The Supreme Court has affirmed that a seafarer is entitled to maximum disability benefits if they remain unable to work in their customary role after the allowable treatment period, regardless of an initial disability assessment by a company-designated physician. This ruling emphasizes that the actual impact of the injury on the seafarer’s ability to work is paramount, not just the initial medical assessment. It reinforces the protection afforded to seafarers under Philippine law and collective bargaining agreements, ensuring they receive adequate compensation when their injuries prevent them from resuming their seafaring duties. The decision clarifies the interplay between the POEA SEC, Labor Code, and AREC, prioritizing the seafarer’s welfare.

When Can a Seafarer Claim Total Disability Benefits Despite an Initial Grade 11 Assessment?

The case of Sealanes Marine Services, Inc. v. Arnel G. Dela Torre revolves around a seafarer who suffered a back injury during a rescue boat drill. Despite an initial assessment of Grade 11 disability by the company-designated physician, the seafarer continued to experience pain and was unable to return to work after an extended period of treatment and rehabilitation. The central legal question is whether the seafarer is entitled to total and permanent disability benefits under the Collective Bargaining Agreement (CBA), the Philippine Overseas Employment Administration Standard Employment Contract (POEA SEC), and relevant labor laws, given the initial Grade 11 disability rating.

The Supreme Court tackled this issue by examining the interplay between the POEA SEC, the Labor Code, and the Amended Rules on Employee Compensation (AREC). The court emphasized that while the company-designated physician plays a crucial role in assessing a seafarer’s disability, their assessment is not the sole determinant of the seafarer’s entitlement to benefits. The court took into account the seafarer’s prolonged inability to work and the extended period of medical treatment beyond the initially prescribed timeframe.

The legal framework governing seafarer disability claims is multifaceted. Article 192(c)(1) of the Labor Code states that a temporary total disability lasting continuously for more than 120 days is deemed total and permanent. Section 2(b), Rule VII of the AREC, echoes this, defining total and permanent disability as the inability to perform any gainful occupation for over 120 days. Section 2(a), Rule X of the AREC, allows for an extension of income benefits beyond 120 days, up to 240 days, if medical attendance is still required. The POEA SEC also stipulates a 120-day period for sickness allowance, extendable under certain conditions.

The POEA SEC, specifically Section 20(B)(3), outlines the process for medical examination and assessment by a company-designated physician. It also provides a mechanism for dispute resolution: a third doctor jointly agreed upon by the employer and seafarer. The Dutch CBA further specifies that the company’s medical advisor determines the degree of disability.

However, the Supreme Court clarified that these provisions must be interpreted in harmony with the Labor Code and the AREC. Citing Kestrel Shipping Co., Inc. v. Munar, the Court reiterated that the 120-day period is for determining fitness to work. The period may be extended to 240 days for further treatment. A total and temporary disability becomes permanent if, after these periods, the seafarer is still unable to resume their duties, regardless of the initial assessment.

In this case, the seafarer underwent treatment for more than 240 days, exceeding the allowed period for temporary disability. Despite the Grade 11 disability rating issued by the company-designated physician, the seafarer was unable to return to work as an able seaman. The Court found that the initial assessment was effectively superseded by the prolonged period of treatment and the continued inability to work. The fact that the seafarer required therapy beyond 240 days and could not perform his usual job duties made securing additional medical opinions unnecessary.

It was held in Kestrel that the POEA SEC provides merely for the basic or minimal acceptable terms of a seafarer’s employment contract, thus, in the assessment of whether his injury is partial and permanent, the same must be so characterized not only under the Schedule of Disabilities in Section 32 of the POEA SEC, but also under the relevant provisions of the Labor Code and the AREC implementing Title II, Book IV of the Labor Code. According to Kestrel, while the seafarer is partially injured or disabled, he must not be precluded from earning doing the same work he had before his injury or disability or that he is accustomed or trained to do. Otherwise, if his illness or injury prevents him from engaging in gainful employment for more than 120 or 240 days, as may be the case, then he shall be deemed totally and permanently disabled.

The Court further supported its ruling by citing Crystal Shipping, Inc. v. Natividad, emphasizing that the inability to perform customary work for more than 120 days constitutes total permanent disability, irrespective of subsequent recovery. This highlights the principle that the purpose of disability benefits is to assist the employee during the period they are unable to work.

The law does not require that the illness should be incurable. What is important is that he was unable to perform his customary work for more than 120 days which constitutes permanent total disability. An award of a total and permanent disability benefit would be germane to the purpose of the benefit, which is to help the employee in making ends meet at the time when he is unable to work.

Finally, the Court addressed the joint and solidary liability of the manning agency, foreign principal, and the agency’s president. Section 10 of Republic Act No. 8042, as amended by R.A. No. 10022, explicitly states that the principal/employer and recruitment/placement agency are jointly and severally liable for claims arising from the employer-employee relationship. This provision ensures that seafarers have recourse against multiple parties to secure their rightful benefits.

FAQs

What was the key issue in this case?	The key issue was whether the seafarer was entitled to total and permanent disability benefits despite an initial Grade 11 disability assessment by the company-designated physician. The Court focused on the seafarer’s prolonged inability to return to work after an extended treatment period.
What is the significance of the 120/240-day rule?	The 120/240-day rule refers to the period within which a company-designated physician must assess a seafarer’s fitness to work or declare permanent disability. If a seafarer remains unable to work beyond this period, the temporary disability can become permanent.
What happens if the seafarer disagrees with the company doctor’s assessment?	Under the POEA SEC, if a seafarer disagrees with the company doctor’s assessment, they can consult their own doctor. If the two doctors disagree, a third, mutually agreed-upon doctor’s opinion becomes final and binding.
What constitutes total and permanent disability for a seafarer?	Total and permanent disability is defined as the inability to perform customary work for more than 120/240 days due to injury or illness. This is irrespective of whether the condition is curable or not.
Who is liable for the seafarer’s disability benefits?	The principal/employer and the recruitment/placement agency are jointly and severally liable for disability claims. In the case of a juridical entity, the corporate officers, directors, and partners are also jointly and solidarily liable.
What laws govern seafarer’s disability claims?	Seafarer’s disability claims are governed by the POEA SEC, the Labor Code, and the Amended Rules on Employee Compensation (AREC), as well as any applicable Collective Bargaining Agreements (CBAs).
Does a Grade 11 disability rating automatically disqualify a seafarer from total disability benefits?	No, a Grade 11 disability rating does not automatically disqualify a seafarer from total disability benefits. If the seafarer remains unable to work after the allowable treatment period, they may still be entitled to total and permanent disability benefits.
What is the role of the CBA in determining disability benefits?	The CBA can provide for higher disability benefits than those stipulated in the POEA SEC. In this case, the Dutch CBA provided for a higher disability benefit amount than the POEA SEC.

This case underscores the importance of protecting the rights of seafarers who suffer injuries or illnesses while on duty. It clarifies that an initial disability assessment is not the final word and that the actual impact on the seafarer’s ability to work must be considered. The ruling reinforces the legal obligations of employers and manning agencies to provide adequate compensation and support to seafarers who are unable to return to their seafaring duties.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Sealanes Marine Services, Inc. v. Dela Torre, G.R. No. 214132, February 18, 2015