MANILA : Philippine Airlines (PAL) has been ordered to reinstate 1,500 crew members who lost their jobs during the Asian financial crisis 10 years ago, the Supreme Court said Wednesday.

The court found the airline had illegally dismissed the staff in 1998, when it drastically reduced its fleet to prevent the business going bust, court officials told AFP.

"The fact that PAL underwent corporate rehabilitation does not automatically justify the retrenchment of its cabin crew personnel," the ruling read.

There was no immediate company reaction to the ruling, which overturned an appellate court's decision upholding the dismissals.

The airline flew into turbulence during the Asian financial crisis, with majority shareholder Lucio Tan being forced to inject US$200 million in fresh equity to prevent the airline being liquidated to pay off its creditors.

PAL has since recovered and returned to profit. However, soaring fuel costs have forced the airline to consider cutting certain services.

The Supreme Court ordered the carrier to pay the dismissed employees their full back wages and to rehire them.

If they cannot be taken back, the company must provide separation pay equivalent to one month's salary for every year of service, the ruling said.

- AFP/yb