Hawaii Gas workers strike raises concerns about statewide service

Large-scale gas users, including the state’s hotel and restaurant industries, are bracing for possible service disruptions after more than 200 unionized Hawaii Gas employees went on strike early Thursday.

The utility and Hawaii Teamsters and Allied Workers, Local 996, have been negotiating a new contract for weeks, but the union rejected the company’s Tuesday “last, best and final offer” and walked off the job at 12:01 a.m. Thursday at seven locations across Hawaii, including three on Oahu.

Visitor and restaurant industry leaders and other business customers are keeping a watchful eye on the situation because the strike could lead to disruptions in gas service that would curtail their operations.

Hawaii Gas says it has about 70,000 customers and is the state’s only franchised gas utility and its largest propane distribution business. It serves residences and businesses alike.

Lynette Eastman, general manager of The Surfjack Hotel & Swim Club in Waikiki, said any disruption in access to gas or service to customers could have broad impacts on tourism and community safety.

“The hotel and visitor industry relies a lot on gas. Some of our hotel water heaters are gas. Our kitchens are gas. It’s not good,” she said. “I would be concerned because of the uncertainty and who it affects, the jobs it affects and if it would affect the service and the access to gas.

“The labor shortage is real,” she said. “How are they going to get enough trained people to fill in? Not just anyone can handle gas.”

Zippy’s restaurants also depend on gas for their operations, said Zippy’s spokesperson Kevin Yim.

“Gas powers things like our flat-top grill; it powers our fryers; it powers things that make steam to heat things up,” Yim said. “It is the major source of energy for the kitchen, as it is for many restaurants.”

All 20 Oahu Zippy’s locations use propane from Hawaii Gas for their cooking equipment. As of Thursday afternoon there were no reported operational interruptions at the restaurants.

There isn’t yet a plan in place if gas service is disrupted, but Zippy’s is working on one, according to Yim.

“We have large propane tanks at each one of our facilities. … That is how we store the propane,” Yim said. “Should there be a disruption in service, we would have to find a new way to get propane in those tanks. We don’t know yet. We haven’t really come up with a contingency plan as of now, but we are looking at one.”

But Hawaii Gas executives said basic gas services will not be interrupted.

Of its 359 employees, 217 are union members, the utility said. Its strike contingency plans include deploying 142 nonunion employees to maintain operations. The deployed employees are already within the company, Hawaii Gas said. Many are in management positions.

Company officials did, however, say that some services might be disrupted.

“We will maintain basic gas service to all utility and non-utility customers statewide, however certain services may be temporarily curtailed while we continue negotiating with our labor union,” Hawaii Gas said in a statement.

Those services include new appliance installations, nonemergency appliance repairs and adjustments, energy-efficient audits of appliances, and in-person bill payments at Hawaii Gas offices.

Hawaii Teamsters leaders contend that the Hawaii Gas plant at Campbell Industrial Park on Oahu can’t run for long without workers before services are affected.

“The SNG (synthetic natural gas) plant itself can only run for 10 hours unmanned. If the pressure drops too low, gas from Kapolei to Hawaii Kai will be shut off,” said Kingsley Lei, lead contract negotiator for Hawaii Teamsters.

Hawaii Gas stressed in the company’s statement, “We want to reassure the public that all Hawaii Gas offices and facilities continue to operate.”

Around 60 employees were striking Thursday morning outside the Hawaii Gas location on Kamakee Street in Kakaako. Some were sign-waving at the building’s entrances, and others picketed at the intersection of Kamakee Street and Kapiolani Boulevard.

The unionized employees include clerical workers, drivers and “technical and distribution” workers. Many of the employees at Kamakee Street maintain and service pipes and other equipment, shop steward Ka‘ai Conradt said.

“We fix the leaks, we do all the maintenance on residential, commercial … meters, underground pipelines,” he said. “Middle of the night, if there’s a leak, it’s our guys from this location that go out and handle it.”

Union leaders accused the company of “bad-faith bargaining.”

“We tried to get them back to the table multiple times, but they didn’t want to do it until we commenced the strike,” Holu said Thursday morning. “They did reach out (Wednesday), trying to settle. I’m willing to settle and get back to the table and give our members what they rightfully deserve: fair wages and fair medical (costs). Our members, from what they’re offering, are paying to go back to work because of medical costs.”

Hawaii Gas countered in a statement, saying, “It is important that the company’s consistent intent to negotiate and to do so in good faith not be mischaracterized. We have made great efforts to move the negotiations forward, including offering to have the parties seek the services of a neutral mediator. To say that the company’s intentions are anything other than for the parties to meet and negotiate in good faith would not be reasonable or accurate.”

Company executives said the union is demanding a 28.5% salary increase for a three-year contract period after initially demanding a 30% increase, suggesting that those demands, if met, could affect gas prices.

“It is in our best interest to offer a competitive compensation package to retain our employees, and with energy prices already sky-high, we also have a responsibility to balance those needs with keeping pricing affordable,” Hawaii Gas said in the statement. “We don’t want to exacerbate the high cost of living in our state. This requires a delicate balancing act to meet all these imperatives.”

Conradt said the strike was largely supported by unionized staff, with 161 voting for it and seven voting against.

“It’s time to stand up for our rights. We’re out here every day putting in all these hours, sacrificing our bodies for the company,” he said.

As the labor strife plays out, hoteliers, restaurateurs and other gas users watch with concern.

Jerry Gibson, president of the Hawaii Hotel Alliance, noted that as of Thursday afternoon there appeared to be no widespread service issues.

But, Gibson noted, “Many of our boilers (for heating water) are run by natural gas. Our kitchens are … run by natural gas. Our refrigeration can be run by natural gas. Our torches around the buildings, in many cases, are run by natural gas. Should we lose the availability to have gas, that would cause challenges.”

Mufi Hannemann, president and CEO of the Hawaii Lodging and Tourism Association, struck a hopeful note and pointed out that the union and the utility kept service to the visitor industry in mind as the strike deadline loomed earlier this week.

“Hawaii Gas and the Teamsters Union took precaution to ensure that the visitor industry was apprised of the possibility of a strike,” he said in a statement. “While we stand prepared, we hope that an agreement that is amenable to both parties can be reached sooner rather than later.”

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Star-Advertiser reporter Allison Schaefers contributed to this story.

This story has been updated to include a statement from Hawaii Gas saying, “all Hawaii Gas offices and facilities continue to operate.”