PAL's move seen as a 'deceitful scheme of massive layoffs'

MANILA - A labor group opposed the early retirement packages offered by flag carrier Philippine Airlines (PAL), which it branded as "a form of massive retrenchment."

According to militant labor center Kilusang Mayo Uno (KMU), PAL's early retirement scheme will cut regular employees from its workforce to hire contractuals, further boosting the airline's profits.

Contractual workers are deprived of benefits given to regular employees. They can also be fired more easily with little or no cost to the management, as compared to regular workers.

"We call on the PAL management to immediately stop offering early retirement packages to regular workers. While this scheme promises to give regular workers hefty retirement packages, it is still a form of massive retrenchment, and a deceitful one at that," KMU Chairperson Elmer Labog said in a statement.

Last month, PAL President and Chief Operating Officer Jaime Bautista said the company will offer early retirement packages for its more than 8,000 employees to reduce costs. Bautista said manpower accounts for 18% of PAL's total expenses, adding that the company wants to reduce this to close to single-digit level.

KMU, however, said that PAL's claim of losses is "highly questionable," given the increase in Lucio Tan's net worth to $1.7 billion from $1.5 billion as reported by Forbes Asia Magazine.

"We don't buy the lie that PAL is incurring losses, as its owner Lucio Tan has just firmed up his position as the second wealthiest man in the country today," Labog said.

Tan placed second in Forbes Asia magazine's list of the 40 richest people in the Philippines. Clinching the top spot is retail mogul Henry Sy, while Ayala conglomerate's Chairman Jaime Zobel de Ayala placed third in the list.

At present, Tan has a controlling stake in PAL, and has interests in tobacco, beer, and banking, among others.

Meanwhile, KMU called on PAL employees to refuse to sign up for early retirement, saying that it is better to have a regular job than getting a one-time compensation especially in a time of crisis.

“We call on PAL employees to come and work together to oppose the retrenchment schemes of the PAL management, and to organize among themselves to fight for their rights and interests," KMU said.

Earlier, abs-cbnNEWS.com received a letter from one of its readers about PAL's cost-cutting measures. The reader, who claimed to be an employee of the airline's Network Management and Telecommunication Services Department, said they were being urged to take a one-week leave per month without pay starting August 17.

PAL, however, refused to confirm whether this is true.