POEA suspends insurance for land-based direct hires and rehires

The Philippine Overseas Employment Administration (POEA) on Monday, 15 August suspended the implementation of the Expanded Compulsory Insurance Coverage for land-based “rehires” and “direct hires” mandated in a department order issued in October 2021, per instructions from Migrant Workers Secretary Susan “Toots” V. Ople.

The POEA justified the suspension in an advisory dated 5 August, citing the better global health condition and high vaccination rates among overseas Filipino employees (OFWs).

The Department of Labor and Employment (DOLE) issued Department Order No. 228, Series of 2021, which addressed the Expanded Compulsory Insurance Coverage for returning OFWs and direct hires (DOLE). According to Undersecretary Bernard Olalia, who is also the Officer-in-Charge of the POEA, the department order is a “protective insurance mechanism against OFWs contracting COVID-19.”

“The suspension will save our ‘balik-manggagawa’ workers and those directly hired by foreign employers at least $35 (P1,700.00) worth of mandatory insurance coverage while reducing the number of requirements imposed by the government. It will be a great relief for our OFWs,” Ople said.

Ople stated that she has received feedback from OFWs who are unsure whether they should continue to pay for the expanded compulsory insurance even though the country is still on Alert Level 1, and that other countries have reported lower COVID-19 infections and have begun to relax travel restrictions.

However, she stressed that the necessary insurance coverage for newly employed OFWs remained legitimate and in effect because it is mandated by law.

“To be clear, there are two types of compulsory insurance. The one for the new OFWs as a result of the enacted law, and the expanded compulsory insurance for returning workers and direct hires stated in an old DOLE department order. We will continue to implement what the law stipulates because this is the answer of the foreign employers,” Ople said.

“Ngunit yung expanded na version na itinatakda ng Department Order 228 para sa mga balik-manggagawa at direct hires ay isasantabi muna natin dahil sa kakulangan ng konsultasyon sa mga stakeholders,” Ople explained.

Among other things, the Department Order compels employers or employees to pay for insurance coverage, which is refundable in full on the first day of arrival at the worksite or country of destination.

Ople pointed out that the advantages of such an insurance system for rehired and directly employed abroad employees during the peak of the COVID-19 pandemic had not been determined.

“The order to suspend will be followed by a series of formal consultations with all stakeholders most especially our OFWs in different parts of the world via online meetings since they were meant to be the primary beneficiaries of DO No. 228,” Ople said.

She said that the surveys will also allow the DMW to report on the development of other initiatives and services, such as ongoing attempts to reduce red tape and digitalize the overseas employment certificate (OEC).

“We will continue to reach out to our stakeholders so that our goal to make the DMW the home and sanctuary of every OFW is attainable,” Ople said. 

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