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Escrow deposits in seafarer’s cases

By: ATTY. DENNIS GORECHO July 02,2018 - 09:45 PM


In terms of labor litigation, “escrow deposit ” plays a significant role in a seafarer’s favorable decision in his monetary claims for disability and death benefits, illegal dismissal awards as well as unpaid or underpayment of salaries and wages.

Every labor dispute involves two opposing parties: the worker on one side and the management on the other.

The seafarer might be unable to enjoy the judgment award after the lapse of time, considering the tactics of the company who may have no recourse but to delay.

Due to the longer years that they have to wait, without any leverage in prosecuting his case, chances are, the seafarer bows to the demand of his employer to either drop his claim or accept a small settlement amount.

Labor litigation takes years before its finality. In most cases, the elevation of the records alone from the NLRC/NCMB to the Court of Appeals or Supreme Court will take several years.

In cases of seafarers with medical conditions, some incur huge debts to sustain their medication. Others die before the decision by the Supreme Court is released.

To protect the seafarers, a manning agency is required under POEA Rules to deposit in escrow with a bank the amount of ONE MILLION PESOS (Php1 ,000,000.00) to answer for all valid and legal claims arising from violations of the conditions for the grant and use of the license, accreditation and contracts of employment.

These include recruitment violations, or claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino seafarers under the joint and solidary liability of the manning agency.

The escrow deposit must remain intact during the validity of license for a period of four (4) years and an additional of four ( 4) years if not renewed upon its expiration or should the license be revoked or otherwise cancelled for whatever legal grounds.

In case the deposit in escrow is reduced, the Manning agency shall replenish the same within fifteen (15) calendar days from notice by the POEA.

The Bank shall at all times advise the POEA whenever the escrow deposit is reduced or same is no longer intact. Failure to replenish shall result in the suspension of license of the Manning agency without further notice.

The escrow deposit shall not be released except upon proper authorization by the POEA .

The bank shall pay the claims on a “first come-first served” basis and the Order of Garnishment that is first served upon the bank shall be satisfied, irrespective of the date of the issuance of the writ of execution.

If several claims are simultaneously presented on the same day, and the escrow deposit is not sufficient to pay the claims, the bank shall pay the claims on a pro-rata basis.

The bank shall not be liable beyond whatever balance of the deposit in escrow.

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TAGS: cases, seafarers

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