Supreme Court rules that POEA Contract applies even if the provisions of the CBA are not applicable

Philippine Shipping Update – Manning Industry

By:  Ruben Del Rosario, President, Del Rosario Pandiphil Inc., 21 January 2019 (Issue 2019/01)

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Supreme Court rules that POEA Contract applies even if the provisions of the CBA are not applicable
The seafarer was engaged as a laundryman by the company.  During the course of his employment, the seafarer alleged that he slipped and hit his left shoulder on the door of a washing machine. He further alleged that he immediately reported his condition to the ship doctor and was given medication. However, despite the same, the seafarer continued to feel pain on his left shoulder.
When the ship had a stopover in Manila, the ship doctor accompanied the seafarer to a hospital for laboratory tests. When the results came out, it was suspected that the seafarer has a coronary artery disease. Thus, he was recommended for further examination and treatment.  To determine the cause of his pain, the seafarer was placed under the care of the company-designated doctors and underwent a series of medical examinations and laboratory tests. The tests cleared him of serious heart ailments but showed that he was suffering from a superior labral tear on his shoulder.
To address the pain on his left shoulder, the seafarer underwent arthroscopic superior labral repair and thereafter proceeded with therapy about three months. Eventually, the company-designated physician assessed the seafarer with a grade “12” disability for the neck and grade “11” disability for the shoulder. 
The seafarer then consulted his own doctors who all issued Medical Certificates stating that he is unfit to resume work as a seaman. Eventually, the seafarer filed a complaint for disability benefits and insisted that his condition was caused by an accident suffered while on board the ship which would make the collective bargaining agreement applicable (CBA for brevity).  The company denied any liability under the CBA as seafarer’s condition did not arise from an accident. Moreover, the company argued that the seafarer did not properly dispute the findings of the company-designated physician.
The Labor Arbiter ruled in favor of the seafarer and awarded full disability benefits under the CBA in the amount of US$125,000 which was affirmed by the NLRC.  On the other hand, the Court of Appeals dismissed the claim altogether citing the inapplicability of the CBA to the claim of the seafarer finding that the alleged “accident” was not sufficiently established by substantial evidence.
Upon reaching the Supreme Court, the seafarer was awarded disability benefits based on the POEA Contract equivalent to the disability gradings issued by the company-designated doctor.
CBA not applicable as fact of accident not established
The pertinent provision of the CBA states that “A Seafarer who suffers injury as a result of an accident from any cause whatsoever whilst in the employment of the Company, regardless of fault, including accidents occurring whilst traveling to or from the Ship and whose ability to work is reduced as a result thereof, shall in addition to his sick pay, be entitled to compensation according to the provisions of this Collective Agreement”.
The Court denied the applicability of the CBA and held that the fact of accident was not sufficiently proven as: (1) there was neither a report on the ship's logbook nor on the Master's report regarding said incident; and (2) the factual findings of the Labor Arbiter, as adopted by the NLRC, on the fact of accident have no basis since the former merely drew a conclusion that an accident occurred just because a superior labral tear implies an abrupt impact on the shoulder which is merely suggestive of an accident.
POEA Contract is applicable
While the fact of accident was not established, this does not imply that seafarer is not entitled to disability benefits just because the CBA does not apply in his case. Aside from the CBA, the POEA Contract finds application in the claim.  The Court explained that deemed incorporated in every seafarer's employment contract is a set of standard provisions determined and implemented by the POEA, called the "Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean Going Vessels," which are considered to be the minimum requirements acceptable to the government for the employment of Filipino seafarers on board foreign ocean-going vessels.
In other words, the POEA Contract and the CBA govern the employment relationship between the seafarer and the company.  The two instruments are the law between them. They are bound by their terms and conditions, particularly in relation to this case, the mechanism prescribed to determine liability for a disability benefits claim.
