Shell and USW 2015 Oil Bargaining - Just The Facts: Update

More than one month ago, Shell Oil Company sat down at the bargaining table with a negotiating team representing national leaders of the United Steelworkers International Union (USW). Shell’s goals were – and still are – to reach an agreement that respects the needs and interests of our employees and ensures the ongoing safety as well as economic health of Shell refineries and chemical plants.

To that end, to date Shell has put seven offers on the negotiating table. The USW International Union leaders have rejected all seven of them. In addition, they have ordered their members to strike at a total of 14 sites across the country, including the Shell Deer Park complex (refinery, chemical plant and lab); Motiva Port Arthur refinery; Motiva Convent Refinery; Motiva Norco Refinery; and Shell Norco Chemicals site. We’re extremely disappointed that the USW International Union has seemed unwilling to achieve a timely and reasonable agreement.

Indeed, we’re seeing little evidence that the USW’s leaders are interested in a meaningful settlement any time in the foreseeable future.

Shell is the lead company in a process called national pattern bargaining, under which Shell negotiates with the United Steelworkers (USW) regarding issues that affect the Company on a national level. If Shell and the USW reach an agreement regarding those national terms, that agreement is used as a pattern within the industry.

Since 1997, Shell has been in the role of lead company in this process. Shell is seen as an industry leader, with a fundamental value of respect for people and the environment. This is reflected in our commitment to safe and responsible operations.

What happens when a national agre What happens when a national agreement isn’t met?

The existing National Oil Bargaining (NOB) agreement with the USW expired Sunday, February 1, 2015, at 12:01 a.m. Shell has been negotiating with USW representatives since January 21, with the intent of reaching a mutually acceptable agreement. Regrettably, no agreement was reached before the expiration deadline.

Shell and/or Motiva owns/operates eight U.S. manufacturing sites, of which seven of those sites have employees who are represented by the USW.

We continue to enact our contingency plans across all impacted sites, utilizing trained and qualified Shell employees to operate in a safe, responsible manner.

We remain committed to providing the quality products that our customers depend upon.

The central issue standing in the way of a settlement is not safety or fatigue, nor is it even about healthcare or wages, as the union claims. Those things are important to all of us, and it’s important to share that we have engaged in productive negotiations regarding each of these issues.

The central issue of the USW’s national leaders is their continued demand that Shell replace routine maintenance contractors with USW-represented employees.

Our established practice of utilizing contractors supports the need for flexibility in hiring to accommodate economic cycles and maintenance schedules. And we’re open to a variety of ways to maintain a strong roster of skilled craftsmen available to each of our locations. But hiring flexibility is a proven way to protect our core Shell workforce and the long-term economic viability of our business. It is the most effective way to keep our sites running safely, efficiently and reliably. This strategy has served us well as we have not had to conduct any layoff in decades.

Shell looks forwards to continuing to dialogue with the USW to further these negotiations, and continues to be committed to resolving the remaining issues in order to arrive at a mutually satisfactory agreement.

Letter to USW Oil Workers
http://www.usw.org/news/media-center/articles/2015/letter-to-usw-oil-workers

This letter is being mailed to all USW Oil Workers and should arrive shortly. Click here to download a PDF of this letter on letterhead that you can print out and distribute at your local union hall, picket line, or facility.

As you know, we began our unfair labor practice strike on Feb. 1 at nine locations. Since then, we have expanded it to 15 locations and nearly 7,000 members. In the past few days, some companies have taken to writing letters to our members. These letters spin their positions about the negotiations and the offers they have made.

Safety is Paramount

During this round of negotiations, the union has made many proposals to address the safety and well-being of our members. While the companies have regurgitated some of the language of these proposals in their letters to employees, thereby giving the impression that they are actually bargaining over these issues, they have, in fact, only agreed to “meet and discuss” them. They have, up until now, adamantly refused to bargain in good faith over these critical matters.

The union has made specific proposals about how safety issues need to be assessed jointly with the local union and our safety committees and professionals. We’ve made proposals on how vacancies need to be reviewed and filled; on the way overtime and exceptions to the fatigue standards need continuous monitoring; and how we can insure safe staffing levels in the operations without undermining the bargaining unit. The company’s response has been to shut down any such discussion and to refuse any good faith bargaining over such issues.

The companies downplay our safety concerns. They seem to forget that not long ago seven of our co-workers were killed in a gruesome fashion at the Tesoro Anacortes plant. The companies may forget about this, but we cannot. In recent years, 27 oil workers have been killed on the job. This is a dangerous industry. We all know that, but we don’t have to run unnecessary risks every time we come through the gate.

