Keystone XL Pipes in Heavy Industry, Cross-Border Workforce Issues

Last week, U.S. President Barack Obama vetoed a bill to move forward with construction of a proposed 1,179-mile (1,897 km), 36-inch-diameter crude oil pipeline beginning in Hardisty, Alberta, and extending south to Steele City, Nebraska - the Keystone XL pipeline. This project would have an immense impact on heavy industry companies in both Canada and the United States.keystone XL pipes in heavy industry

Keystone XL Pipes to Cause Complex Payrolls

The proposed line would lay a more direct and larger conduit connecting the cities; the existing Keystone transport pipeline runs east across Saskatchewan before turning south through the Dakotas to Nebraska. Keystone XL would be able to transport up to 830,000 barrels of oil each day (up from the current 550,000). Ultimately, much of that oil would make its way to refineries along the U.S. Gulf coast (where there are opportunities for export). A much smaller amount of US-produced oil would also be transported by the new Keystone XL line. 

The U.S. State Department estimates that construction of the Keystone XL line would create 42,000 jobs over a two-year construction period (a small number of which would remain after the pipeline is built). These new jobs in both Canada and the U.S. would be a boon to struggling industries and workers. Also, since the pipeline areas are overwhelmingly rural and sparsely populated, these workers would likely be imported from other states and provinces. Companies in these infrastructure-building heavy industries should be prepared for an influx of workers with cross-border issues and confusing payroll issues if they can’t efficiently and easily track, allocate and manage their personnel resources.

The Canadian National Energy Board approved the Keystone XL pipeline in March 2010, and it was approved by both the U.S. House of Representatives and Senate by narrow margins. Because the XL pipeline crosses the US/Canada border, the project requires presidential permit prior to construction, which Obama has refused pending the outcome of studies now underway to determine its economic and environmental value and impact. The White House press secretary has said it is still possible President Obama could approve the pipeline once the State Department cost-benefit review is complete. Or, it’s possible that the issue will be revisited during the next presidential term(s).

U.S. Republicans and supporters note the job-creation aspects of the project, and note that numerous environmental impact studies have been conducted adjusting and approving the placement of the pipeline. Many Democrats and environmentalists, however, including the U.S. Environmental Protection Agency (EPA), warn that the increased oil production and use made possible by the pipeline will add to carbon emissions and contribute to global warming.

This type of large scale project would require the organizations involved to aggressively recruit to meet the labor demands. Retention of those workers as well as the ongoing management of the employee life cycle would require processes and systems be in place to meet the demand. The cross-border and cross-jurisdictional employees would have unique payroll implications as well -- specially designed payroll software can help handle complex payrolls and payroll management for heavy industry and cross-border workforce issues. Managers and HR departments in these related heavy industries should look at this as a opportunity to upgrade and integrate their HR systems so they are ready and able to take on this project if or when it is cleared for construction.

StarGarden can help you implement an integrated payroll and scheduling system that will put you ahead of the game and ready for whatever projects come down the pipeline! Our HR software for heavy industry is customizable for your company's specific needs. Contact us today to see how easy, affordable, and important an integrated system can be for you.

Click the button to download our free white paper with more information on StarGarden's HR solutions and how implementing a new HR system can improve your business! 


 Unionized Industry Solutions White Paper