MANILA, Philippines - Labor groups said the resolution of the ongoing labor dispute between the management and employees of the Philippine Airlines (PAL) will be a litmus test for the Aquino administration.

In particular, labor organizations are keenly watching how the new administration will address their long-standing demand for the government to eliminate the contractualization of labor.

Gerry Rivera, president of the PAL Employees Association or PALEA said they welcomed Aquino's order for the Department of Labor and Employment (DoLE) to review and evaluate its "midnight decision" on the airline labor problem.

PALEA is fighting the DoLE's decision issued shortly before the new government took over, to allow the airline management to outsoure three of its critical operations.

PALEA said this is tantamount to the mass layoff of some 3,000 PAL employees. The management of PAL said outsourcing its operations is necessary to stave off more losses for the airline.

On June 15, DoLE Acting Secretary Romeo Lagman said the outsourcing of PAL's operations are a "valid exercise of management prerogative."

Rivera said more than half of the PAL workforce will be retrenched and the local airline industry will be affected.

"The PAL dispute will not only be a litmus test of the Aquino government’s handling of labor management relations. It will also be an acid test of the task of cleansing the DoLE of corrupt officials and reforming the policy on labor contractualization," said Rivera.

Renato Magtubo, chairperson of Partido ng Manggagawa (PM), said "the epidemic of contractualization is a result of failure in both policy and enforcement."

"There are glaring loopholes in the law that have been abused by employers to wipe out regular jobs and replace them with contractual workers that have less in wages and benefits and enjoy no security of tenure."

Management is allowed by law to contract out jobs that are necessary and desirable to the business of the company.

But labor groups said this has been interpreted to mean that practically all jobs can be outsourced, not just janitorial or security services.

"Thus, you find factories and malls in which contractual workers outnumber regular workers several times over while all do the same job,” said Magtubo.

The PAL tiff between management and labor prompted labor groups to press Aquino to certify a set of pro-labor reform bills as urgent in his state of the nation address.

Various labor groups are mobilizing their ranks that will join rallies in the SONA on July 30. These include the Manggagawa sa Komunikasyon ng Pilipinas, PM, Makabayan, Alliance of Progressive Labor, United Filipino Service Workers, Alliance of Genuine Labor Organizations, United Cavite Workers Association, Samahan ng Manggagawa sa Paranaque, Samahan ng Manggagawa sa Antipolo and the former union of PNCC employees. - By Rocel Felix, abs-cbnNews.com