The case being made to reduce wages for Indian seafarers

Are Indian seafarers pricing themselves out of the market, and if so, what can be done? That was the question put to me and initially, with the accompanying data viewed in purely mathematical terms, it did appear to be the case.

For example, and all figures approximate, in USD and basis contractual wages per month or pro-rata. Indian officers are typically between these two figures.

Newly promoted Master/Chief Engineer: North-West European countries  / 13000 and Far East Developing countries  /  6500

Entry level 3rd Officer / 4th Engineer: North-West European countries / 5300 and Far East Developing countries /  2200

The argument or hypothesis put forward is that Indian officers need to voluntarily start accepting salaries closer to the salaries accepted by officers from the Far Eastern countries if they don't want to see themselve being out-priced from the market. Obviously, this does not take into account flag-state requirements, and applies more to open
register employment opportunities - though even some flag states are now relaxing this when it comes to employing foreign nationals on their ships.

This would be correct if the maritime industry was a simple operational industry, where the financial aspects over-rode everything else, and humans could be increasingly replaced by machines and computers. Or treat the sailor as sub-humans. To some extent, that is the way the industry has evolved over the past 2-3 decades, but there is simply no more elasticity left in the constant battle to reduce head-count on board by every means possible. How much more can the owners and flag states play around with so-called safe manning, before port states start imposing their own conditions, is already being played out.

If anything, as enquiry reports in more than a few accidents have shown lately, fatigue and lack of competence are the two biggest reasons going hand-in-hand while safety and efficiency take a beating. Certificates of competency and time-sheets are one thing, realities are another, and ship-owners as well as operators must realise that the issue is deeper than just salaries or rather the daily-wage kind of contractual numbers.

One solution would be for the same people advocating further reduction in head-counts to spend some time on board real working ships, as pursers, to try and understand the realities involved. And on terms and conditions as applicable to 3rd Officers.

Because. Then only will management, especially financial management, learn that the modern young seafarer, as with any other career professional, is looking for more than just money. There are two other very important parameters involved:- future potential and respect at the workplace. Nothing more needs to be said or written on how both these paramters have gown downhill over the last 2-3 decades.

Not that salaries have kept pace either. Compared with other avenues open to younger people, merchant navy salaries have not kept up. Simple as that.

Speaking with a few youngsters in the Merchant Navy on the subject, one can understand their frustration - managements tend to ignore the fact that their frontline operational staff expect more than just money. Leave alone a reduction in wages, many of them were of the opinion that even doubling of wages without improving working conditions and future potential meant nothing to them.

Which takes me back to the solution - which has to go back to basics. Tthe Indian seafarer was and should still be linked to the Indian flag ships. That is where the solution lies - there will be no dearth of very well qualified people willing to work for lower salaries as long as the other two parameters of respect at the workplace and future potential are met. Sadly, the Indian flag shipowners have defaulted on this responsibility terribly over the last few decades, and this needs to be resolved first.

If, hypothetical if, the Indian shipowners simply matched terms and conditions offered by the Indian Navy to theiir younger officers, then many of the same younger officers see no reason why a 20-year working life could not be something easy to achieve. With all the other benefits that accrue to shipowners able to plan for the future. And more.

The example of the coastal and foreign going Chinese flag fleet can be quoted in this context. The example of how many of us in the '70s and '80s chose to stay on with Indian flag vessels at lower salaries for the same reasons can also be quoted.

By all means, think about reducing salaries to make the Indian seafarer more competitive, but it can not be a stand-alone. It may sound strange, but bench-marking the Indian Navy for this is not such a wild idea - the two services have always been related and till not too long ago, the best who came out of the Training Ships actually went to the Indian Navy.

The rest, the not so best, or the better than most, take your pick, can then certainly work in the open registers.


And there, let market forces decide.

A Master's views on the DGS Revalidation course . . .

Dear Veeresh,

I did my revalidation for master’s COC at ___________ last 4 times .

The first time I told the Directors- that Capt ____________must be put out to pasture. This ignoramus was so full of ego that he tried to treat us like kindergarten kids.

