EXTRACT: “…this company is run by a bunch of ruthless bastards who would sell their grannies to improve shareholder returns, along with their ever increasing personal bonuses and pensions…”
By John Donovan
We are already aware of the deplorable way Shell is treating IT staff. This week we heard from a Shell insider claiming to represent Shell North Sea employees who apparently are also being treated like commodities, rather than human beings, many of whom until recent events, had a genuine affection for Shell as a company.
Immediately below are extracts from the email received. This is followed by my self-explanatory email correspondence with Mr Michiel Brandjes at Shell and then the information supplied by the insider, which I have identified as Documents 1, 2 & 3.
Finally, I have added three related items published in “Blowout” magazine (Summer 2007 edition). These items were not supplied to Mr Brandjes.
I feel sure that former Shell Group Auditor, Mr Bill Campbell, will be interested in the information supplied as it touches on safety issues on Shell North Sea platforms.
I have not gone into detail about the specific grievances involved because these matters are eloquently covered within the information set out below. Suffice it to say that Shell’s treatment of its employees directly contradicts Shell’s Statement of General Business Principles pledging honesty, integrity, transparency and respect for people in all of Shell’s dealings. Shell employees are decent hard working people and deserve to be treated fairly and with respect.
Email received from a Shell insider
As you are aware, Shell on in the middle of divesting 5 platofrms in the North Sea….
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Eider
Tern
North Cormorant
Cormorant Alpha
Dunlin
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We are seeking help from the unions and we are strongly against the way Shell are trying to offload its loyal workforce ‘on the cheap’.
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Please see the attached - feel free to use these as you see fit - we are happy for this to appear in press articles, on your website etc etc etc.
Email correspondence with Shell
—–Original Message—–
From: John Donovan [mailto:john@shellnews.net]
Sent: 30 January 2008 13:32
To: Brandjes, Michiel CM RDS-LC
Cc: van der Veer, Jeroen J RDS-CEJV; Brinded, Malcolm A RDS-ECMB
Subject: Shell North Sea Platforms
Dear Mr Brandjes
I have today been contacted by a Shell insider claiming to represent staff on Shell North Sea platforms.
I intend to publish all of the information supplied, but as per our normal practice on such serious matters, I invite Shell to supply for unedited publication any comments you might wish to make. If you inform me that any statement or allegation is categorically untrue, I will take appropriate action.
Could you kindly let me know today if you wish to take up the invitation?
There are three separate documents which I have printed in full below, plus one pdf file which I have attached.
Best Regards
John Donovan
Royaldutchshellplc.com
REPLY FROM MICHIEL BRANDJES
From: michielbrandjes
Sent: 31 January 2008 09:34
To: john@shellnews.net
Subject: RE: Shell North Sea Platforms
Dear Mr Donovan,
Shell does not wish to take up the invitation.
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The lack of a rebuttal from, or comment by, Shell does not in any way constitute an acceptance on Shell’s part of the accuracy of any of the materials forwarded by you, whether now or in the future, and whether on this or on any other matter, and we continue to reserve our position accordingly in respect of those matters.
Best Regards,
Michiel Brandjes
Company Secretary and General Counsel Corporate
Royal Dutch Shell plc
Registered Office: Shell Centre, London, SE1 7NA, UK
Place of registration and number: England, 4366849
Correspondence address: PO Box 162, 2501 ANÂ The Hague,
The Netherlands
Internet: http://www.shell.com
RESPONSE BY JOHN DONOVAN
From: John Donovan [mailto:john@shellnews.net]
Sent: 31 January 2008 10:28
To: ‘michiel.brandjes@shell.com’
Subject: RE: Shell North Sea Platforms
Dear Mr Brandjes
Thank you for your response which, as promised, will be published unedited (along with the entire correspondence on this matter).
Regular visitors to our website will be aware that you have chosen on occasion to comment on the content of draft articles about Shell which we have submitted to you prior to publication. We will leave it to our readers to draw their own conclusions over the decision to supply a standard response on this occasion which completely ignores the important issues and allegations made against Shell. You were invited to point out any categorically untrue allegations on the basis that we would take the appropriate action i.e. we would delete any such allegation. Obviously if evidence later emerged which proved that an allegation was in fact well founded, that would be another matter.
