Home » Aviation, Breaking News » $50M Credit Suisse loan to fund PAL spinoff program

Philippine Airlines (PAL) has entered into a $50-million debt agreement with Credit Suisse to finance its spin-off program but the militant group Partido ng Manggagawa want the deal scrapped.

The loan will be used to pay separation and other transition benefits for the 2,600 workers affected by PAL’s outsourcing program.

“The agreement has been signed. All affected workers from PAL’s catering, ground handling, and call center reservations units can rest assured that they will be paid in full by October 2011 as promised,” PAL chief finance officer Jose Gabriel Olives said.

PAL needs about P2.5 billion to finance the spin off of its three non-core units.

Partido ng Manggagawa chair Renato Magtubo said Credit Suisse’s funding of PAL’s outsourcing plan is, however, tantamount to promoting an anti-labor social policy and runs counter to PAL’s own employment and social responsibility policies.

The labor group said it sees Credit Suisse as a foreign creditor interfering in PAL’s labor dispute.

The group claimed the three service providers employed by PAL for its outsourcing plan — Sky Logistics, Sky Kitchen and SPi Global — are not registered contractors/subcontractors as required under Labor Department Order No. 18, series of 2002, and are presumed to be engaged in illegal labor-only-contracting.

Financial management seminar

In another development, PAL said it is conducting financial management seminars to help employees affected by its spin-off program to better cope financially in the long term.

“The separation packages our workers are guaranteed to receive must be handled judiciously to sustain them financially in the long-term. The financial experts’ assistance is most timely to guide our workers during this transition period,” PAL president Jaime Bautista said.

“We have lined up a series of seminars to be conducted by financial experts to guide workers in managing their finances and encourage them to engage in other sources of livelihood to boost their income.”

 

Photo by punctuated

 

 

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