BP cuts checks for workers' lost wages

By Chavon Sutton and Ben Rooney, staff reporters


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 26,000 workers and business owners along the Gulf Coast have filed claims so far for lost income.

BP (BP) has made payments already on over 11,600 of those claims, disbursing $35 million to fishermen, shrimpers, charter boat captains and others whose livelihoods are now in limbo. The company has 420 claims adjusters staffing nearly two dozens processing centers in Alabama, Florida, Louisiana and Mississippi.

But those payments are considered only partial payment for the claims that have been filed, and questions remain about whether BP will pay the full amount, according to Clint Guidry, president of the Louisiana Shrimpers Association.

"There's no legal obligation for them to do anything at all," he said. "This is all just P.R. money, that's all."

John Pack, a BP spokesman in Houston, reiterated the company's commitment to pay all legitimate claims associated with the disaster.

"We've acted as quickly as possible, maybe not as quickly as some people would like," said Pack. "But we've put a lot of effort into this, and we will continue to pay all legitimate claims."

Damon McKnight is the owner of Super Strike Charters, which operates three boats in Venice, La. He said he was paid $5,000 in early May. 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.

McKnight said Sunday that he is now working for BP, doing "odds-and-ends work." He said the company is paying him and his crew a daily rate that is comparable to what he would be earning otherwise, though he has yet to receive a check.

"I'm getting more concerned about the future," said McKnight, who has been in business for 14 years. "Every day this goes on, it will take that much longer to get back to business as usual."

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," Josh Howard, the 28-year-old owner of Venice-based Deep South Charters, told CNNMoney last week. "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."

Howard could not immediately be reached Sunday to find out if his claim had been processed.

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

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