Sickness Insurance (Sea) Convention, 1936 (No. 56) - Panama (Ratification: 1971)

Observation (CEACR) - adopted 2011, published 101st ILC session (2012)

The Committee notes that Panama has ratified the Maritime Labour Convention, 2006 (MLC, 2006), whose entry into force will entail the automatic denunciation of Convention No. 56. In the meantime, however, the Committee will continue to examine the application of Convention No. 56 by Panama.

Article 1 of the Convention. Compulsory sickness insurance scheme for seafarers. The Committee notes the Government’s indication that resolution No. 1348-83 J.D. of 1983, which was the subject of previous comments, has been repealed further to the promulgation of Act No. 51 of 27 December 2005 reforming the Organic Act establishing the Social Security Fund (CSS). It requests the Government to send a copy of the law or regulation repealing this resolution. Furthermore, the Committee notes that, under the terms of section 77 of Act No. 51, all workers employed in Panama, whether nationals or foreigners, must be affiliated to the CSS. It notes resolution No. 39489 of 23 March 2007, implementing Act No. 51, section 87 of which states that seafarers employed on board vessels assigned to domestic service are obliged to be affiliated to the CSS and section 88 of which establishes the possibility for seafarers employed on board vessels assigned to international service to be affiliated to the Fund under a voluntary social security scheme. With reference to its previous observation, the Committee recalls that, under the terms of Article 1(1) of the Convention, every person employed on board any vessel, other than a ship of war, registered in the territory of Panama and engaged in maritime navigation or sea-fishing, must be insured under a compulsory sickness insurance scheme. Therefore, the distinction made by the legislation of Panama between vessels assigned to domestic service and those assigned to international service is not permitted under this provision of the Convention. The Committee accordingly hopes that the Government will take the necessary steps as soon as possible to adopt legislative provisions requiring compulsory affiliation to the CSS for all seafarers employed on board vessels flying the Panamanian flag, regardless of whether they are assigned to domestic or international service, the only exceptions being those provided for by Article 1(2) of the Convention.

Articles 2(4) and 3(3). Withholding of sickness benefit payments. The Committee notes the information supplied by the Government in reply to its previous comment, including further details concerning the employer’s obligations with regard to the payment of social security benefits in cases where the employer has failed to affiliate one of his or her employees to the CSS or pay the corresponding contributions. It recalls that benefits in kind (medical care) and daily allowances must be provided by the competent social security institution to persons covered by the Convention, and that failure by the employer to pay social security contributions is not one of the exceptions for which the payment of benefits may be withheld, as listed in Articles 2(4) and 3(3) of the Convention. Noting the Government’s indication that it is currently not possible to reach a consensus among the social partners with a view to revising the labour and social security legislation in force, the Committee hopes that efforts will be made in the near future to bring the legislation into conformity with the Convention on this point. It also underlines the importance of the monitoring measures aimed at ensuring the regular payment of social security contributions by shipowners, which is recalled in Guideline B4.5(7) of the MLC, 2006.

Observation (CEACR) - adopted 2007, published 97th ILC session (2008)

The Committee notes the Government’s report and the adoption of Organic Act No. 51 of 27 December 2005 concerning the Social Security Fund. It draws the Government’s attention to the following points.

Article 1 of the Convention. Compulsory sickness insurance. For a number of years the Committee has been pointing out that, by excluding from the social security scheme foreign seafarers who are married to non-Panamanian women or who have children whose mothers are not Panamanian, resolution No. 1348-83 J.D. of 1983 is contrary to the provisions of Article 1 of the Convention. The Government indicates that the draft amending this resolution, which was under examination, was adopted on 16 November 2005 by the Management Committee of the Board of the Social Security Fund. This body decided, however, with regard to the adoption of Organic Act No. 51 of 27 December 2005 and the new Maritime Labour Convention, 2006, which Panama wishes to ratify, to submit the adopted draft to the National Legal Advisory Department and the National Planning Department for evaluation. The Committee asks the Government to keep it informed of the effective entry into force of the draft resolution adopted on 16 November 2005.