One of the ship’s business lecturers was Capt ________— old ex-_______ – maybe ??? years old. A good guy BUT totally out of touch with modern day REALITY.

Last 2 times I met the Director ____________ personally and told him not to make this course a FARCE — that __________ must go. I am sure he is still there.

Training is being done on sentiments-- Wish I could run my unforgiving and merciless _______________ carrier tanker on sentiments.

This ego thing-- when you have an international conference of brain surgeons – there is maturity and mutual respect. When we have maritime seminars , just see the way the shore guys act as if they are gold medallists, who scored 100% marks— while the seafarers are the moronic bunch who scored zero percent—and hence banished to sea as divine punishment!!

brgds

_______________

mv RENA, MSC Chartered ship for Australia/New Zealand service and her schedules.

In a press release issued a few days ago by MSC, MSC Mediterranean Shipping Company S.A in an unsigned note on their webpage said to the effect that they were only the charterers, they did not have anything to do with the navigation of the RENA:-

http://www.mscgva.ch/news/news_detail_eid_403_lid_2.html

However, it is surprising that the media in New Zealand and Australia have not picked up on the schedules set by MSC for their ships, chartered, managed, owned orotherwise. Take a look here at ther "Capricorn" service:-

http://www.mscaustralia.com/schedules/vessel_schedule_import_oz.html

10-11 ports rotation in 13-14 days is inhuman and probably impossible given the rules and regulations supposed to be followed onboard ships. Those who set these gruelling schedules knew this and know this and are again probably from MSC - but hey, they are not responsible, as charterers, right?

Wrong.

Do the maths. With the Master and Chief Officer awake throughout port stays plus approaching and leaving portplus while at sea plus for all sorts of other responsibilities, it would be fair to assume that by the time the RENA was approaching TAURANGA and/or the Astrolabe, things were pretty much knackered on board as far as rest hour regulations were concerned. the other officers, probably junior 2nd Mate and 3rd Mate, would not have had too much rest either.

A look at the time sheets before they go into the ocean would be of interest. If, however, the timesheets as well as the data from the various data recorders onboard can not be salvaged, then some simple maths working things backwards with available records in ports can be done.

And then, after that, find out who were the wonder boys and girls who laid out schedules of the sort that the MSC Capricorn Service boasts of.

For a country, New Zealand, where dirt on shoes can attract penalties for tourists, letting schedules of this sort endanger the complete environmental balance can only make me, a seafarer from far away and simpler India, look on in amazement. Was there nobody in the whole of New Zealand's maritime administration that noted this simple truth - schedules which simply broke every rest hour and logical rule about ship operations?

At the end of the day, it is fatigue in so many cases of incidents at sea - but what are the responsibilities of those setting the schedules, then? The Master and 2nd Mate will no doubt get it in the neck and probably be laid up for life, but what about the more experienced shore staff, who put them on this amazingly intense schedule, with its tragic consequnces?

It is difficult not to get emotional when you see a proud ship breaking her back, helplessly, in a part of the world which one has wonderful memories of.

But the realities are that the schedules set by MSC for the RENA and the other ships on their Capricorn Service were and still are brutal. And they are still on the same brutal schedules, ongoing. And it appears as though governance in New Zealand is doing nothing about it, the real cause.

Readers may wish to take a look at this previous post on the subject of maritime fatigue:-

http://matescabin.blogspot.com/2010/11/fatigue-at-sea-lllloooong-post.html

Open observation on Indian flag ships and life therein

Basad on first hand observations as well as supported by inputs from others, the one big thing that needs to be done is that people involved in the shore aspect of shipping need to spend atleast 6 months onboard an Indian flag ship every five years.

The full cycle, from recruitment to briefing to joining to life on board and sign off/debrief.

This business of revalidating tickets basis a course or being involved in shipping ashore is simply not enough.

This doesn't include a separate treatise on the games indian shipping companies and their agents play in context with salaries, taxation, and the rest of it.

One way of trying to join cruise ships . . .

