Losses force PAL to cut workforce

Credit to Author: Lisbet K. Esmael| Date: Fri, 28 Feb 2020 17:01:10 +0000

PHILIPPINE Airlines on Friday began laying off as many as 300 employees to reduce its financial losses, which were exacerbated by the recent Taal Volcano eruption and the continued spread of the coronavirus disease 2019 (Covid-19) worldwide.

In an email sent to select PAL employees, a copy of which was secured by The Manila Times, PAL President and Chief Operating Officer Gilbert Santa Maria reported that the Tan-led airline posted a $208-million net loss in 2019 and held “unsustainable long term debt and lease obligations of billions of US dollars.”

The Taal eruption on January 12 and the Covid-19 outbreak that resulted in several travel bans dampened people’s desire to book flights.

“Unfortunately, the closure of our Manila hub during the Taal Volcano eruption [in] January and the ongoing Covid-2019 crisis that shut down all our flights to mainland China, Hong Kong and Macau… only worsened what was already a difficult situation,” Santa Maria wrote.

These prompted PAL to reduce its workforce “in administrative ground personnel across multiple groups through a Retrenchment Program,” he added.

A source with knowledge on the matter said many of those laid off already received their final salary, including their 13th- and 14th-month pays.

The Philippine Airlines Employees’ Association (Palea) criticized Friday’s retrenchment as a “continuation of the anti-worker business scheme of PAL.”

“This (layoff) could spill over to the rank-and-file [employees]. The fact is, PAL is looking into [a] massive labor-cost-savings program. Its savings in labor cost would translate to more profit,” Palea told The Times.