Voluntary Arbitration of Filipino Crew Claims    

By:  Ruben Del Rosario, Managing Partner, Del Rosario & Del Rosario, June 30, 2005

Introduction

The amended POEA contract states that parties covered by a collective bargaining agreement shall submit their claim or dispute to the original and exclusive jurisdiction of the voluntary arbitrator or panel of arbitrators.  However, most employers, manning agents and Filipino seafarers are not aware of the procedures in voluntary arbitration.  This article explains briefly certain aspects of voluntary arbitration of seafarers’ claims in the Philippines.

Jurisdiction and Procedure

Under Section 29 of the amended POEA contract, the parties to the contract agreed to submit their claim or dispute to the original and exclusive jurisdiction of the voluntary arbitrator or panel of arbitrators.  This agreement to settle disputes through voluntary arbitration is sanctioned by the Labor Code of the Philippines.  The procedure for voluntary arbitration is contained in the following:

1.  Procedural Guidelines in the Conduct of Voluntary Arbitration Proceedings, 28 July 1989

2.  Amending the Implementing Rules of Book V of the Labor Code of the Philippines, Department Order No. 40-03, Series of 2003, 17 February 2003

3.  Agreement of the parties manifested in the CBA, in other documents and during the hearing.

Initiating Arbitration 

If grievances are not resolved through the grievance procedure, either party in a collective bargaining agreement (CBA) may submit the dispute to voluntary arbitration by serving notice or demand upon the other to arbitrate invoking the arbitration clause in the POEA contract.

The notice shall state issues to be arbitrated with a copy furnished the arbitrator designated in the CBA.  If the CBA did not designate an arbitrator, a copy of the notice shall be furnished the National Conciliation and Mediation Board (NCMB) of the Department of Labor and Employment.   

In instances when both parties mutually agree to arbitrate their dispute, the procedure is for them to execute a Submission Agreement and jointly file it with a VA whom they mutually appoint. The Submission Agreement shall contain, among others:

a. agreement to submit to arbitration

b. specific issues or disputes for resolution

c. agreement to perform or abide by the decision or award

In real practice, any party can initiate the arbitration process by going to the NCMB and filing a Complaint or filling up a pro-forma Notice to Arbitrate. NCMB shall then send notice to the other party (respondent) to appear before the NCMB for a conference to mediate and eventually select a voluntary arbitrator or panel of arbitrators.

If the party upon whom notice is served fails or refuses to respond favorably within seven (7) days from receipt thereof, or fails to so appear pursuant to NCMB's notice, the voluntary arbitrator designated in the CBA shall commence voluntary arbitration proceedings. Where the CBA does not so designate, NCMB shall call the parties and appoint a voluntary arbitrator who shall then commence voluntary arbitration proceedings.

Selecting the Voluntary Arbitrator or Panel of Arbitrators

The mode of appointing a voluntary arbitrator is as follows:

1.  The CBA may name and designate in advance a voluntary arbitrator;

2.  If there is no voluntary arbitrator specifically named, the provision or mechanics in the CBA on how to select a voluntary arbitrator must be followed;

3.  If there is no provision in the CBA, the same is to be appointed from accredited voluntary arbitrators of the NCMB.  Normally, parties are required to submit a certain number of preferred/chosen voluntary arbitrators (say, 3, 5 or 10). The matter is resolved by various modes usually by drawing of lots and/or each party crossing out unwanted arbitrators.  The chosen arbitrators will usually choose the third arbitrator. 

4. In the event that parties fail to select an arbitrator, the NCMB shall designate an arbitrator, as may be necessary, which shall have the same force and effect as if the parties selected the arbitrator.

Procedure in Voluntary Arbitration

The voluntary arbitrator shall have the power to hold hearings, receive evidence and take whatever action is necessary to resolve the issue/s subject of the dispute.  The usual procedure for voluntary arbitration is as follows:

1.  Initial conference for mediation/conciliation in order to have a voluntary settlement of the dispute.

2.  If no settlement is reach, the voluntary arbitrator may require parties to submit a Submission Agreement which shall state the agreement to submit to arbitration, the issues to be resolved, the agreement to abide by the decision or award, the conduct of proceedings, payment of arbitrator's fees, etc.

3. Normally, the voluntary arbitrator requires the parties to submit Position Papers and responsive pleadings. If deemed necessary by the arbitrator, the parties are called by the voluntary arbitrator for clarificatory hearings or to receive testimonial evidence. 

4.  Unless the parties agree otherwise, the voluntary arbitrator must render an award or decision within twenty (20) calendar days from the date case is submitted for resolution.

5. The award or decision of the voluntary arbitrator(s) shall be final and executory after ten (10) calendar days from receipt of such award or decision by the parties. It shall not be subject to Motion for Reconsideration. Nevertheless, the losing party has recourse to file a Petition for Certiorari with the Court of Appeals within sixty (60) days from receipt of decision.

6. In all cases, the NCMB shall be furnished a copy of pleadings submitted to the voluntary arbitrator as well all orders, resolutions, awards and decisions issued by the voluntary arbitrator.

Execution of Award/Decision

Upon motion of any interested party, the voluntary arbitrator(s) who issued the award or decision may issue a writ of execution requiring the Sheriff of the National Labor Relations Commission or regular courts or any public official whom the parties may designate in the submission agreement to execute the final decision, order or award.

Costs of voluntary arbitration and the voluntary arbitrator’s fee

Unless the parties agree otherwise, the cost of voluntary arbitration proceedings and voluntary arbitrator’s fee shall be shared equally by the parties.  In the event the parties are unable to cover expenses, an amount by way of subsidy may be availed of from the Special Arbitration Fund subject to the guidelines to be issued by the Secretary of Labor.  At present, the fees of members of the Philippine Maritime Voluntary Arbitrators Association (PMVAA) ranges from PHP20,000 (US$375) each for a panel of arbitrators to PHP25,000 (US$470) for sole arbitrators.

Conclusion

Whereas the POEA contract states that the parties covered by CBA’s agree to submit their disputes to voluntary arbitration, Rule V, Section 1 of the NLRC Rules and Procedures and Section 10 of Republic Act 8042 (Overseas Migrant Workers Act) both state that the Labor Arbiters of the NLRC have original and exclusive jurisdiction to hear and decide all cases involving claims of overseas Filipino workers.  There is a thus a conflict as between an agreement of the parties to submit to voluntary arbitration and the NLRC Rules/R.A. 8042.  This issue has not been decided by the Supreme Court.  Decisions of the NLRC on the issue are mixed.  Some decisions favor the agreement of the parties to voluntary arbitration whereas some do not.  In any event, this article provides the procedure should the parties opt or are mandated to resolve their disputes thru voluntary arbitration. 

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Last modified: 10/20/05