The Dynamics of Policies and Practices of Labour Contracting in the Nigerian Oil and Gas Sector

Abstract

This study critically examined the dynamics of the policies and practices of labour contracting within the Nigerian oil and gas sector as operated by some selected multinational organisations, namely: Mobil, Shell and Chevron. The study examined the nature of labour contracting, how and why it was adopted; and the implications of MNCs using such policies and practices in managing Nigerian workers. The study shed light on labour contracting arrangements and emerging employment relationships, as well as tensions among workplace actors. The research methodology was qualitative and was essentially driven by a subjective philosophy. It has an ontological undertone embedded with social constructionist approach. The target population for the study, therefore, was all the randomly selected contract workers of the three MNCs, the contractors of the user firms, and the two trade unions-NUPENG and PENGASSAN who were given survey questionnaires to complete and were engaged in semi-structured interviews. The study found that there are increased tensions in the working relationship. Other findings from this study include: the challenges that come with the entry point (recruitment); pronounced disparities in the remuneration packages between contract staff and permanent employees; contracted labour being faced with poor working conditions; and increase in the precarious nature of job security.

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“…The Federal Republic of Nigeria is Africa's most populous country (203 million) and Sub Saharan Africa's largest economy (Ajonbadi 2015;the CIA World Fact Book 2019). It is a middle income, mixed economy (Mordi et al 2012), the most extensive tropical land in the West African region (Phillips 2004), the third-largest economy in Africa with diverse ethnic groups of each speaking a different language (Phillips 2004;Mordi et al 2012;the CIA World Fact Book 2019).…”

“…Since 1960, Nigerian has alternated between the democratic and military government with the military constituting 28 out of the 44 governments (Phillip 2004;Mordi and Mmieh 2009;the CIA World Fact Book 2019). The resultant effect of this is a lack of stable government and a lack of sustained labour policies which have in turn, negatively impacted the configuration of the labour market (Phillip 2004;Ajonbadi 2015;the CIA World Fact Book 2019). Thus, regulatory constraints and security risks have limited new investment in oil and natural gas, resulting in a reduction in Nigeria's oil production.…”

“…Thus, regulatory constraints and security risks have limited new investment in oil and natural gas, resulting in a reduction in Nigeria's oil production. In addition to this, Nigeria has been plagued by issues such as inadequate power supply, lack of infrastructure, a slow and ineffective judicial system, an inconsistent regulatory environment, unreliable dispute resolution mechanisms, insecurity, pervasive corruption and unemployment (Philips 2004;Mordi and Mmieh 2012;Ajonbadi 2015;the CIA World Fact Book 2019). The weakness and instability prevalent in the industrial sector of the country also impact negatively on the economy by resulting in surplus labour and a scarcity of jobs (Philips 2004;Mordi and Mmieh 2012;Ajonbadi 2015;the CIA World Fact Book 2019).…”

“…In addition to this, Nigeria has been plagued by issues such as inadequate power supply, lack of infrastructure, a slow and ineffective judicial system, an inconsistent regulatory environment, unreliable dispute resolution mechanisms, insecurity, pervasive corruption and unemployment (Philips 2004;Mordi and Mmieh 2012;Ajonbadi 2015;the CIA World Fact Book 2019). The weakness and instability prevalent in the industrial sector of the country also impact negatively on the economy by resulting in surplus labour and a scarcity of jobs (Philips 2004;Mordi and Mmieh 2012;Ajonbadi 2015;the CIA World Fact Book 2019). The unemployment rate currently stands at 24% while the population below poverty line stands at 70% and corruption, pollution, and corporate indifference have eroded job growth and living standards in the rest of the country (Phillips 2004;Mordi et al 2012;Ajonbadi 2015;the CIA World Fact Book 2019).…”

“…The weakness and instability prevalent in the industrial sector of the country also impact negatively on the economy by resulting in surplus labour and a scarcity of jobs (Philips 2004;Mordi and Mmieh 2012;Ajonbadi 2015;the CIA World Fact Book 2019). The unemployment rate currently stands at 24% while the population below poverty line stands at 70% and corruption, pollution, and corporate indifference have eroded job growth and living standards in the rest of the country (Phillips 2004;Mordi et al 2012;Ajonbadi 2015;the CIA World Fact Book 2019). Despite the above challenges, the current functioning sectors in Nigeria remain oil and gas, agriculture, services, finance, telecommunications, legal, banking and entertainment sectors (Mordi et al 2012;Ajonbadi 2015).…”