Brazilian Oil Workers Reject Wage Offer

Brazilian oil workers have rejected a 10.7% salary hike proposed by Petrobras and will decide next week whether to hold a three-day strike. A spokeswoman for Brazil's Oil Workers Federation, known as FUP, said Thursday workers found the offer made by Petrobras unacceptable as it doesn't make up for inflation over the Sept. 2002-Aug. 2003 period.

Workers are demanding a 15.5% readjustment to compensate for inflation, plus a 6.8% hike which would count as their share of the company's productivity gains in the period.

FUP members are planning to hold meetings between Oct. 13-17 to vote on a possible strike. Petrobras wasn't immediately available to comment. Brazil's oil workers went on a 24-hour strike in early September to ask Petrobras for the 22.3% pay increase.

Last week, Petrobras' Chief Executive Jose Eduardo Dutra said the 10.7% offer was "more than fair, and well above salary adjustments companies in the private sector are offering their employees." He also said his experience as a union leader made negotiations with FUP members much easier. "I understand where they are coming from, but they must understand the company can't accept all their demands," Dutra said.