Transocean Is Cutting Injured Oil Rig Workers’ Pay


Transocean Ltd. plans to discontinue paying full salary and benefits by Dec. 15 to crew members injured in the Deepwater Horizon disaster in the Gulf of Mexico, according to the company’s latest court filing.

The company announced the cutoff in a one-sentence court paper filed Friday. More than 60 lawsuits have been filed against Transocean by workers claiming they were injured as a result of the explosion six months ago that caused the massive BP oil spill. The company has acknowledged injuries to 17 crew members.

Transocean, which owns the Deepwater Horizon platform, provided no details to the court. The pay cut affects the less seriously injured. They will be paid under the requirements of several maritime and workers’ compensation laws, said a source with knowledge of the payment plan. Transocean declined to provide a dollar figure.

But Kurt Arnold, a Houston attorney representing about 25 workers who have sued, said crew members will receive $25 a day.

“They are taking guys who made $10,000 to $15,000 a month to $25 a day. That is it,” Arnold said.

The development comes as the personal-injury and wrongful-death claims against the world’s largest offshore driller have been consolidated with more than 300 other spill-related lawsuits in federal court in New Orleans. The majority of the suits against BP and its partners in the calamitous drilling operation were filed by fishermen, shrimpers and property owners who have claimed economic losses as a result of the spill.

Several attorneys for the crew members say folding the personal-injury and wrongful-death claims into the larger, technically complex case will delay cases that could be settled more quickly. They say the pay cut to crew members only adds to the pressure on injured workers to settle quickly out of court.

U.S. District Court Judge Carl Barbier announced last week that the first “test” trial could begin by June. He rejected BP’s suggestion that the first trial begin in 2013 or 2014. He also declined a request to separate out the injury and wrongful-death claims from the larger case.

“The problem for us is being lumped into this group with shrimpers, fishermen and hotel owners whose damages are not yet known and may not be known for years,” said Barry Roach, an attorney in Lake Charles, La., who is representing the family of Wyatt Kemp, one of the 11 workers killed on the rig.

Arnold said some of his clients have tried to return to work, but some have neck and spinal injuries that require surgery and they are physically unable perform the job.

“Some of the jobs require that you be able to lift 60 pounds,” he said. “It doesn’t take too many months of missing your salary before you have trouble making house and truck payments.”

When the explosion occurred April 20, 126 people were on the rig. The majority of them worked for Transocean, although the company has not publicly said how many of its employees were on board. Nine of the 11 men killed on the rig worked for Transocean.

The company has continued to pay full salary and benefits to the survivors of the workers who were killed as well as the most seriously injured. It has settled claims with two of the families of men killed.

Last month, Transocean sent out a letter to other workers on the rig, offering to settle claims with lump sums equivalent to six months’ pay.

“This offer will remain available to you until Dec. 31,” the letter said. “Whether or not you choose to accept payment and sign the release [against making any further claim] is your decision and your decision alone. Your continued and future employment with Transocean will not be affected by your decision.”

Transocean sought to limit its financial liability within days of the explosion. On May 13 — 12 days before the company held a memorial service for the workers who were killed — Transocean filed a request in federal court in Houston to limit its liability to slightly more than $26 million. The company cited the Limitation of Liability Act of 1851, which says that the owner of a sunken vessel is liable only for its value after the accident. The oil rig burned and sank.

Transocean CEO Steven Newman has said that the terms of the company’s contract with BP hold the British oil giant responsible for all damages and liability from the oil spill.

Transocean’s request also has become part of the consolidated case in New Orleans. Judge Barbier said he has scheduled a separate trial in February 2012 to assign percentages of fault to BP, Transocean and the other companies sued.

Meanwhile, Congress has considered revising the 159-year-old law and two other maritime laws to enable injured workers and families of the dead to recover more generous compensation from the companies than allowed under current law.

In June, the House of Representatives passed changes to the laws that would apply retroactively to the BP spill, but the Senate version stalled after the cruise ship industry and other maritime interests objected to the changes as overly broad.

Senate Democratic leaders have not said if they intend to bring the measure up for a vote in the lame-duck session after the election.

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Stuart H. Smith is an attorney based in New Orleans fighting major oil companies and other polluters.
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