Lucio Tan has become richer due to outsourcing

Press Release
March 11, 2011
PALEA

In reaction to news that Lucio Tan is the second richest Filipino in the Forbes list of billionaires, the Philippine Airlines Employees’ Association (PALEA) today said that he has become wealthier by outsourcing and other violations of labor rights. “Despite the bountiful fruits of production, Lucio Tan as owner of Philippine Airlines (PAL) refuses to share with his workers through a collective bargaining agreement (CBA) and plans to squeeze even more profit from employees through contractualization,” declared Gerry Rivera, PALEA president and vice chair of the Partido ng Manggagawa (PM).

In the Forbes list of billionaires, the Lucio Tan family was ranked 512th with a net worth of $2.3 billion, up from its rank of 582nd last year, when its net worth was $1.7 billion. Only the family of Henry Sy was ranked higher with a net worth of $5.8 billion.

“All through the years that PAL was losing, Lucio Tan has been getting richer. His get-rich-quick formula is nothing else but to cheapen labor costs by outsourcing the profitable units of PAL to third-party providers, such as Lufthansa Technik and MacroAsia, in which he has a stake,” Rivera explained.

He added that “But $2.3 billion in not enough for Lucio Tan. The mother of all outsourcing scheme is in the offing, with 2,600 employees to be laidoff and made contractuals in SkyLogistics and SkyKitchen which are owned by Manny Osmena but, as journalist Raissa Robles pointed out in her expose, is just fronting for Lucio Tan. Further PAL wants an indefinite CBA moratorium on top of the 12-year suspension in negotiations. So while PAL workers have not been able to improve their wages and benefits via a new CBA, Lucio Tan’s pockets have been bulging.”

In view of the fruitless conciliation meeting last Tuesday, PALEA called on the Department of Labor and Employment to “enforce the provisions of the Labor Code and order PAL to begin CBA negotiations.”

PALEA also asked the Office of the President (OP), which is hearing the separate case of legality of the outsourcing plan, to “take cognizance of the facts of the case which belie the need for outsourcing and reveal its real intent to bust the union and cheapen labor costs.”

Rivera elaborated that “PAL’s argument that it will wait for a ruling on the outsourcing plan is an alibi for a de facto indefinite CBA moratorium. Whatever is the ruling by the OP on the legality of the outsourcing plan, either the union or management will file a case at the Court of Appeals and the Supreme Court. This was the declaration both of PAL and PALEA in the last mediation meeting called by Malacanang. The outsourcing plan then cannot be executed pending a final judicial resolution which may take years considering the justice system.” ###