Sorbello, Paolo (2021) Industrial relations in Kazakhstan’s oil sector (1991- 2019). PhD thesis. http://theses.gla.ac.uk/82271/ Copyright and moral rights for this work are retained by the author A copy can be downloaded for personal non-commercial research or study, without prior permission or charge This work cannot be reproduced or quoted extensively from without first obtaining permission in writing from the author The content must not be changed in any way or sold commercially in any format or medium without the formal permission of the author When referring to this work, full bibliographic details including the author, title, awarding institution and date of the thesis must be given Enlighten: Theses https://theses.gla.ac.uk/ [email protected] Industrial Relations in Kazakhstan’s Oil Sector (1991-2019) Paolo Sorbello MA Russian, Central and East European Studies; MA International Relations; MA International and Diplomatic Studies This thesis is submitted in fulfilment of the requirements for the degree of PhD within the University of Glasgow School of Social and Political Sciences College of Social Sciences University of Glasgow January 2021 1 “I declare that, except where explicit reference is made to the contribution of others, that this dissertation is the result of my own work and has not been submitted for any other degree at the University of Glasgow or any other institution.” Printed Name: PAOLO SORBELLO Signature: _________________________ 2 Abstract The objective of this thesis is to determine the extent to which the influence of transnational corporations into Kazakhstan’s authoritarian law-making and labour practices has had an effect on worker disenfranchisement. The case study aims to plug two niches: labour processes both in Kazakhstan and in the global oil sector are understudied. The social sciences scholarship on Kazakhstan has concentrated on its post-Soviet legacy, on its macroeconomic dependency on oil exports, and on its authoritarian transition. Political economy studies of the oil sector have focused on its effect on a country’s budget and democratic fabric, while anthropologists have explored the peculiar aspects of “living around oil.” This dissertation enters a conversation with the scholarship that studies the relationship between workers, companies, and governments. Yet, rather than approaching the topic from a strict Industrial Relations standpoint, it follows the “lifetime” of the worker across the topical moments of hiring, working, and outstaffing. This study argues that both private oil companies and government institutions have devised specific strategies to cut their costs, both material and immaterial, and increase their control over their worker-citizen in Kazakhstan. Legal instruments, such as Labour Codes, or corporate intermediaries, such as manpower agencies, have worsened conditions for the workers. In addition, the thesis shows processes of co-optation of trade unions, which were undermined through adverse legislation and political pressure, and the repression of independent labour actions. In the in-depth analysis of the case of Kazakhstan, financialisation and precarisation are shown to be complementary catalysts of corporate and state policies against labour. This work offers a novel framework that could be replicated in other oil-rich contexts, where the peculiar dynamics in the hydrocarbon sector have triggered an increased precarisation of the workforce. 3 Table of Contents Abstract ____________________________________________________________ 3 Note on Translation and Transliteration _________________________________ 7 Acknowledgements ___________________________________________________ 8 Introduction _________________________________________________________ 9 The research objective ______________________________________________ 14 A novel approach: Three phases of working for oil ________________________ 16 A breakdown of the chapters _________________________________________ 18 1. Methodology _____________________________________________________ 23 Introduction _______________________________________________________ 23 Selecting Kazakhstan, framing the question, and gathering data ______________ 24 Doing fieldwork in an authoritarian context ______________________________ 29 Conducting fieldwork in Kazakhstan ___________________________________ 32 Conclusion and final methodological remarks ____________________________ 40 2. Literature Review _________________________________________________ 42 The standard framework and its faults: Industrial Relations Systems __________ 42 States and institutions: Rentierism, patronage, and curses ___________________ 45 Workers: Between assemblages and carbon democracy ____________________ 47 Companies, shareholders, and value in the former Soviet Union and Kazakhstan 50 The case of Kazakhstan _____________________________________________ 53 The gap and the way forward _________________________________________ 56 3. Oil in Kazakhstan: History and Literature ____________________________ 57 Introduction _______________________________________________________ 57 The discovery of oil ________________________________________________ 58 Centre-periphery leadership struggles __________________________________ 66 After independence: The promise of privatisation and multivectorism _________ 70 4 Conclusion _______________________________________________________ 75 4. Labour in Kazakhstan: History and Literature ________________________ 77 Introduction _______________________________________________________ 77 Labour in the Soviet Union and the Kazakh SSR __________________________ 78 After Stalin: The appearance of the Commissions _______________________ 81 Parallels in the Central Asia experience ______________________________ 83 Trade Unions in the Kazakh SSR ____________________________________ 85 From Soviet to neo-liberal labour legislation _____________________________ 88 Zhanaozen ________________________________________________________ 95 After Zhanaozen __________________________________________________ 100 Conclusion ______________________________________________________ 101 5. The Hiring Phase_________________________________________________ 104 Introduction ______________________________________________________ 104 Hiring policies in the oil industry and in Kazakhstan ______________________ 106 Hiring bodies: HR or manpower agency? _______________________________ 111 Manpower agencies in Atyrau _______________________________________ 115 Local Content: A stumbling block for TNCs ____________________________ 117 Nationalisation, education, and the “future” _____________________________ 124 Conclusion ______________________________________________________ 132 6. The Working Phase_______________________________________________ 134 Introduction ______________________________________________________ 134 The workshift system and pay _______________________________________ 136 Enterprise nature and work __________________________________________ 139 Working for a government company: The transition to a new wage system __ 141 Working for an international company _______________________________ 143 Division of labour, ethnicity and conflicts ______________________________ 146 A pivotal moment: The unbundling of Kazmunaigas ____________________ 148 5 Striking oil workers shot in Zhanaozen ______________________________ 152 Conclusion ______________________________________________________ 161 7. The Outstaffing Phase ____________________________________________ 164 Introduction ______________________________________________________ 164 The finite life of an oilfield, the finite life of an oilman ____________________ 166 Out of work in an oil town __________________________________________ 169 Sectoral trade unions: Musical chairs instead of labour struggle _____________ 174 Changing state legislation to streamline job cuts _________________________ 179 “Freedom” and “adaptation” as the new government mantras _______________ 183 Conclusion ______________________________________________________ 188 Conclusion ________________________________________________________ 191 List of References __________________________________________________ 198 Appendix 1: Interviews______________________________________________ 212 6 Note on Translation and Transliteration Doing research in Kazakhstan implied the oral and written use of four languages – Russian, English, Italian, and Kazakh in order of frequency – and producing a final work in English meant that I had to make linguistic choices to translate and transliterate words, names, and toponyms. The continuous attempts of the government of Kazakhstan to set in stone a new Latin-character-based alphabet and phase out the modified-Cyrillic one used at present constituted a challenge, since some of the proposed new versions would revolutionise the orthography: Kazakhstan would become Qazaqstan, for example. Yet, the rapid changes and inconsistencies – current president Kassym-Zhomart Tokayev switched the spelling for his name into Qasym-Jomart Toqayev, yet his online Twitter handle is still @TokayevKZ and his description says: “President of the Republic of Kazakhstan” as of December 2020 – suggested that I continue use a standard transliteration from the modified-Cyrillic alphabet. My choices in this regard were driven by readability and transparency for cross- referencing. In this light, I aimed to employ the most commonly used spellings, especially for what concerns city and people’s