Advice given to a young man in Delhi on how to join cruise ships - comments and corrections as well as views apprecited and welcome:-

To join cruise ships now, you will need:-

1)  To do 4 x basic courses called STCW/78, these can be done at  SIMS/Bijwasan, and would take about 2 weeks, cost about 15k.

2) An InDOS number, which the institute will apply for you, costs about 800-1000/-

3) Then, with these two things in hand, you simultaneously start looking for jobs, for which you have to check out the newspapers, catering colleges, etc.etc.

4) Once you have an offer, that company will or may sponsor you for a CDC of that flag which their cruise ship flies. There are hardly any Indian pax ships, and they dont require anything like what you have in mind. So it will be Panama and similar. Take a look here:- http://www.tsrahaman.org/  . . . you can do the 4 courses listed in "1" over here and hopefully pick up some grapevine on agents/jobs etc. Pleasant place, residential campus.

5) One more 3 day course called Passenger Ship Course, this is done in Cal/Madras/Mumbai. But is better done AFTER you have acquired a CDC or atleast got somewhere.

6) To acquire a CDC, a govt document, involves some run-around in Mumbai as well as the courses listed in "a". Also a job offer from some shipping line. All the foegin flag consulates are de-facto present there.

You can also do the 4 courses listed in "1" at SIMS (Sriram Institute of Marine . . .) Bijwasan,
http://simsnd.org/courses.php,

These are the 4 courses you will need to do, either at SIMS/Bijwasan (day course) or at TS RAHMAN (residential, nearest station by train from Delhi will be PANVEL, do not go by air or by train to Bombay central)

Personal Survival Technique

Personal Safety and Social Responsibility

Fire Prevention & Fire Fighting

Elementary First Aid
http://simsnd.org/courses.php

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Please also apply to:-

mumbai.leisure@vships.com

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What do you think, short and sweet?

Really, is your Merchant Ship insured against piracy? How do you know?

So, dear Seafarer. Shipowner, Shipmanager, regulatory Authority, Fleet Personnel Manager, Union Leader, family members and everybody else interested in this subject of seafarers going off to dangerous waters . . .  would you please like to come out with cogent statements involving not just pleasantly couched words, but hard facts and numbers,  what really the insurance protection for the man on the ship is in case of piracy or hijack? Modern day piracy, of which just about 40% takes place in the Arabian Sea waters, is now a global phenomenon. Somalia gets a lot more attention because it appears to have become a hub lately, and is closer to India, but the rest of the world is not far behind, and the "business" of hijacking ships seems to be growing. Just like other streams of crime, for example prostitution, narcotics, arms trade - this too now seems to be settling into a pattern and a system.

That's as far as the relevance to the fact that this is now another business, and all business is about numbers, so what are the numbers, and where do the numbers go? What does it mean when somebody tells somebody else that "insurance for piracy" exists on such-and-such ship?

To start with, the piracy numbers include:-

# Investment versus returns, and a whole flotilla of numbers and words persons, and also some mercenaries, to keep the whole business well-greased. Imagine, can a transaction of almost 10 million dollars (9.8 million was the reported figure) plus costs involved in enabling this payment for releasing the supertanker SAMHO DREAM (say, another 5 million dollars) have been able to move across the globe without the direct participation of a whole lot of number crunchers  and shysters all over the world, especially in the "developed' world? So, modern-day piracy is not about to simply go away, for any reason.(Source - bankers unwilling to be identified in Europe and UAE.)

#The definitions of piracy and hijacking also appear to vary worldwide, and this in turn impacts the question of whether a vessel is a total loss or not, after the incident, whether hijack or piracy. Either way, in some countries, the insured shipowner/operator has not been "ir-retrievably deprived" of the vessel, so insurance claims for piracy or hijack, even interim, can not be paid out. Never mind what happens on the ship. In addition, it is the duty of the shipowner and his Master/crew to prove that they made all attempts to mitigate losses, and whether this includes the ransom payment or not is an open issue. So, a Master and his crew, who have not been paid, not received decent food, have been under capture, whose families may be starving - they still have to prove that all attempts were made to "mitigate" losses.

