Monday, October 03, 2011

Not an ordinary labor dispute

This was my column on the date indicated above.This post is antedated.

One of the most frustrating things about the media coverage—and consequently, public perception—of the ongoing Philippine Airlines debacle is the effort to oversimplify the conflict as a simple labor-management dispute.

Bias, haste, inability to see the total picture, and just plain lack of information or resourcefulness are just some of the reasons why some media people tend to oversimplify the issue.

Of course the Philippine Airlines Employees Association wants to reduce the issue to a few simple and dramatic sound bytes. They know that for as long as they can project the impression that they have been oppressed, that their rights have been wantonly violated, that they just wanted to protect their jobs against the evil machinations of uncaring management, a significant part of the population will take their side. The wildcat strike they pulled off last week, which left thousands of people stranded during a typhoon, did not endear them to the general public, though. I don’t think any of those stranded passengers (and their friends and relatives) empathize with the union after what happened.

But in the overall scheme of things, it is a given that PAL management will lose the media game. The real issues are far too complicated to be reduced to a few sound bytes.

Thus, most people cannot be blamed for thinking that the issue boils down to a simple matter—greed on the part of either PAL management or if one had the time and the inclination to find out more about the issue, of the employees’ union. Depending on which side of the divide one happens to empathize with, either PAL management is at fault for being heartless and overly profit-oriented or the members of PALEA are just the usual bunch of militants who just want to continue to bleed the company dry.

At the heart of the PAL issues is the question of whether outsourcing is a valid business strategy. PAL wants to become more competitive (if we are to be honest, it just wants to survive at this point) and therefore wants to outsource its ground handling services—something that the other airlines, including Cebu Pacific has already been doing for the longest time. Most of the major business organizations in this country have also embarked on a similar business strategy —from SMART Telecommunications, to IBM, even Jollibee.

The jobs aren’t lost—they are just contracted to another company. So the claim that jobs are lost through the outsourcing scheme is just plain propaganda.

Theoretically, the people who perform the jobs need not lose their jobs as well provided they are willing to agree to the new employment relationship. Necessarily, they have to resign or be separated from the original company, which admittedly is psychologically painful in a culture where prestige is derived from the status of one’s employer. In this country, the second job related question asked of anyone after “what do you do?” is “what company do you work for?” In the case of PAL, the jobs are being outsourced to three other companies and the incumbents in the jobs have been offered a handsome separation package on top of their regular retirement benefits, and the opportunity to get back their old jobs; this time, though, not with PAL anymore but with the new companies to whom the jobs have been outsourced.

PALEA objected to the arrangement for a number of reasons. It is an employees’ union so it is incumbent upon it to oppose anything that threatens to change the employment arrangements of their members. At the same time, their numbers would be severely decimated by the outsourcing decision. Lest we forget, numbers are everything when it comes to labor-management issues and negotiations.

The issue has far-reaching implications on labor. Thus, it is not surprising that PALEA has the support of all the other labor groups. I don’t presume to know what is exactly in the hearts of the leaders and members of PALEA, but I think that it is understandable if they feel that it is their moral responsibility to stand up against outsourcing. They probably think that they owe it to the cause of the labor movement to sharply define the issues and their implications to people and consequently, to advocate for fairer treatment.

The Department of Labor and Employment has already ruled that the outsourcing program of Philippine Airlines is valid and legal. PALEA appealed the decision with the Office of the President, which also agreed with the DOLE Secretary’s ruling. PALEA has brought the case to the Court of Appeals where it is currently pending.

To my mind, however, we’re really just dribbling the ball, so to speak. In the end, it would be futile to rule against a global phenomenon. The issue of outsourcing is a phenomenon that, like globalization, cannot be stopped anymore. And it actually doesn’t make sense for us to try to stop it. The truth is that this country has benefited immensely from the outsourcing phenomenon. The industry has been employing hundreds of thousands of employees locally. Indications point to massive growth in this sector in the next few years. The projection is that the industry will be able to overtake the volume of remittances of overseas Filipino workers in five years if it is given the appropriate support by government.

It certainly smacks of hypocrisy if we rile against outsourcing and consider it invalid and illegal when we happily enjoy its benefits!

Thus, the PAL issue has grave repercussions on our overall ability as a nation to respond to global trends. While it may look like it only affects PAL or the employees who have been affected by the company’s decision to outsource its ground handling services, what is at stake is actually the viability of outsourcing as a business strategy in this country. What is at stake is not just sustainability, nay, basic survival of the flag carrier (incidentally, the PAL situation is not unique; it’s the same situation that many national flag carriers have gone, or are currently going, through); but the future of other industries as well. What is at stake is overall competitiveness of the Philippines.

One wishes, though, that we were more prepared as a country to manage the impact of the outsourcing phenomenon. Obviously, what is happening at PAL is indicative of utter lack of foresight. Of course the labor sector will not take the matter sitting down. We could have prepared better for all these.

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