Legal action threatens Shell's outsourcing plans

Daily Newsletters

Sign up to ZDNet UK's daily newsletter.

NEWS

Shell is facing the threat of legal action from trade union Amicus over staff redundancy terms, which could hit the oil giant's plans to outsource up to 3,200 tech jobs.

The oil multinational is in the process of finalising contracts with AT&T, EDS and T-Systems to run the bulk of its global IT infrastructure as part of a cost-cutting drive.

But the outsourcing plans may be affected by wider legal action being threatened by Amicus to force Shell to reinstate a company redundancy package worth up to £200,000.

Amicus said Shell replaced the £200,000 pay-off provision in June last year with an agreement whereby employees who are made redundant will now only receive a package worth up to £50,000.

Regional Amicus officer Graham Tran told ZDNet.co.uk's sister site, silicon.com, that there is widespread unhappiness among Shell staff and a feeling that "loyal" employees are being "dumped".

He said: "We just want Shell to look after its loyal employees. It no longer has a commitment to the workforce."

Amicus is hoping legal action will force Shell to reinstate the more favourable HR policy before the IT outsourcing contracts are signed.

As well as securing better payouts for any immediate lay-offs, this would mean those IT workers who are transferred from Shell to the outsourcing companies will be guaranteed the higher pay-out should their new employers decide to make them redundant further down the line.

Tran said: "If we are successful [in getting Shell to honour the original HR policy] the new employer will pick up responsibility for that."

Read this

Feature
Special report: Countering corporate espionage

How can you mitigate the risks to your company?

Read more +

That could potentially cost AT&T, EDS and T-Systems millions when they take on Shell IT staff as part of the outsourcing contracts to run the oil company's IT infrastructure.

Shell is apparently arguing the previous redundancy package with the larger payout terms only applied to offshore oil rig staff and not IT workers, something Amicus is disputing.

Tran said: "Shell is arguing that it did not apply to the IT people. [But] it was negotiated by the staff rights committee and both offshore and onshore workers had representatives on that committee."

Shell declined to comment on its HR policies and redundancy terms.

Tran said the bulk of the IT employees affected were in the UK, with many at Shell's HQ in Aberdeen, and the rest based in Europe.

He said: "The majority of staff will be transferred but I would not rule out redundancies in future. The feeling is that these people are being dumped by Shell after years of loyal service."

Contracts for the IT outsourcing are expected to be signed in March, with EDS taking over end-user computing services, T-Systems hosting and storage services and AT&T managed network services.

Shell has been quoted as saying it plans to make pre-tax cost savings of about $500m (£250m) per year through streamlining its structure and cutting and outsourcing jobs. Shell employs about 108,000 people worldwide.

Post your comment

In order to post a comment you need to be registered and logged in.

You can also log in with Facebook. Log in or create your ZDNet UK account below

  • Login

Will not be displayed with your comment

By signing up for this service, you indicate that you agree to our Terms and Conditions and have read and understood our Privacy Policy. Questions about membership? Find the answers in the Community FAQ

Get ZDNet UK's daily newsletter

Enter your email address to sign up

ZDNet UK Live

BrownieBoy

@Jack, > Works really well for thieves.... Nice attempt to deflect the argument by tossing in a point that's totally irrelevant, even it were...

7 hours ago by BrownieBoy on AMD Ultrathins to challenge Intel Ultrabooks
bootlegger

Make that 13 people now - I got refused today at Manchester airport. I thought I was up to date on this legislation - I knew of the EU ruling from...

10 hours ago by bootlegger on UK airport body scans will not be opt out
tinycg

Don't forget to check out apps like GoodReader or SlideShark either, they're indispensible for people on the go in presentation situations. Best...

12 hours ago by tinycg on Four top iPad apps for people on the move
TerryRK

Well it seems there is something a number of us agree on. Why is the Ubuntu Unity launcher so ugly? I thought perhaps it was something to do with...

17 hours ago by TerryRK on A tale of two distros: Ubuntu and Linux Mint
Freebies202

Duplicate comments are not made intentionally. Its very good to know that now you are keeping check on this problem because sometimes a commenter...

1 day ago by Freebies202 on Microsoft fixes blog comments, speeds up blogs with open source
kevinmchapman

"the very significant number of users" and "many (most) of us" - you have no evidence for these statements. It is a fact that most users are saying...

1 day ago by kevinmchapman on A tale of two distros: Ubuntu and Linux Mint
Marg Menzies Harrison

Another grammar faux pas is the improper use of "you". When sitting down down in a restaurant, for example, I get cringe when the waitress...

1 day ago by Marg Menzies Harrison via Facebook on 10 flagrant grammar mistakes that make you look stupid
zdnetukuser

And NOW, folks, for Canonical's next trick... Kubuntu is late. Here's a pencil. Draw your own conclusions. cf.:...

2 days ago by zdnetukuser on Linux Minterface
Moley

@kevinmchapman. The discussion here reflects the very significant number of users who really do like the traditional menu system and who wish to...

2 days ago by Moley on A tale of two distros: Ubuntu and Linux Mint
kevinmchapman

Er, no... It is an efficient means of finding the application/file/setting you need in one place. The icons are a simply a fallback for when you...

2 days ago by kevinmchapman on A tale of two distros: Ubuntu and Linux Mint
TerryRK

Isn't the provision of a text based search an admission by the developers that the mass of icons approach does not work? I don't need to use a...

2 days ago by TerryRK on A tale of two distros: Ubuntu and Linux Mint
kevinmchapman

"Unity and GNOME 3 both abandon the old text-based cascading menus in favour of a graphical icon-driven system." Point truly missed. Both use a...

2 days ago by kevinmchapman on A tale of two distros: Ubuntu and Linux Mint
TerryRK

whs001 - Thank you, I'm glad you liked the article. I absolutely agree with you on your first point. I should perhaps have made it clearer that...

2 days ago by TerryRK on A tale of two distros: Ubuntu and Linux Mint
Dennis Nilsson

If we allow corporate interest to dictate the way our government circumvents due process against foreign entities then we should accept the same...

2 days ago by Dennis Nilsson via Facebook on ACTA stumbles in Germany
GHar123

I totally dislike pirating of works, I fear that artists will be deterred from creating works if they think that they are going to get ripped off....

2 days ago by GHar123 on ACTA stumbles in Germany
JCB33

How dare film makers, artists or anybody that invests in creativity stop us pirating their works for free. I want to be able to walk into my local...

2 days ago by JCB33 on ACTA stumbles in Germany
Moley

@GrueMaster. I prefer horses for courses rather than one size fits all. I, and I suspect most other computer users, do not really wish to have...

2 days ago by Moley on A tale of two distros: Ubuntu and Linux Mint
greycynic

The product that scares me every time I have to use it is the Office 2007 version of Excel. The first bug that I found was applying the median...

2 days ago by greycynic on Ten flawed products that derail productivity
GrueMaster

Nice review and very informative. One thing I'd like to add (in reply to whs001's 1st question), the main reason to have the same interface from...

2 days ago by GrueMaster on A tale of two distros: Ubuntu and Linux Mint
Frederick Wrigley

I'be been using Mint 12 since the RC came out, and I am far more happy with the Cinnamon, the Mate, and, yes (with extensions), theGnome 3...

2 days ago by Frederick Wrigley via Facebook on A tale of two distros: Ubuntu and Linux Mint