Filtered By: Money

CebuPac's ground-handling firm to lay off more than 1,000 employees

The ground handling firm that serving Cebu Pacific's flights is letting go of another batch of employees as the air transportation industry struggles to bounce back  from the impact of the coronavirus disease 2019 (COVID-19) pandemic.

“With a heavy heart, we are left with no other recourse but to let go of 25% of our total workforce,” 1Aviation Groundhandling Services Corp. said in a statement.

“Their last day as employees will be on July 20, 2020,” the company said.

Sought for further details, 1Aviation head of Human Resources Gilbert Enriquez told GMA News Online that the 25% of the company’s close to 5,000-strong workforce translates to over 1,000 employees to be retrenched.

Earlier, 1Aviation laid off over 400 probationary employees due to the impact of COVID-19. 

In 2018, Cebu Pacific created 1Aviation after the Manila International Airport Authority refused to renew the contract of MIASCOR Groundhandling Corp. due to incidents of baggage theft.

CebuPac later sold the majority or 60% of 1Aviation to Jefferson Cheng-led Philippine Airport Ground Support Solutions (PAGSS).

The service firm noted that the decline in demand for air travel and the resulting drop in the number of routes and frequencies have directly impacted 1Aviation “since our core business is ground service support for the aviation industry.”

“To cope with the situation, we implemented cost-mitigation measures which include a freeze on hiring, key projects and capital expenditure; restricting overtime and deferment of salary increases. However, less demand for travel and fewer flights mean reduced need for ground support services,” it said.

“This unprecedented and uncertain situation with COVID-19 will continue to impact the aviation industry for many months ahead,” it added.

Citing forecasts, 1Aviation said that it will take about two years before the aviation industry recovers from the impact of the COVID-19 pandemic.

“Given this situation, it is clear that the company still needs to take more drastic measures to ensure its survival,” it said.

Moreover, 1Aviation said that since January this year, the COVID-19 pandemic has posed a challenge for the global aviation industry—with Philippine carriers being no exception.

“Over the past several months, COVID-19 has caused a decline in demand for travel, and the spread of the disease has prompted the imposition of quarantine and travel restrictions in the Philippines and many other countries worldwide. The travel restrictions in the Philippines caused a virtual halt to all commercial passenger flights for over two months,” 1Aviation said.

“But even as passenger air travel has resumed with the easing of quarantine and travel restrictions in the country, current operations [level] of Philippine carriers is a far cry from where it was as of end-2019,” it added.

Nevertheless, 1Aviation assured the affected employees that they “will be treated fairly and respectfully.”

“The welfare of affected employees will be taken cared of as we always do, with packages that are above what the law requires,” it said.

“We also assured them that they will be prioritized for hiring once the situation stabilizes and business picks up again,” it added.

The Air Carriers Association of the Philippines (ACAP) —comprised of Cebu Pacific, Philippine Airlines, and Philippines AirAsia —has sought financial intervention from the government as the local aviation sector’s survival is in peril due to the disruption of air travel brought by the COVID-19 pandemic. —LBG, GMA News