PM slams richest Filipinos as kings of contractualization

Press Release

June 24, 2011

In reaction to the news about the richest Filipinos on the Forbes list of billionaires, the militant Partido ng Manggagawa (PM) called the top three—Henry Sy, Lucio Tan and John Gokongwei—as “kings of contractualization.” Renato Magtubo, PM national chair, argued that “While Forbes asserts that the booming stock market has increased the wealth of the richest Filipinos, we believe that their base income is the windfall profit from contractualization. Their flagship companies, SM of Henry Sy, Philippine Airlines (PAL) of Lucio Tan and Robinsons Malls of Gokongwei, are well-known as exponents of contractual employment and labor outsourcing.”

Gerry Rivera, president of the Philippine Airlines Employees’ Association (PALEA) and vice chair of PM, stated that Tan has become the second wealthiest Filipino by outsourcing and other violations of labor rights. “Despite the bountiful fruits of production, Lucio Tan as owner of PAL refuses to share with his workers through a collective bargaining agreement (CBA) and plans to squeeze even more profit from employees through contractualization,” he declared.

“As these rich Filipinos grow fat from contractualization, workers wages and benefits are getting thin in proportion,” insisted Magtubo. Magtubo and Rivera both called on President Benigno Aquino III to support the security of tenure (SOT) bill pending in Congress in his forthcoming State of the Nation speech.

PM and PALEA are supporting the bill that seeks to regulate the rampant practice of contractual employment and promises to be as controversial as the RH bill once it is tabled for plenary debates. The SOT bill has been passed by the House Labor Committee and is due to be scheduled for second reading in Congress.

Rivera added that “But $2.8 billion in wealth is 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.”

 “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.