Update: Workers at ConocoPhillips’ UK plant set to vote on industrial action

The article below was originally published on Tuesday, May 16, 2016. It was updated on Wednesday, May 17, to include a statement by Hertel UK.

Members of Unite, the UK biggest union, working for Hertel UK, at the Teesside oil refinery, are to be balloted for industrial action in a dispute over pay.

According to the union, the company has been notified that workers who provide repair and maintenance services for the global oil giant ConocoPhillips will start voting for strike action or industrial action short of a strike from Friday May 20. The ballot closes on June 1, Unit said in a statement.

The union says the dispute is over the refusal of employers to improve on its zero per cent pay offer for 2016/17 – a decision deemed unacceptable by the union.

Industrial action at the Seal Sands site near Middlesbrough will seriously impact operations causing a possible shutdown of the site, warned Unite.

Unite said it was urging Hertel and ConocoPhillips to sit down and come up with a sensible pay deal that the unions (Unite and GMB) can recommend to members.

Steve Cason Unite regional officer said: “The clock is ticking for Hertel and ConocoPhillips with a real threat of a walk-out unless there is some movement to address our members’ concerns.

“We held a constructive meeting with Hertel’s management team but despite some progress being made, it was made clear that ConocoPhillips would not fund a pay increase.

“Hertel has been told in no uncertain terms that the zero per cent pay offer currently on the table is not something our members are prepared to accept.

“Strike action is always a measure of last resort. All our members want is a fair pay deal, one that that recognises the work that they do. They have already signalled that they are prepared to take action to get pay justice and will not be swayed by the employers’ redundancy threats.
“There is still time to bring this dispute to an end but the ball is now firmly in the employer’s court. We are urging Hertel and ConocoPhillips to sit down and come up with an affordable and sensible pay deal or risk major disruption on the site.”

Unite is seeking an improved pay offer, over three years, linked to NAECI pay rates, of 1.5 per cent in the first year, 2 per cent in the second year and 2.5 per cent in the third year.

ConocoPhillips operates the Teesside terminal, with operations comprising both processing and tanker-loading facilities covering a 307-acre site at Seal Sands, at the mouth of the river Tees.

Crude oil and natural gas liquids from ConocoPhillips’ J-Block and Greater Ekofisk Area offshore fields are delivered to Teesside as well as third party volumes from other areas of the North Sea.

Hertel: Rates on par, or higher than many

Following the warning by the union, Hertel UK has issued a response saying that the trade union in fact has decided to end further planned discussions, and it will ballot for strike action among its 66 members who are employed by Hertel UK at Seal Sands.

In an email sent to Offshore Energy Today, Hertel says that the pay claim is made in the face of the “widely acknowledged financial difficulties being experienced in the oil and gas sector.”

The company says that in an attempt to protect jobs and investment at the site, the majority of workers at the Seal Sands have already accepted a pay freeze.

“The rates of pay for most contractors on the site are on a par with, or higher than, many in the area. In addition, site rates have been maintained throughout this difficult period while other oil and gas companies have made cuts to rates of pay.”

The company has also revealed that the potential disruption caused by UNITE’s “continued threats of industrial action in recent months” has led to ConocoPhillips to cancel its maintenance shutdown which was planned for next month.

UNITE’s decision has seen the loss of investment and additional earnings, Hertel says. The loss of this work has taken millions of pounds out of the Teesside’s economy and would have given many employees on the site an opportunity to earn thousands of pounds in additional earnings and bonuses, the company added.

Minority pushing for pay rise?

What is more, Hertel claims that Unite has been told on several occasions during its campaign for industrial action that the cancellation of the shutdown could lead to possible job losses. As a direct result of the union’s actions, there are currently more than 50 employees at risk of redundancy, the company said.

David Massey, Hertel UK’s HR Director, said: “During these difficult times for the oil and gas sector, contractors, workers and employees are trying to protect future investment and jobs. At the same time, we have a minority of UNITE members who are seemingly intent on pursuing a pay increase which is simply not affordable in the current circumstances.

“UNITE issued a press release on 4 February 2016, asking for Government support to protect the oil and gas sector due to the staggering profit losses which are being incurred yet in Teesside the same trade union is looking to instigate industrial action seemingly oblivious to the extreme financial pressures which the industry faces.

“The implications of this action are likely to be a further reduction of investment and the possibility of further job losses. This is something we do not want to see happen on Teesside.”

This article was originally published on Tuesday, May 16, 2016. It was updated on May 17, to include a statement by Hertel UK.