United Steelworkers sues BP after it cut union-represented positions on North Slope

The United Steelworkers filed suit against BP last week, arguing that the oil giant violated an agreement with the union when it outsourced work to a Prudhoe Bay contractor in 2016. Five union-represented workers lost their positions in the outsourcing.

The union wants BP to restore the workers' jobs and cancel the contract with NANA Management Services to run a sewage treatment facility, according to a union grievance report included in the lawsuit, filed in U.S. District Court in Anchorage.

The complaint comes after BP made other contractual changes over the last year that are expected to reduce union workforces, as BP seeks to save money amid low oil prices. Union workers typically earn more than their non-union counterparts, studies show.

The contractual changes include the elimination of 182 union positions starting March 31, as BP switches a pipeline inspection contract from Mistras Group, based in New Jersey, to Anchorage-based Kakivik Asset Management. Those union workers are represented by the Quality Control Council of the United States, according to a notice to state officials triggered by the large layoff.

[Mostly union force of 261 to be laid off in Prudhoe Bay contract change]

United Steelworkers officials said the union represents about 300 workers performing maintenance and production work on the Slope.

"If you let them take five (jobs), next time they'll take 20," said Mariana Padias, an assistant general counsel for United Steelworkers, said Tuesday. "Who knows what they'll outsource next."


Dawn Patience, a BP spokeswoman, said the company "does not comment on a pending litigation."

The five workers represented by United Steelworkers aren't named in the complaint.

The union says BP outsourced the work to Anchorage-based NANA Management after oil prices collapsed in 2014. The crash prompted the oil company to slash costs and lay off hundreds of employees, according to the union's newsletter, "The OilWorker," in May 2017.

"(BP) analyzed its operations and determined that the water and wastewater treatment facility was not a part of its core business," the article says.

The five union workers whose positions were eliminated chose not to accept an "enhanced" severance deal. In 2016, BP transferred the workers to lower-paying roles, leading the union to bring an arbitration case against BP, the article says.

The union says it won that case in April, after an arbitrator determined the positions were outsourced in violation of BP and the union's collective bargaining agreement, according to the union grievance report, made in August.

Kristjan Dye, president of USW local 4959 based in Kenai, said the plant technicians were initially threatened with job loss, but the union fought to protect them.

"We felt they were unfairly singled out," he said. "BP thought they'd have an easy win to replace them with contractors."

Padias said BP is violating the Labor Management Relations Act that requires compliance with the bargaining agreement.

Also, BP violated the arbitration decision when it renewed the contract with NANA for two years in September, the union argues.

The union wants the court to force BP back into arbitration over the grievance report. BP has refused to take that step, the lawsuit says.

"We just want BP to do the thing they agreed to do, when they signed the collective bargaining agreement," Padias said.

Alex DeMarban

Alex DeMarban is a longtime Alaska journalist who covers business, the oil and gas industries and general assignments. Reach him at 907-257-4317 or