PAL: All employees to be laid off to be given jobs

By DJ Yap
Philippine Daily Inquirer
First Posted 18:30:00 11/03/2010

MANILA, Philippines—Philippine Airlines said Wednesday that all 2,600 workers who face termination under its plan to outsource catering, call-center reservations and airport services would be absorbed by third-party service providers as regular employees.

But PAL president and CEO Jaime Bautista said the absorbed employees must still pass the mandated six-month probationary period to become regular employees, as stipulated in agreements with the service providers.

In a briefing at the Century Park Hotel in Manila, the PAL executive said the decision of the labor department recognizing the company's prerogative to restructure operations also hurt PAL as it involved paying the terminated employees P400 million more than the original agreement.
"This is more than what's provided by law, and more than what's provided by the CBA (collective bargaining agreement)," Bautista said.

He said DOLE's decision was "just, reasonable and humane," and that PAL did not wish to be remembered for 2,600 jobs lost, but rather, for 4,000 jobs saved.

Bautista said PAL was the only carrier in Asia which operated its own catering, call center reservations and airport services, and that the practice in the airline industry was to contract these out to service providers.

He said PAL has already signed agreements with third-party providers: PLDT e-Ventures for call center reservations, Sky Kitchen for catering, and Sky Logistics for airport services.
Bautista said the agreements were signed in the early part of the year after PAL had given notice of the outsourcing plan.

PAL said it hoped to finally implement its corporate restructuring to stabilize finances and expand and improve services, enabling the flag carrier to compete with other airlines.

Bautista said he hoped the outsourcing of the services would be implemented within the year.