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Grangemouth crisis: Unite union now accepts plant rescue plan Grangemouth crisis: Unite union now accepts plant rescue plan
(about 7 hours later)
The union at the centre of the Grangemouth crisis has decided to "embrace" a survival plan aimed at preventing the site's closure and the loss of thousands of jobs. A climbdown by the Unite trade union yesterday revived hopes of safeguarding the Grangemouth oil refinery as the Scottish and Westminster governments sought to persuade the site's owners to reopen the petrochemicals factory.
Unite's leader, Len McCluskey, said the union was working to persuade owners Ineos to reverse its shock decision to close the petrochemical complex. But he denied that the union had been forced into a humiliating climbdown by the plant's owners: "My union is engaged with thousands of companies every day to negotiate plans to save jobs. There is nothing humiliating about negotiating plans to ensure jobs and communities are safe." Faced with the sudden shutdown of the chemicals plant and threats to scrap the adjoining refinery on the site, Unite accepted the demands of Ineos, Grangemouth's owner.
The development followed a meeting at the site between general secretary Len McCluskey and union shop stewards. Len McCluskey, the general secretary of Britain's biggest union, travelled to Grangemouth for one-on-one talks with the site's boss, Calum MacLean.
/>McCluskey told MacLean yesterday morning that Unite would "embrace" what Ineos calls its survival plan. Ineos did not comment, but the Swiss-based company is said to be drawing up a legal document to lock Unite in to its demands.
McCluskey said the shop stewards had decided they had to embrace the survival plan, "warts and all", in the wake of the closure decision. Ineos had demanded an end to workers' final salary pensions, a wage freeze and the scrapping of bonuses for three years and a string of further reductions to workers' terms and benefits.
Workers at the petrochemical site, and adjoining oil refinery, had refused to sign up to the plan, which included a pay freeze, ending of the final salary pension scheme, and other changes to terms and conditions. The Scottish secretary, Alistair Carmichael, and Scotland's finance minister, John Swinney, also travelled to Grangemouth for meetings with Ineos and Unite.
McCluskey said: "We are not going to let this plant close. We are encouraged by the comments of the First Minister that he too will not let this plant close. After talking to Ineos, Carmichael said: "We are in a much better place today in relation to the future of the plant than we were yesterday. There remains, of course, a great deal to be done."
"We have a situation whereby a company has put down an ultimatum and we have to respond. It is not how we engage in modern day industrial relations." Ineos is expected to wait until further meetings are held later today involving politicians before responding to the latest development. Ineos has said it plans to make an official statement on the Grangemouth issue today.
Ineos director Tom Crotty has denied that the firm lured unions into a trap over Grangemouth. The threatened closure of Grangemouth is a political bombshell in Scotland, with first minister Alex Salmond talking up the country's ability to thrive as an independent economy ahead of next year's referendum on breaking away from the UK.
Speaking on BBC News 24, Crotty rejected the suggestion that Ineos has wanted to shut the plan all along, and used the unpalatable cost-cutting plan as a way of forcing the union's hand. If staff had voted in favour, he argued, Ineos would have invested £300m and the plant would soon be reopening. Swinney, Salmond's treasury chief, said: "Behind us is a plant of over 1,000 high-quality jobs in refining and petrochemicals. What we need to do is resolve these outstanding issues, get the investment plan implemented, and take forward and improve the prospects for the people that work in this plant."
Crotty reiterated that Ineos will consult with shareholders again if the Unite union substantially alters its position and accepts major changes at the plant. A Downing Street spokesman said: "The prime minister is keen that they are back round the table talking. Clearly, we want both sides to continue with those talks and come to a solution if possible. Half of Grangemouth's 1,370 permanent employees rejected Ineos's plan by a Monday evening deadline set by the company. Ineos's majority owner, the billionaire petrochemicals tycoon Jim Ratcliffe, ordered the closure of the petrochemicals plant on Tuesday night.
"Grangemouth is clearly of vital importance to the Scottish economy and the Prime Minister is keen that those discussions continue and hopefully they can find a solution." McCluskey denied that Unite had been forced to cave in by Ineos's shock tactics and insisted details were still up for negotiation. But he admitted that Unite would accept the demands "warts and all", including the end of the final salary pension plan, which Ineos claims costs it an extra 65p for every £1 of salary paid.
Wednesday's closure announcement Speaking outside Grangemouth, McCluskey said: "The company's closure of the plant has led our stewards to believe the priority is to keep the plant open. We have to say to the company that the survival plan is something we are prepared to embrace and go along with.
