The Maritime Labour Convention 2006 (MLC 2006) was adopted at a Maritime session of the International Labour Conference (ILO) in 2006 and came into force on 20th August 2013. There are more than 1.5 million seafarers in the world and a majority of these seafarers now have the right to be protected through national laws and practices, applying the MLC 2006 to the ships they work on.
“The adoption of the Maritime Labour Convention in 2006 was an historical milestone that heralded a new era in the maritime sector,” said ILO Director-General Guy Ryder. "This latest step, building on international tripartite cooperation, is a very significant and inspiring example for other economic sectors. When they come into force, these measures will ensure the welfare of the world’s seafarers and their families if the seafarers are abandoned, or if death or long-term disability occurs as the result of occupational injury, illness or hazard. These steps will certainly help improve working and living conditions for seafarers, doing what is right for the women and men in this sector who play a central role in keeping the real economy going with some 90 per cent of world trade carried on ships.”
The MLC 2006 establishes mandatory requirements that ship owners have financial security to cover abandonment, as well as death or long-term disability of seafarers due to occupational injury and hazard.
“These legal standards will provide relief and peace of mind to abandoned seafarers and their families wherever they may be,” said Cleopatra Doumbia-Henry, Director of the ILO Labour Standards Department. “In addition, by adopting these amendments to the Convention, shipowners and governments are also strengthening its provisions aimed at ensuring a level-playing field for quality shipping around the world.”
Under the new provisions, ships will be required to carry certificates or other documents to establish that financial security exists to protect seafarers working on board. Failure to provide this protection may mean that a ship can be detained in a port. The ILO Maritime Labour Convention, 2006 came into force on 20 August 2013.
Talking about the impact of the MLC on world trade, the UK Maritime & Coast Guard Agency told International Private Medical Insurance Magazine, "Due to widespread ratification and the “no more favourable treatment” rule contained in the MLC, it will be very difficult for ships registered in countries which have not ratified the MLC to trade without delay in ports of ratifying countries. This is because the rule requires Convention standards to be applied to ships from non-ratifying countries as well as ratifying ones. Ships which are registered with ratifying states and have been issued with MLC certificates by those states will be able to use the certificates as prima facie evidence of MLC compliance when visiting foreign ports. They will only be subjected to in-depth inspections if the surveyor has clear grounds to believe conditions on board are not compliant with the Convention, or a complaint has been received. Ships which do not hold such certificates because they are registered in non-ratifying states are more likely to be subjected to in-depth maritime labour inspections, which have the potential to delay the vessel, and, in addition to the “hassle factor”, this can result in additional costs."
Commenting on further measures, Cleopatra Doumbia-Henry, Director of the ILO Labour Standards Department added, “In addition to the Guidelines that the ILO adopted between 2006 and 2013 explaining the Convention and its implementation in connection with flag State and port State ship inspections and medical examinations as well as guidance regarding model provisions for legal implementation, an ILO tripartite meeting of experts has also recently adopted ground-breaking guidelines for the training of ships’ cooks, covering everything from training and responsibilities of ships cooks to food handling, provision of food without charge to seafarers as well as minimum standards for the amount and quality of food and drinking water on board ships. Also, the international representative organizations for seafarers and for ship owners, the International Transport Workers’ Federation (ITF) and the International Shipping Federation (ISF), respectively, have issued their own important guidelines on implementing the MLC, 2006 and what it means for ship owners and seafarers. Social networks have also sprung up, providing instant sharing of information on issues related to the Convention. And of course, inspections are underway, and actions are being taken in many ports to make sure the MLC, 2006’s provisions are being respected, and that action is then taken on board ships to correct problems.”
Discussing some of the milestones seen since the Maritime Labour Convention 2006 came into force the UK Maritime & Coast Guard Agency told International Private Medical Insurance Magazine, "The certification of UK ships against the Convention is well underway. Inspections are beginning on vessels which are below the threshold for requiring a certificate. Some foreign registered ships have been detained in ports abroad for non-compliance with the MLC."
