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TMCNet:  Ex-AOL employees want separation pay

[October 02, 2007]

Ex-AOL employees want separation pay

(Business World (Philippines) Via Thomson Dialog NewsEdge) Former employees of AOL Member Services Philippines, which was recently acquired by Nasdaq-listed eTelecare Global Solutions, want to get compensation for their decision to quit their jobs following the takeover.

In an e-mail letter to BusinessWorld, an AOL employee who claimed to be speaking for a number of colleagues said they were not given options and were not consulted or notified about the acquisition.

The eight year veteran of AOL's local unit said they had expected to be given an option to resign and get separation pays if they had no plans to join the new company.

Last month, eTelecare, a provider of complex business process outsourcing (BPO) solutions, agreed to purchase the Philippine subsidiary of AOL, which is a division of Time Warner, Inc. in a $7.2 million deal.

A spokesperson for eTelecare who declined to be named said, "If you have the tenure you'll definitely get the corresponding the benefits."

Labor Code

Under article 28 of the Labor Code of the Philippines, separation pay is primarily granted in dismissals for authorized causes including reduction of personnel due to installation of labor-saving devices, reduction of personnel due to redundancy, retrenchment to prevent losses, closure of establishment or cessation of operations.

In one of the sessions with AOL employees, eTelecare said that if an employee opted not to join the company, he or she won't be receiving a separation pay.

"The transition of AOL to eTelecare did not result in the closure of the business here at Clark. Therefore, separation pay does not apply," the company said.

Labor Lawyer Albert S. Almojuela said that AOL employees are not entitled to the option they are asking for.

"They can only complain if the benefits they are previously receiving have been reduced or they have been demoted from previous positions."

Mr. Almojuela added that separation pay should be given if it is under AOL's policy and the employee earned the mandated tenure.

In this case, wherein the entire business unit has been acquired including employees and the operations are going as usual, no separation pay is guaranteed, Mr. Almojuela said.

eTelecare Senior Vice-President for Philippine Operations Benedict C. Hernandez, for his part, told BusinessWorld that with the acquisition, all 1,000 employees of AOL were absorbed and retained in the same position getting their corresponding benefits.

Mr. Hernandez explained that the acquisition wasn't disclosed to employees because eTelecare, as a listed company, was constrained to keep the deal quiet.

"Only a handful of people know about it because we are a listed company."

Mr. Hernandez said employees were given plenty of ways to air their views including focus group discussions.

But he added that they "can't please everybody."

In an earlier statement, eTelecare said the firm is expecting earnings to begin in 2007 following the acquisition of AOL.

The deal was targeted to be finalized last September.

In an earlier statement, John Harris, president and chief executive officer of eTelecare said the acquisition would expand the BPO's capabilities to serve their clients' non-voice needs including e-mail and chat by adding AOL employees.

Copyright 2007 Business World Publishing Corporation, Source: The Financial Times Limited

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