Aquino steps into PAL labor dispute

President Benigno Simeon "Noynoy" Aquino III said on Friday he has intervened in the labor row between the management and the workers of flag carrier Philippine Airlines (PAL). In an interview on Friday, Aquino said he met with "several individuals" from the labor sector and PAL management to "get them closer to negotiated settlement and ease the fears of both parties" before leaving for Japan on Thursday. Aquino is currently in Japan for the Asia-Pacific Economic Summit (APEC). "We're like the bridge, we're trying to be a bridge and so far there are so many promising signs and I have to wait as to how far they have gone and see what acceptance has been by both parties," Aquino said. Aquino mentioned that he met with were labor consultants and "people who could approach the various unions," Aquino said. On November 2, Aquino said he will review the decision of the Department of Labor and Employment (DOLE) to allow PAL to retrench 2,600 of its workers. In a statement issued on Friday, Labor Secretary Rosalinda Baldoz said “The President has the power to review all decisions of the members of his Cabinet, and this applies to the DOLE ruling on the labor dispute of the Philippine Airlines Employees Association (PALEA) with the management of the Philippine Airlines." "He has control over department secretaries and can pass upon their decisions. This power is provided for in Section 17 Article VII of the Philippine Constitution of 1987," Baldoz said. Meanwhile, PAL also confirmed on Friday that its top airline executives sat down with Aquino and Executive Secretary Paquito Ochoa on Tuesday to discuss the planned spin off and its effects on some 2,600 workers. PAL president and COO Jaime Bautista described the meeting as brief but cordial. "The President spoke his mind about the PAL spin off and asked many questions on how best to strike a balance between the concerns of workers and management," Bautista said. On the reported Palace 'intervention' in the PAL-PALEA dispute, Bautista said he has not yet received any call or official communication from Malacañang about the scope, nature and effects of such intervention. "Apparently, Malacanang is waiting for the official communication from PALEA. As far as PAL is concerned, we're also waiting for PALEA's action on whether it will challenge the DOLE decision before the Court of Appeals or the Office of the President," Bautista said. 2.600 workers to be laid off Baldoz recently allowed some of the airline’s services to be outsourced and 2,600 of its workers to be laid off. On October 29, Baldoz issued an order affirming its March 2010 decision to allow the retrenchment, which would cut PAL’s workforce to 4,000. According to a report over GMA News’ “24 Oras Weekend," the Department of Labor and Employment's (DOLE) order stated it is a “management prerogative" of PAL to retrench its employees as it plans to close down at least three of its departments. The DOLE order prompted the PAL Employees' Association (PALEA) to threaten to stage a strike. 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, PAL spokesperson Cielo 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. PALEA, which represents more than half of the airline’s rank-and-file workers, filed on November 5 a second notice of strike and said it plans to elevate the labor dispute to the Court of Appeals. On Thursday, the PAL management asked the DOLE to junk the second notice of strike filed last week by the PALEA , saying the issues raised in the notice have already been settled. Solid legal grounds Bautista said the spin-off is based on solid legal grounds. "The DOLE upheld PAL's position not only once but twice," he said. According to Bautista, he explained to Aquino and Ochoa why the spin off and corporate restructuring was necessary. He cited the massive US $312-million losses that the flag carrier suffered in the last two years. "We told the President that PAL is exercising its legal right and prerogative to restructure its organization and sell some operating units in accordance with provisions of the Labor Code and existing jurisprudence," Bautista said. He stressed that the spin off is not for profit but for the "survival" of the company. "We are retiring 2,600 workers in order to save the jobs of the other 4,000 that will remain in PAL and to ensure continuing service to the nation and PAL's 10-million passengers," Bautista said. Bautista also assured Malacañang that all affected PAL workers will receive separation pay equivalent to three times than those provided by the Labor Code and 25 percent more than the current PAL-PALEA Collective Bargaining Agreement (CBA). Aside from the separation pay, the laid off workers would also receive separation benefits. They will also be hired by the third party service providers of PAL, Bautista said. He noted that Aquino and Ochoa were both aware that the DOLE twice upheld the validity and legal grounds for the spin-off. "He (the President) was also aware that PALEA is poised to question the said DOLE ruling before the Court of Appeals which could limit Malacanang's intervention options," said Bautista. Mediation Meanwhile, Baldoz said the DOLE strongly agrees with Aquino's stance on “a negotiated settlement" in the labor dispute. "We continue to work to end the dispute by mutually acceptable solutions," Baldoz said. “In fact, at the level of the DOLE, the National Conciliation and Mediation Board (NCMB) will again convene both the PALEA and the PAL in a conciliation-mediation meeting on November 18, the third such meeting, over the notice of strike that the PALEA had filed last Friday (November 5)," she said. She pointed out that in a second meeting (on November 11), PAL submitted to the DOLE a motion to dismiss the notice of strike of the PALEA on the ground that the DOLE had already ruled on the issues that PALEA has raised. “We have yet to receive any document that would show that the PALEA has appealed the decision either to the Office of the President or the courts. – with Amita Legaspi, Jerrie Abella, VVP, GMANews.TV