Union workers at a Chevron (NYSE: CVX) refinery in Richmond, California are on strike for the first time since 1980 following failed negotiations over employment contracts. The refinery's existing contract expired on February 1, and two proposals from Chevron have since been overwhelmingly voted down by the United Steelworkers (USW) union.
"The union's demands exceeded what the company believes to be reasonable and moved beyond what was agreed to as part of the national pattern bargaining agreement," says Tyler Kruzich, Chevron's spokesperson.
Chevron "is committed to continuing to negotiate toward an agreement," Kruzich added.
However, USW Local 5 First Vice President B.K. White told reporters that no additional negotiations have been scheduled and that union and company negotiators "are far apart" when it comes to reaching an agreement. White has been a Chevron-employed steelworker for just under three decades.
"It's hard to negotiate when one side sees flesh and bone and other side sees the bottom line," White said. "If we had more people and could get a better pay rate, maybe our members wouldn't feel obligated to come in and work as many as 70 hours a week to make ends meet. We don't believe that is safe."
Due to the higher cost of living in the San Francisco Bay area where the refinery is located, USW is asking for a 5% increase in wages in addition to the 12% national wage increase for steelworkers agreed to in February. The wage increases will be implemented for the roughly 30,000 union employees over the course of four years.
"It's rough for the blue-collar worker in the Bay Area, and we asked for a 5% bump to help us out a little bit with our medical at Kaiser, which went up 23% last years," White said.
While the national union agreement has been ratified, roughly 200 union locations still have plant-specific contracts to negotiate.
In its most recent proposal, Chevron offered a 2.5% additional wage increase for Richmond plant workers.
On Sunday, March 20, the plant's 500 union steelworkers were bussed out of the San Francisco Chevron refinery, with non-union staff being brought in by the company to make up the work. This was just hours before the strike was scheduled to begin, at midnight. On Saturday, following the vote to reject Chevron's recent offer, the USW instructed workers to remove their personal equipment from the plant prior to the strike.
Economists have expressed concern over how this strike could affect gas prices in California, where the price per gallon is already $5.847.