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Terminated DH claims agency made her take out loan to pay illegal fee

14 April 2016

By The SUN staff

A Filipina domestic worker has filed a complaint with the Hong Kong Labour Department against a local employment agency that allegedly forced her to take out a loan from a lending company so she could pay a $9,000 placement fee.
Dexter F. Vargas, 25, filed the complaint on Jan. 11, after failing to recover the excessive fee allegedly charged by her recruiter, despite seeking help from the Philippine Overseas Labor Office (POLO).
Under Hong Kong’s labor laws, only 10% of the helper’s salary for the first month, which in this case is $410, should be collected as agency fee. Moreover, obliging a worker to take out a loan to pay for the illegal fee is seen to be exacerbate the offence.
Vargas told The SUN that within hours of her arrival in Hong Kong on Aug. 22 last year, she and two other Filipina workers were taken by staff of the agency to Ample Corporation Limited in Wanchai so they could each apply for a $11,000 loan.
The loan agreement stipulated a 48% interest per annum, making the total amount she needed to repay in six months to $12,672.
However, Vargas said she did not get to touch the money. The agency staff took the $9,000 as payment for her placement fee, and held on to the remaining $2,000 so it could be sent to her parents in the Philippines. The latter was apparently a ruse to show that it was Vargas who had received the money from the financing company.
The Filipina said the $9,000 was on top of the $20,000 or so that her employer claimed to have paid the agency for recruiting Vargas to work for her.
In the complaint form she filled out and sent to the Employment Agencies Administration (EAA) of the Hong Kong Labour Department, Vargas said, “I was forced to loan (sic) in a finance company by my agency amounting to HKD11,000 as payment for training fee, processing fee, medical in the Philippines, and including the agency fee upon my arrival in Hong Kong last August 22, 2015. The HK2,000 was sent to my family in the Philippines”.
On Dec. 14, or exactly three months and 21 days after she started working for her employer in Cheung Sha Wan, Vargas was told that her work contract was being terminated. Her employer, who cited financial incapacity for letting her go, told her to go to her recruitment agency to collect all payments due her.
But when she got to the agency’s office in Causeway Bay, all she got was a scolding because the employer had reportedly complained that Vargas had been dishonest and was stealing things from her house. The employer reportedly cited these reasons for refusing to pay any money to her. All she was given was a return air ticket to her hometown in Bicol.
 “I was surprised because my relationship with my employer was very good, we were friends and she was very cordial. On the night before she terminated me, she explained that the family had financial difficulties and could no longer afford to pay me,” she said.
Vargas said the employer even saw her off, and promised to write her a favorable release letter. She was thus shocked to read a termination letter handed to her by the agency citing her alleged dishonesty and theft as reason for the termination.
“If I really took things from her, why did she not accuse me directly, or call the police?”, Vargas said. “Why wait until I had left before making up all those allegations?”
She could only surmise that her agency was also behind the bad termination letter, in an attempt to keep her from getting any money from her employer.
As she had no money left on her, Vargas said she tried to claim back the $4,000 that had been withheld by the agency from the $11,000 loan that she was forced to take. However, the agency told her this could not be done because half of her loan was still unpaid.
In desperation, Vargas said she went to POLO to seek help and ask for a computation of the money that she knew was due her, but the people there were not helpful.
“Ate, tatlong buwan ka lang? Wala kang makukuhang bayad,” a staff member she later identified as welfare officer Lorna Obedoza reportedly told her in a smug tone.
Even Acting Labor Attache Ma Nena German was not helpful. During a conciliation meeting with her agency’s representative, German reportedly told Vargas that if she was terminated summarily for personal reasons, the employer is not obliged to pay her a month’s salary in lieu.
But nowhere in the Labour Department’s Practical Guide for the Employment of Domestic Helpers is “personal reasons” cited as justification for terminating a helper without notice or payment in lieu of notice.
Labour’s guidelines advise employers: “You may summarily dismiss your helper without notice or payment in lieu of notice if your helper, in relation to the employment: willfully disobeys a lawful and reasonable order; misconducts himself/herself; is guilty of fraud or dishonesty; or is habitually neglectful of his/her duties.”
However, the fraud cited in the guidelines must be backed by proof, and not simply alleged by the employer as in this case.
Vargas said she was in a series of conciliation meetings with German and the agency owner between Dec 23 and Dec 29. During this time, the helper told German about being taken by her agency to apply for a loan so she could pay the illegal placement fee.
The agency owner readily admitted taking $9,000 from the loan, but reportedly said he used part of it to pay ATD Employment & Training Services, its counterpart agency in the Philippines.
As a compromise, he agreed to pay the balance of Vargas’ “loan”. Subsequently, the agency owner handed Vargas a certificate dated Dec 29. stating that her loan to Ample had been “fully repaid”.
Surprisingly, German reportedly showed no sign of disapproval over the agency’s irregular act of forcing Vargas to take out a loan to pay for an illegal placement fee.
Vargas even quoted German as saying, “Ngayon quits na kayo. Wala ka nang utang.”
In reality, Vargas paid the money lender nearly $7,000 during the three months that she had worked for her employer. Of the $11,000 originally pocketed by the agency, a total of $4,950 was paid back to the financing company to settle the balance, leaving the recruiter still with a hefty $6,000 for the placement that had gone sour.
When she told the labor official about the agency’s offer for her to move to Macau, German, instead of dissuading her, reportedly just asked if she was interested in the offer. Vargas said it was she who turned it down, as she knew she could become an undocumented worker there, and also because she had no money for the placement fee that the agency was again charging her.
As a consolation, German reportedly told Vargas that she could claim her $4,000 from ATD, her agency in Manila, but did not give her an endorsement letter or any document that could help her pursue her claim.
The SUN tried to get German’s side on Jan. 11, but she said she was rushing to a meeting. She said she did not recall any case concerning the agency in question, and complained that the questions about it were making her tense.
Later, she reportedly told Vargas that The SUN should have asked for an appointment first if it wanted her side in the story.
Meanwhile, Vargas has decided to stay put. With help from the Mission for Migrant Workers, she has filed a claim against both her employer and her agency, saying “this is the right thing to do”.

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