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Philippines government upholds PAL unit sell-off plan


Published on Mar 28, 2011

Philippine Airlines (PAL) welcomed a government ruling upholding the national carrier’s right to restructure its operations by selling-off its Airport Services, In-flight Catering and Call Centre Reservations units. The ruling however, called for an additional PHP50,000 (US$1,150) in redundancy pay for each affected worker, which PAL agreed to abide by.

PAL President and COO, Jaime Bautista, said the decision now removes all legal impediments on the implementation of the selloff programme. “PAL can now focus on its restructuring efforts in order to survive in the long term,” he said.

Bautista added that PAL management will now approach affected workers to discuss the implementation of the ruling. Follow the recent threat of strike action by the PAL Employees Association (PALEA), Bautista urged the union to respect the decision.

PALEA recently said it would ballot its members on the possibility of strike action, following the attempted sell-offs. PAl maintains that it needs to outsource the three units as part of cost-control strategies to ensure the airline’s long-term survival.

The close to 2,600 workers will be assured of jobs in the new service provider, which will take over the operations of the three units.

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