Under the terms of section 77 of Organic Act No. 51, all workers employed in Panama, whether nationals or foreigners, are obliged to participate in the social security regime. Title III of Volume III of resolution No. 39489-2007-JD regulating affiliation and registration in the Social Security Fund, however, qualifies this principle. Under this Title, concerning special arrangements applicable to maritime workers, a distinction must be made between seafarers employed on board vessels assigned to domestic service (inshore navigation) and those employed on board vessels assigned to international service. Hence, under sections 87 and 88 of this resolution, seafarers employed on board vessels assigned to international service, unlike those employed on board vessels assigned to domestic service, are not obliged to belong to the Social Security Fund and, consequently, to the sickness insurance scheme, but can belong to this Fund under a voluntary social security scheme. However, the Committee recalls that Article 1, paragraph 1, of the Convention states as follows: “Every person employed as master or member of the crew or otherwise in the service of the ship, on board any vessel, other than a ship of war, registered in a territory for which this Convention is in force and engaged in maritime navigation or sea fishing, shall be insured under a compulsory sickness insurance scheme.” Moreover, this principle is laid down by Standard A4.5.5, taken in conjunction with Regulations 4.1 and 4.2 of the Maritime Labour Convention, 2006, which Panama, according to the Government’s report, wishes to ratify. The Committee therefore requests the Government to take the necessary steps to guarantee that all seafarers employed on board vessels flying the Panamanian flag which are engaged in maritime navigation are insured under a compulsory sickness insurance scheme and enjoy the benefits to which they are entitled pursuant to the provisions of the Convention.

Article 2, paragraph 4, and Article 3, paragraph 3. Withholding of sickness benefit payments. Section 126 of Organic Act No. 51 provides that the employer shall be responsible for cash sickness benefits not paid to insured persons by the Social Security Fund where non-payment is the result of the employer’s failure to discharge his obligations. Hence, if the employer fails to make the contributions for which he is responsible, the Fund will not pay the cash sickness benefits to the insured persons. For many years the Committee has been drawing the Government’s attention to the fact that insured persons must not be penalized by employers’ failure to pay their contributions. It also recalls that medical care must be provided and sickness benefit paid to all persons covered by the Convention. The Convention only allows benefits to be withheld under specific conditions, and these do not include the non-payment of contributions by the employer. The Committee therefore requests the Government once again to take the necessary steps to amend the national legislation and to guarantee that, even in cases of non-payment of contributions by the employer, sickness benefits will be paid to insured persons by the Social Security Fund.

Observation (CEACR) - adopted 2005, published 95th ILC session (2006)

1. In its previous comments, the Committee pointed out that resolution No. 1348-83J.D. of 1983 is contrary to Article 1 of the Convention as it excludes from the social security regime foreign seamen married to a non-Panamanian woman or having children of non-Panamanian mother. The Government replied, in the report it sent in 2000, that the Technical Board of the Social Security Fund has approved a draft amendment to the above resolution. In the report sent this year, the Government indicates that the draft, which was to remedy the discrimination that had been unintentionally incorporated in the resolution, has again been referred to the Executive Board of the Social Security Fund for approval, but has not as yet been examined. While noting this information, the Committee observes that there has been no change in either law or practice. It also recalls that as long ago as 1986, the Government stated that the authorities of the Social Security Fund were to take the necessary measures to resolve the problem. In these circumstances, the Committee once again expresses the hope that the Government will, without delay, take all necessary steps for the adoption of the above draft at the earliest possible date so that all foreign workers, especially those married to non-Panamanian women, employed on Panamanian-registered vessels assigned to international service, or at least those residing in the Republic of Panama, are covered by the compulsory social security scheme.

2. The Committee also drew the Government’s attention previoiusly to fact that entitlement to social security benefits, in particular sickness benefit, depended on payment of contributions by the employer, whereas the benefits provided for in the Convention may be withheld only in the circumstances described in Article 2, paragraph 4, and Article 3, paragraph 3, which make no reference to the possibility of non-payment of contributions by the employer. Noting that in its last report the Government provides no new information in this regard, the Committee is bound to ask it to reconsider this matter, as insured persons must not be penalized because employers fail to pay their contributions. It recalls that medical care has to be provided and sickness benefit paid to all persons covered by the Convention. Although the Convention allows the suspension of benefits in certain circumstances, the non-payment of contributions by employers is not one of them. The Committee hopes that the Government’s next report will contain information on progress made in this respect.

