Posted on January 20, 2011 08:21:41 PM
Business World: Opinion
Trade Tripper -- By Jemy Gatdula
There’s a line from CNN that goes somewhat like this: "do you go with those who got it right or with those who got it wrong?" Because, frankly, in relation to the ongoing debate on the open-skies policy, do we give credence to those men able to build business empires from scratch, as well as the men and women able to effectively run local airlines for the country, or do we believe the promises of some guy who spent a considerable amount of money just to come up with "Pilipinas kay ganda"? I know what I’d choose.
Look, I don’t know Lucio Tan. I don’t know what he’s like. But I do know what he did and what he did is all around us. From beer to banks to airlines to cigarettes, this is a man who knows business. And when you have guys like that who can actually get things done, I would think we should instinctively help them or their endeavors. Apparently, we’d rather do the reverse.
Because at a time when a lot of people are predicting uncertainties for the global economy this year, with the concomitant unpredictability of our own economy, why we should be making it harder for the Philippines’ very own PAL (as well as Cebu Pacific and Zest Air), at this particular time, is beyond me. We shouldn’t be making it harder for them, we should be helping them.
Considerably, our tourism industry needs more than additional plane seats to get going: they need better airports and an efficient infrastructure. Both of which, we don’t really have. Such also needs careful and coordinated planning. None of which is being done effectively. We have a Category 2 rating from the International Civil Aviation Organization due to deficient aviation infrastructure and safety standards. All these are beyond the purview of local airlines. But they do fall squarely within the responsibility of the government. Traffic, peace and order, pollution, sanitation? These are not the responsibility of the local airlines. These are government’s. So why put the burden squarely on the shoulders of our airlines?
Besides, what does "pocket open skies" even mean? How different is that from a mere open skies? I suspect it’s one of those terms some policymaker cooked up to obfuscate matters, like "calibrated trade liberalization." They have no practical meaning. It’s either you open or you don’t. If one is going to be selective about it, then there better be good reasons for the selection. And if the selection turns out to be opening almost all air travel anyway, then that is not "pocket." That is open skies. Period.
Some people argue from the perspective of the expected benefits of "liberalization." Let’s not be simpletons about this. This column obviously is partial to liberalization. But there’s a difference between being partial and blind. As in all matters, we need to be smart about this. Look, US skies won’t open unilaterally. And it’s done very deliberately. Liberalization entails competition, which entails we step our game up, which means all of us, which means the government and private sector. If one of those factors or players is missing from the equation, then we just made people lose their jobs for no purpose. We can’t just open our skies up and hope that a "trickle down" effect ensues. We simply cannot gamble with people’s livelihoods.
Government assistance is particularly crucial for the airline industry. I don’t know of any successful foreign airline that made it without government support. Aside from airports, infrastructure, security, and safety, government help, particularly in economic crunches, is significant. The ability of the government to open up markets for our airlines is vastly important as well. To open up our skies without getting reciprocity from the other countries is to place an undue handicap for our companies. It’s not only unintelligent, it’s unconstitutional.
Besides, the nature of the market doesn’t seem to support the idea of open skies. People sometimes rail against our airlines for being monopolies, but we may have to accept that a "natural monopoly" may be necessary as far as airlines in the Philippines is concerned. That’s because the market could perhaps support only two or three players. That being the case, I’d rather have those two or three to be Filipinos. It then follows that we support such Filipino airlines as to be able to compete against those better-funded and larger foreign airlines.
The importance of Filipino carriers goes beyond economics. There’s also "transport security" (similar to "food security" arguments), particularly to ensure the safe return of our numerous OFWs during international emergencies. Finally, there’s also national pride. I rather like the idea of having Filipino-owned planes flying around. I like the thought that we have a flag carrier. And, despite (or because of) our difficulties, I’d really like to still be able to lift my head up and see the Philippines soar.
Thursday, January 20, 2011
Tuesday, January 11, 2011
Can’t afford pay hike–PAL
By Philip Tubeza
Philippine Daily Inquirer
News
First Posted 03:10:00 01/11/2011
Filed Under: Air Transport, Labour dispute, Wages & Pensions, Retirement
MANILA, Philippines—Saying it could not afford to give “hefty” salary increases, Philippine Airlines (PAL) Monday said it asked the Department of Labor and Employment to reconsider its ruling awarding flight attendants a salary hike and a higher retirement age.
The Flight Attendants and Stewards Association of the Philippines (FASAP) denounced PAL management for filing a motion for reconsideration, saying it was throwing away a “golden opportunity for reconciliation.”
In a press conference, PAL president Jaime Bautista explained that the motion filed by the airline on Friday sought only a partial reconsideration of Labor Secretary Rosalinda Baldoz’s ruling on the labor dispute.
It questioned the salary increase and the adjustment of the retirement age from 40 to 60 years for both male and female attendants, he said, but added that PAL was no longer appealing her ruling on the flight attendants’ maternity and pregnancy leaves.
Bautista said the airline reiterated its position that the wage increase be pegged at a lump sum of P80 million.
Baldoz’s ruling, which awards salary increases to PAL flight attendants from 2008 to 2010, would cost the flag carrier around P250 million. The airline offered an economic package of P105 million during the negotiations.
“So, P105 million against P250 million… that’s a P145 million difference,” Bautista said.
He added that from 2008 to 2009 and again from 2009 to 2010, Philippine Airlines “reported losses of $297 million and $14 million, respectively.”
“So the position of Philippine Airlines is that, even if we were reporting a profit for (the first quarter of) 2010-2011, we cannot afford to give salary increases because the profit for this fiscal year should be set aside for salary increases that would be negotiated not only by (FASAP) but also by (the ground crew union),” Bautista said.
Bautista said PAL was also asking that it be allowed to retire its flight attendants at age 45 since this was also the practice of other airlines.
In a statement, FASAP president Bob Anduiza urged PAL management to accept Baldoz’s decision, which he described as “fair and reasonable.”
He disputed Bautista’s claim that the airline could not afford the salary increases, pointing to the doubling of PAL’s equity from P1.69 billion to P3.32 billion as of March 31, 2010.
Philippine Daily Inquirer
News
First Posted 03:10:00 01/11/2011
Filed Under: Air Transport, Labour dispute, Wages & Pensions, Retirement
MANILA, Philippines—Saying it could not afford to give “hefty” salary increases, Philippine Airlines (PAL) Monday said it asked the Department of Labor and Employment to reconsider its ruling awarding flight attendants a salary hike and a higher retirement age.
The Flight Attendants and Stewards Association of the Philippines (FASAP) denounced PAL management for filing a motion for reconsideration, saying it was throwing away a “golden opportunity for reconciliation.”
In a press conference, PAL president Jaime Bautista explained that the motion filed by the airline on Friday sought only a partial reconsideration of Labor Secretary Rosalinda Baldoz’s ruling on the labor dispute.
It questioned the salary increase and the adjustment of the retirement age from 40 to 60 years for both male and female attendants, he said, but added that PAL was no longer appealing her ruling on the flight attendants’ maternity and pregnancy leaves.
Bautista said the airline reiterated its position that the wage increase be pegged at a lump sum of P80 million.
Baldoz’s ruling, which awards salary increases to PAL flight attendants from 2008 to 2010, would cost the flag carrier around P250 million. The airline offered an economic package of P105 million during the negotiations.
“So, P105 million against P250 million… that’s a P145 million difference,” Bautista said.
He added that from 2008 to 2009 and again from 2009 to 2010, Philippine Airlines “reported losses of $297 million and $14 million, respectively.”
“So the position of Philippine Airlines is that, even if we were reporting a profit for (the first quarter of) 2010-2011, we cannot afford to give salary increases because the profit for this fiscal year should be set aside for salary increases that would be negotiated not only by (FASAP) but also by (the ground crew union),” Bautista said.
Bautista said PAL was also asking that it be allowed to retire its flight attendants at age 45 since this was also the practice of other airlines.
In a statement, FASAP president Bob Anduiza urged PAL management to accept Baldoz’s decision, which he described as “fair and reasonable.”
He disputed Bautista’s claim that the airline could not afford the salary increases, pointing to the doubling of PAL’s equity from P1.69 billion to P3.32 billion as of March 31, 2010.
PAL seeks reversal of Labor ruling on benefits
by Eric B. Apolonio and Vito Barcelo
Manila Standard Today
PHILIPPINE Airlines is seeking a reversal of a Labor department ruling last year granting P250 million for benefits and salary increases.
PAL President and Chief Operating Officer Jaime Bautista said that apart from the lack of legal and factual basis, the ruling of the Department of Labor and Employment is “confiscatory” as it obligates the flag carrier to share its projected income even though the comnpany has not really made money.