The Court noted that the seafarer suffered a superior labral tear on his left shoulder. It is undisputed that said injury took place within the period of his employment, at the place where he reasonably may be and while he is fulfilling his duty.  Said circumstances correspond to the definition of "arising out of and in the course of employment and as such, the seafarer’s injury is work-related which must be compensated in accordance with the provisions of the POEA Contract.
Third doctor rule; assessment of company-designated physician upheld
The Court noted that the company-designated physician issued a disability grade “11” for seafarer's shoulder and disability grade 12 for his neck.  On the other hand, the seafarer’s physicians declared him unfit for sea duty. On this note, the POEA Contract states that should the seafarer's appointed doctor disagree with the assessment of the company-designated physician, a third doctor may be agreed upon by the employer and the seafarer and the latter's decision shall be final and binding on both parties.
Hence, it is imperative that in case of conflicting assessments, the seafarer must submit to a third doctor, who should be mutually agreed upon by him and his employer. This procedure must be strictly followed otherwise, if not availed of or followed strictly by the seafarer, the assessment of the company-designated physician stands.  Considering that the seafarer failed to comply with the mentioned procedure, the assessment of the company-designated physician prevails.
Thus, the Court awarded disability benefits to the seafarer the amounts of US$7,465 for the grade “11” assessment and US$5,225 for the grade “12” assessment.
B. B. vs. Career Philippines Shipmanagement, Inc., Columbia Shipmanagement Ltd., G.R. No. 224127, August 15, 2018, First Division, Associate Justice Noel Tijam, ponente
MARINA Memorandum Circular No. MO-2019-01
The Maritime Industry Authority (MARINA) has recently issued Memorandum Circular No. MO-2019-01 regarding the Rules and Regulations in the Issuance of Seafarer’s Record Book (SRB) and Seafarer’s Identity Document (SID) in consonance with ILO Convention No. 185 and the 1978 International Convention on Standards of Training, Certification and Watchkeeping for Seafarers (STCW).
The SRB and SID will now replace the previous Seafarer’s Identity Record Book (SIRB).
A Seafarer's Identity Document (SID) refers to an International Identity Document under ILO Convention 185 (revised 2003) used to obtain proof of the bearer's eligibility for visa waiver; and to identify them as genuine seafarers who may be entitled to transit with their passport at ports and border crossings, and to shore leave without a visa.  This has a validity of five (5) years.
On the other hand, a Seafarer's Record Book (SRB), refers to a document issued by MARINA to all Filipino seafarers and cadets/cadettes that serves as record of sea service of the holder onboard ships of 35GT and above for commercial vessel and 50GT and above for fishing vessel .  This has a validity of ten (10) years.
The declared objectives of the Rules and Regulations are: (a) to promote national and international modern security for border control, immigration and verification of seafarer's identification; (b) to enhance the security features of the Filipino seafarers' Identification document and ensure its global interoperability and reliability; (c) minimizing the formalities, documentary requirements and procedures associated with the arrival, stay and departure of ships engaged in international voyages; (d) Ensure that the privileges of facilitated border crossing for shore leave, transit, transfer and repatriation are provided only to genuine seafarers; (e) to enhance existing system and streamline the processes and requirements in' the issuance of SRB.
The Rules and Regulations cover all Filipino seafarers, 18 years of age and engaged in any capacity onboard ships 35GT and above.  Filipino cadet/cadettes below 18 years of age may also be issued SID and SRB for shipboard training purposes only.
However, seafarers who have been declared by a competent medical practitioner to be permanently disabled to board ships and who have been paid by the Insurance for such disability shall no longer be allowed to renew or be issued SRB and SID. ln case the SRB and SID  are still valid at the time such declaration of permanent disability is made, the same shall be deemed automatically revoked.
The SRB and SID will also not be issued to those seafarers who are under the watchlist of the MARINA, unless, a Legal Clearance has been issued from the MARINA Legal Service.
The Rules and Regulations will be effective 15 days from publication in a newspaper of general circulation. (Published: Business Mirror, 10 January 2019)
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  • IRR Seafarer's Protection Act
  • Seafarers Protection Act
  • ORDINANCE No. 28 Series of 2015 Zambales, Philippines
  • NLRC MEMO on 3rd Doctor
  • NLRC Rules of Procedure 2011
  • Standard Terms and Conditions of Del Rosario Law
  • POEA SEC - 2010 Amendments
  • POEA Memorandum Circular No. 10 Series of 2010
  • Governing Board Resolution No. 09 Series of 2010

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