I note the warning that Shell continues to reserve its position on these matters. In this connection, I would point out that no other publisher gives Shell the opportunity which we do to provide for publication on an unedited basis, any response Shell wishes to make. We bend over backwards to be fair and reasonable to Shell, even on one occasion acceding to a request not to publish an article at all because of the sensitivities which were involved.
Shell shareholders might be surprised to find out that we have your written permission to vet incoming email meant for Shell (which includes job applications and business proposals) and to use our discretion to decide what is appropriate to pass on to you and what can be discarded e.g. junk mail. A judge might also find the relationship to be unusual to say the least.
Finally you may be interested in the website traffic this month on www.royaldutchshellplc.com: over 6.5 million hits and more than 4 million page downloads. I note that Shell has not responded to our challenge to reveal the monthly traffic figures on your portal site www.shell.com
Best Regards
John Donovan
Royaldutchshellplc.com
FIRST DOCUMENT
SHELL SHOCK
Part One
For decades Royal Dutch Shell has attracted adverse criticism about its activities globally. Environmental issues, health and safety breaches, price fixing, misreporting of non-existent reserves, the list goes on. This magazine has been critical about Shell’s health and safety record and treatment of contractors’ employees on its North Sea platforms. But one area in which the oil giant has avoided criticism is employment practices exercised toward its own staff. The company has had the reputation of being a good employer. Good salaries, excellent career development opportunities capped off with a nice golden handshake and pension to see one through to the grave. Not anymore!
Shell has turned on the one group that has delivered consistently for it down the years - the Shell offshore workforce! Shell employees are witnessing a new face on the company they previously felt connected to and confident with. Job security, career development and cash safety nets if terminated early have all been brought to an end. Except, of course, for those who single-handedly almost destroy the company misreporting non-existent oil reserves, as did ex-Chief Phillip Watts. He bailed out with a multi £million pay-off and a super-charged pension for life!
Shell is about to divest installations in the North Sea and Shell staff thereon with a few years company service have been “ring-fenced” and denied opportunities to pursue alternative career opportunities within the company. Instead they will remain fixed where they are and be transferred to incoming operators about to take over the installations on which they serve. Many of the staff involved are relative new-starts having been head-hunted to help sort the mess created by the Shell’s seriously flawed cost-cutting exercise OBIP (Offshore Business Improvement Plan). The were enticed into Shell with promises of “a long and prosperous career with Shell, the only one who can hold you back is you.”
Having since worked to keep the ageing and partially knackered platforms producing and fit for sale these employees are now to be dumped into the employ of the new operators’ proxy contractor and now face a less certain future.
Some Shell staffers have accumulated decades of service but they have also been “ring-fenced” thereby denying them opportunities to work out the remainder of their careers with the company and also denied the golden handshake recently unilaterally withdrawn by Shell. Having witnessed over the years many so-called ‘dead wood’ colleagues culled through the use of substantial financial packages to induce exit, they stayed on and committed themselves to the company ultimately to be well and truly shafted. OILC and Amicus are supporting their respective members through the internal grievance process. This process looks destined to end in stalemate and almost inevitably the matter is heading to the Employment Tribunal. In the meantime the workers are organising under the union banners and anticipated is a joint application for trade union recognition.
These events are a spin-off from Royal Dutch Shell PLC’s global mid-life crisis. Oil prices are not far off $100 a barrel and year-on-year earnings in the third-quarter 2007 were up 16.4% - but profits were down 13%. Oil prices, once the key contributor to the earnings growth of oil majors, are now so high they are hurting refining margins, driving industry-wide cost inflation and encouraging governments everywhere to seek bigger shares of the booty. Shell’s reserves replacement ratio has been negative for years and while the company is a long way from becoming a pub with no beer the overly-long delay in accessing the Iraqi oilfield bonanza is not helping it or other western oil companies.