Bautista said a motion for reconsideration was filed last Friday by its legal team to counter the decision granted by DoLE.
The oOLE decision last Dec. 23, 2010 ruled in favor of the Flight Attendants and Stewards Association, granting back salary increases amounting to P222 million, a higher compulsory retirement age of 60 years old, and increased monthly allowance of P1,800, among others.
Fasap president Bob Anduiza said PAL missed the golden opportunity for reconciliation with its flight attendants. The group expressed its desire to reconcile with PAL management in a letter to Bautista dated Jan. 5, 2011.
Anduiza said the recent decision of Labor Secretary Rosalinda Baldoz, in resolving the PAL-Fasap collective bargaining agreement dispute, could had been a golden opportunity for both parties to work together and face the tough competition in the Airline industry.
Bautista said DoLE wantonly disregarded evidence and the rules of fair play in violation of its duty to render a decision based on fact and law.
“The subject of the labor dispute is the deadlock in the CBA negotiations between PAL and Fasap from the period July 16, 2007 to July 15, 2010, but the DoLE based its economic awards to Fasap on PAL’s purported financial statements for fiscal year 2010-2011, specifically covering only the months of April, May and June 2010,” Bautista told the Manila Standard.
He said these financial statement cannot subvert or supplant the fact that PAL incurred losses.
“In essence, Dole is directing PAL to grant hefty pay increases for July 2007 to July 2010 despite its knowledge and awareness of PAL’s massive losses for the same perion,” Bautista added.
Manila Standard Today
PHILIPPINE Airlines is seeking a reversal of a Labor department ruling last year granting P250 million for benefits and salary increases.
PAL President and Chief Operating Officer Jaime Bautista said that apart from the lack of legal and factual basis, the ruling of the Department of Labor and Employment is “confiscatory” as it obligates the flag carrier to share its projected income even though the comnpany has not really made money.
Bautista said a motion for reconsideration was filed last Friday by its legal team to counter the decision granted by DoLE.
The oOLE decision last Dec. 23, 2010 ruled in favor of the Flight Attendants and Stewards Association, granting back salary increases amounting to P222 million, a higher compulsory retirement age of 60 years old, and increased monthly allowance of P1,800, among others.
Fasap president Bob Anduiza said PAL missed the golden opportunity for reconciliation with its flight attendants. The group expressed its desire to reconcile with PAL management in a letter to Bautista dated Jan. 5, 2011.
Anduiza said the recent decision of Labor Secretary Rosalinda Baldoz, in resolving the PAL-Fasap collective bargaining agreement dispute, could had been a golden opportunity for both parties to work together and face the tough competition in the Airline industry.
Bautista said DoLE wantonly disregarded evidence and the rules of fair play in violation of its duty to render a decision based on fact and law.
“The subject of the labor dispute is the deadlock in the CBA negotiations between PAL and Fasap from the period July 16, 2007 to July 15, 2010, but the DoLE based its economic awards to Fasap on PAL’s purported financial statements for fiscal year 2010-2011, specifically covering only the months of April, May and June 2010,” Bautista told the Manila Standard.
He said these financial statement cannot subvert or supplant the fact that PAL incurred losses.
“In essence, Dole is directing PAL to grant hefty pay increases for July 2007 to July 2010 despite its knowledge and awareness of PAL’s massive losses for the same perion,” Bautista added.
Can’t afford pay hike–PAL
First posted 03:43:05 (Mla time) January 11, 2011
Philip Tubeza
Philippine Daily Inquirer
MANILA, Philippines—Saying it could not afford to give “hefty” salary increases, Philippine Airlines (PAL) Monday said it asked the Department of Labor and Employment to reconsider its ruling awarding flight attendants a salary hike and a higher retirement age.
The Flight Attendants and Stewards Association of the Philippines (FASAP) denounced PAL management for filing a motion for reconsideration, saying it was throwing away a “golden opportunity for reconciliation.”
In a press conference, PAL president Jaime Bautista explained that the motion filed by the airline on Friday sought only a partial reconsideration of Labor Secretary Rosalinda Baldoz’s ruling on the labor dispute.
It questioned the salary increase and the adjustment of the retirement age from 40 to 60 years for both male and female attendants, he said, but added that PAL was no longer appealing her ruling on the flight attendants’ maternity and pregnancy leaves.
Bautista said the airline reiterated its position that the wage increase be pegged at a lump sum of P80 million.
Baldoz’s ruling, which awards salary increases to PAL flight attendants from 2008 to 2010, would cost the flag carrier around P250 million. The airline offered an economic package of P105 million during the negotiations.
“So, P105 million against P250 million… that’s a P145 million difference,” Bautista said.
He added that from 2008 to 2009 and again from 2009 to 2010, Philippine Airlines “reported losses of $297 million and $14 million, respectively.”
“So the position of Philippine Airlines is that, even if we were reporting a profit for (the first quarter of) 2010-2011, we cannot afford to give salary increases because the profit for this fiscal year should be set aside for salary increases that would be negotiated not only by (FASAP) but also by (the ground crew union),” Bautista said.
Bautista said PAL was also asking that it be allowed to retire its flight attendants at age 45 since this was also the practice of other airlines.
In a statement, FASAP president Bob Anduiza urged PAL management to accept Baldoz’s decision, which he described as “fair and reasonable.”
He disputed Bautista’s claim that the airline could not afford the salary increases, pointing to the doubling of PAL’s equity from P1.69 billion to P3.32 billion as of March 31, 2010.
Philip Tubeza
Philippine Daily Inquirer
MANILA, Philippines—Saying it could not afford to give “hefty” salary increases, Philippine Airlines (PAL) Monday said it asked the Department of Labor and Employment to reconsider its ruling awarding flight attendants a salary hike and a higher retirement age.
The Flight Attendants and Stewards Association of the Philippines (FASAP) denounced PAL management for filing a motion for reconsideration, saying it was throwing away a “golden opportunity for reconciliation.”
In a press conference, PAL president Jaime Bautista explained that the motion filed by the airline on Friday sought only a partial reconsideration of Labor Secretary Rosalinda Baldoz’s ruling on the labor dispute.
It questioned the salary increase and the adjustment of the retirement age from 40 to 60 years for both male and female attendants, he said, but added that PAL was no longer appealing her ruling on the flight attendants’ maternity and pregnancy leaves.
Bautista said the airline reiterated its position that the wage increase be pegged at a lump sum of P80 million.
Baldoz’s ruling, which awards salary increases to PAL flight attendants from 2008 to 2010, would cost the flag carrier around P250 million. The airline offered an economic package of P105 million during the negotiations.
“So, P105 million against P250 million… that’s a P145 million difference,” Bautista said.
He added that from 2008 to 2009 and again from 2009 to 2010, Philippine Airlines “reported losses of $297 million and $14 million, respectively.”
“So the position of Philippine Airlines is that, even if we were reporting a profit for (the first quarter of) 2010-2011, we cannot afford to give salary increases because the profit for this fiscal year should be set aside for salary increases that would be negotiated not only by (FASAP) but also by (the ground crew union),” Bautista said.
Bautista said PAL was also asking that it be allowed to retire its flight attendants at age 45 since this was also the practice of other airlines.
In a statement, FASAP president Bob Anduiza urged PAL management to accept Baldoz’s decision, which he described as “fair and reasonable.”
He disputed Bautista’s claim that the airline could not afford the salary increases, pointing to the doubling of PAL’s equity from P1.69 billion to P3.32 billion as of March 31, 2010.
PAL seeks reversal of DoLE ruling on back pay hike, retirement age
By EMMIE V. ABADILLA
January 11, 2011, 12:59am
MANILA, Philippines – For lack of legal and factual basis, Philippine Airlines (PAL) wants the labor department to reverse its ruling granting hefty back salary increases and higher retirement age for flight attendants. “This order is ‘confiscatory,’ obliging us to share income we did not earn,” PAL President and COO Jaime J. Bautista told reporters yesterday.
Last month (Dec. 23, 2010), the Department of Labor and Employment (DoLE) granted the demands of the Flight Attendants and Stewards Association of the Philippines (FASAP), consisting of back salary increases amounting to P222 million, a higher compulsory retirement age at 60 years old plus increased monthly rice allowance of P1,800, among others.
However, last Friday, PAL lawyers filed a motion asking DoLE to reinstate the flag carrier’s lump-sum offer of P80 million to FASAP, considering PAL’s financial status while it was negotiating the collective bargaining agreement (CBA). PAL lost US$297.8 million in fiscal year 2008-2009 and US$14.3 million for fiscal year ending March 2010.
PAL likewise sought to maintain the retirement age of flight attendants at 45 while eliminating any distinction between domestic and international attendants for flight assignments. Raising their retirement age to 60 goes against industry practices worldwide, the flag carrier argued.
