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Russia’s TNK-BP employees suing CEO Dudley

Reuters

UPDATE 1-Russia’s TNK-BP employees suing CEO Dudley

Thu Jul 17, 2008 6:21am EDT

Rewrites with TNK-BP news conference)

MOSCOW, July 17 (Reuters) – A group of employees at BP’s (BP.L: QuoteProfile,ResearchStock Buzz) troubled Russian oil venture TNK-BP have filed a lawsuit in Moscow against the firm’s chief executive, accusing him of mismanaging the company in the absence of a proper contract.

Oil major BP shares control of TNK-BP with four Russian-connected billionaires and has been at loggerheads with them over the company’s strategy and management control in the past few months.

The group of employees, led by TNK-BP’s vice-president for legal issues, Elvardi Stafilov, told a news conference the suit against Chief Executive Robert Dudley was not linked to the corporate conflict despite the fact the Russian side is demanding Dudley’s resignation.

“The reason for bringing the case now is because the company is not in a normal situation,” Stafilov said.

“His (Dudley’s) contract was valid until Dec. 31, 2007. It does not get renewed automatically. The board of directors had several tasks to fulfil in order to renew it and they did not do this.”

Stafilov also said the suit was filed because he believed some managers in the company violated international law by choosing people based on nationality — echoing accusations by the Russian shareholders that BP was overusing foreign staff.

“It is discrimination,” said Stafilov.

The Russian co-owners accuse Dudley of poor performance and showing favouritism to BP. BP denies both allegations, saying Dudley has performed well and acts impartially in the interests of both groups of shareholders.

BP says the Russian side wants to illegally seize control of the 50/50 joint venture by sacking Dudley.

Dudley’s contract expired at the end of last year but his team says that, under Russian law, a labour contract is deemed to continue in force unless there is a specific instruction to cancel it.

It was not immediately clear what the implications for Dudley would be if the court ruled in favour of the employees suing him as the news conference was still continuing.

(Reporting by Amie Ferris-Rotman, writing by Dmitry Zhdannikov; Editing by Erica Billingham and Sue Thomas)

 

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