Philippine government agencies are on the warpath against ambulance chasers and members of the legal profession who are alleged to practice it. But are Filipino seafarers and maritime lawyers really guilty of ambulance chasing or are they only asserting their economic and human rights guaranteed under the law?
Ambulance chasing as a threat
In November 2022, Philippine Supreme Court Chief Justice Alexander G. Gesmundo met with heads of the newly-formed Department of Migrant Workers (DMW) and said the court is stepping up its campaign against ambulance chasers.
“The judiciary will not tolerate lawyers who prey on seafarers and other overseas Filipino workers (OFWs) through ambulance chasing,” he said. He added that victims of ambulance chasers should file appropriate and verified complaints against these lawyers with the courts and the Integrated Bar of the Philippines (IBP).
“Lawyers who take advantage of overseas Filipino workers including seafarers have no place in the justice system,” he insisted.
By definition, ambulance chasing occurs when lawyers or their subordinates actively go after victims of accidents or individuals involved in potentially big legal issues with the intent to file cases on their behalf to get the biggest settlement possible.
Ambulance chasing is against the Code of Professional Responsibility that lawyers swore to. Lawyers are said to be “ambulance chasing when they persuade their clients to file charges against their employers instead of negotiating with them”. Under the law, ambulance chasing specifically involving seafarers is prohibited under Republic Act No. 10706 or the Seafarers Protection Act.
Jebsen Garrido, executive director of Positibong Marino, a non-government organization supporting seafarers coping with HIV and AIDS, said his group warned its beneficiaries against ambulance chasers.
Garrido said: “Ambulance chasers can either be individuals or groups. They promised exorbitant claims or awards on cases that they fabricated against the manning agencies and their principals, and they charged excessive fees against the entitlements of the seafarers should they succeed in the lower labor courts.
“Inevitably, seafarers were left with the barest, most minimal amount from the claims. If their claims were truly valid and legal, all claims should go to the seafarer with a legitimate disability.”
He said a repercussion of successful claims achieved through ambulance chasing methods is a cause for alarm.
“Foreign employers are beginning to explore other manning supply countries for seafarers from other nationalities. They are also being more stringent when it comes to the pre-employment medical examination (PEME) and the age limit,” he said.
Migrant Department Assistant Secretary, Jerome Pampolina, said it was urgent to address ambulance-chasing, especially in the maritime sector.
“We hope for the sake of our hardworking OFWs, measures to instill discipline among lawyers against ambulance chasing and other unethical acts should be implemented strictly,” he said.
Chief Justice Gesmundo for his part said the High Court is prepared to suspend or disbar lawyers who violated the Code of Professional Responsibility. The proposed Code of Professional Responsibility and Accountability is currently being revised.
Francesco Gargiulo, CEO, International Maritime Employers Council (IMEC), has earlier said ambulance chasing does real damage to the maritime industry in the Philippines.
He said ambulance-chasing lawyers are among the reasons why operators decided to explore alternative manpower sources. This, he said, was true during the height of the COVID-19 pandemic, and operators were forced to “temporarily look elsewhere.”
He added that many of those temporary arrangements were now less problematic than returning to the old source of manpower, and this was a warning the Philippines should heed.
In its 2021 review, the IMEC said there had been a small decline in the share of global supply for Filipino ratings in favor of Indian ratings since 2015. The Indian sub-continent also overtook the Philippines as the number one supplier of officers in 2017.
But is there really a basis to accuse all maritime lawyers who assisted seafarers in seeking claims of being ambulance chasers? Is it all just about the money?
Complicated process of confirming claims
A well-known maritime lawyer and advocate of seafarer rights, Atty. Dennis Gorecho believes that lawyering for seafarers involved in accidents or who have developed work-related health concerns is not unscrupulous in all cases.
“Employers and manning agencies often wrongfully blamed the falling number of deployed seafarers on the increasing number of litigated cases,” Gorecho said. “They deliberately and sweepingly depicted seafarers’ lawyers as unscrupulous in an attempt to deflect the real issues why cases were being filed.”
He asserted that the government and other parties utilize the phrase “ambulance chasing” to sanitize the problematic legal battle for seafarers’ compensation.
“It’s actually very hard to secure compensation claims. The process is long and complex because of how valid claims are defined,” he said.
Gorecho added that what constituted a valid claim is dependent on what Philippine Overseas Employment Administration (POEA) contracts dictated. He said in most cases, these contracts contained terms and conditions that were inherently favorable to employers.
“They’re littered with ambiguous provisions, generalizations, and technicalities that seafarers do not understand,” he said.
Changes in the law have made it harder for seafarers to seek compensation. In the 1996 POEA Standard Employment Contract (SEC), it was stated that for disability or death to be compensable, it was sufficient that the seafarer suffered injury or illness during the term of his employment. The cause of illness or death is immaterial.
However, in 2000, the law was changed and the restrictive clause “work-related” was added to limit the liabilities of employers.
In the updated version, the SEC defined “work-related injury” as “injury resulting in disability or death arising out of and in the course of employment.” It also defined “work-related illness” as “any sickness resulting to disability or death as a result of an occupational disease.”
