CA upholds personnel outsourcing by PAL

MANILA, Philippines - The Court of Appeals (CA) yesterday upheld the legality of outsourcing of personnel by Philippine Airlines (PAL) in 2011.

The CA’s special eighth division dismissed a petition of the PAL Employees Association (PALEA) questioning the orders of the Office of the President and Department of Labor and Employment (DOLE) affirming the termination of 2,600 its members.

In the 87-page decision, the CA said the outsourcing of employees is a management prerogative.

“Jurisprudence recognizes that the contracting out of some work is an employer’s proprietary right in the exercise of an inherent management prerogative,” read the ruling penned by Associate Justice Priscilla Baltazar-Padilla.

Associate Justices Ricardo Rosario and Rosalinda Asuncion-Vicente concurred in the decision.

The appellate court said PAL – as employer – is “accorded the rights and privileges to assure self-determination and independence and reasonable return of capital.”

“PAL’s exercise of its privilege to contract out its non-core operations is done in good faith, and that the contracting out of services performed by the union members should not be seen as an act of unfair labor practice per se,” the CA explained.

The CA concluded there was “nothing capricious and arbitrary” about the orders of OP and DOLE.