PAL loses P3-b labor case

Manila Standard
Oct. 7, 2009

THE Supreme Court has ordered the labor arbiter to compute the compensation due some 1,400 cabin crew that Philippine Airlines retrenched in 1998 after the flag carrier was placed under corporate rehabilitation.

The high court’s order came after it affirmed its decision in July 2008 declaring as illegal PAL’s dismissal of the cabin crew, and then tossed back the case to the labor arbiter so it could compute exactly how much the carrier owed them.

Initial estimates showed that Philippine Airlines owed the employees P3 billion, Daniel Reyes, the airline union’s lawyer, said earlier.

The Court said that the flight attendants who had reached retirement age or had died should receive back wages up to the date of their retirement.

Those who had not been re-employed by the carrier—including those who had executed quitclaims and received separation pay or financial assistance—should be reinstated without loss of seniority rights and paid full back wages. But the amounts they had already received should be deducted from whatever amounts were adjudged to them individually, the high court said.

It said the flight attendants who had obtained substantially equivalent or even more lucrative employment elsewhere in 1998 or after were deemed to have severed their employment with the carrier.

“They shall be entitled to full back wages from the date of their retrenchment only up to the date they found employment elsewhere,” the Court said.

PAL president Jaime Bautista said he was disappointed with the high court’s decision.

“While we have yet to receive a copy of the said decision, PAL is disappointed that the high tribunal did not appreciate our arguments that the termination of PAL employees, including [Flight Attendants and Stewards Association of the Philippines] members in 1998, was necessitated by the fact that PAL was under rehabilitation, which is equivalent to Chapter 11 bankruptcy,” Bautista said in a statement.

“We will wait for the official copy of the Supreme Court decision to study its implication and determine our legal options,” he said.

Bautista last month told the Philippine Airlines Employees Association that management planned to outsource or spin off some units including catering, passenger handling, ramp handling and cargo handling because of heavy losses.

In response, the association said this planned “second wave of outsourcing” would affect the job security of the 2,000 to 4,000 employees assigned to those departments.

“It seems 10 years of labor sacrifice were not enough,” group president Gerry Rivera said. Rey E. Requejo