# In the UAE, it is even more complex, since they demand a "special provision" for piracy. The difference between "war risk" and "piracy" is there, not sublime, but complicated. However, one can not substitute the other, so a special cover in advance will be needed. At what point does piracy become an "act of war", given the current pronouncements of the attackers, claiming that they are working for their countries? No clear answers here, either - and carrying armed guards on board through somebody else's territorial waters, does that impact right of innocent passage? What does the Master of a ship have to say, if armed guards are on his ship, and the ship is then considered "hostile" - where do the crew stand as far as insurance goes, then?

# So while "piracy insurance" may have been taken by a shipowner/operator, please remember that "even though piracy is an insured peril, the onus to prove the act of piracy for successful recovery remains with the assured, in particular to establish that the act occurred was piracy and not terrorism, i.e. that the persons committing the act did so exclusively for their own material benefit, rather than pursuing a political, ideological or religious scope."

(Fichte & Co. http://www.fichtelegal.com/en/news_article.php?news_id=71)

Many of the latest episodes of piracy are defining their activities stikingly close to this.

# There is an estimate, provided by the Professional  General Insurance Research Organisation (GIRO) that each piracy attack on a merchant ship costs around 9 million dollars, and from another un-named source, that it is eventually between 10 and 15 million dollars, ransom and all costs. This is just a ballpark estimate, and rising lately. Working backwards from here, the average cost per merchant ship transiting the Suez Canal and going through the Gulf of Aden works out to between 70 and 110 thousand dollars, another rough estimate, and rising. Higher on ships carrying higher value cargoes, ofcourse, so assume a 10000 teu ship is paying about 300,000 dollars per trip each way - that's 30 dollars per teu extra costs. But what are the owners, cargo interests and seafarers getting out of this, incase of attack? That's not very clear.

# The number of seafarers kidnapped in piracy/hijack incidents as per the London-based International Chamber of Commerce’s Commercial Crimes Services was 867 in 2009, and 790 so far this year. There are some 'carry-forwards' who have been kidnapped in the previous year/years, and some simply 'missing'. However, this does not in any way provide any information on the disruption to seafarers even way outside in the Arabian Sea, in terms of mental tension and actual attacks.

# Allianz Global Corporate & Strategy, a leading insurer of ships and cargo, says that in most cases, piracy is covered under "normal" hull and insurance cover, even for ships not trading in piracy prone areas. The efficacy of this "normal" cover when a piracy or hijack takes place is very much under debate and till then, may well be slightly ineffective at best. So the solution would be to take additional cover. However, truth is that many owners or operators or charterers simply do not take additional cover when going through these areas - because special piracy covers are not easily available that offer special, flexible and tailor made cover for such ships.

# Here is a map of the piracy prone areas worldwide:-

http://www.aida.org.uk/AIDAEurop/AIDAStellaspaper.pdf

It is clear that marine insurance is the oldest form of insurance worldwide. War risk and piracy insurance have been linked for a long time. However, war risk insurance, and also piracy, can be unilaterally cancelled by the insurer at 48 hours notice. What does the seafarer onboard know about this, is the regulator able to provide any form of guarantees here?

It is in your interest as a seafarer to actively seek out the full details of the insurance cover taken for piracy, and to see that it is kept valid throughout your tenure - which obviously you can not do. But certainly the regulators, DG Shipping, can frame some rules urgently in this context?

Or, as is often the case, keep sailing "Ram Bharose".

Regine Brett - at 90

Lady called Regina Brett wrote this when she turned 90 - and I read it years ago, came back to me when I was looking for something else. Sounds good, so here's this for all the young and younger seafarers . . .

Written By Regina Brett, 90 years old, of "The Plain Dealer", Cleveland , Ohio . . . "to celebrate growing older, I once wrote the 45 lessons life taught me. It is the most-requested column I've ever written."