In addition, PAL wants to peg the monthly rice allowance for 2007-2008 of FASAP members at P1,200 until Sept. 30, 2007; P1,500 between Oct. 1, 2007 to Sept. 30, 2008; and P1,800 from October 1, 2008.
“DoLE’s wanton disregard of the evidence and rules of fair play is a violation of its duty to render a decision based on fact and law,” according to PAL.
While the subject of the labor dispute is the deadlock in the CBA negotiations between PAL and FASAP from July 16, 2007 to July 15, 2010, DoLE based its economic awards to FASAP on PAL’s purported financial statements for fiscal year 2010-2011, specifically covering only the months of April, May and June 2010, the PAL President explained.
“These financial statements cannot subvert the fact that PAL incurred losses,” he stressed. “In essence, DoLE is directing PAL to grant hefty pay increases for July 2007 to July 2010 although it knows of PAL’s massive losses for the same period. DoLE expects PAL to produce the money but as to how, the decision did not say.”
They can only infer that DoLE thinks that future income of the company from April 2010 forward can be applied to the salary increases it granted to FASAP for July 2007-2008, July 2008-2009, and July 2009-2010. “But this will result in an absurd situation,” Bautista reasoned.
“It is an unthinkable fiscal maneuvering. Considering that the DoLE had already ‘pledged’ any income of PAL for the next years, one can only wonder where PAL is supposed to source funds for the succeeding demands for salary increase when negotiations for the 2010-2015 PAL-FASAP CBA begin.”
On the retirement age issue, DoLE should not have ignored the fact that the memorandum of agreements (MoAs) between PAL and FASAP providing lower retirement age resulted from voluntary negotiations within the framework of their previous CBA.
Article 287 of the Labor Code, as amended by Republic Act 7641, states that any person may be retired upon reaching the retirement age established in the CBA or other applicable employment contract.
January 11, 2011, 12:59am
MANILA, Philippines – For lack of legal and factual basis, Philippine Airlines (PAL) wants the labor department to reverse its ruling granting hefty back salary increases and higher retirement age for flight attendants. “This order is ‘confiscatory,’ obliging us to share income we did not earn,” PAL President and COO Jaime J. Bautista told reporters yesterday.
Last month (Dec. 23, 2010), the Department of Labor and Employment (DoLE) granted the demands of the Flight Attendants and Stewards Association of the Philippines (FASAP), consisting of back salary increases amounting to P222 million, a higher compulsory retirement age at 60 years old plus increased monthly rice allowance of P1,800, among others.
However, last Friday, PAL lawyers filed a motion asking DoLE to reinstate the flag carrier’s lump-sum offer of P80 million to FASAP, considering PAL’s financial status while it was negotiating the collective bargaining agreement (CBA). PAL lost US$297.8 million in fiscal year 2008-2009 and US$14.3 million for fiscal year ending March 2010.
PAL likewise sought to maintain the retirement age of flight attendants at 45 while eliminating any distinction between domestic and international attendants for flight assignments. Raising their retirement age to 60 goes against industry practices worldwide, the flag carrier argued.
In addition, PAL wants to peg the monthly rice allowance for 2007-2008 of FASAP members at P1,200 until Sept. 30, 2007; P1,500 between Oct. 1, 2007 to Sept. 30, 2008; and P1,800 from October 1, 2008.
“DoLE’s wanton disregard of the evidence and rules of fair play is a violation of its duty to render a decision based on fact and law,” according to PAL.
While the subject of the labor dispute is the deadlock in the CBA negotiations between PAL and FASAP from July 16, 2007 to July 15, 2010, DoLE based its economic awards to FASAP on PAL’s purported financial statements for fiscal year 2010-2011, specifically covering only the months of April, May and June 2010, the PAL President explained.
“These financial statements cannot subvert the fact that PAL incurred losses,” he stressed. “In essence, DoLE is directing PAL to grant hefty pay increases for July 2007 to July 2010 although it knows of PAL’s massive losses for the same period. DoLE expects PAL to produce the money but as to how, the decision did not say.”
They can only infer that DoLE thinks that future income of the company from April 2010 forward can be applied to the salary increases it granted to FASAP for July 2007-2008, July 2008-2009, and July 2009-2010. “But this will result in an absurd situation,” Bautista reasoned.
“It is an unthinkable fiscal maneuvering. Considering that the DoLE had already ‘pledged’ any income of PAL for the next years, one can only wonder where PAL is supposed to source funds for the succeeding demands for salary increase when negotiations for the 2010-2015 PAL-FASAP CBA begin.”
On the retirement age issue, DoLE should not have ignored the fact that the memorandum of agreements (MoAs) between PAL and FASAP providing lower retirement age resulted from voluntary negotiations within the framework of their previous CBA.
Article 287 of the Labor Code, as amended by Republic Act 7641, states that any person may be retired upon reaching the retirement age established in the CBA or other applicable employment contract.
PAL seeks reversal of DOLE ruling on wages, retirement age
By Mary Ann Ll Reyes (The Philippine Star) Updated January 11, 2011 12:00 AM
MANILA, Philippines - Philippine Airlines (PAL) is seeking the reversal of a Labor Department ruling granting hefty back salary increases and higher retirement age for flight attendants.
PAL president Jaime Bautista said apart from the lack of legal and factual basis, the ruling of the Department of Labor and Employment (DOLE) is “confiscatory” as it obliges the flag carrier to share income it did not earn.
In a motion for reconsideration filed by PAL’s lawyers, Bautista said DOLE’s order raising the flight attendants’ retirement age to 60 years old has no justification in law and jurisprudence and goes against industry practice worldwide.
DOLE’s Dec. 23, 2010 ruling favored the Flight Attendants and Stewards Association of the Philippines (FASAP) by granting back salary increases amounting to P222 million, a higher compulsory retirement age at 60 years old, and increased monthly rice allowance of P1,800, among others.
In particular, PAL wants DOLE to reconsider and reinstate PAL’s lump-sum offer of P80 million to FASAP members considering its financial status for the periods subject of the collective bargaining agreement (CBA) negotiations; maintain the retirement age at 45 years old instead of 60 while eliminating any distinction between domestic and international flight attendants for flight assignments; and peg the monthly rice allowance for 2007-2008 of FASAP members at P1,200 until Sept. 30, 2007; P1,500 between Oct. 1, 2007 to Sept. 30, 2008; and P1,800 from Oct. 1, 2008.
Bautista explained that the subject of the labor dispute is the deadlock in the CBA negotiations between PAL and FASAP from the period July 16, 2007 to July 15, 2010, but the DOLE based its economic awards to FASAP on PAL’s purported financial statements for fiscal year 2010-2011, specifically covering only the months of April, May and June 2010.
“These financial statements cannot subvert or supplant the fact that PAL incurred losses. In essence, DOLE is directing PAL to grant hefty pay increases for July 2007 to July 2010 despite its knowledge and awareness of PAL’s massive losses for the same period,” Bautista stressed.
He lamented that it is unjust and even confiscatory to oblige PAL to share income it did not even earn or does not have. “DOLE expects PAL to produce the money but as to how, the decision did not say,” Bautista said.
He said PAL could only infer that the DOLE is probably of the view that future income of the company from April 2010 forward can be applied to the salary increases it granted to FASAP for July 2007-2008 July 2008-2009, and July 2009-2010.
“But this will result in an absurd situation. It is an unthinkable fiscal maneuvering. Considering that the DOLE had already ‘pledged’ any income of PAL for the next years, one can only wonder where PAL is supposed to source funds for the succeeding demands for salary increase when negotiations for the 2010-2015 PAL-FASAP CBA begin,” Bautista said.
To prove its point, PAL presented pertinent records to DOLE showing that it suffered losses of $297.8 million in fiscal year 2008-2009, and $14.3 million for fiscal year ending March 2010.
On the retirement age issue, Bautista said DOLE should not have ignored the fact that the memorandum of agreements (MOAs) between the company and FASAP that provided lower retirement age were the product of voluntary negotiations within the framework of their previous CBA.
He said Article 287 of the Labor Code, as amended by Republic Act 7641, states that any person may be retired upon reaching the retirement age established in the collective bargaining agreement or other applicable employment contract. “Thus, a careful reading of the above provision indicates that employers and employees are at liberty to agree and fix the applicable retirement age even at below 60 years old.”
He added that DOLE failed to consider the fact that the average retirement age of most, if not all, of PAL’s fiercest competitors in the ASEAN region is much less than 60 years old. Thus, early retirement for flight attendants is fast becoming the rule rather than the exception.