In 2008 Shell will launch a multi-pronged reorganisation that will include outsourcing 3,000 computing staff, cuts to finance positions, reshaping expatriates’ packages and a restructuring its Nigeria ventures. Already in 2007 steps were taken to reduce group-wide costs by $500 million a year. A Shell manager who declined to be named said that the reserves misreporting scandal in 2004 caused a wholesale top management reshuffle but left the second and third tiers of the senior management corps largely unscathed. This will change in 2008 but, and in contrast to the scrapping of golden parachutes for offshore Shell staff, Shell suits at London HQ will enjoy enhanced termination packages designed to staunch the wounds about to be sustained in the approaching night of the long knives.
A major factor in the drive for change is the internal manoeuvring by key figures in their quests for the top job. Successful implementation of the restructuring and cost-cutting scheme will be critical in selecting the next chief executive before current CEO Jeroen van der Veer leaves in 2009. Two front-runners tipped to succeed him are chief financial officer Voser and exploration and production chief Malcolm Brinded (he of OBIP fame). Successful financial restructuring will boost Voser’s chances while Brinded will make sure the numbers within the exploration and production division make him look good.
Shell’s North Sea staffers, particularly those about to be dumped, will feel satisfaction and pride when contemplating their personal role in the greater scheme of things. For so many years they made Brinded look good and got him to where he is today. Their Shell careers are about to be cut short in furtherance of this very same cause.
Part Two
recurring theme, particularly on Shell’s North Sea platforms, is maintenance backlog. How much maintenance has been avoided, shelved or just generally fiddled off the backlog registers is anyone’s guess, including Shell’s. Given the evidence at the Brent Bravo Fatal Accident Inquiry (two fatalities in 2003 caused ultimately by cut-backs in maintenance) we may safely assume that a fair proportion of the ‘red lights’ uncovered by the HSE KP3 inspection program likely exist on Shell platforms (see pages 2 & 3).
Of course it takes time and a special talent to screw things up to this extent and Sigma 3 (motto: delivering excellence) and OBIP each played a part. OBIP (Offshore Business Improvement Plan) was Shell’s misguided and subsequently very costly experiment in minimal maintenance. Patched hydrocarbon pipes, botched repairs, safety critical plant not functioning as needed, fiddled documentation and the tragic loss of two colleagues, are OBIP legacies. The Sigma consortium (members include AMEC and Wood Group) was tasked by Shell under the terms of OBIP to maintain the platforms subject to incentives to reduce expenditure on maintenance. The outcomes were predicted.
Shell is presently offloading production platforms as it prepares to bail out of the North Sea. Entities lower down the food chain are positioning to acquire the assets and hope to maintain commercial viability way beyond what Shell thinks is feasible under its own management. The Sigma contribution will be crucial not just for the success of the post-Shell ventures but also generally for the future of the UK oilfield. Viability when the super-majors depart will depend on consortia like Sigma being up to the mark and fit for purpose.
Directly employed Shell employees on the platforms in question are presently getting thoroughly abused as Shell prepares to dump them into the employ of the incoming bottom feeders (see facing page). The platforms are to be handed over as going concerns. Some of the operatives were only recently elevated to directly employed status so will have a fair idea of what they are about to return to. Longer serving Shell staffers are about to get a rude awakening when first encountering life downstairs. Take, for example, the contractors’ strong-arm tactics to establish institutionalised compulsory overtime on the Shell platforms.
We know from internal documentation that the contractors’ men have no problems working overtime on production, safety and integrity issues, as and when these issues arise. They realise the importance of ensuring the platform is on track and working to the best of its capabilities. However, routine scheduled overtime they are under pressure to work on backlog, compliance, preparation/scheduling is, the men feel, outside this scope.
Terms & conditions lay down normal hours as 12 comprising a 10.5-hour shifts plus meal and tea breaks. Scheduled working over and above this shall be avoided as far as is practicable subject to a proviso that reasonable additional hours may be required to cover essential and safety critical work. What constitutes essential and safety critical? The workforce say breakdowns and safety-related problems, management says ANY work (they think) is REASONABLE.
The dispute focuses on what “reasonable” actually means and Jim Quinn, Sigma’s contract team leader, being an entirely reasonable manager wanting the overtime worked, is in no doubt that it is the workforce being entirely unreasonable. He asks in an Email to the Tern platform Nov. 2007: “Is this a F&%*ing 1960’s car plant or shipyard? Has anyone here ever been in a real job?”
