When a Seafarer Is Deemed Totally and Permanently Disabled Under the POEA-SEC

The Supreme Court, in Hoegh Fleet Services Phils., Inc. v. Turallo (G.R. No. 230481, July 26, 2017), clarified when a seafarer is considered totally and permanently disabled even if the company-designated physician issues a disability grading. The ruling also settled the proper amount of attorney's fees in disability claims, making it a significant guide for seafarers and employers alike.

The Case: A Messman's Injury and Disability Claim

Bernardo Turallo was hired as a Messman on board the vessel "Hoegh Tokyo" in November 2012. In September 2013, he felt pain in his upper back and chest while on board. He was referred to the company-designated physician upon arrival in Manila, who diagnosed him with several conditions, including a bicep tear and cervical spondylosis.

Turallo underwent surgery in December 2013. In a letter dated 23 December 2013, the company-designated physician stated that, based on Turallo's condition, the closest assessments were Grade 8 (shoulder) and Grade 10 (neck). Turallo continued rehabilitation, but his pain persisted. He sought a second opinion from a government physician, who declared him permanently unfit for further sea duties.

The parties failed to settle, and the case reached the Panel of Voluntary Arbitrators, which awarded Turallo US$90,000.00 as disability compensation, sickness allowance, and attorney's fees equivalent to 10% of the total monetary award. The Court of Appeals affirmed with modification, reducing attorney's fees to US$1,000.00.

The Issue: Interim Assessment vs. Final Disability Grading

The central issue was whether Turallo was entitled to total and permanent disability benefits, or only to partial disability compensation corresponding to a Grade 8 assessment. Hoegh Fleet argued that its company-designated physician issued a final disability assessment of Grade 8 within the 240-day period.

The Supreme Court disagreed. It held that the company-designated physician's letter expressly stated that the assessment was merely interim, not final. The Court cited Kestrel Shipping Co., Inc. v. Munar (G.R. No. 198501, January 30, 2013), which reads the relevant provisions of the POEA-SEC in harmony with the Labor Code.

The Rule: 120 or 240 Days Without a Final Assessment

Under the POEA-SEC, a seafarer is deemed totally and permanently disabled if the company-designated physician fails to arrive at a definite assessment of the seafarer's fitness to work or permanent disability within the period of 120 to 240 days. The Court explained that even if an injury or disability is classified as partial and permanent under the Schedule of Disabilities, the seafarer is considered totally and permanently disabled if the illness or injury prevents him from engaging in gainful employment for more than 120 or 240 days, as the case may be.

The company-designated physician's certification must be a final and definite assessment, not merely interim. Since the assessment in this case was interim, Turallo was deemed totally and permanently disabled, entitling him to the maximum disability compensation of US$90,000.00 under the Collective Bargaining Agreement.

Attorney's Fees: The 10% Ceiling Is Not Mandatory

On the issue of attorney's fees, the Court clarified that Article 111 of the Labor Code sets a maximum of 10% of the amount of wages recovered, not a mandatory rate. The Court cited Taganas v. National Labor Relations Commission (G.R. No. 118746, September 7, 1995), which held that the NLRC may fix an amount lower than the 10% ceiling when circumstances warrant.

The Court found five percent (5%) of the total monetary award more appropriate and commensurate under the circumstances, considering that the seafarer was constrained to litigate with counsel at all stages of the proceeding.

Practical Takeaways

• A seafarer is deemed totally and permanently disabled if the company-designated physician fails to issue a final and definite assessment within 120 or 240 days, depending on the need for further medical treatment.
• An interim assessment does not count as a final disability grading. The certification must be final and definite to limit the seafarer's claim to partial disability benefits.
• The 10% attorney's fees under Article 111 of the Labor Code is a ceiling, not a mandatory rate. Courts may award a lower percentage based on the circumstances.
• Seafarers should keep records of all medical consultations, assessments, and correspondence with the company-designated physician to establish the timeline of their disability claim.
• Employers must ensure that the company-designated physician issues a final, definite assessment within the prescribed periods to avoid liability for total and permanent disability benefits.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.