Last week, it was reported that ExxonMobil activities were disrupted by its ex-employees as the oil giant embarked on a mass restructuring to combat the declining oil profits.
Mobil Producing Nigeria, one of its affiliates, has faced challenging year especially with the global nosedive of crude oil prices combined with the recession. Its profitability has been the worst in recent history. Revenue is down by almost three quarter while the company has been struggling with its earnings to get contractors and employees are paid.
Steps taken by the organization to ensure survival include scaling down operations, reducing personnel, deferring projects and renegotiating contracts.
BusinessDay investigations reveal that the employees affected are only about 6 percent of the workforce, and were offered an enhanced benefits package in excess of the provisions of the Collective Bargaining Agreement (CBA) signed with the in-house Union.
Post-employment support programs to support their transition period from the company were also included in the package. The severance payments driven by years of service and additional redundancy gratuities are in some cases up to N350m for an employee.
According to internal memo sighted by BusinessDay, average payment per person hovers around N140m. The pay package covered redundancy pay of about 36 months basic salary, Settling-in allowance of up to 2 months basic salary, additional pay to address economic realities of up to 3 months basic salary, and Notice pay of 3 months basic salary!
The labour union within the oil firm said the company “disregarded laid down procedures and humiliated them’ by serving them sack letters when all avenues to achieve peaceful resolution were yet to be explored”.
However, labour analysts who spoke to BusinessDay said that neither the Nigerian Labor Law nor the Collective Bargaining Agreement (CBA) with the Union requires alignment between the Company and the Union in the event of redundancy actions.
The CBA (Clause 23b) states that “whenever redundancy actions are contemplated, the Company shall inform the Association of the intended action and the Association may bring to the Company’s attention any problems that it believes are involved”.
Similarly, the Nigerian Labor Act (Clause 20a) states that “In the event of redundancy, the employer shall inform the trade union or workers’ representative concerned of the reasons for and the extent of the anticipated redundancy”.
Our source said that despite this, the company’s management engaged in discussions with the union for over 3 weeks about the anticipated action with a view to obtaining some understanding based on the challenges the company has been facing.
The analysts said that because the union disagreed with the company’s notification, they abandoned the provisions of their CBA which specifically states in Clause 13b that “if a dispute arises during the subsistence of the Agreement, either party shall comply with the current law governing Trade Disputes in Nigeria and neither party shall resort to arbitrary strike action or lockout”.
There is need to speedily resolve this face-off as the country which is grapples with sustaining oil production and obtaining the dollar revenue.
FRANK UZUEGBUNAM
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