He also chided DOLE for accepting FASAP’s argument that since the 2005-2010 CBA containing the agreed retirement age had already expired then there is no more agreed retirement age to invoke. “We can’t understand how DOLE and FASAP can legally justify that only the retirement provisions of the PAL-FASAP CBA have expired while other provisions on salaries, perks and work rules remain valid and in effect,” he said.
Even the absence of an agreement, Bautista said, does not warrant the outright rejection of PAL’s position without taking into account the bargaining history between the parties.
He said PAL did not force FASAP officers and members to accept the early retirement provisions as these were subject of negotiations and were approved and ratified by FASAP members in exchange for numerous concessions, in the form of monetary benefits, easier work rules and other perks.
MANILA, Philippines - Philippine Airlines (PAL) is seeking the reversal of a Labor Department ruling granting hefty back salary increases and higher retirement age for flight attendants.
PAL president Jaime Bautista said apart from the lack of legal and factual basis, the ruling of the Department of Labor and Employment (DOLE) is “confiscatory” as it obliges the flag carrier to share income it did not earn.
In a motion for reconsideration filed by PAL’s lawyers, Bautista said DOLE’s order raising the flight attendants’ retirement age to 60 years old has no justification in law and jurisprudence and goes against industry practice worldwide.
DOLE’s Dec. 23, 2010 ruling favored the Flight Attendants and Stewards Association of the Philippines (FASAP) by granting back salary increases amounting to P222 million, a higher compulsory retirement age at 60 years old, and increased monthly rice allowance of P1,800, among others.
In particular, PAL wants DOLE to reconsider and reinstate PAL’s lump-sum offer of P80 million to FASAP members considering its financial status for the periods subject of the collective bargaining agreement (CBA) negotiations; maintain the retirement age at 45 years old instead of 60 while eliminating any distinction between domestic and international flight attendants for flight assignments; and peg the monthly rice allowance for 2007-2008 of FASAP members at P1,200 until Sept. 30, 2007; P1,500 between Oct. 1, 2007 to Sept. 30, 2008; and P1,800 from Oct. 1, 2008.
Bautista explained that the subject of the labor dispute is the deadlock in the CBA negotiations between PAL and FASAP from the period July 16, 2007 to July 15, 2010, but the DOLE based its economic awards to FASAP on PAL’s purported financial statements for fiscal year 2010-2011, specifically covering only the months of April, May and June 2010.
“These financial statements cannot subvert or supplant the fact that PAL incurred losses. In essence, DOLE is directing PAL to grant hefty pay increases for July 2007 to July 2010 despite its knowledge and awareness of PAL’s massive losses for the same period,” Bautista stressed.
He lamented that it is unjust and even confiscatory to oblige PAL to share income it did not even earn or does not have. “DOLE expects PAL to produce the money but as to how, the decision did not say,” Bautista said.
He said PAL could only infer that the DOLE is probably of the view that future income of the company from April 2010 forward can be applied to the salary increases it granted to FASAP for July 2007-2008 July 2008-2009, and July 2009-2010.
“But this will result in an absurd situation. It is an unthinkable fiscal maneuvering. Considering that the DOLE had already ‘pledged’ any income of PAL for the next years, one can only wonder where PAL is supposed to source funds for the succeeding demands for salary increase when negotiations for the 2010-2015 PAL-FASAP CBA begin,” Bautista said.
To prove its point, PAL presented pertinent records to DOLE showing that it suffered losses of $297.8 million in fiscal year 2008-2009, and $14.3 million for fiscal year ending March 2010.
On the retirement age issue, Bautista said DOLE should not have ignored the fact that the memorandum of agreements (MOAs) between the company and FASAP that provided lower retirement age were the product of voluntary negotiations within the framework of their previous CBA.
He said Article 287 of the Labor Code, as amended by Republic Act 7641, states that any person may be retired upon reaching the retirement age established in the collective bargaining agreement or other applicable employment contract. “Thus, a careful reading of the above provision indicates that employers and employees are at liberty to agree and fix the applicable retirement age even at below 60 years old.”
He added that DOLE failed to consider the fact that the average retirement age of most, if not all, of PAL’s fiercest competitors in the ASEAN region is much less than 60 years old. Thus, early retirement for flight attendants is fast becoming the rule rather than the exception.
He also chided DOLE for accepting FASAP’s argument that since the 2005-2010 CBA containing the agreed retirement age had already expired then there is no more agreed retirement age to invoke. “We can’t understand how DOLE and FASAP can legally justify that only the retirement provisions of the PAL-FASAP CBA have expired while other provisions on salaries, perks and work rules remain valid and in effect,” he said.
Even the absence of an agreement, Bautista said, does not warrant the outright rejection of PAL’s position without taking into account the bargaining history between the parties.
He said PAL did not force FASAP officers and members to accept the early retirement provisions as these were subject of negotiations and were approved and ratified by FASAP members in exchange for numerous concessions, in the form of monetary benefits, easier work rules and other perks.
Monday, January 10, 2011
PAL questions ruling on cabin crew CBA
Posted on 11:35 PM, January 10, 2011
LUCIO C. TAN-led Philippine Airlines, Inc. (PAL) has asked the Labor department to reconsider a ruling favoring flight stewards and attendants over a collective bargaining deadlock.
Saying last month’s ruling did not have legal and factual basis, the airline said it was ready to appeal all the way to the Supreme Court.
A reversal of the decision will ensure operating efficiency in the flag carrier, which expects to post $1.5 billion in revenues in the current fiscal year ending March, PAL President Jaime J. Bautista said.
But the Flight Attendants’ and Stewards’ Association of the Philippines (FASAP) said PAL should accept the ruling then focus on operations and deal with competition.
“We think that this case is very important for PAL and the Labor department should give a second look and consider the arguments we have presented in our motion for reconsideration,” Mr. Bautista said in a news conference yesterday.
Mr. Bautista said the Labor department wanted the flag carrier to share income it did not earn.
On Friday, PAL filed the motion for reconsideration on the Dec. 23 decision of the Labor department.
In particular, PAL wants to:
• reconsider and reinstate PAL’s lump-sum offer of P80 million in wage increases to FASAP members considering its financial status for the periods subject of the collective bargaining agreement (CBA) negotiations;
• maintain the retirement age at 45 years old instead of 60 while eliminating any distinction between domestic and international flight attendants for flight assignments; and
• peg the monthly rice allowance for 2007-2008 of FASAP members at P1,200 until Sept. 30, 2007; P1,500 between Oct. 1, 2007 to Sept. 30, 2008; and P1,800 from Oct. 1, 2008.
Labor Secretary Rosalinda D. Baldoz, who assumed jurisdiction over the dispute in October to prevent a strike, resolved the deadlock in a Dec. 23 ruling. The ruling provided for the following:
• compulsory retirement age for all FASAP members at 60 years old;
• two pregnancy leaves for a maximum of seven months for each leave, to be credited in computing the length of service for retirement, 13th month pay, Christmas bonus, rice allowance, and trip passes;
• prospective application of pregnancy and maternity leave crediting;
• monthly rice allowance of P1,800 for the period covering July 16, 2007 to July 15, 2010, estimated at P25 million; and
• three-year salary increases totaling over P200 million.
In the motion, the PAL said it incurred losses of $297.8 million in the fiscal year that ended March 2009, and $14.3 million in the fiscal year that ended March 2010.
PAL said it therefore cannot pay the salary increase granted to FASAP for July 2007-2008, July 2008-2009, and July 2009-2010.
“In essence, [the Labor department] is directing PAL to grant hefty pay increases for July 2007 to July 2010 despite its knowledge and awareness of PAL’s massive losses for the same period,” Mr. Bautista said in the motion for reconsideration.
On the retirement age, Mr. Bautista told reporters 35 to 45 is the industry standard.
“Most, if not all, of PAL’s fiercest competitors in the Southeast Asian region [have retirement ages of] much less than 60 years old,” Mr. Bautista said in the motion.
But the flag carrier will accept the provisions on maternity leave, Mr. Bautista said.
Meanwhile, PAL’s decision to file a motion for reconsideration “is a clear sign that instead of promoting peace, management opts to continue fighting with its flight attendants,” Roberto D. Anduiza, president of the 1,542-member FASAP, said in a statement.
“The airline industry is very competitive but instead of focusing on running the business well, of selling more tickets and attracting more passengers, our management is concentrating on fighting its own front-liners, the flight attendants,” Mr. Anduiza added.
Asked what PAL will do if the Labor department upholds its decision, Mr. Bautista said: “We can file an appeal to the Court of Appeals and up to the Supreme Court also.”
Meanwhile, PAL is on track toward posting $1.5 billion in revenues for the fiscal year ending March, up from around $1.4 billion last year.
“We are close to our projection because last December was one of the most profitable months,” Mr. Bautista said.
