ABS-CBN CEO contemplates retrenchment by August if media giant remains off-air

FILE: ELJCC as seen from Eugenio Lopez Drive just in front the Pinoy Big Brother studios. (Photo By Hollyckuhno, CC BY 3.0)

ABS-CBN President Carlo Katigbak on Tuesday said that they are “considering retrenchment” of their employees by August if the media giant fails to resume broadcast as soon as possible.

“We continue to lose a substantial amount of money every month and I’m afraid that if we cannot get back on air soon, by August, we may already have to consider beginning a retrenchment process,” Katigbak said during the Senate hearing.

Katigbak assured that the jobs of the 11,000 workers of the media corporation will be safe for at least three months during the Senate hearing of the franchise, but may consider the retrenchments due to financial constraints.

During the hearing on the various pending bills regarding the network’s franchise, Katigbak admitted that the network is confronting two challenges—when the broadcasts were affected when the COVID-19 pandemic and when they were forced to shut down on May 5^th after their franchise expired.

“Your honor, when we’re taken off the air on May 5th, we made our commitment to our employees given the difficult economic situation following COVID-19, we made a commitment to them that we would not take away any jobs for three months,” said the ABS-CBN President.

However, Katigbak said that the commitment cannot be open-ended due to the major revenue losses the company is enduring.

“We felt it would be very, very painful to put our employees out on the street without them having an idea as to how they can continue earning a living and continue to feed their families,” he noted.

ABS-CBN has been losing P30-35 million in daily advertising revenues since the broadcasting station was forced to shut down.

If this continues, the media company said to the Supreme Court that they “may be constrained to eventually let go of workers, reduce salaries and benefits, and substantially cut down on costs and expenses.”

“Our end objective is hopefully to secure a 25-year franchise,” the ABS-CBN President told the Senate. “If securing the franchise is the fastest way to go back on-air, then we have no objection to that.”

Provisional franchise to 25-year franchise

The House of Representatives last week approved on the first and second reading the “provisional franchise” for ABS-CBN that is valid until October 31. However, it was recalled on Monday as some of the Senators wanted to deliberate the issue further.

Senate Majority Leader Juan Miguel Zubiri said the in his opinion, the consideration of granting the media company a 25-year franchise instead of the five-month provisional franchise proposed by the House should be passed and then tackle this at the bicameral conference committee when the Congress re-opens after adjournment on June 6.

“In practical terms, if the House of Representatives – I’m being presumptuous this time – if they do pass a five-month period…in my personal opinion, we should grant them more than the five months being requested so they have time to ventilate issues at the House of Representatives and at the same time continue their operations,” Zubiri said.

Former Senate President Juan Ponce Enrile advised the legality of amending the House’s proposed five-month provisional franchise bill into a full 25-year franchise bill when asked by Senator Panfilo Lacson about its possibility.

“You can amend it, alter it, substitute a new [one]—that is your power. The power of origination belongs to the House. Once it releases the bill from there, it loses control and it goes into the hands of the Senate, then you can do anything in that bill,” Enrile said.

Enrile also added that the differences would be deliberated in the bicameral committee and President Rodrigo Duterte would ultimately approve or veto the bill.

The ABS-CBN Corporation’s 25-year franchise was approved on March 30, 1995, through the Republic Act No. 7966 and expired on May 4. After its expiration, the National Telecommunications Commission (NTC) issued a cease and desist order against the media giant which led to the network’s shutdown.