“The Company undertakes not to contract out existing positions, jobs, divisions, and departments presently occupied by present or future regular employees within the collective bargaining unit. All existing programs whereby positions, jobs, divisions, and departments presently occupied by regular employees are being contracted out temporarily arising from exigencies of operations, shall immediately be deemed discontinued when the said exigencies or needs cease. Thereafter, where these programs have resulted in transfers and/or other adverse implications on security of tenure, all affected employees shall be immediately restored to their status and position prior to said contracting out, without any loss of seniority or diminution of benefits.
In case the Company deems it necessary to reorganize its corporate structure for the viability of its operations by forming joint ventures and spin-offs, the Company shall do so only after proper consultations with PALEA [Philippine Airlines’ Employees Association] not less than forty-five (45) days before the implementation of said reorganization for the protection of the Union and those affected employees.”
— From Article 24, Section 4 of the 1995-2000 labor agreement between Philippine Airlines (PAL) and the PALEA. Arguably, the agreement remains in effect after both parties agreed to extend it in 1998. During that time, the company sought — and later secured — court approval to temporarily suspend debt payments to creditors. In October, the Philippines’ Department of Labor and Employment affirmed an earlier decision dated June, allowing the outsourcing of 4,000 jobs in the airlines’ inflight catering, airport services, and reservations staff. The June 2010 decision was made after workers appealed a much earlier verdict rendered in March that also ruled against their favor. Earlier, workers filed a case against PAL, disputing its plans to contract out its labor needs. The case also sought to renew the labor agreement that had already lapsed. [See: Labor Dept. allows layoff of PAL workers]