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Pay Deal Sets Pattern For US Oil Industry

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11 August, 2005ICEM News release No. 8/2002

American oil workers have accepted an offer from Shell Oil and its affiliated companies that will set the pattern for all contracts covered under the National Oil Bargaining Agreement.

The settlement was announced today by the Paper, Allied-Industrial, Chemical and Energy Workers (PACE) union.

Under the "pattern bargaining" system, pay deals with other companies covered by the National Oil Bargaining Agreement must meet this pattern settlement in order for the union to approve them. The previous national agreement expired today, and the new settlement will set the pattern for some 30,000 workers in the US oil and gas industry.

"In view of the events of recent months and the decline of the economic climate, this settlement represents optimism on the part of the oil industry and our membership," said PACE Administrative Vice President Jim Pannell. "We find ourselves in an increasingly difficult bargaining atmosphere. However, I feel we were able to reach an agreement that all involved can take pride in."

"This is the first round of bargaining in oil under our new merged union, and pattern bargaining has remained intact and effective," said PACE President Boyd Young.

Main points of the pattern settlement, which applies up to 31 Jan. 2006:


Effective Feb. 1 2002, all hourly wage rates will be increased by 85 US cents per hour.

Effective Feb. 1 2003, all hourly wage rates will be increased by 3.5 percent.

Effective Feb. 1 2004, all hourly wage rates will be increased 3.7 percent.

Effective Feb. 1 2005, all hourly wage rates will be increased 4 percent.

Percentage increases will be rounded to the nearest cent.

Health insurance: Employers reaffirmed their commitment to pay 80 percent of health insurance premiums, with employees contributing 20 percent of the cost.

Shift bonuses go up, from today, by 75 cents per hour for the 3 p.m. - 11 p.m. shift and by $1.50 per hour for the 11 p.m. - 7 a.m. shift.

The existing occupational death benefit of $250 000 will be increased to $500 000 for death which occurs as a direct result of a work accident.

- Various provisions on job security and health and safety are carried over into the new collective agreement.

At the global level, PACE is affiliated to the 20-million-strong International Federation of Chemical, Energy, Mine and General Workers' Unions (ICEM).