These diseases were on a list in the contract, and for a condition to be compensable, two elements must concur: the injury or illness must be work-related and it must have existed during the term of the seafarer’s employment contract. Proving these, it turned out, was harder than it sounded.
Gorecho said: “The restrictive provisions of the POEA contract make cases of claims for disability and death compensation a legal battleground. Employers do not hesitate to harness their immense resources to limit their liability.
“For instance, employers usually say that under the SEC, disability can only be assessed by the company-designated physician based on the disability grading system. This is very misleading and when uninformed of their rights by a lawyer, many seafarers end up just agreeing to the diagnosis of the company doctor who actually will just heed what the company says.”
Magna Carta for seafarers
In the meantime, proposals for a Magna Carta for Filipino seafarers are currently being deliberated upon in the Philippine congress, and different parties from manning agencies, ship owner groups, and seafarer support organizations are closely watching the developments.
Among the provisions now being contested concern the compensation system for seafarers. The manning agencies and Protection and Indemnity (P&I) Club representatives repeatedly mentioned the phrase “ambulance chasing” and called out the abuse of the system in their response papers on the proposed law.
Concerning monetary claims, there are proposals to include in Magna Carta a provision to place proceeds in escrow until the cases have been settled with finality. There is also the proposal to create a specialized regulatory body, and to ensure the terms and conditions of the SEC, among others, are codified in the Magna Carta. A specific suggestion is to entrench the phrase “work-related” for disability and death benefits, including the list of occupational illnesses and the grading system.
Gorecho said with their escrow proposals, the shipping companies, etc. revealed their true agenda, and it was not to protect seafarers.
“What they’re trying to do is to throw off-kilter the already imbalanced legal battle on seafarers’ claims. They always there’s a need to weigh the interest of the seafarer and the company to justify their position, but their so-called “balance of scale” will just favor the shipping companies and protect the business interest of the manning agencies and their principals instead of protecting seafarers,” he said.
It has been revealed that many seafarers signed quit claim documents without understanding the implications.
“When they signed the documents, their employers were released from all claims, demands, and causes of action. In one case, a seafarer is misled into taking an ex-gratia, a minuscule amount, and accepted the declaration that his condition was not work-related, and for other reason for which he did not comprehend,” he said.
Gorecho said another issue that should be addressed is the definition of “valid claims” in the service contract. He said the “work-related” clause should be deleted as this appeared to be at the core of disagreements on whether or not a seafarer should get compensation.
“This very broad definition continues to apply, leading to the denials of seafarers’ claims. What other recourse do seafarers have other than to get legal assistance from lawyers? Give our seafarers what they should receive, and employers will not be hounded by legal cases,” he said.
On the proposal to place proceeds in escrow, Gorecho said this was patently anti-seafarer.
“It’s a dilatory tactic where the seafarer will not be immediately given what is rightfully due to him. Never mind if the seafarer dies before the decision, as long as the employer’s interest is upheld,” he said.
“Manning agencies and their principals accused maritime lawyers of being unscrupulous, but the term should be applied to the employers who harnessed their immense resources to limit their liability.”
Like going to war
Teresa Fuentes (not her real name), a seafarer, told Maritime Fairtrade her experience to get compensation was like going to war. She worked on a cruise ship for almost 14 years. Three years ago, she met an accident on board and eventually was declared not fit to work.
Fuentes said: “I learned the hard way that so many illnesses, injuries, and resultant disabilities are not covered by the so-called Protection and Indemnity (P&I Club). Many disability claims were repeatedly denied by employers, labor arbiters, the National Labor Relations Commission (NLRC), by the Court of Appeals, and by the Supreme Court because the seafarers who made the claims failed to comply with many requirements and guidelines. I share all their frustrations and I have gone through so much anxiety.”
She has had many realizations as she made the rounds in the community of seafarers. Among them was the absence of healthcare institutions in the country that prioritize seafarers.
She said: “There are no state hospitals or even government-managed health programs for seafarers. For decades, we’ve been singing praises of seafarers and their contributions to the economy, but never has the government built reliable mechanisms to help seafarers with their health needs. Seafarers have to rely on the doctors of the shipping companies they worked for, or paid private doctors who charged exorbitant fees.
“It’s long overdue that seafarers and all other overseas Filipino workers be provided with better medical services as part of the government’s support. Unions have succeeded in making employers contributed to the healthcare needs of seafarers; the support groups of seafarers are also calling on the government to do the same.”
Various seafarers who refused to be named for fear of retaliation by their companies said many compensation claims were either denied or downgraded. This, the seafarers alleged, was because of the biased medical opinion of the company-designated doctor.
Andrew Reyes (not his real name) said seafarers should make it a habit to get a second medical opinion when the company doctor said they (seafarers) needed to undergo an operation. He said he had a bad experience getting compensation for an illness.
“Getting an operation is a serious thing, but not everyone in the medical profession is ethical and they won’t sign off on our real health condition just to save the shipping company money. There are also lawyers whose goals are just to make money, and ripping off seafarers is a way to do it,” he said.
