Freelance oil workers forced to take pay cut

HUNDREDS of workers in the oil industry were forced to take a 10 per cent cut in their wages yesterday because of demands by the oil companies for offshore contractors to cut costs.

The cuts, for freelances who find work through agencies, hit workers on the design and maintenance side of the industry. But they are being seen by many as the start of a pay squeeze that could move into all areas on and offshore.

Self-employed workers form between 60 per cent and 70 per cent of the design side of the industry, which is responsible for maintenance and modifications of platforms. They range from chartered engineers, who can demand up to pounds 350 a day, to clerks, who command about pounds 8 an hour.

The Manufacturing, Science, Finance union, which has several thousand members in offshore oil, estimated that up to 75 per cent of the 30,000 employees in the industry would eventually be affected by the calls for cuts. But an Aberdeen-based agent said only 600 faced an immediate drop in pay.

Jimmy Inglis, Aberdeen regional officer for MSF, said talks had been taking place between the oil companies - primarily Shell Expro and BP Exploration - and contractors such as Brown and Root, Amec Engineering, John Brown Engineering, and others, aimed at cutting costs in a market where production has fallen from 117 million tonnes in 1987 to 83.1 million last year.

'At the moment, agency workers are the ones being affected, but inevitably, the contractors' own employees may be hit,' Mr Inglis said. 'The oil companies are pushing for 10 per cent cuts in return for the promise of longer contracts, from two years to five.'

The agent, who asked not to be named, said only 600 workers from design specialist companies were likely to be affected, but he added: 'The oil companies are looking for ways and means to cut costs. It could well be that other people are in line for wage cuts.'

Shell confirmed that it was holding discussions about 'the cost-effectiveness of services' provided by the contractors, but refused to discuss cuts. BP said it had told several dozen freelance chartered engineers last Friday that it intended to drop their rates from pounds 350 to pounds 325 a day, but it denied pressing contractors for 10 per cent cuts in costs.

However, one oil company said: 'We expect sacrifices in the bad times just as we are happy to see them prosper in the good times.

One affected freelance said: 'I was told by my agent that my rates would be reduced by 10 per cent from 2 August.' He said the cut came after two consecutive years when rates were frozen.

PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksNow available in paperback
News
people

Actress isn't a fan of Ed Miliband

Arts and Entertainment
Rooney Mara plays a white Tiger Lily in forthcoming film Pan
filmFirst look at Rooney Mara in Pan
Life and Style
health

Do you qualify – and how do you get it?

News
Food blogger and Guardian writer Jack Monroe with her young son
people
News
i100
News
Privately schooled, Oxford educated and a former editor of arguably the world's poshest magazine 'The Lady', it's perhaps unsurprising that Rachel Johnson rarely mixes with ordinary Proles.
people

The Mayor of London's sister, Rachel Johnson, apologises for shocking tweet about the PM

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

h2 Recruit Ltd: Business Development Manager / Invoice Finance £75k OTE

£40000 - £50000 per annum + £75,000 OTE Car+Mobile : h2 Recruit Ltd: Business ...

h2 Recruit Ltd: Business Development Manager-Managed Services-£80,000 OTE

£45000 - £80000 per annum + £80,000 OTE + Car,benefits: h2 Recruit Ltd: Busine...

Langley James : IT Sales Executive;Borehamwood;£40k(neg) uncapped comm£100k+OTE

£40000 per annum + £100k+ OTE: Langley James : IT Sales Executive; connectivit...

Recruitment Genius: Web Designer

£20000 - £28000 per annum: Recruitment Genius: Award winning Peterborough base...

Day In a Page

Homeless Veterans Christmas Appeal: Drifting and forgotten - turning lives around for ex-soldiers

Homeless Veterans Christmas Appeal: Turning lives around for ex-soldiers

Our partner charities help veterans on the brink – and get them back on their feet
Putin’s far-right ambition: Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU

Putin’s far-right ambition

Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU
Tove Jansson's Moominland: What was the inspiration for Finland's most famous family?

Escape to Moominland

What was the inspiration for Finland's most famous family?
Nightclubbing with Richard Young: The story behind his latest book of celebrity photographs

24-Hour party person

Photographer Richard Young has been snapping celebrities at play for 40 years. As his latest book is released, he reveals that it wasn’t all fun and games
Michelle Obama's school dinners: America’s children have a message for the First Lady

A taste for rebellion

US children have started an online protest against Michelle Obama’s drive for healthy school meals by posting photos of their lunches
Colouring books for adults: How the French are going crazy for Crayolas

Colouring books for adults

How the French are going crazy for Crayolas
Jack Thorne's play 'Hope': What would you do as a local politician faced with an impossible choice of cuts?

What would you do as a local politician faced with an impossible choice of cuts?

Playwright Jack Thorne's latest work 'Hope' poses the question to audiences
Ed Harcourt on Romeo Beckham and life as a court composer at Burberry

Call me Ed Mozart

Paloma Faith, Lana del Ray... Romeo Beckham. Ed Harcourt has proved that he can write for them all. But it took a personal crisis to turn him from indie star to writer-for-hire
10 best stocking fillers for foodies

Festive treats: 10 best stocking fillers for foodies

From boozy milk to wasabi, give the food-lover in your life some extra-special, unusual treats to wake up to on Christmas morning
Phil Hughes head injury: He had one weakness – it has come back to haunt him

Phil Hughes had one weakness – it has come back to haunt him

Prolific opener had world at his feet until Harmison and Flintoff bounced him
'I have an age of attraction that starts as low as four': How do you deal with a paedophile who has never committed a crime?

'I am a paedophile'

Is our approach to sex offenders helping to create more victims?
How bad do you have to be to lose a Home Office contract?

How bad do you have to be to lose a Home Office contract?

Serco given Yarl’s Wood immigration contract despite ‘vast failings’
Green Party on the march in Bristol: From a lost deposit to victory

From a lost deposit to victory

Green Party on the march in Bristol
Putting the grot right into Santa's grotto

Winter blunderlands

Putting the grot into grotto
'It just came to us, why not do it naked?' London's first nude free runner captured in breathtaking images across capital

'It just came to us, why not do it naked?'

London's first nude free runner captured in breathtaking images across capital