Palea vs the people

Unfortunate and grave! This is all I can say about that wildcat strike launched by the Philippine Airlines (PAL) employees’ union, Philippine Airlines Employees Association (Palea), last Tuesday, as Typhoon “Pedring” battered the metropolis. That strike stranded thousands of PAL passengers not only in the country but overseas and disrupted for a good 11 hours the operations of the nation’s flag carrier. One passenger, a certain Annie Recio, who was flying to Iloilo to visit her ailing mother and who braved the rains to be at the airport on time only to be told flights were cancelled summed the public’s sentiments well when she said “while she could sympathize with the Palea members’ plight what they did was unforgivable…they have a responsibility to the passengers and the public to do their job and not let them suffer as well.”

Indeed, that strike could not have been done at the worst time. There was a typhoon, people were hurrying to their destinations and essential cargoes were being moved in, out and around the country that any kind of disruption would cause irreparable damage not only to PAL but probably even more to its customers such as Recio whose presence beside her ailing mother was beyond any consideration. No wonder she was visibly shaken and angry when she got interviewed by members of media.

In any event, it should now be clear to one and all that the parties will not back down from their hardline positions, that is, PAL management will proceed with its outsourcing plan for the three non-core undertakings, i.e., airport services, call center operations and inflight catering, which has been approved for implementation by Oct. 1 by both the Department of Labor and Employment (DoLE) and the Office of the President unless the Court of Appeals issues a TRO by today. Pending any approval and as Palea should have realized by now it would be fool hardy to raise hell, as it were, to the consternation and damage not just to PAL management but, more importantly, to the riding public. The carrier’s management has already announced it lost millions of pesos as a result of the stand off last Tuesday and will probably have to suffer even more as it tries to stabilize its operations over the next few days. That is to be expected, considering the circumstances. But the greater damage maybe to Palea and its associates who apparently threw all caution to the wind in a last ditch effort to prevent the almost inevitable move into a leaner PAL operations. By going that route without regard for the public welfare they may lose whatever goodwill they still have from those who sympathize with their cause.

For if truth be told, with what happened last Tuesday, the public will now be more predisposed to understand and perhaps better appreciate PAL’s efforts to restructure and stay afloat in the face of the lingering global economic crisis which has had a truly devastating effect on the airline industry. Even such giants in the industry as the big US airlines, British Air, Air France, Japan Air and Qantas have had to cut back or merge in a bid to staunch the red ink. PAL could do no less given its historical losses before, during and after its privatization in the early 1990s. In fact, over the past three years, PAL has had a net loss of more than $200 million, losing $312 million in 2008 and 2009 while bouncing a bit with a $72 million profit in 2010. But it has since been back to registering losses in the past two quarters and stands to get even worse as the cutthroat competition in the industry gets even worse than ever before.

As it is, the restructuring initiative can be considered as a kind of a “soft landing” package, almost a silver parachute, for the 2,600 affected workers. True, they may not have the kind of perks and privileges they are now getting under the collective bargaining agreement (CBA) which Palea has gained through the years. Many of them, especially the old timers, will probably have a harder time to get any new jobs or move on to other fields. They may even have to struggle to make both ends meet with the package they will be getting even if there is a one year guaranteed employment proviso inserted in the said package. But consider the other possibility of PAL closing down or even sold to another group.

I am sure they cannot be better off under any of those possibilities. If PAL closes down then the package under the old CBA will just set in, if at all.

The workers may even have to fight it out with other creditors for the remaining assets which a “closed down” PAL will have at that time even if they are entitled to be the first in the line. On the other hand, if tomorrow the Lucio Tan group decides to walk away and sell the airline to another group or turn it over to its major creditors, then the first thing that will surely be looked into would be that old CBA and all other labor and employment related work out. The perks and benefits under the CBA will be the first item on the block for review and definitely restructuring. In the course of things the workers will be on their own and will have to take care of their daily bread as they battle it off with the old management or the incoming one(s) whichever comes first.

On the other hand, under this “soft landing” package, the 2,600 workers affected will have an immediate cash in, as it were, ranging from a minimum of P300,000 to as high as P2 million. That is on top of a guaranteed one year employment plan with all the perks and benefits available under the old CBA which can translate into a longer term arrangement or may be even better, depending on the business’ standing in the course of the year. It can, of course, get worse also depending on the situation of PAL and the airline industry in the one year transition. Whatever it is, what is clear is that the situation as of today is no longer sustainable. And it is utterly whimsical if not suicidal for the Palea leadership to think otherwise. If it persists in doing what it did last Tuesday then it is clear where the public’s sympathy and goodwill will be. Pity. –Jonathan De la Cruz, Daily Tribune