To sustain its continuity and assure its long-term survival, an organization must take actions and adopt practices consistent with good governance.
Prudent financial management is vital. Do not spend money which you do not have. Match your expenses with your income by following a budget. Set aside money for food, electricity, rent, transportation and other essential expenses.
Use your credit card judiciously. Do not borrow beyond your means. If you are reckless, you will incur high interest costs; if unable to pay fully, you will be slapped with penalties. You may even end up being sued in court.
What is true for people applies to big organizations. Sales revenues are earmarked for production costs such as building maintenance, materials and employees’ payroll.
Only after settling its obligations can a corporation consider giving out surplus earnings as dividends to stockholders, or bonuses to employees.
“In non-stock, non-profit educational institutions like UST, where no dividends are distributed, any surplus is reinvested to improve academic programs, upgrade facilities, and support faculty and student development. As discussions continue between UST employees and management, it is essential to understand the proper application of laws on tuition fee increases and how these funds are allocated to uphold the university’s mission.
Republic Act (RA) No. 6728 mandates that at least 70 percent of the proceeds from tuition fee increases in private educational institutions must be used for salary, wage, and benefit increases for teaching and non-teaching personnel, excluding administrators who are principal stockholders.
The current labor dispute at UST may be traced to a lack of understanding on how management endeavors to marshal its resources --- and manage its risks prudently --- to sustain its long-term viability.
Employees must realize that there are also downside risks such as drop in enrolment and big increases in recurring costs that could impair the long-term financial stability of the university as well as their employment status.
In my view, three things are important in bridging the apparent gaps between UST management and employees:
First, there must be a commonly shared understanding of the law on tuition fee increases. Both parties would do well to review the jurisprudence or how the courts have interpreted the application of the law.
Secondly, both parties must agree to implement their agreements within the bounds of the law and not make excessive or unreasonable claims always putting in mind the risks involved for the university and its sustainability. Employees need to understand that their management is doing its best to produce the best financial results for the company. If their company does well, continuity of their employment --- as well as their professional advancement--- are assured.
Finally, both sides must be wary and careful that they do not fall prey to the evils of fake news that drive misunderstanding and cause ill will between them.
Meeting these three imperatives will enable both sides to discover pathways toward reaching mutual understanding, with the help and guidance of the arbiters of the Department of Labor and Employment (DOLE).