Offshore oil and gas workers have secured a sector-leading pay rise of 8.6 per cent after threatening industrial action against a key labour hire firm.
The Offshore Alliance, a team-up of the Australian Workers Union and Maritime Union of Australia, revealed on Monday it had reached an in-principle deal with Rigforce that guarantees about 60 drill workers a 15.6 per cent pay rise over two years, made up of 8.6 per cent this year and 7 per cent next year.
Rigforce supplies labour to vessels contracted with Inpex and its LNG plant in northern Australia.
The deal is the latest massive pay rise in the offshore resources sector and surpasses previous highs over just the past two months ranging from 6 per cent to 8 per cent.
Bargaining in the sector is expected to heat up further over the next few months, even as the Reserve Bank closely watches wages growth out of concerns it could cause high inflation to persist for longer, and therefore keep interest rates up.
Alliance spokesman, AWU West Australian secretary Brad Gandy, said the deal was “a positive outcome for offshore drill crew who, over the past six years, have experienced deteriorating real wages and employment conditions”.
“We’ve allocated significant organising resources into the offshore drilling sector, which has traditionally been poorly organised and characterised by subpar agreements, over the past 18 months,” he said.
“It’s pleasing to see our efforts pay off with a good EBA for Rigforce employees and in-principle agreement with the other key offshore drilling labour hire provider, Atlas Professional, on an industry standard EBA.
“The two labour hire agreements largely align pay and conditions and create a new level playing field of rates and conditions, which should benefit both the drilling companies and our members.”
Rigforce, which supplies drillers for the vessel Noble Deliverer, currently performing work for Inpex, declined to comment.
The Alliance has also secured deals with major offshore drilling company Valaris and driller Noble with significant uplifts for permanent employees.
Rigforce workers, who had voted in favour of industrial action at the end of last month, will get backpaid the 8.6 per cent pay rise from July 1 on top of 12 per cent superannuation, 1 percentage point higher than the minimum.
Despite the big pay rise, the agreement is understood to be less costly as a whole compared to others struck between vessel operators and the MUA.
However, industry sources said that union pressure was ramping up in the sector and pay rises like Rigforce’s were broadly expected.
Last month, the MUA notified 41 days of strikes at vessel operator DOF Subsea. The union has since pulled the action and is understood to have an in-principle agreement to shift workers to the highest rates of pay that normally apply to specialist vessels.
The MUA is also hotly opposing Chevron’s proposed agreement at its Wheatstone LNG platform that goes to a direct ballot of employees this week, with the union’s organiser promising to resign if the deal gets up.
Recently, shipping giant Maersk agreed to an 8 per cent pay rise for officers and engineers on its vessels supplying gas platforms while UGL paid 7.5 per cent increases to maintenance workers at the Santos-led GLNG project in Queensland.
The Consumer Price Index rose 7 per cent in the year to March 2023. However, monthly indicators suggest it fell to 5.6 per cent in May.
Overall wage growth grew by 3.8 per cent in the private sector.
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