Analysis: UK North Sea Strike Threat
Following a dispute between unions and the Offshore Contractors Association (OCA) over changes to terms for UK offshore workers, GMB announced May 21 a call for strike action.
The OCA, which represents service and engineering companies with a combined annual turnover of more than $4.5 billion, had been in talks with the GMB and Unite unions since the beginning of 2015. The OCA proposed pay cuts as a way for the industry to save money, as well as rota changes from two weeks on-two weeks off to three weeks on-three weeks off and changes to sick pay and holiday patterns.
Unions are upset at the proposed measures. GMB Scotland Regional Officer John Kelly claimed in a union statement that oil companies and contractors were “seeking to fundamentally attack the terms and conditions of our members employed in the offshore industry.”
Of particular concern to the unions are the rota amendments, with Kelly commenting that "any changes to rotas could have a serious impact on the safety of those working offshore" and urged companies to "rethink the proposals".
Unite Scottish Secretary Pat Rafferty was equally dismayed with the proposed changes.
"The industry agenda is clear in that it wants to impose a reduced number of employees to work longer and for much less. It’s a race to the bottom disease that is unsustainable and unacceptable," Rafferty said in a statement issued by his union.
In response to the opposition of the proposed changes from the unions, the OCA Chief Executive Bill Murray commented:
"The industry as a whole recognizes the need to make efficiencies and increase productivity in order to extend the life of the UK North Sea and maintain jobs in the sector.
"In its World Economic Outlook the International Monetary Fund highlighted that the UK has the highest operating costs of any oil producing country in the world. Even as the barrel price recovers there are other parts of the world that will be better placed to take advantage of this if we don’t manage our costs."
Murray has also stressed that the OCA's proposed rota changes are not an unusual practice in North Sea operations.
"Changes to equal time shift rotation are designed to reduce handovers and logistics costs and are not new to the North Sea. Any productivity changes required will be subject to change management and risk assessment and the unions have been offered the opportunity to participate in this," the OCA Chief Executive said in a statement from the organization.
Compromise & Future Talks
As the situation currently stands, neither side is willing to compromise enough to please the other, which has led to a call for strike action from both Unite and the GMB. Murray, understandably, believes strike action from the unions will be bad for the sector and ultimately to the detriment of its workers.
"Strike action will only serve to make investment in the North Sea less attractive and jeopardize the long-term future of the industry," Murray said in an OCA statement.
Despite Murray's warning, Unite and GMB have charged ahead with their threat and the unions are currently making the necessary arrangements to proceed with their industrial action. A strike is still not a certainty though, and both Unite and GMB have implied that the planned union protest in the UK North Sea can be avoided, should the OCA decide to backtrack its latest proposals.
GMB National Officer David Hulse commented in a union release:
"We remain available for talks should the employers want to pull back from going ahead with the unilateral changes to working practices that has provoked this dispute."
Unite echoed the GMB's idea that it’s still not too late to reach a deal.
"There is still time for the OCA employers to return with an improved offer that we can take back to our members but the ball is in their court," a Unite spokesperson told Rigzone recently.
It's not yet clear if the OCA is willing to change its proposals to cut costs in the UK offshore industry. Considering the current fiscal state of the oil market however, and the lack of progress in previous talks, it seems unlikely that the OCA will radically adjust the amends it has put forward, which suggests that the GMB-Unite strike may end up going ahead.
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