The government reacted with dismay to Wednesday's announcement and the climate change secretary, Ed Davey, pledged that all efforts would be made to rescue the plant on the Firth of Forth. Grangemouth is Scotland's biggest manufacturing business. Its refinery supplies most of the country's fuel, and the petrochemicals plant produces plastics used in industries ranging from cars to packaging. Its closure would have far-reaching implications for Scotland and the UK. "The stewards are now responding to the wishes of our members who may feel outraged by what has happened but the priority is to keep the plant open and we will see what the future brings."
The company said it had no alternative but to shut down the business after it failed to persuade its staff to accept a survival plan. Shutting the petrochemicals plant would have destroyed up to 800 well-paid permanent jobs and put about 600 more permanent workers at risk at the refinery, which supplies its by-products to the chemicals operation.
Unite said about 680 of the site's 1,370-strong workforce had rejected the company's proposals, which include a pay freeze for 2014-16, removal of a bonus up to 2016, a reduced shift allowance and the ending of the final-salary pension scheme. But the closure of Grangemouth would have far greater reverberations across the Firth of Forth, Scotland and the UK. The plant regularly employs another 2,000 contract workers and routinely takes on another thousand or more for overhauls that can last a month or more.
Ineos had said it was ready to invest £300m in Grangemouth, but only if workers agreed to the new terms. It said the plant, which has been shut down since last week because of the dispute, was losing £10m a month. About 130 maintenance contract employees employed by Babcock were told to pack up work at 3pm on Thursday. Workers say up to 800 contractors, from cleaners to scaffolders, were laid off in the last two weeks as the plant closed down.
In an urgent question on Grangemouth in parliament on Wednesday, Davey told MPs repeatedly that the government wanted the plant to stay open if at all possible. He said it would still consider a business case to provide investment to help keep the plant running, but Downing Street dismissed speculation that the plant could be nationalised, saying it was a matter for the unions and owner to resolve. Every business in Grangemouth and the surrounding area relies on the site for custom – from cab firms to hotels, burger vans, building suppliers and maintainers of components. Contractors travel to work at Grangemouth from Glasgow, Edinburgh and south of the border.
The prime minister's spokesman said it was disappointing that the petrochemicals side of the plant had closed and called on both parties to continue their dialogue over the future of the refinery. Many other major companies rely on the petrochemicals plant to supply the plastics used in cars, packaging and a host of other products made in Britain. Paul Hodges, chairman of consultants International iChem, said: "I have companies who buy Ineos's products saying, 'Where am I going to get my plastics?' The next time they are looking to expand or restructure, they may well think they are better off somewhere else than in the UK."
Number 10 said the closure of the Grangemouth refinery would not pose a threat to fuel supplies, after the AA warned it could hit petrol prices. A dispute over pay and conditions at the oil refinery remains unresolved. David Cameron, speaking during a visit to Yorkshire, said: "This is an important business for Scotland. It's a very important industry for the whole of the United Kingdom. We want to see those jobs saved, we want to see this business thrive, and I'm hopeful that agreements will be reached."
Len McCluskey explains Unite's position: Workers at the plant have criticised Unite's handling of its dispute with Ineos. The company has been trying to change employees' terms since it bought the plant from BP seven years ago.
"What's different? The company's closure of the plant has led our stewards to believe the priority is to keep the plant open. We have to say to the company that the survival plan is something we are prepared to embrace and go along with if, if you like. But that includes discussions and consultation and we will see what comes out of those discussions. I wouldn't want to mislead you. Their survival plan requires us to accept certain things and our stewards' position is that we are accepting those issues. Unite had threatened to stage a 48-hour strike on Sunday over Ineos's treatment of Stephen Deans, a Unite official at Grangemouth who was cleared of vote-rigging in the election of Falkirk's parliamentary Labour candidate.
"It's not that it's all up for negotiation. They are demanding we accept their ultimatums and we have decided to accept their ultimatums. The consultation will be around the logistics of those issues and the practicalities of those issues. There will be no doubt some alterations within the context of those discussions. What has changed is the company have closed the plant and have put it into liquidation and we are not going to allow that to happen and the stewards are now responding to the wishes of our members who may feel outraged by what has happened but the priority is to keep the plant open and we will see what the future brings." Sean Farrell The union called off the strike last Wednesday after talks collapsed, but Ineos went ahead with closing the plant and stunned workers by giving them the weekend to accept its demands.
A union member who works at the petrochemicals plant said: "Unite walked into an ambush over Stevie Deans."
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