Recruitment industry stops OFW deployment
The Philippine Association of Service Exporters, Inc. (PASEI), the biggest single land-based association of Overseas Employment Service Providers composed of over 750 private recruitment agencies, has called for “an indefinite” industry-wide deployment holiday beginning Monday.
PASEI’s President Victor E.R. Fernandez, Jr. explained that starting Monday, licensed recruitment agencies will stop the processing of OFW exit clearances with the Philippine Overseas Employment Administration (POEA) resulting to the OFW non-deployment in protest of the “highly scandalous exorbitant” premium rates that three insurance consortia imposed recently.
PASEI requested President P-Noy to directly order a roll-back of premium rates to ensure that OFWs who will be deployed are properly covered and protected by the deploying recruitment agencies. In a letter, PASEI likewise asked the President to investigate how the highly scandalous insurance premiums were arrived at in order to ferret out the “invisible hands and brains behind this surreptitious machinations and highly irregular scheme.”
Under Section 37-A of the new Republic Act No. 10022, an amendment to Republic Act No. 8042 or The Migrant Workers and Overseas Filipinos Act of 1995, licensed recruitment agencies are mandated to cover their recruits under an insurance that complies with the requirements of the Compulsory Insurance Coverage for Agency-Hired Workers. The insurance premium must be paid by the recruitment agencies and should be secured at no cost to the OFWs.
“PASEI does not object to providing welfare and insurance protection not covered by Overseas Workers Welfare Administration (OWWA). But the premium for these protections dictated by the three insurance consortia is so ludicrous. It actually amounts to forcing the recruitment industry to work and to support the business of the insurance industry at the expense and death of the overseas employment industry,” Fernandez said in a press release.
Describing it as a “cartelized move,” the three insurance consortia had uniformly pegged their premium rates at US$72 for a one year coverage and US$144 for two-year coverage.
Fernandez further explained that an agency that deploys an OFW with a monthly salary of US$300 (for unskilled worker) can only collect US$300 from the OFW as placement fee.
“Imagine if the agency procures an insurance coverage for this OCW at US$144, about 50 percent of the agency’s income already goes to the insurance premium. Where will recruitment agencies get the fees to pay for other costs, overhead, salaries, income, and others?” he asked.
PASEI has called on the Insurance Commission to exercise prudence and fairness in favor of the consumer especially to ensure there will be no pass-on of cost burdening further OFWs. The Insurance Commission’s alleged dictating highly exorbitant premium rates will not only kill the recruitment agencies but the national economy as well due to reduced remittance income, overseas employment job losses, lost of business for airlines, examination fees of medical clinics, the PASEI president stressed.
“We will only have the Insurance Commissioner to blame for this employment and massive business loses disaster in terms of billions of dollars,” he added.
PASEI also called Congress to task to convene the Joint Congressional Oversight Committee and challenged the Senate Committee on Government Corporations and Public Enterprises and the House Committee on Good Governance and Public Accountability to investigate the Insurance Commission on how it can endorse such “exorbitant and unconscionable insurance premiums.”
PASEI likewise warned the Philippine Overseas Employment Administration (POEA) not to just watch and do nothing but “fence-sit” using the argument that it can do nothing because insurance matter is outside of POEA’s mandate and jurisdiction.
PASEI also wrote Vice-President Jejomar Binay, in his capacity as Presidential Adviser on Overseas Filipino Workers’ Concerns, to take cognizance of this serious problem and asked him to check this alleged anomaly within the Insurance Commission.
