The Fair Work Commission (FWC) has made recommendations help resolve an ongoing pay dispute between Chevron and unions at two of the world’s largest gas projects in the Pilbara.
Key points:
- The proposal includes a $7,000 travel allowance and extra pay when planes to take workers home are late
- The two sides have until 9am Friday to accept or reject the proposal
- If rejected, there will be a hearing to determine if the commission needs to take a bigger role in finding an outcome
About 500 workers have been part of industrial action at Chevron’s Wheatstone and Gorgon liquid natural gas operations since September 8, over pay and working conditions.
The action escalated to one-hour strikes at the weekend.
The American multinational and the Offshore Alliance, a partnership between the Australian Workers’ Union and the Maritime Union of Australia, have been to the negotiating table several times, with the latest attempt ending without a deal on Wednesday afternoon.
The two parties are set to go back to the FWC for a hearing on Friday morning, but have been presented with a possible path to a resolution.
FWC commissioner Bernie Riordan released a set of recommendations today on 11 outstanding issues between the alliance and Chevron.
“In my view, the parties are close to achieving their desired outcome of registered enterprise agreements to cover the wages and employment conditions,” he wrote.
“It would be a very unfortunate circumstance if the parties did not utilise the good work that has been done during this period.”
What’s been recommended?
Commissioner Riordan’s recommendations include all staff receiving a $7,000 travel allowance, increasing the limit on automatic progression, and ensuring job security for employees subject to the agreement.
A major point of contention has been around pay on the day workers return home from site.
The agreement being negotiated currently includes a “field loading allowance” to partly compensate for delays in getting workers home, but additional payments around late planes resulting problems such as missed connecting flights have been a source of disagreement.
Commissioner Riordan recommended that where flight delays could be attributed to Chevron, it should make payments to impacted staff.
“If the plane is more than two hours late … then Chevron will be required to pay each employee four hours pay at [overtime] rates,” he said.
“If the plane is more than four hours late, then Chevron will be required to pay 12 hours pay at [overtime] rates.”
If a connecting flight was then missed, Chevron would have to pay for accommodation and meals, under the recommendations.
What’s in dispute?
Chevron is the last of the major oil and gas producers in Western Australia to reach a new enterprise agreement with its workers in recent years, against a background of sizeable industry profits.
Preliminary analysis by consultancy EnergyQuest from earlier this year suggested the value of Australia’s LNG exports in 2022 went up 86 per cent to $93 billon.
Chevron itself posted a record $56 billion ($US36 billion) profit from its global operations in 2022.
Shell, Inpex and more recently Woodside have all reached agreements on increased pay and conditions since last year.
In Shell’s case, workers took 76 days of industrial action before getting an outcome, which the unions estimated cost the company $1.5 billion.
The Offshore Alliance said it wanted Chevron workers to enjoy similar conditions to those at the other companies.
But Chevron has insisted it has offered terms on par with other companies in the industry.
Commissioner Riordan’s recommendations show that travel allowances, hours worked, penalty payments for transit flight delays, sharing of worker accommodation, training, progression and several other issues remain in dispute between the two sides.
What happens next?
Chevron and the Offshore Alliance have been given until 9am Friday to accept or reject the proposal from the FWC.
If the two do not agree, then Chevron’s application for “intractable bargaining” will be heard.
Intractable bargaining is where an employer and employees cannot reach a deal on an enterprise agreement, which is a minimum set of standards for employment terms and conditions.
New federal laws that came into effect in June mean the commission would then intervene, by either forcing the two sides to continue negotiations or coming up with an outcome itself.
If the dispute reaches the intractable bargaining stage, it would be the first time the new law has been put into action.
Chevron and the unions are reviewing the recommendations from the FWC.