My odometer rolled over to 90 in August, so here is the column once more:

1. Life isn't fair, but it's still good.
2. When in doubt, just take the next small step.
3. Life is too short to waste time hating anyone.
4. Your job won't take care of you when you are sick. Your friends and parents will. Stay in touch.
5. Pay off your credit cards every month.
6. You don't have to win every argument. Agree to disagree.
7. Cry with someone. It's more healing than crying alone.
8. It's OK to get angry with God. He can take it.
9. Save for retirement starting with your first paycheck.
10. When it comes to chocolate, resistance is futile.
11. Make peace with your past so it won't screw up the present.
12. It's OK to let your children see you cry.
13. Don't compare your life to others. You have no idea what their journey is all about.
14. If a relationship has to be a secret, you shouldn't be in it.
15. Everything can change in the blink of an eye. But don't worry; God never blinks.
16. Take a deep breath. It calms the mind.
17. Get rid of anything that isn't useful, beautiful or joyful.
18. Whatever doesn't kill you really does make you stronger
19. It's never too late to have a happy childhood. But the second one is up to you and no one else.
20. When it comes to going after what you love in life, don't take no for an answer.
21. Burn the candles, use the nice sheets, wear the fancy lingerie. Don't save it for a special occasion. Today is special.
22. Overprepare, then go with the flow.
23. Be eccentric now. Don't wait for old age to wear purple.
24. The most important sex organ is the brain.
25. No one is in charge of your happiness but you.
26. Frame every so-called disaster with these words: 'In five years, will this matter?'
27. Always choose life.
28. Forgive everyone everything.
29. What other people think of you is none of your business.
30. Time heals almost everything. Give time time.
31. However good or bad a situation is, it will change.
32. Don't take yourself so seriously. No one else does.
33. Believe in miracles.
34. God loves you because of who God is, not because of anything you did or didn't do.
35. Don't audit life. Show up and make the most of it now.
36. Growing old beats the alternative -- dying young.
37. Your children get only one childhood.
38. All that truly matters in the end is that you loved.
39. Get outside every day. Miracles are waiting everywhere.
40. If we all threw our problems in a pile and saw everyone else's, we'd grab ours back.
41. Envy is a waste of time. You already have all you need.
42. The best is yet to come...
43. No matter how you feel, get up, dress up and show up.
44. Yield.
45. Life isn't tied with a bow, but it's still a gift.

So, you get it?

So, are you an NRI, or what?

Here's a quick article I did for Sailor Today on tax-free status . . . and even more relevant now than ever before. Please do visit and ask your tax consultant for more . . .

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The issue of a review in NRI status from, broadly, not more than 6 months a year to 2 months a year, has caused great debate and worry with seafarers - both present, prospective and past. And rightly so. This is one of the most widely misunderstood and misinterpreted aspects of Income Tax in India, which is one reason why the new Direct Tax Code (DTC) is trying to address that too. Many will now have to rework startegies.

 

Interim, here are a few basic observation, issued in best interest but without guarantee. Please do consult your own taxation entities for any decision you wish to take pertaining to fiduciary issues.

 

1) The new DTC will come into effect from the 1st of April 2012. Likely. Maybe, but at the same time, maybe earlier, maybe later. This remains to be seen.

 

2) The present dispensation of not more than 6 months in a year is water-tight. Not really, it comes with a few ryders and conditions, some extremely complex.

 

3) To be on the safe side, stay out of the country on a foreign flag ship for atleast 190 days. Apparently, that's not enough, and here are some queries being raised:-

 

# Did the ship in question visit India or enter territorial waters/Economic Zone at any time. That's 200 miles.

# Did the NRI sign an agreement with any entity/company/agent in India. If he did, how was he an "NRI"?

# Did the seafarer get "control" of the money in India? (Means - where was the bank account)

# Did the seafarer NRI exceed 365 days in India in total in the last 3-4 financial years.

# Where was his place of residence while an NRI. Ship was place of work. Explain the issue.

 

This is not something that SAILOR TODAY concurs with, or supports - but we would not be doing our job if we did not bring this to your notice. As for the Income Tax Authorities, their focus is clear - incremental taxation from any source is their aim.

 

Complicated days ahead for NRI seafarers unless something is done, and soon. Otherwise, the best advice we can give you is - proceed with caution.

 

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MLC 2010 and the seafarer onboard a ship - some new bits . . .

