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Union rejects pay offer in U.S. refinery worker contract talks -sources

Randy Mancini 3 Jan 28
United Steelworkers flag flies outside the Local 1299 union hall in Ecorse, Michigan,
FILE PHOTO: A United Steelworkers flag flies outside the Local 1299 union hall in Ecorse, Michigan, U.S., September 24, 2019. REUTERS/Rebecca Cook

January 29, 2022

By Erwin Seba

HOUSTON (Reuters) -The United Steelworkers union (USW) rejected a pay increase offered by lead oil company negotiator Marathon Petroleum in talks for a new three-year agreement covering U.S. refinery workers, people familiar with the matter said on Friday.

The offer was for a 4% pay increase over three years for 30,000 refinery and chemical plant workers represented by the union, the three sources said.

Under the current contract, which expires Feb. 1, workers received pay increases of 3.5% in each of the contract’s first two years and 4% in the third and last year.

Marathon spokesman Jamal Kheiry said talks with the union were continuing.

“We’re in active discussions on various topics,” Kheiry said. “We are committed to bargaining in good faith and working toward a mutually satisfactory agreement.”

In a message to members on Friday afternoon that was seen by Reuters, the USW said Marathon was ignoring issues the union has raised in the talks that began on Jan. 13.

“Their wage proposals to date are paltry,” the USW message said. “In light of their earnings & dividends to shareholders, they are offensive. It’s time for the companies to quit screwing around, recognize the seriousness of the approaching deadline and move towards a settlement.”

On Wednesday, the USW said in a message to members that Marathon had offered a 3% pay increase over three years.

Going into talks, the union was seeking “significant” pay increases and improvements in health insurance, according to sources within the union.

Refiners and chemical producers began recovering in 2021 from large losses in 2020 when lockdowns and work-from-home policies drove down motor fuel demand.

In 2015, negotiations between the USW and then-lead company Shell Plc broke down leading to a series of strikes nationwide. This is the first year Marathon is the lead negotiator.

(Reporting by Erwin Seba; Editing by David Gregorio and Stephen Coates)