Business_news Schlumberger is slashing its global workforce, but workers in 1 country say the company is taking advantage of weak labor laws to stiff them of fair severance

Business_news

An oilfield worker.

Kirk McKoy/Los Angeles Times via Getty Images


  • Schlumberger, a global oilfield services company,is cutting 21,000 jobsin response to the energy-market collapse.
  • Workers in Ivory Coast, a West African nation, say the company didn’t pay them fair severance when they were laid off this summer.
  • The workers said the company is taking advantage of weak labor laws and unions to cut costs, a tactic used widely by multinational corporations, according to a labor expert.  
  • Ivory Coast has poor protections for workers, according to a labor advocacy organization.
  • This story is for subscribers to business Insider. For a brief period, we’re making it widely available. For more information on a subscription to business Insider,click here.
  • Do you have information about Schlumberger? Reach out to this reporter atbjones@businessinsider.comor through Signal at +1-646-768-1657.
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As layoffs proceed at Schlumberger — the world’s largest oilfield services company — former workers in Ivory Coast say they’re being cheated of fair compensation.

Headquartered in Houston, Schlumberger is taking advantage of the West African nation’s weak governance and feeble unions to avoid giving the workers the pay they’re due under an employee agreement, they say. 

This practice is not uncommon among global corporations based in the West, according to Joe Drexler, an international labor expert and adjunct professor at the University of Denver. 

“The employers in Côte d’Ivoire do what they can get away with — which is almost everything,” Drexler said. 

Ivory Coast hasamong the weakest labor laws in the world, according to the International Trade Union Confederation (ITUC), an organization that advocates for workers’ rights. The country received ITUC’s second-worst rating in the organization’s 2020 global rights index, dedicated to countries where there are “systematic violations of rights.” (The US is in the same category.)

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In July, Schlumberger, which is present in almost 80 countries,said it would cut 21,000 jobsin response to the oil-price downturn. On Tuesday, the price of Brent, the international benchmark for crude prices, was down about 40% relative to the start of the year. 

Schlumberger did not respond to a request for comment. 

In March and April, the coronavirus pandemic caused demand for fuels like gasoline to collapse, plunging the price of oil to historic lows and forcing energy companies to rapidly cut costs. Many major oil firms, such as BP, Chevron, andExxon,have reduced their workforcesin the last few months. 

Do you have a tip about Schlumberger? Reach out to this reporter atbjones@businessinsider.comor through Signal at +1-646-768-1657.

The exterior of a Schlumberger Corporation building is pictured in West Houston

Reuters


Business_newsSchlumberger lays off workers in Africa

Following the fall in oil prices, Schlumberger in May said it would lay off 35 Ivorian workers, including engineers, analysts, and equipment operators, according to a document obtained by business Insider. The company had 60 workers in Ivory Coast before the pandemic, another document shows. 

The reason was that oil companies Schlumberger supports in sub-Saharan Africa canceled or suspended their projects, according to notes from an August meeting between Schlumberger, an Ivorian union representative, and a labor inspector to discuss workforce cuts.

The oilfield services giant has also cut local staff in other African nations including Cameroon, according to a union representative. The rep, a Schlumberger employee in another West Africa division, requested anonymity for fear of retaliation. business Insider has verified the person’s identity. 

Read more:Layoffs, furloughs, and dividend cuts: We’re tracking how 20 energy giants from Shell to Exxon are responding to the historic oil market meltdown

Business_newsWorkers allege Schlumberger cheated them of fair severance 

Four former Ivorian workers told business Insider that when Schlumberger laid them off, it didn’t pay them adequate severance and failed to uphold terms of a 2010 agreement 

The people requested anonymity for fear of retaliation. business Insider has verified their identities. 

According to the agreement, which business Insider reviewed, Ivorian workers are entitled to severance benefits including a fixed sum of about $5,400, in addition to two months of gross salary per year at the company, with a maximum of 36 months of payment.

When Schlumberger laid off workers, however, the company said the agreement was no longer valid and offered workers far less compensation, according to another internal document we obtained. 

For example, Schlumberger offered workers with fewer than five years at the company half a month’s salary per year of their tenure. The company didn’t offer a fixed bonus, according to the document. 

Three pay stubs seen by business Insider show that analyst roles at Schlumberger in the Ivory Coast earn a base salary of $400 to $600 a month. With various bonuses, however, analysts can earn over $2,000 a month, one of the former employees said.

To justify its reduced offer, Schlumberger cited a memo it sent to a union representative two years ago, which stated that it was canceling the 2010 employee agreement, according to the documents.

According to Ivory Coast labor laws, a company can choose to cancel an agreement, but it must follow specific procedures including providing notice, a justification for termination, and time for negotiations. 

The former employees said that Schlumberger did not meet those requirements, and they refused to agree to the new terms.

Workers on an offshore rig west of Abidjan, Ivory Coast

ISSOUF SANOGO/AFP via Getty Images


Business_newsNegotiations go nowhere

Schlumberger and an Ivorian union rep spent weeks this summer negotiating new terms of severance without reaching an agreement, according to several pages of documents reviewed by business Insider. 

By August, when the negotiations ended, Schlumberger had upped its offer: Workers who were with the company for fewer than five years received a month’s salary per year of employment, for example. Those who were with the company for more than 10 years would receive 1.5 months of salary per year of employment. 

Still, the former workers say the offer is far from the original agreement — and far from what they’re willing to accept.

The union representative from a different West African nation said it’s also less than what Schlumberger paid workers in other countries who were laid off. 

“IVC staff worked so hard for SLB for years, making huge sacrifices for the company even when the business was going well,” said one employee who was laid off. “We do not deserve this treatment.”

Business_newsMany African nations have weak labor laws

Unions and laws that protect employees tend to be weaker in parts of Africa, Asia, and Latin America, Drexler says. And it’s not uncommon to see large multinational corporations take advantage of those deficiencies to cut costs, he added. 

“Companies invest in these countries knowing that they can take advantage of underfunded unions or poor labor or environmental laws,” he said. 

The former workers say they’re prepared to go to court to fight for more compensation. 

Do you have a tip about Schlumberger? Reach out to this reporter atbjones@businessinsider.comor through Signal at +1-646-768-1657.

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