BP cuts checks for workers' lost wages

bp_claims.gi.top.jpgFishermen gathered last week at BP's claims office in Bayou La Batre, Ala. By Chavon Sutton, staff reporter


NEW YORK (CNNMoney.com) -- The scope of the damage from the Gulf Coast oil spill is still hard to calculate, but here's a grim tally: More than 23,000 workers and business owners along the Gulf Coast have filed claims so far for lost income.

BP (BP) has made payments already on 9,000 of those claims, disbursing $27.8 million to fishermen, shrimpers, charter boat captains and others whose livelihoods are now in limbo, according to BP spokesman David Nicholas. The company has 420 claims adjusters staffing nearly two dozens processing centers in Alabama, Florida, Louisiana and Mississippi.

"We've paid claims for immediate hardship," which typically come to a month's estimated salary, Nicholas said. "We're trying to process the others as quickly as possible."

Damon McKnight is the owner of Super Strike Charters, which operates three boats in Venice, La. He said he was paid $5,000 three weeks ago. Among his employees, the captains of two of his boats got $2,500 each, while deckhands each received $1,000.

That's a drop in the bucket compared to what they could have earned out on the water, McKnight said. In a good year his company can pull in $50,000 a month during the fishing season's May to August peak.

"We expected to make a lot of money [this summer]. Right now, we're not making the money we need to make," said McKnight, who has been in business for 14 years.

Others are still on hold, unsure of when they will receive a payout.

"I submitted a claim three weeks ago and haven't heard back," said Josh Howard, the 28-year-old owner of Venice-based Deep South Charters. "I talked to [BP] once and they said my name was in the system."

Howard, who expects to be paid $5,000 for the month he's already been out of work, is fairly new to the charter business, and was relying on a strong season this summer to help pay off his startup costs.

"A lot of people just got their businesses up ... this was going to be a good year for a lot of us," he said. "I just got a new boat this year and spent $50,000 alone on tackle."

All claims will be assigned to an adjuster for evaluation, BP said in a prepared statement. Some will be paid within days, but BP's Nicholas said that "tax returns and previous records of earnings may be appropriate" for larger and more complex claims.

McKnight has already been asked to submit three years of tax returns in order to receive additional funds.

The requirement could prove thorny for fledgling companies like Deep South Charters, which are still struggling to establish themselves. "If they are going off the last three years, we're going to get screwed," Howard said.

BP recently said that costs to clean up the oil slick have exceeded $350 million, or $16 million per day, since the April 20 explosion that sank BP's Deepwater Horizon drilling rig 40 miles off the coast of Louisiana, leaving 11 workers missing and presumed dead.  To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Questions & Answers



QHow does a florist sell more in this economy? We changed our business to designing weddings and events only, as the everyday flowers are not selling. We had to throw out too much product at the end of the week -- flowers are perishable! More
Get Answer
- The Flower Lady, Suwanee, Ga.
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.07%4.07%
15 yr fixed3.13%3.09%
5/1 ARM3.22%3.08%
30 yr refi4.12%4.12%
15 yr refi3.19%3.16%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:

Sections

That number will likely grow as the Obama Administration eases restrictions with the Communist country. More

Reddit made the unusual decision to take down a subreddit that housed hacked Sony Pictures materials. More

News startup The Skimm announced a new round of funding, 1 million active readers, and plans to expand into a 'lifestyle brand.' More

Congress waited until the last minute to decide what to do with a slew of expired tax breaks. They extended most of them, and a handful will affect individuals directly. More

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.