Petrofac’s reversal of pandemic pay cut after axing workers

Petrofac has awarded eligible employees a 5% pay increase, reversing pandemic-related cuts initiated two years ago, as the firm looks to “recovery and growth” in 2022.

Responding to the immediate impact of the pandemic in April 2020, the oilfield services giant cancelled previouslyawarded pay increases and implemented a 10% pay cut at all levels.

The measures also saw the Jersey-headquartered firm announce a 20% reduction in headcount.

The measures were partially reversed last April, when it approved a 5% global pay increase to those affected by the cuts, though this excluded directors and the senior executive team.

However, headcount reductions have continued through the period, and of the 11,500 employees at the end of 2019, 8,200 remained as of the end of 2021 – a contraction of nearly 30%.

In its 2021 report, Petrofac said it would award a further 5% increase to employees affected by the initial cuts, effective of April 2022.

It has also reversed the 10% cut in salary for its senior executive team, and the 10% cut in fees for the chairman and the non-executive directors.

Chief executive Sami Iskander received a compensation package just shy of £1.8 million for 2021, inclusive of an annual £894,000 salary.

The past year has seen the company face serious challenges, in particular a Serious Fraud Office investigation which saw it plead guilty to failing to prevent former senior executives from paying £32m in bribes to help it secure contracts.

The investigation concluded with a ruling requiring the company to pay £77m for seven separate counts of failure to prevent bribery between 2011 and 2017.

The firm is planning “recovery and growth” in 2022.