PAL Pilots Hit Freeze on Retirement Benefits

Philippine Star

Wednesday, December 23, 1998

Gina Tabonares

Officers of the Airline Pilots Association of the Philippines (ALPAP) renewed their war against the management of ailing Philippine Airlines, accusing it of inducing three commercial banks not to release their retirement benefit funds totaling P2.2 billion.

At a press conference, ALPAP officers led by Captains Sotico Lloren and Florendo Umali accused the Bank of the Philippine Islands (BPI), Metrobank, and PCIBank of freezing their retirement funds granted to the pilots’ union under a collective bargaining agreement (CBA) forged with PAL management in December 1996.

They said the CBA is in effect up to December 2000. The ALPAP also questioned the decision of BPI and Metrobank to grant the petition of management pilots to temporarily stop the disbursement of the PAL’s Pilots’ Retirement Fund to the ALPAP Credit and Cooperative Union.

Lloren, who is also ALPAP board chairman, said that aside from the 1996 CBA fund, PAL pilots have been contributing 20 percent of their monthly pay to the retirement fund since 1971.

Lloren said the trust agreement the ALPAP signed with the three banks provides for the payment of specific amounts to PAL pilots in cases of disability, voluntary or involuntary separation from the service, retirement, and death.

The retirement plan, which has been implemented since 1971, is being administered by two pilots designated by PAL management and seven designated ALPAP.

The trustees are duty-bound to make payments from the fund as the board decides without any preconditions.

Umali said that when the labor dispute between PAL management and ALPAP broke out earlier this year, three banks – questioning the ownership of the funds – refused to grant the claims of some ALPAP members.

“We want the banks to honor their duties as trustees so that the money goes to where it is intended,” Lloren said.

“The pilots are entitled to and expect to receive their retirement benefits as and when they fall due – whether they have retired, are dismissed or are disabled…we understand the banks have their own interests to protect but we can’t see why that should be sufficient reason to perpetuate the injustice committed by PAL to us,” Umali added.