ITF Inspector Nathan Smith questions allotment clause in Magna Carta

Inspector questions allotment clause in Magna Carta
Yashika F. Torib May 28, 2025 https://www.manilatimes.net/2025/05/28/business/maritime/inspector-quest...

AN inspector for the International Transport Workers Federation (ITF) has expressed concern over the controversial Section 38 of the Magna Carta of Filipino Seafarers, echoing the same grievances of Filipino seafarers who are directly affected by the said provision.

Nathan Smith, a Canadian-based ITF inspector who is currently in the Philippines to assess ITF-Philippines inspectors, believes that Republic Act 12021 could still be improved in favor of the seafarers.

"I agree with the Philippines having a starting platform, this is a step forward that took a lot of years to complete. But it's causing a big problem and I'm hearing nothing but complaints from seafarers," Smith said.

The provision in question was Chapter 7 of the Magna Carta which stipulates the Terms and Conditions of Employment of Overseas Seafarers. Section 38 or the Allotment and Remittance of Wages states that a seafarer is required to send to his designated allottee in the Philippines a monthly allotment of 80 percent from his monthly salary.

This provision departs from previous policies that direct seafarers to send a monthly allotment of 80 percent based only on their basic salary.

Monthly salaries of seafarers, according to veteran ship captain Edgardo Flores, includes a seafarer's guaranteed overtime pay and bonuses on top of the basic salary. Sending 80 percent of this totality leaves very little onboard funds for seafarers, according to Flores.

In a separate television interview, Migrant Workers Undersecretary Bernand Olalia explained that this provision is "pro-family and pro-financial literacy."

"The difference now is that the computation for the 80-percent allotment already includes the guaranteed overtime pay of a seafarer. This prevents them from overspending while onboard, especially when their board and lodging are free on ships," Olalia said.

A family decision

For Smith, budget allocations from earnings are a family decision, not the government's.

"Deciding how and where a seafarer will spend their salary should be their own prerogative. No government or company should decide on what they will do with their money, especially when it leaves them almost nothing while onboard.

"By controlling the movement and percentage of their overtime pay and bonuses, the seafarers will have nothing much to spend while on shore leave, particularly for their basic necessities and the pasalubong that everyone back home expects," Smith explained.

He added that such regulations affecting workers should be made in the form of a collective agreement between the government, the employer, and a labor union who shall serve as the voice of the workers.

"We cannot just leave this to the government and the employers. They need to include people who deal with seafarers because there are groups who will be using this law for their benefit," Smith said.

"The Philippines is one of the top countries where seafarers are being abused by their manning agencies. Even the employers who are prominent and are supposed to be good are actually benefiting the seafarers. They will take away whatever they can if you leave things up to them," he added.

Smith said that the ITF will only enforce the Maritime Labor Convention 2006 and the Collective Bargaining Agreement.