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Philippine Crew

Claims Targeting People Claims 1

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What is “Garnishment” and when does it occur?

Garnishment is when a Complainant / seafarer seeks to enforce the NLRC or NCMB’s decision, which becomes “final and executory” 10 calendar days from receipt of the decision by the parties (including a Resolution in relation to any Motion(s) for Reconsideration).

To commence the process of Enforcement / Garnishment, the Complainant files a Motion seeking the Issuance of a Writ of Execution with the Labour Arbiter of the NLRC (or Panel of the NCMB), once the period of 10 calendar days has expired.

Once granted, the Sheriff, in possession of the Writ of Execution and Notice of Garnishment, will proceed personally to the bank where the Sheriff has grounds to believe that the Manning Agent maintains an account and / or to the local Insurance Company who posted the Supersedeas Bond issued to facilitate an appeal by the Respondent / employer (in cases progressed before the NLRC).

The bank concerned will ultimately have no legal recourse but to comply with the “Order of Release” and will issue a cheque in favour of the NLRC Cashier and / or the Insurance Company will call down on the Club LOU. In the alternative, they will act in line with the direction of the NCMB, as may be appropriate.

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Notable developments

2005 – AMENDMENTS TO NLRC RULES OF PROCEDURE, ADOPTING ART. 223 OF THE LABOR CODE 1974, AS AMENDED

2005/2006 – “CRYSTAL SHIPPING” & “REMIGIO” – 120 DAYS

2007 – RULES OF COURT – RULE 65, SECTION 7 AMENDED

2010 – AMWA – IRR - Section 7, Rule VII – OFWs with CBAs to VA

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The consequence

Garnishment, being the enforcement of the NLRC or NCMB’s “final & executory” decisions.

Continuously increasing number of “ambulance chasing” lawyers, with very diverse backgrounds, exclusive to the Maritime / Manning Industry, who pursue spurious claims, for their own personal gain, which are too often upheld by the NLRC, and certainly the NCMB.

Seafarers, or their next of kin, are being exploited, in pursuit of very generous no fault contractual benefits available, in a manner inconsistent with the terms of the POEA SEC and / or CBA.

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IG statistics Cases Overturned / Modified

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354

290

252 229

179 157

129 98 87

59 41

23

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IG statistics The Quantifiable Damage

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$1.2M

$20.4M

$25.2M

$16.4M

$11.25M

$6.25M $4M

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Analysis

175 new cases & USD 12.3M added in 28 months (May ‘15 to Sept ’17)

USD 69,673.32 recovered through Restitution (15 cases – total to be recovered in those cases totalled USD 896,460.25 – a 7.7% recovery).

232 cases have been decided with FINALITY, totalling USD 16,260,642 (a 0.43% recovery made through Restitution)

The NCMB accounts for 62 of the 354 recorded cases (34 new in last 9 months recorded) totalling USD 5,078,346.21, with an average value per case of USD 81,908.81 (NLRC average value USD 68,946.99).

USD 93,232.10 has been recovered in 3 further cases, under the terms of the Memorandum of Agreement (MoA) entered into. The total due back to Owners / Employers in those 3 cases totalled USD 221,903 (a 42.01% recovery in those cases).

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Experience before VA (NCMB)

IG’s Statistics (2012)

178 cases (57 pending)

65 cases resolved – 2 favourable

3.1% success rate

140 cases (nearly 80% involved Atty. Valmores)

83 cases settled (fear of outcome or under duress)

11 cases resolved by Court of Appeals, 4 overturned (> 1/3rd)

UK Club’s Experience @ 22nd Dec. 2017

311 cases (259 added since 2012)

69 Pending / 134 Discontinued (No decision, often due to fear of the outcome)

108 resolved – 9 favourable decisions (includes 3 award of “Financial Assistance”)

8.3% success rate (5.6% excl. 3 awards of “Financial Assistance” – USD 10 – 30K!)

50 cases with Dissenting Opinions (nearly 50% of cases)

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IG statistics - projection The Quantifiable Damage

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$1.2M

$25.2M

$41.6M?

$12.9M

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The impact

Significant and understandable frustration

Evidence employers switching from Filipino to India crew, amid concerns over higher medical / labour cases and training*

Gap closing when looking at the Nationality of Officer Cadets and Trainees employed from Philippines, Indian Sub-Continent, Ukraine and China*

Employers not looking to the Philippines, amid concerns over the legal system; and the hidden costs.

* Source: IMEC Membership Survey Report 2015

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The solution

ESCROW First raised with the NLRC in 2006 and within the IG Position Paper

(NLRC sitting En Banc 2013)

Would be a significant step forward in addressing the desire

to reform Labour Arbitration & Adjudication, to strengthen integrity and fairness in the system, and eliminate the

perception of corruption* * Source: Presidential directive to DOLE

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“ “

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Did you know? Cost of reported claims @ 60 mths

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Some good news & looking ahead

The notable improvement within the NLRC for the past 36 months.

The Anti-Ambulance Chasing Act / Seafarers’ Protection Act was pushed through Congress and the Senate in record time and signed by the President in November 2015. This makes it a criminal offence to solicit cases (Ambulance chasing), punishable with a fine and/or imprisonment.

A further HB filed by Cong. Manalo introducing the IG’s Escrow proposal.

IG to circulate a new / updated Position Paper to all interested Stakeholders.

IG also preparing something specific for DOLE, in relation to the very poor experience faced before the NCMB

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Tony A. Nicholson Senior Claims Director & Chairman of the IGPISC-PWG

THANK YOU

www.ukpandi.com