Philippine Airlines said Monday it will cut around a third of its workforce by the end of this year as travel restrictions brought about by the global pandemic severely affected operations.
The pandemic has devastated the global aviation industry, forcing airlines to seek government bailouts, furlough workers and slash jobs.
The airline unit of tycoon Lucio Tan said it asked employees to apply for voluntary separation, the first stage of a manpower reduction initiative that may affect up to 35 percent of more than 7,000 personnel or 2,700 workers.
“The retrenchment is part of a larger restructuring and recovery plan as the flag carrier rebuilds its domestic and international network amid the global pandemic,” PAL said.
PAL laid off about 300 employees in February over continued losses, aggravated by the travel restrictions and flight suspensions in areas affected by COVID-19.
The airline suspended capital expenditures, adopted a skeleton work force, reduced management salaries and slashed non-essential expenses to control costs in March at the start of the enhanced community quarantine period.
“At the height of the pandemic, PAL chose to implement temporary furloughs and flexible working arrangements to maintain jobs as long as possible,” PAL said.
“However, the collapse in travel demand and persistent travel restrictions on most global and domestic routes have made retrenchment inevitable, with PAL currently operating less than 15 percent of its normal number of daily flights after eight months of lockdowns,” it said.
PAL said the retrenchment program would combine voluntary and involuntary measures, to be carried out in the fourth quarter of 2020.
The airline assured employees that the measures would be carried out in a fair manner that complies with all legal requirements and with support for outplacement assistance.
The airline said it continued to mount special repatriation flights to help bring home stranded Filipinos from the Middle East, Europe, North America and all over Asia and cargo services to meet the essential cargo transport needs of the public and support economic supply chains.
PAL recently flew its second repatriation flight from Beirut carrying OFWs fleeing the troubled Lebanese capital.
PAL Holdings, the listed parent of the airline, sank deeper into the red in the first half with a net loss of P20.75 billion ($428.6 million). That compared with a P2.98-billion net loss in the same period last year.
PAL said shareholders infused capital and provided funding to sustain the airline’s liquidity.
The announcement comes as the Philippines takes tentative steps to revive its battered tourism industry by allowing domestic travelers to visit Boracay Island, famed for its white sand beaches.
Strict protocols require tourists to test negative for Covid-19 before they can travel to the popular holiday destination.
The Philippines has the highest coronavirus caseload in Southeast Asia, with more than 324,000 confirmed infections, including more than 5,800 deaths. With AFP