“The economy of the United States has already recovered and profit has improved for the entire airline industry,” Mr. Bautista added.
PAL expects higher revenues following the start of flights to New Delhi in March. PAL will pay $35 million-$40 million in unsecured debt in June.
PAL posted modest gains of $28.2 million in the second quarter of its fiscal year covering July to September. In a filing with the Securities and Exchange Commission last month, PAL reported revenues of $399.5 million for the period, up by 33%. -- Neil Jerome C. Morales
LUCIO C. TAN-led Philippine Airlines, Inc. (PAL) has asked the Labor department to reconsider a ruling favoring flight stewards and attendants over a collective bargaining deadlock.
Saying last month’s ruling did not have legal and factual basis, the airline said it was ready to appeal all the way to the Supreme Court.
A reversal of the decision will ensure operating efficiency in the flag carrier, which expects to post $1.5 billion in revenues in the current fiscal year ending March, PAL President Jaime J. Bautista said.
But the Flight Attendants’ and Stewards’ Association of the Philippines (FASAP) said PAL should accept the ruling then focus on operations and deal with competition.
“We think that this case is very important for PAL and the Labor department should give a second look and consider the arguments we have presented in our motion for reconsideration,” Mr. Bautista said in a news conference yesterday.
Mr. Bautista said the Labor department wanted the flag carrier to share income it did not earn.
On Friday, PAL filed the motion for reconsideration on the Dec. 23 decision of the Labor department.
In particular, PAL wants to:
• reconsider and reinstate PAL’s lump-sum offer of P80 million in wage increases to FASAP members considering its financial status for the periods subject of the collective bargaining agreement (CBA) negotiations;
• maintain the retirement age at 45 years old instead of 60 while eliminating any distinction between domestic and international flight attendants for flight assignments; and
• peg the monthly rice allowance for 2007-2008 of FASAP members at P1,200 until Sept. 30, 2007; P1,500 between Oct. 1, 2007 to Sept. 30, 2008; and P1,800 from Oct. 1, 2008.
Labor Secretary Rosalinda D. Baldoz, who assumed jurisdiction over the dispute in October to prevent a strike, resolved the deadlock in a Dec. 23 ruling. The ruling provided for the following:
• compulsory retirement age for all FASAP members at 60 years old;
• two pregnancy leaves for a maximum of seven months for each leave, to be credited in computing the length of service for retirement, 13th month pay, Christmas bonus, rice allowance, and trip passes;
• prospective application of pregnancy and maternity leave crediting;
• monthly rice allowance of P1,800 for the period covering July 16, 2007 to July 15, 2010, estimated at P25 million; and
• three-year salary increases totaling over P200 million.
In the motion, the PAL said it incurred losses of $297.8 million in the fiscal year that ended March 2009, and $14.3 million in the fiscal year that ended March 2010.
PAL said it therefore cannot pay the salary increase granted to FASAP for July 2007-2008, July 2008-2009, and July 2009-2010.
“In essence, [the Labor department] is directing PAL to grant hefty pay increases for July 2007 to July 2010 despite its knowledge and awareness of PAL’s massive losses for the same period,” Mr. Bautista said in the motion for reconsideration.
On the retirement age, Mr. Bautista told reporters 35 to 45 is the industry standard.
“Most, if not all, of PAL’s fiercest competitors in the Southeast Asian region [have retirement ages of] much less than 60 years old,” Mr. Bautista said in the motion.
But the flag carrier will accept the provisions on maternity leave, Mr. Bautista said.
Meanwhile, PAL’s decision to file a motion for reconsideration “is a clear sign that instead of promoting peace, management opts to continue fighting with its flight attendants,” Roberto D. Anduiza, president of the 1,542-member FASAP, said in a statement.
“The airline industry is very competitive but instead of focusing on running the business well, of selling more tickets and attracting more passengers, our management is concentrating on fighting its own front-liners, the flight attendants,” Mr. Anduiza added.
Asked what PAL will do if the Labor department upholds its decision, Mr. Bautista said: “We can file an appeal to the Court of Appeals and up to the Supreme Court also.”
Meanwhile, PAL is on track toward posting $1.5 billion in revenues for the fiscal year ending March, up from around $1.4 billion last year.
“We are close to our projection because last December was one of the most profitable months,” Mr. Bautista said.
“The economy of the United States has already recovered and profit has improved for the entire airline industry,” Mr. Bautista added.
PAL expects higher revenues following the start of flights to New Delhi in March. PAL will pay $35 million-$40 million in unsecured debt in June.
PAL posted modest gains of $28.2 million in the second quarter of its fiscal year covering July to September. In a filing with the Securities and Exchange Commission last month, PAL reported revenues of $399.5 million for the period, up by 33%. -- Neil Jerome C. Morales
‘Pocket open skies won’t hurt local carriers’
Monday, 10 January 2011 20:51 Mia M. Gonzalez / Reporter
Business Mirror
MALACAÑANG on Monday assured local carriers they will have some protection once it implements the Executive Order (EO) adopting a pocket open-skies policy.
Palace officials gave the assurance in response to the appeal of opposition Party-list Rep. Juan Miguel “Mikey” Arroyo for Malacanang to carefully study the open skies policy since it may not be something the Philippines needs at this time.
“What we’d like to assure everybody is that the contents of that EO were studied carefully. It is not a product of something that happened on a whim or on caprice. We believe this would put forward our reform agenda. This is not something that was done whimsically,” said Deputy Presidential Spokesman Abigail Valte.
“Knowing the officials who were behind the drafting of that EO, they would make sure that of course the local carriers would be protected,” she added.
Secretary Ricky Carandang of the presidential communications office said that under the proposed EO on pocket open skies, “the proposals that we’re going to put forth as far as liberalization of aviation is concerned are very well thought out by the economic team so I don’t think he (Rep. Mikey Arroyo) has to worry about it.”
He added, “The local?carriers can be assured that we will do what we can to take into account, and balance, all the interests here.”
When asked, Carandang said that the slump in the stocks of local carriers, following the Palace announcement that the EO would be issued soon, is just a “natural reaction,” since “stocks always react? to uncertainty in a negative way. If you wait for the release of the actual EO,?then the market will be in a better position to evaluate whether or not it will help or hurt [local carriers].” ?
He cited the case of Cebu Pacific, which operates domestically and in countries where aviation is already deregulated but continues to fare well. “Cebu Pacific has shown that it’s able to operate in whatever environment exists, so that’s why the market shouldn’t be too worried about it.” ?
He said that “if the carrier is efficient and [can] compete overseas, I don’t? see why they should worry too much about this. Remember the reason we’re doing this. We want to bring in more tourists, we want to bring in more jobs, we?want to make fares eventually more competitive, both domestically and internationally, for the Filipinos who travel so there’s a very big plus to this which is why we’re looking at it in the first place.”
Business Mirror
MALACAÑANG on Monday assured local carriers they will have some protection once it implements the Executive Order (EO) adopting a pocket open-skies policy.
Palace officials gave the assurance in response to the appeal of opposition Party-list Rep. Juan Miguel “Mikey” Arroyo for Malacanang to carefully study the open skies policy since it may not be something the Philippines needs at this time.
“What we’d like to assure everybody is that the contents of that EO were studied carefully. It is not a product of something that happened on a whim or on caprice. We believe this would put forward our reform agenda. This is not something that was done whimsically,” said Deputy Presidential Spokesman Abigail Valte.
“Knowing the officials who were behind the drafting of that EO, they would make sure that of course the local carriers would be protected,” she added.
Secretary Ricky Carandang of the presidential communications office said that under the proposed EO on pocket open skies, “the proposals that we’re going to put forth as far as liberalization of aviation is concerned are very well thought out by the economic team so I don’t think he (Rep. Mikey Arroyo) has to worry about it.”
He added, “The local?carriers can be assured that we will do what we can to take into account, and balance, all the interests here.”
When asked, Carandang said that the slump in the stocks of local carriers, following the Palace announcement that the EO would be issued soon, is just a “natural reaction,” since “stocks always react? to uncertainty in a negative way. If you wait for the release of the actual EO,?then the market will be in a better position to evaluate whether or not it will help or hurt [local carriers].” ?
He cited the case of Cebu Pacific, which operates domestically and in countries where aviation is already deregulated but continues to fare well. “Cebu Pacific has shown that it’s able to operate in whatever environment exists, so that’s why the market shouldn’t be too worried about it.” ?
He said that “if the carrier is efficient and [can] compete overseas, I don’t? see why they should worry too much about this. Remember the reason we’re doing this. We want to bring in more tourists, we want to bring in more jobs, we?want to make fares eventually more competitive, both domestically and internationally, for the Filipinos who travel so there’s a very big plus to this which is why we’re looking at it in the first place.”
