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Ethiopian employees accuse Shell of raiding retirement fund

By John Donovan

We recently published news of litigation brought against Shell by a trade union representing 90% of its Ethiopian employees. The article was authored by my father Alfred Donovan. We jointly operate a website described by the Financial Times as being “anti-Shell”:

In fact our objective is to persuade Shell management to stand by the Shell Statement of General Business Principles pledging among other things, honesty, integrity and transparency in all of its dealings. If Shell senior management did operate on that basis, the reserves fraud and other scandals which have badly damaged the reputation of the oil giant in recent times could never have happened.

The latest scandal stems from a decision by Shell management to unilaterally change the terms of an early retirement scheme for its Ethiopian employees.

Our article was entitled: “Is Royal Dutch Shell a racist company?

We have today received an update from Shell Ethiopian employees which we have published in its entirety.


Dear John

Warm greetings!

I am writing to keep you in touch with events unfolding in our case against Shell Ethiopia. As you will recall, Shell management unilaterally reneged on the terms of the early retirement package available to ordinary Shell employees in Ethiopia cutting benefit by up to 70% with the intention of using the stolen funds to substantially boost monies paid to senior managers.

The General Manager of Shell Ethiopia, Edgar Omoto, sent the following self-explanatory message a few days ago:

Dear Colleagues,

An article in Fortune dated 2nd December 2007 entitled “Labour Union sues Shell over Severance Benefits stated that Shell Ethiopia Labour Union has filed a suit at the Court of First Instance alleging that the company illegally changed its retirement policies.

I am sorry that a number of people have found it necessary to take such action. Since this issue has been addressed directly to the Court of First Instance, I cannot comment on the contents or validity of the suit other than to say that, as a matter of policy, we will defend this claim. I trust we can convince the court that we believe we have behaved responsibly and in keeping with the law.

If you have any questions please contact me directly.

Edgar Omoto

Mr Omoto says that he is sorry that we have found it necessary to take action.  We only did so after our attempts at resolving the matter amicably were spurned. As you can see, he then said that because the issue has been taken to court, he was unable to comment before immediately contradicting himself by making the comment that Shell acted “responsibly and in keeping with the law”.  We note that there was no denial by Omoto of the basic facts of our claim i.e. the unilateral cut by Shell management of early employee retirement benefit of up to 70%, so that the funds robbed from employees could be diverted to inflate management income.

We have also noted that he took nearly two weeks to comment on the article published by the newspaper in its December 2 issue. We think his belated and predictable comments were prompted by the fact that he gave permission to the request of the workers union to conduct a meeting of all its members on December 13, 2007 at 3:00PM. He started sending out his email message just 40 minutes before the start of the meeting in what seems to have been a brazen attempt to deflate and demoralize staff stirred by your father’s article which, incidentally, we feel was 100% accurate in its analysis.

I confess that we were all profoundly shocked by the discovery that Shell management does not honour its claimed core values of Honesty, Integrity and Respect for People. This is why we made reference to this important extract from Shell’s ethical code in our letter to Mr Xavier Le Mintier and in the subsequent letter to Rob Routs and also stressed it again in our STATEMENT OF CLAIM. We feel betrayed by Shell’s actions and believe the use of the description “bad motive and evil spirit” applied to Shell in the STATEMENT OF CLAIM is fully justified.

While well received by all affected staff, Shell Ethiopia management members are extremely angry about your intervention.  On the day your father sent an email to Mr Michiel Brandjes copied to Rob Routs and other Shell executives, the management of Shell Ethiopia received a call from a Shell senior management VIP who inquired about the case. His sudden interest was plainly sparked by your email which included the draft article “Is Royal Dutch Shell a racist company?” It is ironic that your intervention had more success than we did as Shell employees in trying to attract the attention of Shell senior executives to our plight. We hope that even at this late stage Mr Routs will intervene in the interests of legal and moral obligations to employees. If he does not, then we will know that the disgraceful change in early retirement benefit to the detriment of ordinary employees is fully supported by the management of Royal Dutch Shell Plc.

As could be expected from Shell Ethiopia management, intimidation and harassment have been intensified towards staff suspected of being in contact with you. We note that our colleagues suing Shell in Malaysia on a similar basis have also been subjected to the same callous and unlawful treatment in direct contravention of Shell’s claimed core principles. Perhaps Shell management in Ethiopia had so little respect for us that they thought we would meekly accept the raid on our early retirement benefits. That was a serious misjudgement as should be plain by our decision to issue legal proceedings only after all other avenues of settling the matter internally had been exhausted.

Respectfully yours,

This website and sisters,,,, and, are owned by John Donovan. There is also a Wikipedia segment.

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