From “Oil Nationalisation and Managerial Disclosure: The Case of Anglo-Iranian Oil Company, 1933-1951”

Chapter 3: Employee relations and Iranianisation

Author : Neveen Abdelrehim | The university of YORK

Iranian Oilworkers in Abadan 1940’s

The level of wages paid in the oil industry was considered more favourable than in other sectors with regard to unskilled labour[432].

Working conditions and training given by the oil industry to its employees was better than those offered in other sectors of the economy[433]. Nevertheless, the level of wages that the AIOC offered to its Iranian employees was always very low and had not risen in relation to their cost of living. The wages paid to Iranian workers were calculated on the basis of meeting the minimum necessities of existence for a single man. Whereas the oil workers were receiving less than Rials 80 per day which is equivalent to £4 a week, oil workers in the United States received $1.65 an hour which is about 6.5 times the rate paid by the AIOC. Moreover, there was no area outside the Middle East paying as low a rate as in Iran[434]. It is worth noting that the situation was almost the same for higher grades and the wages and salaries offered for executive posts did not meet the expectations of ambitious men. Even Mr. Elkington declared that he was afraid that if their Iranian employees compared Iran with highly industrialised countries in the matter of pay “it would be found difficult at the present time to find Persians who would work for the company”[435]. However, the fear of unemployment and loss of wages was always present in Iranian workers‟ mind. Iranian authorities including the Iranian Government accused the company of ignoring the terms of the 1933 Agreement to improve pay and social provision since the wages paid to the Iranian workers were calculated on the basis of meeting the minimum necessities of existence for a single man regardless of having his family accompanying him or not[436]. Wages also can be examined with reference to the comparative earnings data shown in Table (2) below.

Although Table (2) shows that AIOC‟s Iranian employees‟ remuneration
increased significantly after 1945, it is clear that higher graded Iranian employees received a disproportionate share of the general increase and it is clear that inequality within the Iranian workforce increased during the period. It is worth highlighting that the company‟s staff manager in Iran asserted in 1947 that “there is more joy in Iran over the appointment of one Iranian chemist/ engineer/ accountant/ doctor/ labour officer than there is over the appointment of 100 Iranian artisans or 1000 Iranian cooks”[437]. Jameson disclosed that “it was not the company‟s scale of salaries that was at fault
but the occasional discrepancy in individual salaries which gave rise to a certain amount of grousing”[438]. In the interim, he justified the low payment to the Iranians by claiming that the Iranian staff are paid in sterling and by converting the sterling into Rials, they would consider themselves very well paid[439]. Furthermore, the company justified the low pay to the Iranians by arguing “that a man working at home would have a higher standard of living than a Persian working in this country”[440]. In fact, the company used the excuse for their low pay to the Iranians that the wages were based on the market rate and that they could not consider paying rates in Persia exceeding the normal trade rates at home[441]. For instance, Gass disclosed that the AIOC “could not consider paying a Persian in his own country more than would be paid to British staff doing the same job at home”[442]. While the Iranians were not well paid, it was intended that British staff should be
paid a sterling allowance in addition to their salary since “it was appreciated that such a basic salary would be insufficient for British staff who were employed in a foreign country”[443]. Not only that, but also the British staff asked the company for entertaining allowances. For instance, Jameson emphasized in his correspondence to his father that

Before taking over the place I let them clearly understand
that I would expect a good entertaining allowance as we get all sorts of generals of people[444].

When the situation is taken as a whole, it is apparent that the British, with their
excellent rates of pay remained dominant and at the top of the hierarchy. From this position they were thus able to discriminate in favour of their British colleagues.


Notes & References :

432. Issawi and Yeganeh, The Economics of Middle Eastern Oil, 97.

433. Ibid, 151.

434. Elwell-Sutton, Persian Oil, A study in power politics, 89.

435. BP 67589, Notes of meeting held on 6th February 1934, 48.

436. Elwell-Sutton, Persian Oil, A study in power politics, 88.

437. Bamberg, The History of the British Petroleum Company, 360.

438. BP 67589, Notes of meeting held on 6th February 1934, 47.

439. BP 067627, Report on a visit to Tehran in 1938, 52.

440. BP 67589, Notes of meeting held on 6th February 1934, 47.

441. Ibid, 46.

442. Ibid, 48.

443. Ibid, 46.

444. BP 66815, Jameson to father, 24th October 1917, 4.


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