"Seafarer Recruitment and Placement Services which are not already compliant are rushing to become compliant. Implementation of the Convention is enhancing the rights of seafarers to receive medical treatment both onboard and ashore. Many (mutual) P&I Clubs have been amending their rules to accommodate the shipowner financial security obligations relating to repatriation (under MLC Regulation 2.5.2) and compensation for death and long term disability resulting from occupational illness, injury or hazard (under MLC Standard 4.2). Not all vessels which are subject to the MLC have P&I cover, and of the ones which do, it may be that some will be covered by P&I Clubs which have not altered their Rules in the way described above to accommodate the MLC obligations. We understand that some mainstream insurance companies have also been developing products to address the financial security requirements in Titles 2.5 and 4.2."
Speaking to leading C-Level executives from the insurance world, iPMI specifically asked what has the maritime labour convention meant for the insurance industry?
Philip Wright, Chief Commercial Officer, Globality Health said, "I think a more important question is: What does the Maritime Labour Convention mean for Seafarers? Seafarers deserve the same right to benefits, the same access to the best medical treatment and the same security expected and enjoyed by those who work ashore. For too long the challenging life of the seafarer has gone unnoticed, but due to the MLC this is now changing. Legislation brings reform and improvements to working conditions, granting the same care and concern that shore side employees receive and benefit from. For the insurance industry, the MLC 2006 equals a reconsideration of how to best provide insurance solutions for seafarers. It also means continuing debate. Should seafarers remain insured as beneficiaries of a Ship owner’s Liability policy, or should they properly be ‘insured persons’ in their own right? We believe that the Convention envisages seafarers being provided benefits in the same way as employees ashore are looked after. In fact it states this in terms. Regulation 4.1.4 states that the “requirements for on-board health and medical care set out in the Code include standards for measures aimed at providing seafarers with health protection and medical care as comparable as possible to that which is generally available to workers ashore.”
Philip Catterton, CEO at Integra Global told us, "Good question. The MLC calls into question how best to provide health insurance cover to the maritime community, whilst raising awareness as to the importance of comprehensive health cover for sea farers. The MLC provides a framework to develop sea farer health services and insurance plans. How best to work with ship owners, P and I clubs and the more niche specialist areas of the marine business like the cruise liner and charter yacht sectors. The MLC also provides a level of certainty and stability for insurers; a regulatory environment and a level playing field where we all play by the same rules. This pushes insurers to innovate in maritime insurance plan design whilst evolving the way we deliver service."
Todd Hancock, the Chief Operating Officer at IMG added, "As it is in most cases, a change in the status quo brings with it both challenge and opportunity. IMG has been providing best of class medical insurance solutions for marine crew members for more than 20 years and is particularly well suited to respond these changes. The MLC sets minimum standards of responsibility for vessel owners to provide, among other things, access to medical care for injuries and illnesses that arise as a course of the crewmember’s service aboard ship. IMG’s expertise in the design and administration of this specialized coverage and understanding of the unique needs and challenges of the marine culture allow us to work in harmony with the industry to make compliance with these requirements simple and cost effective.
Susan Landers, Head of Marketing and Client Management, Allianz Worldwide Care said, "The MLC is a global set of laws put in place to ensure shipping companies provide a uniform minimum level of labour standards and protection for employees and their families. The MLC is already in force in many countries including Cyprus, Denmark, France, Netherlands, Norway, Spain and Sweden, with the UK, Germany and Belgium set to implement the Convention in 2014. The convention is a positive step for the industry, as it ensures that shipping companies provide comprehensive rights and protection to the world’s 1.2 million seafarers and their families. Although the MLC sets out minimum global standards, insurers can provide specialised products for the maritime sector, where appropriate, that meet or exceed the requirements of the MLC, helping employers to differentiate themselves in this highly competitive labour market."