Many shipowners and seafarers do not realise it as yet, but the Maritime Labour Convention 2010 (MLC 2010) which is going to come into force next year (2011), will be implemented by Port State Control. So it does not matter if your Flag State has ratified or signed on to the convention or not - if the Port State has signed on, then compliance by owners, operators, Master and seafarers will be essential.

States that have already ratified the MLC 2010 include Panama, Canada, Bahams, Norway, Liberia, Marshall Island, Bulgaria, Croatia, and Spain. Countries that are expected to ratify before the end of 2010 are the European Union countries and the Pacific Rim countries.

So what are the significant changes for seafarers?

One aspect would be the contract between seafarer and owner. Some significant new points would include:-

# The seafarer has been given enough time to read and review and also take advice on the contract or agreement before signing. What is "enough time"? That is left to the seafarer. If he feels he has not been given enough time, then he asks for more.

# The full name and address of the shipowner will have to be entered into the contract or agreement. In case the ownership is multiple layered, then all the names and addresses will be required to be entered.

# Full details of the health and social security benefits provided to the seafarer shall have to be entered. In this context, the new rules pertaining to NRIs and "foreign workers/Indians working abroad" under the EPFO may also be seen.

# Where the seafarer is liable for any reason to pay for his repatriation and other expenses, then a maximum amount needs to be set out in the contract/agreement itself. This can not be open ended as it is now.

# A :Shipowner's Complaint Procedure" will have to be defined and made available to the seafarer. The exact mechanics of this are yet unknown, but it is expected that this will have provision for referral back to flag and port state.

# Disciplinary rules and procedures will have to be set down, in detail, in keeping with flag and port state requirements. This appears to be a tough one. Each Port State will have different rules for such actions.

# On rest periods, much was expected, but little has changed. Maximum interval between 2 rest periods will be 14 hours. Extra work impacting rest hours for any reason - emergency, drills, musters, safety, peril - must be compensated.

# Paid leave entitlement is now a minimum of 40 days in each year of employment. This means 325 days work, 40 days leave, which works backwards to about 3.75 days per month. Pro-rata if employed for less than a year. In other words, for a 3-month contract, onboard for 2 months and 20 days entitles you to 10 days leave. Encashment of leave permitted.

# Termination of contract by seafarer for urgent or compassionate reasons shall be without cost to the seafarer. Notice period for termination of contract shall be not less than 7 days on both sides, and both seafarer as well as shipowner shall have equal number of days for this.

# Dental treatment will now be included in medical care, when visiting doctors ashore.

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Ofcourse, the above is still evolving, and there may be variations as and when the MLC 2010 comes into force in your Flag State. But expect the Port State Control to implement their version of MLC 2010 with vigour, and  soon.

Good luck. One more inspector . . .

How to join a cruise ship? ver 1.0

Basic advice to a young man who wants to join the cruise industry. Age 27, done this and that in the travel industry ashore, now looking at the romance of being on a ship.

Please do read, update, correct, suggest improvements?

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a) To join cruiuse ships now, you will need:-

1)  To do 4 x basic courses also called STCW/78, these can be done at a variety of institutes and colleges in India. Cost about 12k.

2) An InDOS number, which the institute will apply for you, costs about 800-1000/-

3) Then, with these two things in hand, you simultaneously start looking for jobs, for which you have to check out the newspapers, catering colleges, byelanes of port cities, internet.

4) Once you have an offer, that company may sponsor you for a CDC of that flag which their cruise ship flies. There are hardly any Indian pax ships, and their rules are, different. So it will be open register and similar.

5) Also take a look here:- http://www.tsrahaman.org/  . . . you can do the 4 courses listed in "1" over here and hopefully pick up some grapevine on agents/jobs etc. Pleasant place, residential campus.

5) One more 3 day course called Passenger Ship Course, this is done in Cal/Madras/Mumbai. But is better done AFTER you have acquired a CDC or atleast got somewhere.

These are the 4 courses you will need to do, at DGS approved colleges, for STCW purposes:-

Personal Survival Technique
Personal Safety and Social Responsibility
Fire Prevention & Fire Fighting
Elementary First Aid

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And then, good luck.

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