Alex Lotorto

By Naveena Sadasivam; image by Matt Nager - ProPublica, September 25, 2014

Disclaimer: The views expressed here are not the official position of the IWW (or even the IWW’s EUC) and do not necessarily represent the views of anyone but the author’s.

A ProPublica review of U.S. Department of Labor investigations shows that oil and gas workers – men and women often performing high-risk jobs – are routinely being underpaid, and the companies hiring them often are using accounting techniques to deny workers benefits such as medical leave or unemployment insurance.

The DOL investigations have centered on what is known as worker "misclassification," an accounting gambit whereby companies treat full time employees as independent contractors paid hourly wages, and then fail to make good on their obligations. The technique, investigators and experts say, has become ever more common as small companies seek to gain contracts in an intensely competitive market by holding labor costs down.

In the complex, rapidly expanding oil and gas industry, much of the day to day work done on oil rigs and gas wells is sub-contracted out to smaller companies. For instance, on one gas rig alone, the operator might hire one company to construct the well pad, another to drill the well, a third company to provide hydraulic fracking services and yet another to truck water and chemicals for disposal.

But for the thousands of workers in the hundreds of different companies, a single standard is supposed to apply: by law, they must be paid more than minimum wage and they must be fairly compensated for any overtime accrued.

In 2012, the DOL began a special enforcement initiative in its Northeast and Southwest regional offices targeting the fracking industry and its supporting industries. As of August this year, the agency has conducted 435 investigations resulting in over $13 million in back wages found due for more than 9,100 workers. ProPublica obtained data for 350 of those cases from the agency. In over a fifth of the investigations, companies in violation paid more than $10,000 in back wages.

One of those companies was Morco Geological Services, a company providing mud logging services for other oil and gas drilling companies. In 2013, the DOL found that Morco was paying some workers $75 daily for working virtually round-the-clock shifts. The company eventually agreed to pay $595,737 in back wages to 121 workers following the DOL's investigation. In another significant case, Hutco, a company providing labor services to the oil and gas industry, ended up paying $1.9 million to 2,267 employees assigned to work in Louisiana, Mississippi and Texas.

"The problem of misclassification has become pervasive," said Dr. David Weil, a former economics professor at Boston University who today heads the DOL's Wage and Hour Division.  "Employers are looking for opportunities in a changing business landscape at the employee's expenses to cut corners as much as possible, leaving room for wage and hour violations."

Over the last decade, the oil and gas industry has seen tremendous growth. Between 2007 and 2012, when average employment in all U.S. industries fell by 2.7 percent, employment in the oil and gas industry increased by over 30 percent. According to research conducted by Annette Bernhardt, a scholar on low-wage work, 84 percent of workers in the oil, gas and mining industry were employed by contractors in 2012.

At the same time, the industry has also seen an increase in fatalities and injuries on the job. There is, so far, no evidence to suggest that these accidents are a result of inadequate training or overworked laborers. But accounts from other industries that heavily outsource work suggest those risks could be present.

By Chesapeake Climate Action Network - Originally Published at Popular Resistance, July 14, 2014

Disclaimer: The views expressed here are not the official position of the IWW (or even the IWW’s EUC) and do not necessarily represent the views of anyone but the author’s.

WASHINGTON, DC—Residents impacted by shale gas infrastructure and their supporters blocked the entrances to the Federal Energy Regulatory Commission (FERC) headquarters today in protest of the proposed Cove Point liquefied natural gas (LNG) export facility and others proposed around the country.

This is the second consecutive day of action to demand that the Obama administration take the voices of impacted communities seriously in the federal regulatory process, and that FERC reject Dominion Resources’ proposed LNG export facility in Cove Point, Maryland, just 50 miles south of the White House on the Chesapeake Bay. Over a thousand people rallied on the National Mall and marched to FERC yesterday despite scorching heat and high humidity.

Protesters linked arms and blocked the main entrance and a secondary entrance of FERC as employees came in to work this morning. A total of 24 people were arrested for the shut down, including participants from Maryland, Pennsylvania, Virginia, North Carolina, Connecticut, and Washington, D.C. The protesters were arrested by Homeland Security police and then turned over to the DC Metropolitan Police for processing. They were charged with “incommoding,” or blocking a public passageway, and are being released with a citation and $50 fine.