An Iraqi oil workers union has challenged the largest subcontractor operating in Iraq.

Jobless Recovery

By outsourcing labor, U.S. planners of Iraqi “democracy” do not include unions

BY Jonathan Reingold

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Hassan Jum’a is an impressive negotiator. As head of the 10,000-member Southern Oil Company Union in Iraq, last December he successfully challenged the hiring and wage policies of Al Khorafi, a Kuwaiti subcontractor for the U.S. construction giant Bechtel and the Halliburton subsidiary Kellogg Brown & Root (KBR). Jum’a’s union first flexed its muscles against Al Khorafi in October, when its members launched a two-day wildcat strike at the Bergeseeya oil refinery in Basra. They literally dragged out the predominantly Pakistani and Indian workforce Al Khorafi had imported and demanded that the company hire Iraqi workers in their place.

Union members also protested at Al Khorafi’s headquarters, and tribal leaders topped off the strike by threatening to bomb the company’s offices. Jum’a’s strong-arm tactics paid off, and his union now controls access to all Southern Oil locations, barring all foreign workers and KBR representatives. Al Khorafi, the largest subcontractor in Iraq, is now doing its best to placate the powerful union. The company is paying wages of $125 per month—more than three times the state-enterprise minimum wage level set by Coalition Provisional Authority (CPA) administrator Paul Bremer. Al Khorafi even donated wheelchairs, blankets, computers, and desks to the union and renovated a private hospital for Khorafi employees, according to Occupation Watch, an NGO in close contact with the union.

In the struggle to transform Iraq into a viable democracy, the Bush administration may be overlooking a powerful force for change: a long history of labor unionism in Iraq, on which workers already are beginning to build. Right now they face daunting obstacles, given a 1987 law that banned unions and collective bargaining in the public sector (with the exception of state-sanctioned Baathist unions, whose leaders joined in Saddam’s mass killing and torture campaigns). About 70 percent of Iraq’s economy is state-owned so most workers currently cannot unionize legally.

At the end of World War I, Iraqi workers formed oil, railway and dockworker unions in the fragmented country that Winston Churchill carved out of the desert. British occupiers quashed repeated strikes during six years of occupation. Armed with a mandate to rule from the League of Nations, the British installed a Hashemite monarchy that maintained a ban on union organizing until a nationalist-led coup in 1958, in which army General Abd al-Karim Qasim assumed power. Under Qasim’s watch, unions swelled in rank and number; by 1959, 250,000 workers were unionized.

In February 1963 the Baath party, aided by the CIA, overthrew Qasim. That November, when Nasserite army officers seized power, unions enjoyed five years of relative freedom until a second Baathist officer coup in 1968. Within four days, the new Baath regime arrested all union leaders and replaced them with loyal Baathists.

When Saddam Hussein came to power in 1979, he continued to suppress unions, even executing some Baathist union leaders. In 1987, Baathist unions supported Saddam’s Orwellian decree: “From now on, the title ‘worker’ is abolished and all workers shall become official employees by the State. … As everybody is now a government employee, there is no more need for trade unions.”

Still determined to keep the idea of independent unions in Iraq alive, organizers secretly formed the Workers’ Democratic Trade Union Movement in 1980, which received support from trade unions abroad, particularly in the United Kingdom.

Immediately after the fall of Saddam’s regime, when British troops once again found themselves in Basra, Iraqi unions reemerged. In May they mounted a strike, calling for the right to organize and protesting the appointment of a Baath Party member as mayor.

In June, hundreds of Iraqi union organizers met in Baghdad and founded the Workers’ Democratic Trade Union Federation. Since then, a host of unions have materialized, including the Oil and Gas Union, the Transport and Communication Union, and the Construction and Carpentry Union.

So far the CPA has taken no notice of Iraqi unionists’ calls for legalization and bargaining rights, but the international labor movement has shown a keen interest. In December, the International Labor Organization (ILO) and the International Confederation of Free Trade Unions hosted Iraqi union representatives at a Jordan conference to discuss ways to help Iraqi labor leaders “build new, transparent and democratic unions,” according to an ILO statement.

Last fall in Basra, workers went on three strikes against occupation authorities, demanding fuel, livable wages and clean water, says Gene Bruskin of U.S. Labor Against the War (USLAW). “The right to organize is fundamental to democracy,” says Bruskin, and even President Bush would be hard pressed to argue otherwise.

Iraq’s workforce draws on a highly educated population (Iraq boasts more Ph.Ds per capita than the United States), and has no shortage of engineers and well-trained laborers, yet unemployment is at 50 percent, according to a joint United Nations-World Bank report released in October. Instead of hiring Iraqis, the CPA and U.S. contractors are shipping in foreign laborers at a much higher cost. Their hands are tied, government and corporate officials say, because of security threats.

“We don’t want to overlook Iraqis, but we want to protect ourselves,” Colonel Damon Walsh, head of the CPA’s procurement office, told the Financial Times in October. “From a force-protection standpoint, Iraqis are more vulnerable to a bad guy influence.” In the same report, a Pakistani manager of a catering company for troops in Iraq said he hires Iraqis only to do the cleaning.

For now, the high cost of foreign labor due to transportation and housing expenses appears to make little difference to contractors in postwar Iraq. Although the CPA mandates that 10 percent of the half-trillion dollars in potential contract largesse go to small business subcontractors, only a fraction of even this tiny share will find its way to Iraqi workers and companies. And of the Iraqi firms that have managed to land contracts, many are tied to Pentagon favorite Ahmed Chalabi, the powerful former exile who sits on the Governing Council.

Legalizing unions in Iraq could go a long way toward preventing favoritism in the contracting process, given that unions have a vested interest in promoting transparency and accountability from their employers. Even better, the United States would help revive an Iraqi democratic tradition and secure reconstruction jobs for the many qualified Iraqi workers who grow more restless day by day.

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Jonathan Reingold has written for the Financial Times and is a former research assistant with the Arms Trade Resource Center at the World Policy Institute.

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