Crew claims cost the industry $339 million 2013-2017
At this year’s CrewConnect Global, we spoke to the leaders and stakeholders of this industry, and found out about their views on the changes in the maritime industry and their impact on crewing and seafarers.
Imelda Barcelona, CEO & President at Agile Maritime Resources, explores the legal aspect of crew claims and possibilities of preventing them.
How have crew claims impacted the Filipino seafarers?
“In terms of desirability, it is a disincentive to shipowners having crew who are quite litigious. But then again, if you look at the statistics, the number of seafarers deployed is actually increasing through the years.
Still it is becoming a source of complaint among shipowners because of the scale of the awards given to seafarers’ claims. It’s really burning a big hole in their pockets and it’s affecting their bottom lines.”
How big is the whole that crew claims are burning?
“Right now, for the 5 year period of 2013-2017, it is about USD 339 million. For that amount of money, you could buy a castle in the UK. It’s staggering.
I cannot find data before 2013, but could you imagine? If we are able to secure the data, we would see a more staggering figure.”
What has been done in the Philippines to prevent these claims?
“There are efforts, but I think that they are still trying to come up with a solution to this. 3 years ago, they passed a legislation called the ambulance chasing law. In this law, it is stated that seafarers’ lawyers can only get 10% of the award.
However, that law is more honoured in breach than in compliance. The very creative lawyers of seafarers always find a way to step around this.
For now it’s not working, but what I suggested is that maybe the solution is to align the POEA contract and the CBA to the provision of the Maritime Labour Convention on shipowners’ liability, where the pre-condition, the medical condition, or the death of the seafarer must be work related in order to be compensable. If you remove the pre-condition, maybe there will be less claims.
It has been proven already during the 1996 POEA contract when there were no pre-conditions, there have been less claims. The claims started when they inserted pre-conditions into the 2000 POEA contract.”
How could the industry come together to take this idea further?
“The owners could amend their CBA and stipulate compliance to the MLC. As for the POEA contract, which is currently under review, they could articulate their desire that it should be aligned to the MLC.”
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