THE Department of Labor and Employment (DOLE) has ordered Philippine Airlines to maintain a status quo on operations following recent announcements the flag carrier will undertake a restructuring program.
At the same time, DOLE ordered union employees not to go on strike, noting the interruption of airline services that will affect related sectors such as trade and tourism, will adversely impact on the economy.
Earlier, the PAL Employees Association (PALEA) warned of a strike if the flag carrier pushes through with a restructuring that involves the spinoff of three non-core units — inflight catering services; airport services, including ground handling, cargo terminal/cargo handling and ramp handling; and call center reservations.
PALEA said the spinoff will displace about 4,500 employees.
PAL president Mario Bautista said there “is an assumption of jurisdiction of the case by the DOLE secretary” and that PAL will abide by DOLE’s order.
“It must be emphasized that this is not the first time that PAL has been embroiled in a labor dispute that eventually progressed into a strike among its employees, which resulted in the loss of employment status of not a few union officers as well as its members,” Labor Secretary Marianito Roque said in an April 23 order.
“Both parties are ordered to refrain from committing any act that might exacerbate the situation,” he said.
PAL’s financial situation has deteriorated over the years, with the company sustaining over $350 million (more than P15 billion) in losses during the last two fiscal years.
The spinoff of non-core units is the second phase of the flag carrier’s restructuring program designed to reduce effects of the global economic crisis on its operations.
The airline has also suffered from a downgrade by the US of the country’s aviation sector status to Category I, and the recent blacklisting by the European Union of Philippine carriers due to safety concerns.
