Russian Seamen On Ships Under The Flag Of Convenience: Advantage Or Disadvantage?

Analysis of fleet dynamics and Flag of convenience registration

The crews of aircraft and ships, interacting in human-machine systems with various equipment, are exposed to fatigue factors.

The world merchant fleet is one of the actively developing sectors of the world economy. According to UNCTAD statistics, the tonnage of the sea fleet increased from 672.1 million tons in 1980 to 907.5 million tons in 2005. During this period, the growth was 35 %. In the twentieth century, the fleet began to develop much faster – since 2005, in a twice shorter period of 2005–2020, the fleet has grown by 2.3 times (Fig. 01).

Registration of FOC ships has also increased (Fig. 02). At the same time, by the number of ships of Russian shipowners, the Russian Federation is in the top 10 world maritime powers, ranking ninth. The Soviet Union possessed the largest naval fleet in terms of numbers and 6th in terms of tonnage.

Ensuring the functioning of the navy led to the creation of a network of vocational schools for the training of officers and nautical schools for the private. In 1983, MacLeod wrote (MacLeod, 1983), there are currently about 7.500 Soviet merchant ships, making the Soviet fleet the largest in the world. In terms of tonnage over two decades, it rose from 14th to sixth place, ahead of the United States. The modern fleet controlled by Russian shipowners ranks 20th globally in terms of tonnage with a share of 1.13 % (Tables 01 and 02).

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Russian seamen in international shipping

The location of shipping companies in the USSR was determined by historical, economic, and geographical factors. As a result, after the collapse of the USSR, many shipping companies that have a specialized fleet and supply them with personnel from educational institutions ended up in new states – Ukraine, the Baltic countries, Georgia, Azerbaijan.

Many complex branches of the national economy in the new countries fell into decay. Economic ties were severed, and the ensuing general economic recession led to the technological degradation of the economy. Most of the state shipping companies ceased to exist, splitting into small companies.

The system of maritime training personnel created in the Soviet years has remained one of the few competitive areas of the national economy. The system of maritime training personnel has been continuously updated. Currently, it produces professional personnel competitive in the world market, which, due to the peculiarities of the legal status of the modern fleet (flags of convenience), form the export of Russian labor.

At the same time, unlike traditional labor migrants, professional seafarers are, in terms of their income, representatives of the middle class, even by the standards of developed countries.

Initially, the acquisition of a maritime profession (occupation of a position on a ship) was determined by the country's national legislation of the ship's registration. However, many major accidents in the maritime fleet pushed the world community to decide this issue. Frequent causes of accidents are the low qualifications of the ship's crew, which was recruited from low-skilled workers who are not familiar with the specifics of the ship's work, who do not have a safety culture.

In 1978, the first edition of the International Convention on the Training, Certification, and Watchkeeping of Seafarers, the International STCW Convention, was adopted. This Convention established many mandatory requirements for the training and certification of professional seafarers. The Convention establishes international standards for the training and certification of seafarers and watchkeeping. The Convention includes provisions to ensure that seafarers on board are adequately trained and trained, have sufficient experience, skills and qualifications, meet the requirements for work, age, health and are fit to perform their duties in a manner that protects human life and the safety of property at sea, as well as the protection of the marine environment.

A diploma means a valid document, whatever its name, issued by or under the authority of the Administration, or recognized by the Administration and entitling its holder to hold the position specified in this document or permitted by national regulations.

As a result, the system of training maritime personnel received many differences from other specialties (areas of training). A future seaman (cadet) who is educated in any country in the world after graduating from his educational institution receives the corresponding national document on education. Further, provided that the cadet and the educational organization fulfill the requirements of the Convention on the training, certification, and Watchkeeping of Seafarers, the cadet has the right to apply to the authorized body in the state – the Administration. In the Administration, seamen can be issued a so-called "working" diploma (Certificate of competency). This international document gives the right to perform work on a seagoing vessel of any country.

A Russian who has received a maritime education has the possibility of legal employment in most countries of the world. This advantage made it possible to preserve the prestige of maritime education and the Russian Federation to preserve the continuity of the training of qualified seamen.

The harsh working conditions at sea make the maritime profession unpopular in developed countries. Working at sea implies the remoteness of the sailor from the family, work without traditional days off, no time off, forced constant communication with a limited number of crew members, exposure to harmful substances. Moreover, despite the collapse of the system of Soviet shipping companies (shipping companies), most sailors were able to adapt to the new requirements and successfully work in multinational crews. The modern Russian system of training seafarers gives them both the necessary competencies to work in foreign companies and the legal basis.

However, the profession of a seafarer is a status one for many reasons: the romance of sea travel, regular visits to foreign countries, the availability of access to privileged resources, namely, checks/certificates/bills as monetary surrogates, a "parallel" currency that existed in the USSR instead of the turnover of foreign currencies (American dollars, German marks, and other currencies) (Fig. 03).

In the behavioral model of household members of professional seafarers, stable stereotypes and patterns of behavior have been formed. Note that the Criminal Code contains Article 209 of the RSFSR Criminal Code, which defines parasitism and punishment for parasitism. Parasitism is a parasitic existence at the expense of society, i.e., evasion of socially useful work or living and unearned income.

In the maritime domain, gender equality is not widespread – the majority of professional seafarers are men. Although women worked on Soviet sea-going ships, they occupied rank-and-file positions with low wages (barmaids, cooks). Today, girls graduate from maritime universities and make a career on ships, but this is an exception so far.

A typical seafarer's family, a household, is represented by a seafarer husband who forms most of the household's income. A seafarer's wife, in most cases, is employed in areas with relatively low wages, self-actualizes in this profession, but does not form a significant share of household income, or is a housewife. We are dealing with a typical patriarchal family, in which a man financially provides for his family, and his relatives depend on him materially.