Reverse backpay ruling, PAL asks DOLE
Monday, 10 January 2011 21:04 Recto Mercene / Reporter
CITING the huge overlay to cover the cost in the rise of aviation fuel among other expenditures, flag carrier Philippine Airlines (PAL) on Monday appealed to the Department of Labor and Employment (DOLE) to reverse its ruling granting hefty back-salary increase and higher retirement age for cabin crews.
PAL president and COO Jaime Bautista, in a press conference, said that apart from lack of legal and factual basis, the DOLE ruling is “confiscatory” as it obliges the flag carrier to share income it has yet to earn.
On Friday PAL lawyers filed a motion for reconsideration against the DOLE’s order raising the flight attendant’s retirement age to 60 years old. Bautista said the ruling has no justification in law and jurisprudence, and goes against industry practice worldwide.
According to Bautista, the cost of fuel at the start of the fiscal year was $80 a barrel, which would mean $5.5 million for PAL. Now that the cost of fuel is going from $80 to $90 a barrel, or a difference of $10 a barrel, PAL is
expected to spend $55 million this year alone.
“Fuel cost represents the largest overhead in terms of expenditures for PAL, followed by labor and then maintenance,” Bautista said.
On December 23, 2010, Labor Secretary Rosalinda Baldoz favored the Flight Attendants and Stewards Association (Fasap) with the grant of P222 million in total back-salary increase, compulsory retirement age of 60 years and increased monthly rice allowance of P1,800 and other benefits.
The DOLE also wanted PAL to reinstate its lump-sum offer of P80 million to Fasap.
PAL said the DOLE’s wanton disregard of the evidence and rule of fair play is a violation of its duty to render a decision based on fact and law, Bautista said.
Although the subject of the labor dispute is the deadlock in negotiations between the contending parties from July 2007 to July 2010, the DOLE based its economic awards to Fasap on PAL’s purported financial statements for fiscal year 2010-11.
“These financial statements cannot subvert or supplant the fact that PAL incurred losses and, in essence, DOLE is directing PAL to grant hefty pay increases from July 2007 to July 2010 despite its knowledge of the airline’s massive losses for the same period,” Bautista said.
He added that PAL could only infer that the DOLE viewed future earnings can be applied to salary increases it granted to Fasap.
“This will result in an absurd situation,” Bautista said.
He called the DOLE’s move “unthinkable fiscal maneuvering,” considering that it already pledged PAL income for the coming years, and wondered where PAL is supposed to source funds for succeeding demands for salary increase when negotiations for 2010-15 CBA begins.
To prove its point, PAL presented to the DOLE its records showing losses of $297.8 million in fiscal year 2008-2009, and $14.3 million for fiscal year ending March 2010.
On the retirement-age issue, Bautista said DOLE should not have ignored that the memorandum of agreement between the company and Fasap that provided lower-retirement age was the product of voluntary negotiations of their previous CBA.
PAL said the Labor Code, as amended by RA 7641, states that any person may be retired upon reaching the retirement age established in the CBA or other applicable employment contract.
“Thus, a careful reading of the provision indicates that employers and employees are at liberty to agree and fix the applicable retirement age even at below 60 years old.”
Bautista pointed out that the DOLE failed to consider that the average retirement age of most, if not all, of PAL’s fiercest competitors in Asean is much less than 60 years old.
“Early retirement for flight attendants is fast-becoming the rule rather than the exception,” he pointed out.
Bautista rebuked the DOLE for accepting Fasap’s argument that since the 2005-10 CBA on agreed retirement age had expired, then there is no more agreed retirement age to invoke.
“We can’t understand how DOLE and Fasap can legally justify that only the retirement-age provisions of PAL-Fasap CBA have expired, while other provisions on salaries, perks and work rules remain valid and in effect,” he added.
Bautista said even in the absence of an agreement, outright rejection of PAL’s position is not warranted without taking into account the bargaining history between the parties.
He said PAL did not force Fasap to accept the early-retirement provisions, as these were subject of negotiations and were approved and ratified by Fasap members in exchange for numerous concessions, in the form of monetary benefits, easier work rules and other perks.
On the other hand, Fasap president Bob Anduiza praised the DOLE decision as a golden opportunity for both parties to work together and face the tough competition in the Airline industry.
“We urge PAL to join hands with its flight attendants. We need one another to support the company’s operations and beat PAL’s competitors.”
However, Fasap said on Monday it is “obvious that PAL management opt to continue fighting with its flight attendants.”
Anduiza pointed out that PAL management has the capacity to pay Fasap for salary increases, citing the DOLE’s report on the financial statements of PAL last year.
Baldoz cited PAL’s own financial statements for April, May and June 2010. The records show that its “equity had doubled from P1,695,532,000 [as of March 31, 2010] to P3,321,653,000.”
“It is really pathetic that PAL is once again hogging the news not to promote travel and tourism, but because of labor disputes. The airline industry is very competitive but instead of focusing on running the business well, of selling more tickets and attracting more passengers, our management is concentrating on fighting its own frontliners, the flight attendants,” Anduiza said. (With S. Fabunan)
CITING the huge overlay to cover the cost in the rise of aviation fuel among other expenditures, flag carrier Philippine Airlines (PAL) on Monday appealed to the Department of Labor and Employment (DOLE) to reverse its ruling granting hefty back-salary increase and higher retirement age for cabin crews.
PAL president and COO Jaime Bautista, in a press conference, said that apart from lack of legal and factual basis, the DOLE ruling is “confiscatory” as it obliges the flag carrier to share income it has yet to earn.
On Friday PAL lawyers filed a motion for reconsideration against the DOLE’s order raising the flight attendant’s retirement age to 60 years old. Bautista said the ruling has no justification in law and jurisprudence, and goes against industry practice worldwide.
According to Bautista, the cost of fuel at the start of the fiscal year was $80 a barrel, which would mean $5.5 million for PAL. Now that the cost of fuel is going from $80 to $90 a barrel, or a difference of $10 a barrel, PAL is
expected to spend $55 million this year alone.
“Fuel cost represents the largest overhead in terms of expenditures for PAL, followed by labor and then maintenance,” Bautista said.
On December 23, 2010, Labor Secretary Rosalinda Baldoz favored the Flight Attendants and Stewards Association (Fasap) with the grant of P222 million in total back-salary increase, compulsory retirement age of 60 years and increased monthly rice allowance of P1,800 and other benefits.
The DOLE also wanted PAL to reinstate its lump-sum offer of P80 million to Fasap.
PAL said the DOLE’s wanton disregard of the evidence and rule of fair play is a violation of its duty to render a decision based on fact and law, Bautista said.
Although the subject of the labor dispute is the deadlock in negotiations between the contending parties from July 2007 to July 2010, the DOLE based its economic awards to Fasap on PAL’s purported financial statements for fiscal year 2010-11.
“These financial statements cannot subvert or supplant the fact that PAL incurred losses and, in essence, DOLE is directing PAL to grant hefty pay increases from July 2007 to July 2010 despite its knowledge of the airline’s massive losses for the same period,” Bautista said.
He added that PAL could only infer that the DOLE viewed future earnings can be applied to salary increases it granted to Fasap.
“This will result in an absurd situation,” Bautista said.
He called the DOLE’s move “unthinkable fiscal maneuvering,” considering that it already pledged PAL income for the coming years, and wondered where PAL is supposed to source funds for succeeding demands for salary increase when negotiations for 2010-15 CBA begins.
To prove its point, PAL presented to the DOLE its records showing losses of $297.8 million in fiscal year 2008-2009, and $14.3 million for fiscal year ending March 2010.
On the retirement-age issue, Bautista said DOLE should not have ignored that the memorandum of agreement between the company and Fasap that provided lower-retirement age was the product of voluntary negotiations of their previous CBA.
PAL said the Labor Code, as amended by RA 7641, states that any person may be retired upon reaching the retirement age established in the CBA or other applicable employment contract.
“Thus, a careful reading of the provision indicates that employers and employees are at liberty to agree and fix the applicable retirement age even at below 60 years old.”
Bautista pointed out that the DOLE failed to consider that the average retirement age of most, if not all, of PAL’s fiercest competitors in Asean is much less than 60 years old.
“Early retirement for flight attendants is fast-becoming the rule rather than the exception,” he pointed out.
Bautista rebuked the DOLE for accepting Fasap’s argument that since the 2005-10 CBA on agreed retirement age had expired, then there is no more agreed retirement age to invoke.
“We can’t understand how DOLE and Fasap can legally justify that only the retirement-age provisions of PAL-Fasap CBA have expired, while other provisions on salaries, perks and work rules remain valid and in effect,” he added.
Bautista said even in the absence of an agreement, outright rejection of PAL’s position is not warranted without taking into account the bargaining history between the parties.
