BP Unemployed Oil Rig Workers Fund

*** UPDATE 07-30-2010 ***
On July 30, 2010, BP announced in a press release that it will establish a $100 million charitable fund to support unemployed rig workers experiencing economic hardship as a result of the moratorium on deepwater drilling imposed by the United States federal government.

The Rig Worker Assistance Fund will be administered through the Gulf Coast Restoration and Protection Foundation, a supporting organization of The Baton Rouge Area Foundation (BRAF). More information is at RigReliefGrants.org.

The following is from Rig Worker Assistance Fund FAQ’s:

“The application hotline is (866) 577-8141, and information will be available online at RigReliefGrants.org. Until Sept. 1, the line has a recorded message. On Sept. 1, the line will go live to accept applications. We are hopeful the hotline will begin taking information from applicants before Sept. 1. If the line does go active before then, we will post the information at RigReliefGrants.org.”

– Read more on our Blog : How To Apply for BP Unemployed Oil Rig Workers Compensation Fund

*** UPDATE 06-15-2010 ***
“BP Chairman Carl-Henric Svanberg apologized for the worst environmental disaster in U.S. history and backed up his vow to regain Americans’ trust by agreeing to set aside $20 billion for victims of the Gulf Coast oil spill.”

– USA TODAY: Apologetic BP pledges $20B compensation fund
“President Barack Obama says BP has agreed to establish a $100 million fund to compensate unemployed oil rig workers affected by a six-month moratorium on deepwater drilling imposed in the wake of the Gulf oil spill. ”

– The Guardian: Obama says BP creating $100 M fund for oil workers
“Senate Majority Leader Harry Reid, D-Nev., also sought to take some credit. ‘While this fund will in no way limit BP’s liability, it is a good first step toward compensating victims,’ he said. Reid and other Senate Democrats proposed a $20 billion BP-financed fund earlier in the week.”
– Nola.com : BP to create $100 million fund for unemployed workers

BP this week agreed to establish a $100 million fund to support oil rig workers from the Gulf Coast states.

President Obama had imposed a 6-month moratorium on new deep water drilling in May to enable a commission to review the April 20 explosion and sinking of the Deepwater Horizon rig. This disaster killed 11 employees of Transocean and initiated the blowout that is polluting the Gulf of Mexico and the beaches and shorelines in Alabama, Mississippi, Texas, and Florida.

The government mandated work stoppage is guaranteed to create unemployment for the rig workers assigned to these rigs or about to be deployed on them.
The creation and availability of benefits from this $100 million fund will impact upwards of 10,000 workers and is welcomed news to those already laid off, destined to be laid off or without work as a result of the presidential order to halt the drilling of riskier wells.

Few details were released at the announcement as to how the oil rig worker money will be paid out. A White House spokesman said that any funds provided from the $100 million fund would be considered entirely separate and distinct from any unemployment money. Oil rig workers would not have to be rejected for or exhaust their unemployment payments before making claims for payment from the fund. The $100 million fund will be administered by a foundation, though further details remain to be worked out.

When asked at the White House briefing whether the $100 million would be focused solely on rig workers or also include the far broader category of support-service workers who inevitably will be affected by the moratorium on deepwater drilling, Browner responded, “it’s focused on oil rig workers.”

This is unfortunate because there will be many oil industry support-service workers left jobless or unable to find employment.
Criticism of the amount, $100 million, and the limited scope of who would be eligible, was immediately heard from both Democrats and Republicans.

“It shows they don’t even understand just how far-reaching their ban is on the entire economy,” commented Rep. Steve Scalise, R-Jefferson. In addition, he said that the $100 million would eventually demonstrate to be an ineffectual sum that wouldn’t even see the rig workers through the first two months of the government mandated moratorium. Concern for oil rig employees came also from Rep. Charlie Melancon, D-Napoleonville, who wrote to BP CEO Tony Hayward on Wednesday requesting that the company offer to pay the full salary of every oil rig worker who has been laid off due to the moratorium. He observes, “The direct wages lost during the shutdown may be as high as $330 million per month.” Melancon also calls the $100 million “a drop in the bucket of what is needed to make these workers whole.”

However, it should be noted, according to Carol Browner, head of the White House Office of Energy and Climate, who was part of the negotiations, BP would not have established the fund absent pressure from the White House. There was some concern within the White House that oil rig workers might not be able to participate in the $20 billion fund that BP had agreed to set aside to cover the pollution damage done to individuals and businesses working in the Gulf. Therefore, the $100 million fund for oil rig employees by BP was a welcomed result of the meeting because Browner also indicated that it there was “a very significant legal question about (BP’s) liability” for those harmed by the moratorium, which is a US government action.

Hopefully, the $100 million voluntary contribution by BP and the work that is being conducted in Congress to create a new program of unemployment modeled after the Disaster Unemployment Assistance Program, to provide benefits to workers who lose their jobs as a result of a spill of national significance, in this case the disastrous Gulf of Mexico oil spill, will be significant steps toward meeting the needs of unemployed oil rig workers.