[The Government is asked to reply in detail to the present comments in 2006.]

Observation (CEACR) - adopted 2001, published 90th ILC session (2002)

1. In its previous comments, the Committee had drawn the Government’s attention to the fact that resolution No. 1348 83 J.D. of 1983, by excluding from the social security scheme any foreign seaman married to a non Panamanian woman or having children whose mother was non Panamanian, was contrary to the provisions of Article 1 of the Convention. In reply, the Government indicates that the Technical Board of the Social Security Fund had approved a draft amendment to this resolution. This draft aims to rectify the discrimination which had been unintentionally incorporated into the resolution and which is one of the subjects to be debated within the Management Committee of the Social Security Fund for approval. The Committee notes this information. It notes that the situation has not changed inasmuch as the Government communicated with its previous report a copy of the said draft. In addition, the Committee points out that, in 1996, the Government indicated that the Social Security Fund authorities were going to take the necessary measures to solve this problem. Hence the Committee hopes that the Government will not fail to adopt all necessary measures to ensure that this draft is adopted without any delay, so that all foreign workers and in particular any foreign worker married to a non-Panamanian woman as well as his dependants, residing in the Republic of Panama and employed on a vessel under the Panamanian flag assigned to international service will be covered by the compulsory social security scheme.

2. The Committee had also drawn the Government’s attention to the fact that entitlement to social security benefits, and in particular sickness benefits, was conditional on the payment of contributions by the employer, whereas the benefits provided for by the Convention may be withheld only in the circumstances described in Article 2, paragraph 4, and Article 3, paragraph 3, which make no reference to the possibility of non payment of contributions by the employer. In its report, the Government indicates that the financing of the social security system depends on the payment of social contributions. The fact that the Fund is not responsible for benefits due to the insured person when the employer has failed in his obligation to pay contributions constitutes a measure for safeguarding the financial equilibrium of social security programmes, in particular the health and maternity programme, which is based on a simple distribution of income and expenditure without the accumulation of any reserves. While noting the Government’s concerns on the financial equilibrium of the social security system, the Committee considers that insured persons must not be penalized by employers’ failure to pay their contributions. It recalls in this regard that medical care must be provided and sickness benefits paid to all persons covered by the Convention, and although the Convention allows benefits to be withheld under certain conditions, the latter do not include the non payment of contributions by the employer. Consequently, the Committee hopes that the Government will reconsider this issue and carry out all the necessary amendments. It hopes that its next report will contain information on the progress made in this regard.

Observation (CEACR) - adopted 1998, published 87th ILC session (1999)

1. The Government indicates in its report that the Social Security Fund is revising resolution No. 1348-82 J.D. of 1983 which regulates the inclusion of seafarers in the social security scheme, in the light of the Committee's comments. The Government also indicates that the draft revision of this resolution will be adopted by the Board of the Social Security Fund after going through the internal procedure.

The Committee takes note of this information. It notes with interest that, according to the draft provided by the Government, all foreign workers and their dependants resident in the Republic of Panama and employed on a Panamanian vessel assigned to international service will in future belong to the compulsory social security scheme, in accordance with Article 1 of the Convention.

2. The Committee in its previous comments also drew the Government's attention to the fact that entitlement to social security benefits, and in particular sickness benefits, was conditional on the payment of contributions by the employer, which is contrary to the Convention. The benefits provided for by the Convention may be withheld only in the circumstances described in Article 2, paragraph 4, and Article 3, paragraph 3, of the Convention, which make no reference to the possibility of non-payment of contributions by the employer. The Government in its reply indicates that the Committee's comments will be taken into account when the regulations in question are revised.

Under these circumstances, the Committee trusts that the draft revision of resolution No. 1348-83 J.D. of 1983 will be adopted in the very near future so as to ensure full application of the Convention in respect of points (1) and (2) referred to above. The Committee requests the Government to indicate any progress made in this regard and to provide a copy of the text revising resolution No. 1348-83 J.D. of 1983 as soon as it has been adopted.

