Thu, 23 Nov 2000

Caltex workers continue protests for higher pay

JAKARTA (JP): About 3,000 workers of contractors that support the oil operations of PT Caltex Pacific Indonesia in Riau continued protests on Wednesday to pressure the company to meet their demands for higher pay.

"Some 3,000 of the total 24,000 workers of Caltex's contractors continued protests today despite the call by the manpower office to return to work," Caltex's spokesman Renville Almatsier told The Jakarta Post.

Renville said the protesters worked for French company Schlumberger and local company PT Tripatra among others.

The workers went on strike on Tuesday morning in Pokok Jengkol, Duri, putting an end to negotiations with Caltex over their demands for higher pay and benefits.

Caltex, which is equally owned by American firm Chevron and Texaco, said that it had called on the workers to discontinue the strike and send their representatives to the negotiating table.

The company promised to care about the welfare of the workers and respect their rights to "raise the compensation issue", but the workers should raise the issue through fair and transparent negotiations.

The company threatened to stay away from future negotiations with the workers and withhold their pay if they continued to strike.

"Caltex is extremely disappointed by the workers' decision to leave productive discussions and strike.

"In the last month, we have worked in good faith with the Riau government and manpower office to resolve these compensation issues," said Caltex's managing director J. Gary Fitzgerald.

According to Fitzgerald, the protesting workers are demanding a 360 percent increase in pay and other benefits, which is too much for Caltex.

"This is unfair, unreasonable and not realistic in today's fragile economy.

"Any business attempting to absorb such significant cost increases will be injured competitively and be forced to lower other operating costs in order to survive," Fitzgerald said.

Fitzgerald warned that Caltex and its business partners would be forced to lay off many workers to cut operating costs if they had to meet the protesting workers' demands.

The strike disrupted Caltex's oil production and would cut the government's oil revenue at the time the government very much needed all revenue to re-build the country's economy, Fitzgerald said.

He did not specify the impact of the strike on Caltex's oil output.

Caltex can produce up to 750,000 barrels per day but the company recently said in a meeting with the House of Representatives that its output had dropped by 30,000 due to civil unrest and security problems. (jsk)