We Do Dangerous Work

We’ve seen more recent fires and explosions, just like the recent one in Torrance, California, for example, and now the companies are trying to operate these facilities with people who are unfamiliar with the processes and equipment. In many cases, they have never done such work in their lives. Attempting such operations is arrogant and dangerous, and a threat to our communities.

We shouldn’t be expected to work long hours for weeks on end without a break. We shouldn’t be expected to work in places where, on average, we have a fire every week of the year. We shouldn’t be expected to work in places where equipment is old and in need of maintenance, but the company considers too costly to take off line and fix properly because it might slow production.

We shouldn’t have to sacrifice quality time with our families by working shifts and schedules that never end. We end up too exhausted to do anything other than grab a few hours’ sleep before heading back to work. We have the right to insist on better conditions.

We Know Best How to Keep Our Facilities Safe

On the particular issue of doing routine day-to-day repair and process maintenance work within the gates of the refineries, we have met the same stonewalling. The union has proposed a one-time comprehensive review of that work, conducted by the local unions and our knowledgeable craft members at the plant level. Our proposal includes specific time limits for completing the review and a process by which the parties can agree to develop a plan to assign it to our bargaining unit. It includes the flexibility to have certain of that work remain in the hands of contractors where that is suitable and where that makes sense for the local unions at the refinery level. Remember, this isn’t about outage, turnaround and new construction work that we are talking about unless we are currently doing some of that work. This is the day to day maintenance and repair work that is crucial to our ability to conduct ourselves as a union. The local union and company would jointly develop a plan and timetable for that day-to-day work to be performed by the bargaining unit. Furthermore the USW and the North America’s Building Trades Unions (NABTU) have reached an understanding regarding the types of work the USW is defending in our strike and the Building Trades have pledged their members will refrain from performing that struck work. The oil companies cannot whipsaw us against each other.

It also includes a provision for rebuilding our internal bargaining unit maintenance forces where necessary through recruitment, training of new hires and the assignment of these jobs for our bargaining unit. This is where these jobs belong! Our proposal also includes an enforcement process whereby we can insure our bargaining unit work is not diminished any further, and that, indeed, the day-to-day bargaining unit maintenance work we have lost will be recovered.

This provision enrages the company. They have intentionally allowed our skilled maintenance forces to erode over the years, and they very much like the arrangement. They refuse to replace retired members, rejecting any proposal that would include a mechanism for the local unions to have a real voice in the daily work done inside the refineries or who is performing that work. This situation as it currently exists has been allowed to go on for too long.

While it was well-intentioned many years ago as a means to supplement our workforce on a temporary or as-needed basis, it has been extremely abused by the oil companies. In many cases, our craft forces have been cut in half or more. We have a right to protect and defend our work.

Industry Greed Should Not Shortchange Us

We have tried to have discussions about the cost of health care benefits. In particular we want to discuss the huge out-of-pocket expenditures for a single person or a family. The company has refused to even consider such a change. These companies can well afford a backstop for families that incur such high costs in a year so that they run up against their out-of-pocket maximums. We have been asking for a minor reduction in that maximum level that is not even pennies on a dollar, but they insist they will not budge on this matter. This treatment from a multi-billion dollar industry is mean-spirited and unnecessary.

Wages have not been the center piece of these negotiations, and while we note the companies’ references in their letters to current oil prices, we also note the billions of dollars they have earned over the term of our last labor agreement. While we have issues that must be addressed, we expect a fair and honest economic offer.

We also note that while gas prices have declined at the pump, the costs of inputs to the refinery have as well. The spread of the value we add to the product has become even greater. We are an efficient and productive workforce and that needs to be recognized.

Our Issues are Important

This round of oil bargaining is different than some of the past. There is no question about that. The National Oil Bargaining Conference, which is made up of all our oil local union leadership, unanimously adopted this agenda in October of last year. The USW bargaining team and the Oil Policy committee have worked hand-in-hand throughout this set of negotiations.

We are committed to bargaining a fair contract that we can insure gets implemented. There is a history of the companies’ settling agreements by promising to address critical issues, but ignoring them after bargaining has concluded.

They “meet and discuss.” That’s it. They have not bargained with us in good faith. That’s been the case with our health care committees and the fatigue standards that they abused. We can’t accept more open-ended promises. We need to be able to enforce all aspects in our contracts, and if the company means to do what it claims, then they should not be afraid of that idea.

Be Informed

To keep updated on our fight, opt into our daily text alerts (text oil to 47486), look for our regular bargaining updates or go to www.oilbargaining.org.

In solidarity,

Leo W. Gerard
International President

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