THE SUPREME COURT en banc voted 7-2 to favor Philippine Airlines (PAL) in its 20-year dispute with the Flight Attendants and Stewards Association of the Philippines (FASAP) over the flag carrier’s retrenchment program.
In a 55-page resolution penned by Associate Justice Lucas P. Bersamin, the SC affirmed an Aug. 23, 2006 Court of Appeals (CA) ruling that upheld the airline’s retrenchment program in 1998.
The High Court also denied the motion for reconsideration filed by the FASAP in 2012, and set aside the resolutions in 2008 and 2009 issued by SC divisions, which favored FASAP and directed the flag carrier to reinstate the laid-off employees.
The Supreme Court en banc said PAL implemented a valid retrenchment program, after establishing it had incurred serious financial losses.
“After having been placed under corporate rehabilitation and its rehabilitation plan having been approved by the SEC on June 23, 2008, PAL’s dire financial predicament could not be doubted,” it said.
The court said it used fair and reasonable criteria in selecting the employees to be retrenched, as provided for under the collective bargaining agreement.
“We hold that for as long as PAL followed a rational criteria defined or set by the CBA and existing laws and jurisprudence in determining who should be included in the retrenchment program, it sufficiently met the standards of fairness and reason in its implementation of its retrenchment program,” the decision read.
The SC also ruled that the release and quitclaim signed by the affected PAL employees had satisfied the basic contents of valid and effective quitclaims and waivers.
“A quitclaim is invalid or contrary to public policy only: (1) where there is clear proof that the waiver was wrangled from an unsuspecting or gullible person; or (2) where the terms of settlement are unconscionable on their face. Based on these standards, we uphold the release and quitclaims signed by the retrenched employees herein,” it said.
To recall, FASAP claimed the airline illegally dismissed around 5,000 employees, of which 1,400 were cabin crew personnel in 1998.
PAL, for its part, argued the retrenchment program was necessary to ensure the airline’s survival following financial difficulties in the aftermath of the 1997 Asian crisis.
Seven justices concurred, including Mr. Bersamin, Diosdado M. Peralta, Estela M. Perlas-Bernabe, Samuel R. Martires, Noel Gimenez Tijam, Alfredo S. Caguioa, and Alexander G. Gesmundo.
Only justices Marvic F. Leonen and Andres B. Reyes, Jr. dissented.
In his dissenting opinion, Mr. Leonen said: “This (was) an extraordinary case… Like in the Book of Revelation, it involves a miraculous resurrection of the dead; in this case, a dead case.”
Five justices inhibited themselves from the case, namely Antonio T. Carpio, Presbitero J. Velasco, Jr., Teresita J. Leonardo-De Castro, Mariano C. Del Castillo and Francis H. Jardeleza.
Chief Justice Maria Lourdes P.A. Sereno, who is on indefinite leave, was unable to take part. — DAME