Traditional problems of ordinary Soviet sailors (sailors) – drunkenness, low level of responsibility and discipline, lack of understanding of the boundaries of subordination and familiarity, craving for "swinging rights" led to the almost complete disappearance of Russian rank and file (sailors) from sea-going ships. At the moment, ordinary Russian sailors have remained on inland navigation vessels (river fleet), auxiliary fleet (for example, tugs, bunkering ships), and ships flying the Russian flag (in most cases, this is a forced measure – a consequence of the prohibition of foreign ships working in cabotage).

As a result, the system of nautical schools that trained rank-and-file sailors ceased to exist. Moreover, modern sailors' main level of training has become officer positions – navigators, ship mechanics, and electromechanics.

For this study, it is necessary to clarify the definition of "household." A household is a collection of persons living in the same dwelling (or part of it), both related and not related by kinship relations, jointly providing themselves with food and everything necessary for life, that is, fully or partially combining and spending their funds. Such a definition is given by the Russian Federal State Statistics Service (On approval of the main methodological and organizational…, 2018) in the method of comprehensive observation of the population's living conditions. A household is an economic unit consisting of one or more persons that supply the economy with resources and uses the money received to purchase goods and services that satisfy material needs – this is the definition (McConnell et al., 2009).

By their composition, seafarers' families are usually nuclear – they are represented by a couple of spouses and children, without parents living with them.

Thus, the household of a Russian professional sailor can be understood as a nuclear family of the patriarchal type.

The prevailing myths, stereotypes of behavior, and the forms of implementation of the social-status function of the family, taken by the family, have a significant impact on the structure of expenses of the studied household. The social roles of the seaman's family members were formed under the influence of both the Soviet period and the crisis of the 1990s. In Soviet times, a sailor, not representative of the nomenklatura, had, albeit financially limited, access to foreign goods and materially and status corresponded to the middle class. In the 90s of the twentieth century, against the background of the general economic recession, the financial position of those sailors who were able to rebuild on the modern market, rails began to significantly contrast with the national level. Separately, it should be noted the polarization of income among representatives of the profession. Companies can be divided into three groups in terms of wage rates:

Those who switched to work on modern maritime conventional, i.e., meeting the high international (conventional) court requirements, sharply increased their income in dollar terms. If in the Soviet period the captain of a ship could receive about $ 200, then in the 90s, the salary increased to several thousand a month.

Substandard vessels are usually old vessels of mixed navigation (river-sea), which do not fully meet the modern conventional requirements and the requirements of the "first world" states. Salaries on such ships can be several times lower than on conventional ones.

Inland navigation vessels are old vessels that usually do not meet even the minimum convention requirements and operate inland traffic. Salaries are usually ten times lower than on conventional ships.

Estimation of the number of Russian sailors

Assessing the total income of Russian seafarers requires determining their number, which is a non-trivial task. Official Russian statistics on the number of seafarers, positions held are not published.

Since seafarers seek to use the opportunity to obtain non-resident status under the Tax Code of the Russian Federation. According to Art. 207, individuals who actually stay on the territory of the Russian Federation for at least 183 days within 12 consecutive months are recognized as tax residents. Therefore, seafarers do not pay personal income tax (PIT) from income received outside the Russian Federation, and the amount of income is not declared.

To estimate the current number of seafarers, we will use the UNCTAD statistics. MARITIME PROFILE: RUSSIAN FEDERATION (UNCTAD, 2020c), which is based on the results of the BIMCO-ICS Manpower Report 2015. The number of Russian seafarers is estimated at 97 061 (BIMCO, 2015). For comparison: Philippines – 215 500 people, China – 243 635 people, India – 86 084 people, Ukraine – 69 000 people, USA – 33 218 people, Great Britain – 14 955 people. The total number of rank-and-file sailors (BIMCO, 2015) is estimated at 873.5 thousand people, officers – 774 thousand, and the total number is 1 million 647.5 thousand people. Russian sailors are in 4–5 place globally in terms of numbers (data obtained from national sources). According to the results of the survey of companies, the places are located differently – China, the Philippines, and Russia occupy the first three positions with similar data, then Ukraine and India follow (Table 03). Please note that national / FOC categorizes neither country survey data nor company survey data. However, these values ​​are estimates and approximate and are not based on mandatory statistical reporting.

Based on significant discrepancies in the estimates of the number in (BIMCO, 2015) according to data received from countries and data received from companies, it is possible to estimate the share of Russian seafarers in the world labor market in the range from 3 to 10 %.

We use Drewry reports to estimate the income of Russian seafarers (Drewry, 2017). A feature of a seafarer's work is the inconstancy of receiving wages (rotational work). In most companies, a seafarer is paid only while on a voyage (contract). The contract duration for Russian seafarers is 4–6 months, plus or minus one month. The wages of Russian seafarers increased from USD 2–3 thousand at the beginning of the century to USD 12 thousand by 2009 and then remained without significant growth (Table 04) (Drewry, 2017).

Thus, the lower bounds of the annual salary of a Russian seafarer can be estimated from USD 28 667 for a dry cargo ship to USD 54 333 for a tanker.

Let us construct tables 06 and 07, using the classification of households by quintiles – top, upper-middle, middle, lower-middle, bottom and using data from the US Census Bureau (HINC-05, 2020) (Table 05).

For the study, we use UNCTAD estimates of the number of Russian seafarers. The lower bound for the annual income of Russian households of professional seafarers is $ 2 billion 782 million, and the upper bound is $ 5 billion 274 million. These figures are comparable with the volume of income from exports from Russia of food (5.61 billion US dollars), nickel (2.97 billion US dollars), copper (5.22 billion US dollars), electrical machinery and equipment, television, and sound equipment (5.59 billion US dollars).