He said PAL did not force Fasap to accept the early-retirement provisions, as these were subject of negotiations and were approved and ratified by Fasap members in exchange for numerous concessions, in the form of monetary benefits, easier work rules and other perks.
On the other hand, Fasap president Bob Anduiza praised the DOLE decision as a golden opportunity for both parties to work together and face the tough competition in the Airline industry.
“We urge PAL to join hands with its flight attendants. We need one another to support the company’s operations and beat PAL’s competitors.”
However, Fasap said on Monday it is “obvious that PAL management opt to continue fighting with its flight attendants.”
Anduiza pointed out that PAL management has the capacity to pay Fasap for salary increases, citing the DOLE’s report on the financial statements of PAL last year.
Baldoz cited PAL’s own financial statements for April, May and June 2010. The records show that its “equity had doubled from P1,695,532,000 [as of March 31, 2010] to P3,321,653,000.”
“It is really pathetic that PAL is once again hogging the news not to promote travel and tourism, but because of labor disputes. The airline industry is very competitive but instead of focusing on running the business well, of selling more tickets and attracting more passengers, our management is concentrating on fighting its own frontliners, the flight attendants,” Anduiza said. (With S. Fabunan)
PAL to DoLE: We can't afford economic package for FASAP
By SAMUEL P. MEDENILLA
January 10, 2011, 6:49pm
MANILA, Philippines – Flag-carrier Philippine Airlines (PAL) said it cannot afford the estimated P250-million economic package it has to pay to its flight crew union after it filed a partial motion for reconsideration at the Department of Labor and Employment (DoLE) last week requesting the review of its previous decision.
PAL President Jaime Bautista said in a media forum Monday that PAL does not have enough funds to pay for the economic package ordered by the DoLE to pay 1,600 members of the Flight Attendants’ and Stewards’ Association of the Philippines (FASAP).
“The amount is about three times the amount previously offered by PAL to FASAP. We reiterate our initial position that the wage increase, in effect should be at the lump sum of P80 million, considering the past financial status (of PAL) during the collective bargaining agreement (CBA) period,” Bautista said.
He said the new CBA, which was formed based from the resolution, will cover 2008 to 2009, when PAL posted a loss of about 300 million dollars from 2008 to 2010.
“We cannot afford to give those salary increases because the profit for this fiscal year, which we have reported for the first quarter should be set aside for salary increases that would be negotiated by not only by FASAP but also by PALEA for the current fiscal year,” he added.
Bautista also asked DoLE to reconsider the other provisions of its decision favoring FASAP last December 23, including the extension of the mandatory retirement age for its flight attendants from 45 to 60-years-old and the 1,800 pesos rice allowance for its cabin crew.
He said PAL’s policy in its retirement age is a market standard practiced by at least 15 airline companies in South East Asia to maintain their market competitiveness, while the rice allowance exceeds their initial offer of a 25 million pesos lump sum for all of their flight crew.
Bautista, however, said PAL will abide by DoLE’s decision regarding the crediting of maternity and pregnancy leaves for purposes of retirement.
Meanwhile, FASAP President Robert Anduiza has renewed its call to the PAL management to respect DoLE’s decision.
January 10, 2011, 6:49pm
MANILA, Philippines – Flag-carrier Philippine Airlines (PAL) said it cannot afford the estimated P250-million economic package it has to pay to its flight crew union after it filed a partial motion for reconsideration at the Department of Labor and Employment (DoLE) last week requesting the review of its previous decision.
PAL President Jaime Bautista said in a media forum Monday that PAL does not have enough funds to pay for the economic package ordered by the DoLE to pay 1,600 members of the Flight Attendants’ and Stewards’ Association of the Philippines (FASAP).
“The amount is about three times the amount previously offered by PAL to FASAP. We reiterate our initial position that the wage increase, in effect should be at the lump sum of P80 million, considering the past financial status (of PAL) during the collective bargaining agreement (CBA) period,” Bautista said.
He said the new CBA, which was formed based from the resolution, will cover 2008 to 2009, when PAL posted a loss of about 300 million dollars from 2008 to 2010.
“We cannot afford to give those salary increases because the profit for this fiscal year, which we have reported for the first quarter should be set aside for salary increases that would be negotiated by not only by FASAP but also by PALEA for the current fiscal year,” he added.
Bautista also asked DoLE to reconsider the other provisions of its decision favoring FASAP last December 23, including the extension of the mandatory retirement age for its flight attendants from 45 to 60-years-old and the 1,800 pesos rice allowance for its cabin crew.
He said PAL’s policy in its retirement age is a market standard practiced by at least 15 airline companies in South East Asia to maintain their market competitiveness, while the rice allowance exceeds their initial offer of a 25 million pesos lump sum for all of their flight crew.
Bautista, however, said PAL will abide by DoLE’s decision regarding the crediting of maternity and pregnancy leaves for purposes of retirement.
Meanwhile, FASAP President Robert Anduiza has renewed its call to the PAL management to respect DoLE’s decision.
Sunday, January 9, 2011
'Mikey' warns vs open skies policy
Manila Bulletin, Jan 9, 2011
MANILA, Philippines - As the local airline industry awaits with caution anytime this week President Benigno "Noynoy" Aquino's issuance of an executive order paving the way for the adoption of open skies policy, former presidential son and now Ang Galing Pinoy Rep. Juan Miguel "Mikey" Arroyo Sunday warned the Palace against the adverse repercussion that a new presidential edict might bring."The adoption of an open skies policy should be carefully studied first before being implemented," Arroyo said."First issue we have to address is: Do we really need an open skies policy? Or are foreign airlines really asking for such policy?" Arroyo stressed.Arroyo said that in Cebu alone, there are no less than 40 airlines which have applied for direct access to its airport and which have been approved but so far, only three airlines are availing of the direct access to the Cebu International Airport."So, why adopt an open skies policy when in Cebu alone, airlines have not exploited their direct access pass to its airport? Maybe it's not an open skies policy these airlines need.Maybe we have to ask them directly what really do they need," said Arroyo.Arroyo also brushed aside claims by the administration the open skies policy will help bolster the country's tourism industry."It's not the number of airlines operating in the country that is the behind the lackluster performance of the tourism industry in the Philippines but the country's negative image abroad, especially in the area of peace and order and security which was further aggravated by the hostage-taking fiasco.""In Clark alone, which was declared open by the previous administration, while the number of passengers increased, the increase in the influx of tourists was insignificant as the increase in the number of passengers have been attributed largely to OFWs from Central and Northern Luzon who have used the Diosdado Macapagal International Airport as take-off and landing points to and from their country of destinations," Arroyo noted."Maybe this administration should revisit their data," he added.What the administration should do, according to Arroyo, is that aside from addressing the country's peace and order issue, is to acquire a Category 1 status in terms of international aviation safety standards from its present Category 2 rating, which would make it at par with other Western countries.A Category 2 status means the country is in the same standard level as many African nations.Representatives from the Civil Aviation Authority of the Philippines have been insisting that the country must be able to guarantee first that it would comply with internationally acceptable aviation standards as well as security and safety measures before the government implements an open skies policy that would fully liberalize the civil aviation industry.And assuming the country acquires Category 1 status and is all ready and set up to implement an open skies policy, Arroyo said the administration should ensure "the terms and rules should be clear so that we would not end up in the losing end.""If we are to allow foreign airlines to have direct access to our airports, then they should also allow our airlines to have direct access to their airports, too," Arroyo said.
"There should be a reciprocity clause.""The open skies policy should not be a one-way traffic, otherwise instead of creating new jobs as this administration claims this executive order would generate, it would kill the local airline industry which would result to massive lay-offs," said Arroyo.
