Why Oil Refinery Workers are Striking for the First Time in Decades
PHILADELPHIA: Jim Savage, the leader of United Steelworkers Local 10-1 at an oil refinery on the south side of Philadelphia, hasn’t walked out yet. But he’s ready: Nine plants across the country have been on strike since Feb. 1 in the first nationwide oil worker strike since 1980. And if contract negotiations between the union and oil industry negotiators don’t wrap up soon, he might be called up, as well.
“People are nervous,” said Savage, standing in a gaggle of refinery workers waving flags at a rally last weekend. “We picked a fight with the wealthiest, most powerful people in the history of the world. So we’re either very courageous, or the stupidest people walking.”
Most of them don’t remember the oil workers’ last general strike. Since then, the Steelworkers (and predecessor unions) have managed to come to agreements with the 20 or so oil companies that negotiate as a group, ironing out a contract that now covers 30,000 workers — down from 50,000 in 1984 — and two-thirds of the nation’s refining capacity.
But this year, talks broke down. So, what’s the holdup?
At a time when membership has sunk, unions that control critical infrastructure — like oil refineries — are digging in. And the fact that the economy is finally recovering gives them more solid ground to stand on, since unions figure that companies have the margins to share a little extra.
Unlike many labor disputes, though — and in contrast with the AFL-CIO’s new focus on raising wages — this one isn’t about pay. While incomes for many Americans have stagnated or even declined, refinery workers’ earnings have kept pace with inflation over the past decade, staying around $62,000 per year in current dollars, plus substantial health care and retirement benefits. Most of the workers at the Philadelphia plant had little college education, if any, and the most experienced can make $35 an hour.
“We do pretty well,” says Savage. “This is about the best-paying job a guy like me is going to get.”
Rather, the Steelworkers say, this is about safety. There aren’t enough people working in the plants, they argue, and the companies work around industry standards to keep employees on the job more days in a row than they can handle without losing focus. “I’ve never been so exhausted since they instituted a fatigue policy,” Savage says. “They wouldn’t have to work people like this if they were staffing refineries properly, and they’re just not.”
Plus, the Steelworkers are upset by the number of maintenance staff that have been contracted out, coming in to do temporary jobs rather than staying with the refinery year-round. Though those contract workers are often unionized themselves, that means fewer jobs for the Steelworkers, who say that outsiders aren’t equipped to do the best job.
“The truth is, the people who work there on a day-to-day basis, they sort of have an inherent interest in making sure the job’s done right the first time,” says Tom Conway, the union’s International vice president, who’s taken the lead in the oil bargaining.
But have staffing and safety precautions really gotten so much worse in the three years since the last three-year contract expired?
There certainly have been a number of horrifying accidents over the past decade, from the explosion at Texas City in 2005 that killed 15 people to a flash fire last year that killed two in Galveston, Texas. In response, the Occupational Safety and Health Administration instituted tougher inspections, and the state of California just issued a report recommending stricter regulation and oversight.
Cumulatively, however, the rate of injuries is lower in petroleum refining than it is in other industries. The American Chemistry Council says that the OSHA-recorded injury rate of companies that belong to its safety membership program — which includes many of the major oil refiners — has been declining. And there’s no public data on staffing within the refineries, so it’s difficult to tell whether the oil workers are actually more overloaded than they used to be.
Here’s what may really be going on: As business has improved for the oil industry, companies haven’t put as much pressure on purely economic issues, like wages. The Steelworkers figure it’s finally time to get stronger health and safety language in their contract, which they haven’t been able to achieve in previous years.
“When the economy is in a recession, it’s usually not the time that these other issues come up,” says Michael Noel, an associate economics professor at Texas Tech who specializes in oil and gas. “Now that their jobs are more secure, it’s time to fix these safety issues.”
At the same time, this year Shell Oil — which bargains on behalf of the industry — brought on new labor experts for its negotiating team. Shell is fighting hard against the Steelworkers’ desire to have a say in staffing levels or the use of contractors. “One of the issues on the table is the company’s fundamental rights to staff operations according to business needs,” Shell said in a statement.
That tougher approach is apparent to the Steelworkers, as well. “Just in the last couple years, it’s gotten more focused, and it’s like the companies have no intention of doing anything on their own,” says Conway. “I’m truly surprised that they’ve taken it to this level, and have this sense that ‘no one will tell us about any of our operations.’ “
Thus, they’re at an impasse, and on strike — at a time when labor unions rarely exercise that right. There were only 11 strikes involving more than 1,000 workers last year, down from hundreds annually in the 1970s.
Unlike most workers in the modern economy, the oil workers have real leverage. Just like the longshoremen — who have been fighting with the operators of the west coast shipping ports, in a dispute that will shut down freight traffic over the weekend — they are key to the operations of critical infrastructure. The oil companies can’t keep their refineries running on back-office labor forever. And if they’re actually forced to shut down, the impact on gas prices could be swift.
As for the Steelworkers? Their resolve lasts as long as their strike fund, which pays out a few hundred dollars a week for people who’ve walked off the job. It’s taken a long time to build.
“I don’t know how this ends, but we’ve had enough broken promises,” says Jim Savage. “We always talk, but never fix.