Aberdeen-based energy services giant Wood Group is the latest oil business to transfer North Sea staff to a company in a tax haven to avoid employer national insurance contributions.
The move has been criticised by Scottish politicians, while union official Jake Molloy described it as “morally and ethically contemptible”.
The RMT union regional organiser said yesterday that dozens of companies working in the North Sea had already set up similar arrangements and he called for HM Revenue and Customs to look into the situation.
“This has been going on for more than a decade.
“For example, every catering contractor in the UK sector are now using this arrangement.
“It is costing the state millions of pounds of much-needed funds every year. National Insurance underpins things like pensions and healthcare.
“I have brought this situation to the notice of the government before, but there doesn’t seem to be that much interest in changing things.”
It emerged yesterday that up to 3,500 offshore workers at Wood Group Engineering (North Sea) could be affected by the move, which comes into force on April 1.
Staff have been told that their employment is to be moved to new firm Wood Group Offshore Services, based in Guernsey.
Yesterday, a spokeswoman for the Wood Group said: “In order to remain competitive and promote further investment in the North Sea sector, we maintain a rigorous cost focus and have decided to offer our customers an alternative cost-reduction approach.
“The terms and conditions of employment for offshore personnel will not be affected and the corporate tax position of Wood Group remains unchanged.”
The spokeswoman could not say how much the use of the legal loophole would save Wood.
Research has estimated that about £25billion a year is lost to the Treasury through legal tax avoidance by rich individuals and companies.