approval and verification under Art. 34(i) of the Labor Code is to ensure that the employee shall not be placed in a disadvantageous position and that the same are within the minimum standards of the terms and conditions of such employment contract set by the POEA. This is why a standard format for employment has been adopted by the DOLE. However, there is no prohibition against stipulating in a contract more benefits to the employee than those required by law. Thus, in this case, wherein a “supplementary contract” was entered into affording greater benefits to the employee, and although the same was not submitted for approval of the POEA, the POEA properly considered it to be valid and enforceable, and their pronouncements have the effect of an approval of such contract . Moreover, as said contract was voluntarily entered into by the parties the same is binding between them. Not being contrary to law, morals, good customs, public policy or public order, its validity must be sustained. sustained. (Provision on insurance benefit of $50,000 is valid.)
SEAGULL MARITIME CORP v BALATONGAN
Petitioner/s: Seagull Maritime Corp. and Philimare Shipping & Equipment Supply (Seagull) Respondent/s: Nerry Balatongan, NLRC, POEA (Balatongan) Facts: 1. A Crew Agreement was entered into by Balatongan and Philimare Shipping, whereby Philimare employed Balatongan as a seaman on board its vessel Santa Cruz (renamed to Turtle Bay). Said a greement was processed and approved by the National Seaman’s Board (NSB). 2. While on board, the parties entered into a supplementary contract of employment, which provides that: a. The employer shall be obliged to insure the employee during his engagement against death or permanent invalidity caused by accident on board up to $40,000 for death and $50,000 for permanent total disability. b. The supplementary contract provide that, notwithstanding his claim against insurers, the employee expressly waives all claims of his own or his heirs for compensation of damages due to death or permanent disability, which he suffered during his engagement aga inst employers…unless caused by willful acts of employers. 3. In 1983, Balotongan met an accident in Suez Canal, Egypt, resulting to his hospitalization at the Suez Canal Authority Hospital. He was repatriated to the Philippines and hospitalized at Makati Med. In 1985 a medical certificate was issued describing his disability as “permanent in nature.” 4. Balatongan demanded payment for total disability insurance of $50,000, as provided in the supplemental contract. This was denied as it was allegedly filed beyond the designated period. 5. Hence, Balatongan filed a complaint in the POEA against Philimare and Seagull Maritime for non-payment of his claim for permanent total disability. 6. POEA: Ordered Seagull to pay Balatonganthe amount of US$50,000.00 representing permanent total disability insurance and and attorney’s fees at 10% of the award. award. NLRC: Affirmed. POEA did not err when it considered the second contract of employment as valid without any verification or approval by the NS B Intention of the law when Art. 34 LC was enacted is to provide for the prohibited and unlawful practices relative to recruitment and placement. The purpose of having the contracts approved by NSB (POEA) is to determine whether or not the contracts conform to the minimum terms and conditions prescribed. But it did not prohibit any alteration, which provided for increases in wages or other benefits voluntarily granted by employer. 7. Seagull:The supplementary contract of employment entered into on board the vessel Turtle Bay which provides for the insurance benefit was not approved or verified by POEA. Such violates Art. 34(i) of the LC. 1 Issue: Whether the provisions of the supplementary contract are valid? (Provision on insurance benefit valid; Provision on waiver waiver void.) Held: Affirmed. 1. The supplemental contract of employment was entered into between Seagull and Balatongan to modify the original contract of employment. The reason for POEA 1
Art. 34(i) to substitute or alter employment contracts approved and verified by the DOLE from the t ime of actual signing thereof by the parties up to and including the period of expiration of the same without the approval of the DOLE.
The provision in the s upplementary contract whereby Balatongan waives any claim against Seagull for damages arising from death or permanent disability is against public policy, oppressive, and inimical to the rights of Balatongan as it defeats the duty of Seagull t o insure Balatongan against said contingencies stipulated in the contract. Hence, it is void.
2.
I ssue on liabili liabili ty Petitioners argued that Philimare was a mere manning agent, hence could not be bound by the supplementary contract contract entered into by Balatongan with Philimare’s principal, Navales Shipping. SC: Facts and findings of POEA are conclusive. Even if it was Navales that entered into said contract with Balatongan, Philimare as manning agent, was still jointly responsible with the principal.
3.
I ssue on prescription The claim has not yet prescribed as it was only in 1985 when the medical certificate was issued describing disability to be permanent in nature. Hence, it was not possible to file a claim with the insurance company within the 1 year period, from the time of injury, as disability was ascertained to be permanent in nature only thereafter.
WHEREFORE, the petition is hereby DISMISSED for lack of merit and the temporary restraining order issued by this Court on March 21, 1988 is hereby LIFTED. No costs. This decision is immediately executory. SO ORDERED.
