North Sea labor strikes suspended

Labor leaders say they're protesting pay and allowance cuts of up to 30 percent.
By Daniel J. Graeber  |  Aug. 12, 2016 at 6:47 AM
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LONDON, Aug. 12 (UPI) -- Labor strikes over pay for North Sea oil workers are suspended while all parties to the dispute sit down for a new round of talks, lead negotiators said.

Strikes against oilfield services company Wood Group have been staged sporadically on platforms in the North Sea operated by Royal Dutch Shell.

"Wood Group and the Unite and RMT unions can confirm we have agreed to restart the process for resolution of the current dispute," a joint statement read. "We will hold a number of full-day meetings over the next few weeks, starting early next week, to take a fresh look at the issues."

The labor unions said their recent action, which they said is the first in more than 25 years, was in protest of potential pay cuts of up to 30 percent.

Wood Group this year cut rates paid to its North Sea contractors by about 9 percent because of negative market pressures. The company's rate reduction follows a 10 percent decrease for onshore contractors in 2014. The company said additional cuts would give the company the room needed to move through the market downturn.

Shell, for its part, has trimmed thousands of people from its payroll and announced plans to leave oil and gas operations in up to 10 countries as it streamlines its operations in the wake of its mega-merger with British energy company BG Group.

Energy companies are under pressure from lower crude oil prices, an economic situation compounded by the British decision in June to leave the European Union.

Scottish Member of Parliament Dave Anderson met with labor leaders earlier this week to discuss one of the biggest labor disputes to strike the North Sea in a generation. The North Sea, he said, is vital for the regional economy.

"In the North Sea and right across the country, we need an economy that works for the many and not just the few," he said in a statement.

Less than $1.4 billion in spending on new projects in the North Sea is expected in 2016, compared with an average of around $7 billion in the past five years.

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