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Shell employees STATEMENT OF CLAIM against Shell Ethiopia

November 20, 2007 

To: Federal First Instance Court

      Kera Bench Work Litigation Tribunal

      Addis Ababa

            Plaintiff…………….. Trade Union of Shell Ethiopia Ltd

                        Address: N/S/Lafto Sub-City Kebele 10 House No. 280

            Defendant…………… Shell Ethiopia Ltd

                        Address: N/S/Lafto Sub-City Kebele 10 House No. 280

This is a mutual work litigation charge filed to adjust improper deduction of benefits and protect employees’ right as the defendant is going to sell its shares and leave the country

In accordance with Article 138 of Proclamation No 377/2004, this work litigation bench has jurisdiction over this case
The plaintiff and defendant have legal capacity
The plaintiff litigates through its lawyers
The plaintiff can deliver any sort of subpoenas to the defendant

1.     Brief causes of this mutual work litigation 

1.1  The defendant company is making preparations to transfer its assets (shares) in Ethiopia and leave the country with in a short time. The regional head office has decided to add the company among the list of 10 countries whose market it thinks is not feasible. This means that by complying with this decision, the defendant company has taken the first step to leave the country. The defendant has sold 63 of the 280 fuel stations under its possessions in the country and it has issued a directive not to employ new staff members and not to incur significant operating expenditures. The defendants plan to leave the country was published in local papers and the defendant didn’t deny this fact.

1.2  During its operation in Ethiopia, the defendant company has been applying the special early retirement scheme. In this scheme, those employees who wish to retire were allowed to resign with their benefits maintained and receiving up to 55 months of salary. This system has been applied for employees who are forced to resign due to force majeure. 

1.3  However, in relation to its plan to leave the country, the defendant company has decided to stop the implementation of this long existed system with no sufficient explanation and has replaced it with voluntary severance package which reduces employee benefits up to 70%.

1.4  The deduction of benefit against what used to be practiced has raised work litigation in accordance with Article 136 (3) of Proclamation No 377/2004 and has required the subrogation of the plaintiff Trade Union. Based on this, the plaintiff Union has made several letter correspondences with the defendant company’s local and regional officials in order to solve the case amicably. But, the Union is forced to file this charge because the defendant company has informed its decision to stick to its position.

2.     The defendant company’s decision to change the long existed system is illegal and it affects the rights of employees

2.1  It is illegal for the defendant to terminate the implementation of special early retirement scheme and replace it with another system that reduces the benefit of members in the plaintiff Union up to 70% just because it intends to leave the country. It is made with bad motive and evil spirit and it is illegal. The defendant’s action contradicts the provisions of Article 12 (3) of Proclamation No 377/2004 and violates human rights of employees.

2.2  The defendant company has a policy of paying salary which exceeds the salary paid by other employers in order to attract the best man power. One of the benefits that help the company attract the best manpower in the labor market is also the special early retirement benefits which have now become the center of this litigation.

2.3  One of the benefits assumed to be obtained by members of the plaintiff Union when they establish employment contract with the defendant company is the said scheme which motivates them to prefer the defendant to other employers. Employees also decide to maintain their employment contract with the defendant company instead of seeking other alternatives with the hope to benefit from this scheme should they decide to leave the company because of health problem or accident. Therefore, all members of the plaintiff Union have a tacit agreement with the defendant company when they established employment contract with the same.

2.4  During operation in Ethiopia, the defendant company had a desire to obtain better skilled manpower and for this reason, it used to maintain this benefit package to its employees. However, now the company is no more interested to operate in this country and hence it won’t recruit any more employees, it decided to change the system with the intention of minimizing cost through discharging its current employees with highly reduced severance pay and this is in absolute contradiction with the basic ethical values such as Honesty, Integrity and Respect for People which the defendant company insists to advocate them.

2.5  A few years ago, the defendant company has purchased the assets /shares/ of Agip Ethiopia. When it did so, it has accepted 34 employees of Agip Ethiopia on permanent basis. However, 13 employees who were accepted by the defendant were not interested to work for the defendant and in accordance with the agreement made with the Trade Union, they were given the chance of special early retirement scheme and they have left the company receiving up to 55 months of salary. However, the remaining 21 employees are still working in the defendant company.

2.6  In other words, the 13 employees who left the defendant company were given better advantage where as those who are serving the defendant company with the hope of benefiting from the same scheme are affected by the new policy change which means that their long service to the defendant is valueless and considered as a disadvantage by the defendant company. Accordingly, the system change effected by the defendants affects the current serving employees, and it is prepared with evil motive in relation to the defendant’s decision to leave the country.

2.7  The defendant company has breached the reconciliation agreement it signed on September 20, 2000 to protect the right and benefits of employees it received from Agip Ethiopia during the work litigation raised when the defendant company purchased Agip Ethiopia. The employees who decided to be transferred and work for the defendant company mad their decision hoping that they will get better benefits if they are to retire early according to the defendant’s contractual obligation. So this action of the defendant doesn’t only violate its own practices but also the contractual obligations it entered with these employees.

3.     Concerning the loss caused to members of the plaintiff Union

3.1  81% of members of the plaintiff Union have lost up to70% of the benefit because of the change made to the policy that was in place, when they established employment contract with the defendant company. Particularly, those employees with a service period of less than 18 years are seriously affected while the company’s management bodies have become beneficiaries of the changed in policy in a very privileged way.

3.2  The minimum amount of money that the defendant company intends to withhold from the employees is more than Birr 4,900,000.00 (Four million nine hundred thousand Birr). The change in policy doesn’t only cause financial damage to the plaintiff’s members. When the defendant company sells or transfers its assets in the country and leave, and if members of the plaintiff don’t want to continue working with the company that purchases the defendant and request for special early retirement scheme, the amount of payment they are entitled will be reduced by the above stated amount and this will definitely narrow their choice to continue/discontinue with the new employer and this causes moral damage and affects their legally ensured human right. The change of this long existed system has raised mutual work litigation in accordance with 136 (3) of Proclamation No 377/2004.

4.     The Plaintiff Union lodges the following demand

4.1  When members of the plaintiff Union established employment contract, they have assumed to have tacit agreement with regard to the special early retirement scheme benefit that has been implemented for many years. This benefit motivated members of the plaintiff Union to ignore other better alternatives and choose the defendant and remain working for same. For this reason, the defendant has no legal ground to terminate this scheme just because it intends to sell its assets and minimize costs and it shall be ruled that the scheme shall be reinstated.

4.2  When the defendant company transfers its assets to other company and leave the country and if the new buyer doesn’t maintain the benefits granted by Shell, it shall be ruled that the defendant company shall be responsible to implement its special early retirement scheme for those employees who don’t wish to continue working for the new employer.

4.3  The plaintiff finally petitions for ruling which shall hold the defendant to cover all cost incurred by the plaintiff Union in relation to this charge.

In accordance with Article 92 of the Civil Procedure Code, I certify that the genuineness of the above statement.

                                                                                    For the plaintiff


                                                                                    Samuel Demeke



The Federal Democratic Republic of Ethiopia

Federal First Instance Court


Details of the firm that did the translation of the Statement of Claim: 


TELE – 251 – 10116556388 / 0911-154331

P.O.BOX 102199



The person who signed on the translated paper is 


Editor & Translator

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