PAL outsources cargo handling, flight catering

Thursday, 29 April 2010 00:00

PHILIPPINE Airlines (PAL) has picked two firms that will handle separately the 69-year-old flag-carrier’s catering and cargo handling services.
In a telephone interview, Gerardo Rivera, president of PAL Employees’ Association (PALEA) said the airline’s management, in a letter dated April 16, informed affected employees that catering services will be handled by Sky Chef, while cargo handling would be outsourced to Sky Logistics.

Rivera said that PALEA has rejected the notice of termination issued by the PAL management on April 26.
As of press time, PAL refused to confirm or deny the plan to outsource to Sky Chef and Sky Logistics.
Earlier, PAL awarded its call center service to ePLDT Ventus, a unit of Philippine Long Distance Telephone Co. (PLDT).

The outsourcing bid would entail laying off nearly 600 airline employees.

Under the partnership, ePLDT Ventus would handle the reservations, inquiries, bookings, disruption handling, back-office services and other call center services of the carrier.
These units will be phased out on June 1.

Call center services is one of the three non-core units that PAL will outsource to other firms. Other non-core units are flight catering services and airport services (including ground handling, cargo terminal/cargo handling and ramp handling).

PAL will rationalize its medical, information technology and human resource units so it can let go of 500 more employees.

The airline is expected to let go of 3,500 employees out of its 7,500 workforce to keep it from bleeding further.

The cost-cutting measures would save the company about P500 million to P1 billion a year. PAL is setting aside P2 billion to P2.5 billion to compensate the displaced workers.

Earlier, the Department of Labor ordered a halt to PAL’s outsourcing program to prevent a looming strike by the airline’s labor union.