October 19, 2016 / 6:15 PM / 9 months ago

Petrobras unions reject 6 percent pay rise, raising strike chances

2 Min Read

RIO DE JANEIRO (Reuters) - Brazilian oilworkers' unions said they rejected a sweetened pay offer from Petroleo Brasileiro SA in annual salary talks on Wednesday, raising chances of a second major strike in two years at the state-led oil company.

Petrobras, the world's most indebted oil company, offered to raise base salaries for its more than 50,000 employees by 6 percent, compared with 4.97 percent in a proposal made last month, representatives of FUP and FNP, the two largest oilworkers' union federations said.

The unions, whose members voted last month to give leaders the right to call a strike at any time, said the increase was still well below the 12-month inflation rate of 9.12 percent.

"In the face of such a low first offer, the company tried to present its second offer as if it were a great advance," Sindipetro-LP, which represents Petrobras workers at ports and other facilities near Santos, Brasil said in a note.

Petrobras did not immediately respond to requests for comment. Chief Executive Pedro Parente has said in recent weeks that Petrobras cannot grant major pay increases to employees this year because it has to reduce its nearly $125 billion of debt.

Petrobras maintained its previous proposal to reduce overtime pay and give workers the option of working fewer hours for less money.

Strike interest is also being driven by opposition to company plans to sell about $35 billion of assets by the end of 2018 and withdraw from many non-core business areas.

Jose Maria Rangel, coordinator of FUP, the largest federation of oilworkers' unions, said his membership rejected the offer and pledged to fight against the budget cuts and asset sales in the company's most recent five-year plan.

Last year, unions staged the largest strike at Petrobras in two decades, driven more by opposition to the cuts and sales than salary issues. The more than two-week strike in November prevented Petrobras from producing about 2.29 million barrels of oil, or less than an average day of output.

Reporting by Marta Nogueira; Writing by Jeb Blount; Editing by Andrew Hay

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