1,000 unionized oilsands camp jobs lost and more to come: Trade union

Oilsands companies have recently cut about 1,000 jobs, and 170 workers at a lodge just north of Fort McMurray will lose their positions the day after Christmas, trade unions said.

Unions say oil companies laying off workers in favour of cheaper ones a trend

Trade unions say job losses in the oil sands aren't only on production sites but in the camps where workers stay. (Getty Images)

Oilsands companies have recently cut about 1,000 jobs, and 170 workers at a lodge just north of Fort McMurray will lose their positions the day after Christmas, trade unions said.

"It's really cutthroat up there in the Fort McMurray area," said Doug O'Halloran, the president of United Food and Commercial Workers Canada (UFCW) Local 401.

"But it's big business — they don't have any concerns about the average worker. It's all about the profit they need to make."

UFCW, which represents the employees at Beaver River Lodge, said 170 workers are being sent home from Buffalo Métis Catering.

Doug O'Halloran, president of United Food and Commercial Workers Canada (UFCW) Local 401. (CBC News)

Houston, Tex.-based Civeo Corp. owns the catering company in a joint venture with five Métis communities.

In December, Civeo notified employees in a letter their jobs were ending on Dec. 26 because the company had found cheaper non-union contractors to do the same jobs, according to the union.

The employees, who perform duties such as cleaning, cooking and laundry, were given 26 days' notice.

The union said Civeo asked the employees in August to take a pay cut of about 44 per cent.

Months earlier, employees gave up increases to pay and travel allowances.

'Commodity prices have changed'

Civeo said in a statement it could not reach an agreement on needed changes to ensure its company remained viable.

"Commodity prices have changed dramatically in recent years and have had a significant impact on the businesses that Civeo serves," the statement read.

It said the company "diligently" communicated those challenges to employees and even implemented changes that would retain workers but, in the end, jobs needed to be cut to keep the lodge open.

'Financial gain for the million-dollar company'

Employees like shop steward Rob McDonnell say it's hard to be in a festive mood when unemployment hangs over his family at Christmas time.

"To be honest, I have a Grade 10 education. Now, I am laid off my job for no apparent reason other than more financial gain for the million-dollar company that I work for," McDonnell said.

McDonnell said he made about $90,000 a year working at the camp.

O'Halloran said McDonnell joins the growing ranks of unemployed oilsands support workers. The union boss said low oil prices were an excuse for companies to take advantage of labour.

The company's third-quarter 2016 results said Canadian lodge revenues increased by nearly 11 per cent year-over-year because it expanded its capacity and has had higher occupancy from customers who are involved in the Fort McMurray wildfire recovery efforts. But that was offset by a decline in the average daily lodging rate from $112 to $100.

As well, its mobile, open camp and manufacturing revenues have declined because of lower activity levels.

Civeo's Canadian lodges and camps generated $73.5 million US between July and September, but incurred an operating loss of $44.7 million US during the same three-month period. Adjusted earnings for the quarter were $19.6 million US.

Adjusted earnings from its Canadian operations for the first nine months of 2016 were $57.6 million US, down from $81.5 million US for the same period in 2015.

A dump truck works near the Syncrude oil sands extraction facility near the city of Fort McMurray, Alta., on June 1, 2014. (Jason Franson/Canadian Press)

Other oilsands camps have recently closed.

Last week, another oilsands contractor, CEDA, locked out 15 mechanics after collective bargaining talks stalled.

The union representing workers, Teamsters Local 362, agrees oil sand companies and firms throughout Alberta are taking a tougher stand against unions — and it's tied to the tough economy.

"Collective-bargaining is almost always linked to the economy and to think it isn't it's naive," said Wayne Garner, vice-president of the union.

The UFCW plans to take Civeo to court on grounds the company can't let go of workers while both sides are going through wage negotiations.

The Canadian Association of Petroleum Producers declined an interview about camp job losses, saying it did not track employment numbers for oilsands camp support staff.