/HS, GMANews.TV 
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