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5:53 pm | Wednesday, March 20th, 2013
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MANILA, Philippines—The Court of Appeals affirmed the Malacañang and the Department of Labor and Employment (DOLE) ruling that favored the outsourcing of employees by the Philippine Airlines that cost the jobs of some 2,600 workers.
In an 87-page decision, the appeals court’s Special Eight Division through Association Justice Priscilla Baltazar-Padilla said the Office of the President did not abuse its discretion when it affirmed the findings of the Secretary of Labor and DOLE and disregarded the evidence presented by the employees.
“We are unimpressed with PALEA’s contention that the assailed judgment and resolution of the OP are tainted with grave abuse of discretion after having assiduously reviewed and carefully sifted the record and evidence at hand,” the appeals court said.
“We see no apparent indication that the decree upholding the validity of PAL’s plan to outsource its non-core operations was attended with whim, caprice and arbitrariness,” the appeals court added.
PAL’s spin-off/outsourcing program was first recognized as legal and valid by acting Labor Secretary Romeo Lagman on June 15, 2010, and was affirmed by Labor Secretary Rosalinda Baldoz on Oct. 29, 2010. Baldoz’ ruling was affirmed by the Office of the President prompting PALEA to file an appeal with the Court of Appeals.
The appeals court said the permanent outsourcing of non-core operations of PAL is part of the company’s exercise of its right to reorganize its business structure “to enable it to thrive and grow in highly competitive airline industry.”
Based on the financial statements of PAL, it incurred a comprehensive loss of US$297.8 million for fiscal year 2009 and US$14.3 million for 2010.
“It is readily apparent that PAL has a fluctuating financial condition and it is understandable if it continues to explore cost-saving measures to attain full financial stability. Hence, we decline to interfere with PAL’s judgment in the conduct of its business by making a legitimate business decision to outsource certain services to maintain a healthy and viable financial standing,” the appeals court said.
The appeals court added that PAL even consulted its employees for the planned outsourcing, it is also allowed under its Collective Bargaining Agreement.
It added that the dismissal of the employees from the in-flight catering, airport services and call center reservation is due to closure of operations but not on retrenchment to cut losses. The court noted that PAL already paid 1,406 affected employees.
The court pointed that PAL did not even challenged the order of the OP to increase the additional gratuity to affected employees from P50,000.00 to P100,000 apart from other benefits that they are entitled to receive.
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Tags: aviation industry , Labor , labor dispute , nation , News , Philippine Airlines
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