A second strike at a Chevron refinery was narrowly averted on Wednesday after the United Steelworkers union voted to ratify the oil company’s last contract offer at the Chevron El Segundo Refinery outside of Los Angeles.
The Contract issue dates back to last month, when the majority of U.S. refineries and the USW came to an agreement of a 12% pay raise over 4 years after weeks of protests at refineries nationwide. Agreed to in late February, the new contracts came in just before gas prices started drastically increasing due to the Russian-Ukrainian War.
“The industry came to the table with demands that would have undermined generations of collective bargaining progress,” said USW International president Thomas Conway last month. “Thanks to the solidarity of the membership and the hard work of our national oil bargaining policy committee, we have achieved a fair agreement.”
However, some local unions needed advanced individual negotiations due to issues pertaining to specific refineries and plants. While some refineries shortly came to agreements, others including Chevron El Segundo and Chevron Richmond in the San Francisco Bay area held out. The USW in Richmond pushed for an additional 5% pay raise due to the cost of living in the Bay area, as well as a reduction of work hours. While Chevron drew up better offers, the USW refused to budge. After a second rejection this month, USW employees at the refinery officially went out on strike on Monday. Chevron, which had prepared for such an action, quickly brought in standby replacement workers, and despite the union saying that they might not be up to the task, they have proceeded to keep the refinery running with no major issues.
With Chevron showing that not only could they scramble to replace the more than 500 USW employees in Richmond with skilled workers, the 1,000 USW employees in El Segundo furthered talks with Chevron to avoid a similar strike and replacement workers situation. On Wednesday, Chevron presented the USW with their last and final offer, improving conditions of the contract over the previous one. While not released to the public, sources said it was similar to the offers given to the Richmond refinery workers. USW Local 675, which represents the El Segundo refinery workers, agreed to it the same day.
USW, Chevron officials come to an agreement in El Segundo
USW officials declined to comment on the new deal on Wednesday and Thursday. However, a Chevron spokesman noted that the months long negotiation was successful and that they hope to reach an agreement soon in Richmond.
“We have negotiated in good faith for months to reach a mutually acceptable agreement with our employees who are represented by the USW Local 675,” Chevron spokesman Tyler Kruzich said. “The company is pleased by the ratification and looks forward to returning to the bargaining table as it continues to operate the Richmond refinery and deliver products to customers.”
Combined, the 245,271 barrel per day Richmond refinery and the 269,000 barrel per day El Segundo refinery supply about 20% of all gasoline and aviation gas in California. Despite the strike and near strike at the respective facilities, they have not factored into gas prices in California.
“You see this happen when strikes need to be approved locally instead of a more general strike under the union, as well as sympathy strikes,” said Darren Morgan, a former 40-year negotiator researcher who worked on several prominent union negotiations in the Midwest and West Coast, to the Globe on Thursday. “When you have local unions wanting more specific things it can still be harmful. But El Segundo just agreed to a deal. Richmond, whose San Francisco area-centric needs are similar to LA’s, now has to contend with Chevron holding the ‘Well they agreed to these terms, why can’t you?’ card. Similar thing happened to some facilities in the 1986 Hormel strike in Minnesota and some smaller factory strikes in Illinois in the 90’s. Others in a similar bind agree to a deal because they saw that the companies easily got replacement workers who could do the job, and the ones still deciding on a contract or to strike suddenly see the lay-of-the-land better.”
“The USW in Richmond were not happy yesterday about this, that’s for sure.”
With the El Segundo refinery now in agreement, eyes turn back to Richmond, where both the union and Chevron have not met since the strike was announced on Monday. It is currently unknown when they will meet again.
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