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BP postpones North Sea cutback plans

BP  postpones North Sea cutback plans
Oil giant BP has postponed plans to make cost-cutting moves on its North Sea platforms, it emerged yesterday.

Oil giant BP has postponed plans to make cost-cutting moves on its North Sea platforms, it emerged yesterday.

A spokeswoman for the company denied union claims, however, that it had performed a U-turn on the pay of contractor employees following strong opposition to the move.

She said a revised payment model would still be introduced in the future, although not before next year.

Jake Molloy, regional organiser for the RMT union in Aberdeen, had warned the energy giant there might be industrial action if BP did not rethink.

He said that several hundred people employed offshore by contractors including PSN, Wood Group, Salamis and Cape had faced reductions in their pay packages of between 10% and 20% from next month.

BP was targeting cuts in areas such as automatic nightshift payments to reduce costs in the tougher financial environment.

Mr Molloy said yesterday: “We are obviously delighted to hear about BP’s change of heart.”

The Unite union said the 90-day consultation period on changes to offshore rates of workers on BP platforms had now closed.

It added: “The proposal to adjust rates on October 1 has been withdrawn and no rates will change.”

Unite said this was a positive step.

BP said: “Having listened to feedback on the proposed changes to the basis on which Offshore Contractors’ Association (OCA) company employees working on BP facilities are paid, it has been decided to postpone any changes until further detailed analysis of options has been completed.

“BP is committed to creating a revised payment model that will incentivise productivity and efficiency gains, and will provide the opportunity for contractor employees to increase their earning capacity, but has recognised that it will take more time to define a workable model.

“BP would like to recognise the valuable contribution of the OCA companies.

“This is a positive outcome for a constructive consultation process.”

The Press and Journal reported in February that BP was asking its contractors and suppliers in its North Sea business to work with it to identify ways to reduce costs and improve efficiency after being hit by lower crude prices.

Last week, offshore union leaders threatened industrial action in the North Sea unless contractors ditched plans for a pay freeze. The GMB union said a consultative ballot of its members and also those of Unite was being organised in a move affecting thousands of offshore workers.

General secretary Keith Hazlewood said the vote followed a series of meetings with the OCA, which had not budged from its original position of having a pay freeze.

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