UPDATE: UK Offshore Oil Union Angered By BP Contractor Cuts
July 01 2009 - 12:52PM
Dow Jones News
One of the main unions representing the U.K. offshore oil and
gas industry responded angrily Wednesday to plans from oil giant BP
PLC (BP) and its contractors to reduce wages in order to cut
costs.
A BP spokeswoman said the changes still honor existing pay
agreements and cutting costs is important for the future of the
business.
"Our North Sea business is not sustainable at current oil and
gas prices. We need to take action to protect activity levels and
jobs," she said.
But Willie Wallace, regional officer for Unite in Aberdeen,
Scotland, said oil companies had "conveniently forgotten the record
profits they made last year on the back of high oil prices and now
that the oil price has fallen they want to attack our members' well
earned wages."
"BP are looking to make significant savings in the North Sea and
they are asking our members to bear the brunt of the cost savings"
through measures including wage cuts, said Wallace. "Our members
offshore have already reacted with anger at the level of the
proposed cuts."
The BP spokeswoman said that over the years, BP had paid certain
discretionary payments. "In the past, all OCA workers would get
paid one hour overtime whether they worked it or not ... now we
will only pay for overtime or a night shift when it is actually
worked," she said.
Workers will meet in the next few weeks to determine their
response to the plan, the Unite union said Wednesday.
The cuts will affect around 800 workers for contractors AMEC PLC
(AMEC.LN), John Wood Group PLC (WG.LN), Sparrows Offshore, RBG, BIS
Salamis, PSN and Cape PLC (CIU.LN), Wallace said. The contractors
have commenced a 90-day consultation with their workers on the
proposals, he added.
Construction projects at power plants, chemical plants,
refineries and gas import terminals were affected last week when
more than 4,000 contractors staged unofficial strike action to
protest job losses at Total SA's (TOT) Lindsey oil refinery in
eastern England.
Company Web site: http://www.unitetheunion.com
-By James Herron, Dow Jones Newswires; +44 (0)20 7842 9317;
james.herron@dowjones.com