He did expect challenges when introducing the behavioral changes necessary and introducing the terms “reasonable” and “cooperative” into what has previously often defaulted to an adversarial or “what’s in it for me” relationship. Good to see that this is a management with the knack of turning things around.
Mr Quinn continues: “Backlog on safety critical systems is at appalling levels by any standard and is an issue with the HSE which if we do not reduce to the scorecard targets and sustain it at these levels then the customer is likely to receive an improvement or prohibition notice. This is neither in the interests on the customer, asset or ANY employees onshore or offshore … what do they think the consequences to all of us are of a shite performance … I would be surprised if knocking off early for a shampoo and expecting 13 hours paid for 12 is an attractive alternative to anyone. “Refusal of any reasonable request to work any overtime is at variance with the contract of employment and as such will be subject to relevant disciplinary procedures.”
Two contrary readings of identical text introduced into the terms and conditions only weeks earlier does not surprise those who signed reluctantly on pain of losing their positions on the platforms. However, Mr Quinn insists that no one was pushed into signing and he is ” … surprised if anyone who finds anything … unacceptable has signed … instead of seeking alternative opportunities more attractive … elsewhere.”
Maintenance backlog is appalling according to Mr Quinn’s own assessment. Perhaps sufficient manning and not industrial relations gangster-ism is the solution. Or, better still, manage the job not to have backlog.
SECOND DOCUMENT
Statement To Management
Regarding the Current Divestment Situation
We, the “in scope” workforce of the affected platforms (NC, EA, TA, CA & DA) would like to reiterate the unacceptable nature of the situation we currently find ourselves in. We believe we have dealt with our management in a professional manner since the announcement of the Northern mature asset divestment on the 14th of June 2007, and that this is clearly demonstrated by our adherence to the following behaviours:-
* Commitment to consultation - we acknowledge the need to review policies and procedures at the company’s discretion, but firmly believe that a significant HR policy that was initially co-created by both staff reps and management should be reviewed in the same atmosphere that initially created it - one of mutual understanding and respect and taking note of to the aspirations of all parties in order to reach an acceptable and sustainable conclusion. The original divestment principles were accepted and understood by staff, and it is therefore only reasonable to expect the company to honour these principles until proposed changes are fully consulted.
* Sustained commitment to safety - this is the company’s key KPI and is something we fully support. However, it has been a very difficult and stressful environment offshore over the last several months, and we are all feeling the strain due to the loss of critical skilled personnel due to resignation and stress related illness. Despite these problems, we have continued to operate our assets in a safe and professional manner throughout, and have fulfilled our collective responsibility to report safety and competence shortfalls as and when they arise.
* Compliance with procedures - offshore staff spend their entire working lives paying constant attention to standards and procedures, and many disillusioned personnel therefore turned to the company’s own grievance process in an effort to demonstrate their dissatisfaction, and to seek redress for the draconian method the company has chosen to implement changes to a long-standing set of principles. Unfortunately this procedure has been something of a charade, and affected staff are now convinced the whole process was a pretence, resulting in nothing but standard responses essentially ‘cut and pasted’ as required in response to each and every issue. This clearly demonstrates the ongoing inflexibility of management and their seeming inability to enter into meaningful discussions with staff.
In contrast to this, the company’s approach throughout the divestment process has been demonstrated through the following behaviours:-
* No commitment to constructive consultation - we believe the company has been disingenuous in its use of the word ‘consultation’ throughout, and has intimated on several occasions that consultation has indeed taken place on various issues - without being able to provide documentary evidence to back this up. We speak as the affected workforce, and we maintain that no consultation took place before the preferred HR principles were removed. The proposed ‘new’ HR framework was not unveiled until some time after the divestment announcement, and we were not consulted on its content.
* Severe lack of commitment to safety - this has been demonstrated by urgently re-writing MIMS competence requirements when they could not be fulfilled, attempting to bridge competence gaps with hastily produced risk assessments, and the employment of inexperienced contract staff to bolster offshore numbers and create the illusion of a minimal impact on safety and integrity. These measures were clearly a knee-jerk reaction to competence gaps created by the resignations of many disillusioned experienced staff, and are simply the result of the company’s own rigid approach throughout.