Direct Request (CEACR) - adopted 1995, published 83rd ILC session (1996)

Article 2 of the Convention. The Committee notes the Government's statement in its report that the receipt of social insurance benefit is conditional on the employer's payment of contribution. The Committee recalls that medical care and cash sickness benefits must be provided to all persons included in the scope of the Convention, as stipulated in Article 1, and may be withheld only under the conditions listed in Article 2, paragraph 4, which does not include failure of the employer to pay contribution. The Committee requests further information on what provisions exist or are envisaged to ensure that all seamen within the scope of the Convention are entitled to sickness benefit, regardless of whether the employer has paid contribution.

[The Government is asked to report in detail in 1997.]

Observation (CEACR) - adopted 1995, published 83rd ILC session (1996)

Article 1 of the Convention (scope). In previous comments, the Committee had drawn the Government's attention to the fact that resolution No. 1348-83 J.D. of 1983 excludes from the social security scheme any foreign seaman married to a non-Panamanian woman or having children by a non-Panamanian mother, contrary to the provision of Article 1. The Government states in its report that the draft legislation which would bring resolution No. 1348-83 into conformity with the Convention is still in the initial stages of parliamentary debate. The Committee notes this information and expresses its hope once again that the Government will take the necessary steps in the very near future to ensure that all foreign seamen are covered by the social security scheme.

[The Government is asked to report in detail in 1997.]

Observation (CEACR) - adopted 1992, published 79th ILC session (1992)

Article 1 of the Convention (Scope). In its previous comments, the Committee noted that, under Resolution No. 1348-83 J.D. of 14 April 1983, foreign seamen married to a non-Panamanian wife or having children by a non-Panamanian mother were excluded from the social security scheme. In its latest report on the period 1986-91, the Government confirms that this exclusion was due to a drafting error that did not arise out of any intention to discriminate. It adds that the Technical Board of the Insurance Fund has been instructed to formulate a proposal designed to bring the aforementioned Resolution No. 1348-83 into harmony with Article 1 of the Convention. The Committee notes this information with interest. It consequently expresses the hope that the said Resolution No. 1348-83 may shortly be amended to ensure full conformity with the Convention, which makes no distinction on the basis of nationality with the sole exception provided for in Article 1, paragraph 2(d), of persons not resident in the territory of the member State. The Committee ventures to remind the Government of the possibility of having recourse to the technical assistance of the International Labour Office.

Observation (CEACR) - adopted 1991, published 78th ILC session (1991)

The Committee notes that the Government's report has not been received. It must therefore repeat its previous observation which read as follows:

Article 1 of the Convention (scope). In its previous comments the Committee had noted the exclusion from the social insurance scheme, under Resolution No. 1348-83 J.D. of 14 April 1983, of foreign seafarers married to a non-Panamanian wife, or with children whose mother is not Panamanian. In its report the Government states that this exclusion was due to a drafting error and that it was not its intention to exclude such persons from social insurance. It adds that the authorities of the Social Insurance Fund will soon take the necessary measures to ensure that all foreign seafarers resident in the country and employed on ships under the Panamanian flag will be protected by the social insurance scheme. The Committee takes note of this information with interest. It hopes that these measures will be taken in the near future so as to ensure full conformity with the Convention which makes no distinction on the basis of nationality - the sole exception authorised in this connection being that provided for by paragraph 2(d) of Article 1 in respect of persons not resident in the territory of the member State. The Committee requests the Government to supply information on any progress made in this respect.

Observation (CEACR) - adopted 1988, published 75th ILC session (1988)

Article 1 of the Convention (scope). In its previous comments the Committee had noted the exclusion from the social insurance scheme, under Resolution No. 1348-83 J.D. of 14 April 1983, of foreign seafarers married to a non-Panamanian wife, or with children whose mother is not Panamanian. In its report the Government states that this exclusion was due to a drafting error and that it was not its intention to exclude such persons from social insurance. It adds that the authorities of the Social Insurance Fund will soon take the necessary measures to ensure that all foreign seafarers resident in the country and employed on ships under the Panamanian flag will be protected by the social insurance scheme. The Committee takes note of this information with interest. It hopes that these measures will be taken in the near future so as to ensure full conformity with the Convention which makes no distinction on the basis of nationality - the sole exception authorised in this connection being that provided for by paragraph 2(d) of Article 1 in respect of persons not resident in the territory of the member State. The Committee requests the Government to supply information on any progress made in this respect.