MANILA, Philippines - As the local airline industry awaits with caution anytime this week President Benigno "Noynoy" Aquino's issuance of an executive order paving the way for the adoption of open skies policy, former presidential son and now Ang Galing Pinoy Rep. Juan Miguel "Mikey" Arroyo Sunday warned the Palace against the adverse repercussion that a new presidential edict might bring."The adoption of an open skies policy should be carefully studied first before being implemented," Arroyo said."First issue we have to address is: Do we really need an open skies policy? Or are foreign airlines really asking for such policy?" Arroyo stressed.Arroyo said that in Cebu alone, there are no less than 40 airlines which have applied for direct access to its airport and which have been approved but so far, only three airlines are availing of the direct access to the Cebu International Airport."So, why adopt an open skies policy when in Cebu alone, airlines have not exploited their direct access pass to its airport? Maybe it's not an open skies policy these airlines need.Maybe we have to ask them directly what really do they need," said Arroyo.Arroyo also brushed aside claims by the administration the open skies policy will help bolster the country's tourism industry."It's not the number of airlines operating in the country that is the behind the lackluster performance of the tourism industry in the Philippines but the country's negative image abroad, especially in the area of peace and order and security which was further aggravated by the hostage-taking fiasco.""In Clark alone, which was declared open by the previous administration, while the number of passengers increased, the increase in the influx of tourists was insignificant as the increase in the number of passengers have been attributed largely to OFWs from Central and Northern Luzon who have used the Diosdado Macapagal International Airport as take-off and landing points to and from their country of destinations," Arroyo noted."Maybe this administration should revisit their data," he added.What the administration should do, according to Arroyo, is that aside from addressing the country's peace and order issue, is to acquire a Category 1 status in terms of international aviation safety standards from its present Category 2 rating, which would make it at par with other Western countries.A Category 2 status means the country is in the same standard level as many African nations.Representatives from the Civil Aviation Authority of the Philippines have been insisting that the country must be able to guarantee first that it would comply with internationally acceptable aviation standards as well as security and safety measures before the government implements an open skies policy that would fully liberalize the civil aviation industry.And assuming the country acquires Category 1 status and is all ready and set up to implement an open skies policy, Arroyo said the administration should ensure "the terms and rules should be clear so that we would not end up in the losing end.""If we are to allow foreign airlines to have direct access to our airports, then they should also allow our airlines to have direct access to their airports, too," Arroyo said.
"There should be a reciprocity clause.""The open skies policy should not be a one-way traffic, otherwise instead of creating new jobs as this administration claims this executive order would generate, it would kill the local airline industry which would result to massive lay-offs," said Arroyo.
Wednesday, January 5, 2011
Open skies set for Davao, Cebu, Zamboanga, Laoag
Manila Standard Today: News
January 05,2011
by Joyce Pangco Pañares
THE government will this week declare an open-skies policy in Davao, Cebu, Zamboanga and Laoag, exposing those secondary destinations to more competition from foreign airlines, Executive Secretary Paquito Ochoa said Tuesday.
But the local airlines will still have the exclusive right to serve domestic routes as the executive order coming from President Benigno Aquino III will prohibit cabotage, an airline’s right to carry passengers between two domestic points.
PAL Holdings Inc. fell the most in seven weeks, leading Philippine carriers lower, after Ochoa made his announcement.
PAL, which controls the nation’s biggest carrier, sank 7.2 percent to P4.50, set for the steepest loss since Nov. 12.
Cebu Air Inc., the country’s biggest budget carrier, declined 2.8 percent to P111, set for the sharpest decrease since Dec. 17.
Valenzuela City Rep. Rex Gatchalian on Monday filed House Bill 1601 espousing a “pocket open-skies policy to boost tourism, liberalize air traffic, and prevent business disruption when an airline’s operations are snagged by a labor dispute.
The bill is being supported by the House leadership led by Speaker Feliciano Belmonte Jr.
“Open skies will usher in more competition and that will change the dynamics of the business,” said Rico Gomez at Rizal Commercial Banking Corp.
“Greater competition will always be difficult for entrenched players.”
President Benigno Aquino said in August that the government might give foreign carriers more access because of a labor row at Philippine Airlines. With Christine F. Herrera, Bloomberg
January 05,2011
by Joyce Pangco Pañares
THE government will this week declare an open-skies policy in Davao, Cebu, Zamboanga and Laoag, exposing those secondary destinations to more competition from foreign airlines, Executive Secretary Paquito Ochoa said Tuesday.
But the local airlines will still have the exclusive right to serve domestic routes as the executive order coming from President Benigno Aquino III will prohibit cabotage, an airline’s right to carry passengers between two domestic points.
PAL Holdings Inc. fell the most in seven weeks, leading Philippine carriers lower, after Ochoa made his announcement.
PAL, which controls the nation’s biggest carrier, sank 7.2 percent to P4.50, set for the steepest loss since Nov. 12.
Cebu Air Inc., the country’s biggest budget carrier, declined 2.8 percent to P111, set for the sharpest decrease since Dec. 17.
Valenzuela City Rep. Rex Gatchalian on Monday filed House Bill 1601 espousing a “pocket open-skies policy to boost tourism, liberalize air traffic, and prevent business disruption when an airline’s operations are snagged by a labor dispute.
The bill is being supported by the House leadership led by Speaker Feliciano Belmonte Jr.
“Open skies will usher in more competition and that will change the dynamics of the business,” said Rico Gomez at Rizal Commercial Banking Corp.
“Greater competition will always be difficult for entrenched players.”
President Benigno Aquino said in August that the government might give foreign carriers more access because of a labor row at Philippine Airlines. With Christine F. Herrera, Bloomberg
Saturday, January 1, 2011
PAL may sell Bacolod property to pay debts and fund capex
Monday, 10 January 2011 20:25 Lenie Lectura / Reporter
BELEAGUERED Philippine Airlines (PAL) may yet again resort to selling another piece of property to partly repay debts and to fund working capital.
“We still have a property in Bacolod where the airport is situated. We own part of the airport. If there will be opportunities to sell and make money out of it then we will consider,” PAL president Jaime Bautista said yesterday.
PAL raised $12 million from the sale of its property in Makati City last year. This one-time gain was included in the airline’s $31.5- million profit ending June last year, said Bautista.
PAL is paying off $10 million in debts every month and about $46 million which comes due every sixth month of the year. Bautista said the flag carrier is sourcing payment from internally generated cash as well as savings from various cost-cutting measures.
Fuel remains to be one of the biggest expenses of the airline company with an annual payment of an estimated $570 million for fuel alone. “Early last year, a barrel of crude costs about $80 but when the year ended it already costs $90. For every $1 increase, this translates to $55 million in operational cost for us,” explained Bautista.
The PAL chief said in the third quarter ending December last year the airline will be reporting the same or slightly higher profits compared with the previous year ago, thanks to higher revenues.
PAL is projecting $1.5 billion in total revenues for the fiscal year ending March this year. Bautista said PAL is on track to meet that number.
“Our revenues for December 2010 alone were up by $5 million. December is one of our most profitable months. We haven’t finalized yet our profit because December just ended but it is closer to our projections. Traffic worldwide has recovered,” added Bautista.
“February is a losing month again. But in spite of our projection, we will continue to pay our debts, operational costs and labor expenses which totals around $225 million a year,” said Bautista.
Amid labor woes, PAL registered a 10-percent increase in flight bookings in December compared with the same period last year.
Based on sales data, almost all flights coming from the US are full, registering the highest number of forward bookings, followed by those coming from Australia. PAL’s traditionally packed flights every December are those from North America, Australia, Hong Kong and Singapore.?
Between Christmas and New Year, PAL’s airplanes are filled with vacationers bound for Kalibo, Hong Kong, Bangkok, Singapore and China.
BELEAGUERED Philippine Airlines (PAL) may yet again resort to selling another piece of property to partly repay debts and to fund working capital.
“We still have a property in Bacolod where the airport is situated. We own part of the airport. If there will be opportunities to sell and make money out of it then we will consider,” PAL president Jaime Bautista said yesterday.
PAL raised $12 million from the sale of its property in Makati City last year. This one-time gain was included in the airline’s $31.5- million profit ending June last year, said Bautista.
PAL is paying off $10 million in debts every month and about $46 million which comes due every sixth month of the year. Bautista said the flag carrier is sourcing payment from internally generated cash as well as savings from various cost-cutting measures.
Fuel remains to be one of the biggest expenses of the airline company with an annual payment of an estimated $570 million for fuel alone. “Early last year, a barrel of crude costs about $80 but when the year ended it already costs $90. For every $1 increase, this translates to $55 million in operational cost for us,” explained Bautista.
The PAL chief said in the third quarter ending December last year the airline will be reporting the same or slightly higher profits compared with the previous year ago, thanks to higher revenues.
PAL is projecting $1.5 billion in total revenues for the fiscal year ending March this year. Bautista said PAL is on track to meet that number.
“Our revenues for December 2010 alone were up by $5 million. December is one of our most profitable months. We haven’t finalized yet our profit because December just ended but it is closer to our projections. Traffic worldwide has recovered,” added Bautista.
“February is a losing month again. But in spite of our projection, we will continue to pay our debts, operational costs and labor expenses which totals around $225 million a year,” said Bautista.
Amid labor woes, PAL registered a 10-percent increase in flight bookings in December compared with the same period last year.
Based on sales data, almost all flights coming from the US are full, registering the highest number of forward bookings, followed by those coming from Australia. PAL’s traditionally packed flights every December are those from North America, Australia, Hong Kong and Singapore.?
Between Christmas and New Year, PAL’s airplanes are filled with vacationers bound for Kalibo, Hong Kong, Bangkok, Singapore and China.
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