Reyes also thought manning agencies were to blame for ambulance chasing.
“They gave seafarers who claimed for sickness or disability benefits the runaround. Also, some were in cahoots with corrupt lawyers who who actively sought out clients. Usually, lawyers accepted cases on a no-cure-no-pay basis, but seafarers should also know they will get a certain percentage of what’s awarded. The corrupt lawyers would pile on out-of-pocket expenses on top of the bill like court appearance fees. Seafarers seeking damages often get left with an almost empty bag.”
Time for overhaul
In the campaign to go after ambulance chasers, the government seemed to ignore the fact that when seafarers and their lawyers sought claims, they did so under the special protection of international law in the case of death and injuries at sea.
Specifically, the International Labor Organization’s (ILO) Maritime Labor Convention 2006 (MLC) aims to ensure protection for seafarers from the financial consequences of sickness, injury or death occurring while employed on board a ship.
The MLC stipulates that all ship owners must have financial security for compensation should such an event happened. For instance, they must have funds to cover their employees’ medical treatment, food, accommodation, and wages for a specified time, or the cost of burial services.
Since January 2017, ships have been required to ensure compensation for contractual claims for death and long-term disability, and they must have certificates issued by an insurer or other financial security provider that confirmed there were insurance or other financial security mechanisms in place to cover the ship owner’s liabilities, including seafarer personal injury, long terms disability, or death.
In the Philippines, however, it was always an uphill battle for seafarers to secure their claims regardless of what the MLC stipulated. Based on records released by the Commission on Human Rights (CHR), cases involving OFWs that reached the Supreme Court predominantly involved sea-based workers or seafarers, for disability and death benefit claims.
From 2015 to 2019, on average, cases involving seafarers accounted for 85.39 percent of the total number of OFW cases. As for cases involving land-based workers, they accounted for only 14.61 percent. The CHR also determined there was a massive disparity in disability and death benefits of sea-based workers compared to those of land-based workers.
Philippine law provides for compulsory insurance coverage for all OFWs deployed through recruitment/manning agencies, including US$15,000 accidental death benefit, US$10,000 natural death benefit, US$7,500 permanent total disablement benefit, actual costs for repatriation, US$100 per month for a maximum of six months, and money claims benefit of three months for every year of employment contract with a maximum of US$1,000 per month.
From 2015 to 2019, the combined claims for total or partial disability benefits and claims for death benefits filed exclusively by seafarers accounted for 80.72 percent of the total number of OFW cases the Supreme Court settled.
Cases involving seafarers’ claims also took longer to settle. The CHR said that from 2015 to 2019, it took 7.2 years on average for an OFW money claims case to go through the entire judicial process from the date of filing of the complaint in the National Labor Relations Commission (NLRC) up to the time the Supreme Court decides on it.
A separate survey of filed cases in the Supreme Court from 1996 to 2018 also gave a picture of how hard it was for seafarer claim cases to be settled. Out of 250 cases (cases from 2000 to 2003 were not included), 193 involved claims for disability and death benefits. Out of these, 105 involved the issue of work-related seafarer’s illness, injury, or death. In the court’s decisions, 44 were favorable to the seafarers while 61 were unfavorable.
The survey did not include cases filed before the National Labor Relations Commission (NLRC) or National Conciliation and Mediation Board (NCMB) could have resolved either favorably or unfavorably for the seafarers that filed them.
Based on reports, labor litigation took years before it reached the Supreme Court. The elevation of the records alone from the NLRC/NCMB to the Court of Appeals or the SC takes several years. The proceedings in the appellate court also entail further delay.
“In cases of seafarers with medical conditions, some incurred huge debts to sustain their medication while others died before the decision by the Supreme Court was released. Because of the long process, many seafarers were forced into accepting an ex-gratia. Companies have the legal remedies to recover the amount, but one cannot reclaim the life of the deceased claimant,” said Gorecho.
Seafarers are considered as contractual employees
Finally, another reason why it is very hard for seafarers to assert their rights is they are considered contractual employees. The length of their employment and their conditions of work are limited within the provisions of the contracts they signed which are predetermined and fixed for a certain period. When the contracts expired, their employment was terminated.
Gorecho said: “Seafarers worked under very difficult conditions, but when they sustained injury or illness or died on the job, in many cases they did not receive full compensation provided under the law.
“Many companies use the POEA contract to do legal maneuverings. The contract itself contained terms and conditions formulated more favorable to the employer and was littered with ambiguous provisions, generalizations, and technicalities that ordinary seafarers do not understand.”
For these reasons, he said advocating for the rights of seafarers, including negotiating for monetary claims for disability and death benefits, opposing illegal dismissal as well as securing unpaid or underpayment of salaries and wages, is a just cause.
“Seafarers were forced to go to court because employers violated their legal rights first. Every labor dispute was a David and Goliath battle involving two opposing parties: the seafarer on one side and the management on the other. It is misleading to dismiss the efforts of lawyers and their clients to secure just compensation as ambulance chasing,” said Gorecho.
Top photo credit: iStock/ Butsaya
Other photos credit: Batang Peney