* A non committal approach to the grievance procedure - members of staff put significant effort into preparing for their grievance hearings, and the process was a stressful experience for many - people who believed Shell was a reputable employer and never imagined they would have to invoke a procedure that they saw as a last resort. The response to this was by answering all enquiries and challenges with ambiguous statements.
We would like to contrast the current sorry state of affairs in Northern Mature - with morale at rock bottom and resentment constantly building - with the completely different outcome of consultations in NAM, where despite being in a similar situation, a mutually agreeable covenant has been jointly created between the staff council and management by entering into the spirit of true consultation and negotiation. We only wish that a similar process could take place to resolve our issues and prevent further deterioration of relations with staff.
We firmly believe that the company has breached both Article 13 of the European Works Council Directive and the Information and Consultation of Employees Regulations (2004) - not to mention the constitutions of both the SEF and the UK staff committee, by failing to fully consult on the above issues, and our professional legal advisors believe that we have a strong case to take forward to employment tribunal if required.
We therefore believe that if management are not prepared to sit down with the affected workforce and try to find a way through the current stalemate, we will have no alternative but to proceed with legal action for each and every affected worker as each transfer is announced.
It is a sad reflection on Shell that as loyal staff, we find ourselves compelled into taking this action, but this is a very important issue for every affected employee, and we are committed to taking this matter as far as necessary in an effort to seek redress.
Even at this late stage, we would welcome a move from management to enter into meaningful discussions in an attempt to reach an agreement on a sustainable framework for UK divestment. We know that in a suitable environment this is possible - as demonstrated to great effect by our colleagues in NAM - and we therefore await your response.
Regards,
The combined offshore in scope workforce of
Tern
Eider
Cormorant Alpha
North Cormorant
Dunlin Alpha.
THIRD DOCUMENT
The Truth About Divestment!
Folks,
It has come to our attention that Bayliss and Rankin are telling all that “everything in Northern is rosy and everyone is happy and delighted with the current deal.
We on the divestment affected platforms TA, EA, NC, CA, DA would like it to be known that we are not at all happy.
In fact, we remain disgusted, and utterly opposed to the imposition of this “deal” that they are trying to force on us.
One interesting fact that the company is not talking about is that of the original 400 onshore and 180 offshore staff originally in-scope, only 22 onshore staff remain, while the number offshore is still 150.
The offshore in-scope staff are so happy with the deal that over 130 people have initiated individual grievance procedures against the company.
These grievances have so far have been handled in the same vein as the so called “consultation process”.
We are particularly disgusted by the arrogant, and offhand manner in which they have gone about it, and the sly, underhand tricks they have used while doing it.
SEF (The Shell European Forum for staff committee reps) have discussed the way in which the U.K. divestment process has been conducted and have said :-
“What SEF finds unacceptable is the company’s unilateral decision to change it’s “Preferred HR Principals” in dealing with staff affected by the divestments. These Principals were Co-created with the staff councils in the UK and demonstrated the company’s commitment to the staff representation process”.
They go on to say:-
Suggestions made by EPE staff to use “best practices” that are presently used in NAM in the UK have been deemed unsuitable. For a company that thrives on using best practices across our business it is again an example that the company is not truly committed to the staff consultation process within the UK.
The U.K SEF reps have a meeting scheduled on the 29/1/08 with Tom Botts to put forward these views.
It will be interesting to see the outcome of this meeting. We should all look out for it.
The straight facts of the matter are that they are seeking to force the following “deal” on us instead of honouring the original co-created HR principles.
1)    A transition bonus payment:- Max 25% of salary ( approx’ £15,000 gross or £9000 net for someone at 100% PIR JG6).
Payable at transfer.
2)    A time bound payment :- Ranged between £10,000 and £45,000 gross.
This equates to a range of £6,000 to £27,000 net. The £27,000 being the absolute max for 30+ years service. This would be paid in 2 instalments 25% after 3 months and 75% after 9 months.
So in effect to get your max terms which are way below that offered under the SVS package previously available under the agreed HR principles each tech is being asked to sign up to assisting Shell with the transfer and some 9 months beyond.
Shell state that the agreed co-created divestment principles are not part of our terms and conditions. This begs the question. Why do we bother if the company can change the “rules” at will? Up until recently the comp
