The escalating dispute at Grangemouth is indicative of an alarming heavy-handedness among major employers
The biggest company you've probably never heard of is engaged in a titanic battle with Britain's biggest union. Ineos, the world's fourth largest chemicals conglomerate, which is also the largest privately owned company in Britain, has issued its 1,400 Grangemouth workers with what has been called a "sign-or-be-sacked" ultimatum. Drastic reductions in pay and pensions are demanded of its workers if they want a continued livelihood. Their union, Unite, has urged them to return their ballot papers unmarked.
The battle's significance lies not just in the size of the protagonists and the employment issues at stake – it's also found in the economic and political ramifications. The plant includes Scotland's only oil refinery and it powers the Forties pipeline (which supplies a third of Britain's North Sea oil). This occasioned Scotland's first minister, Alex Salmond, to intervene and broker fresh but failed talks late last week.
The now "hot" war began as a "cold" one back in June. Stephen Deans, the lead shop steward, is accused of misusing company time and property to recruit Unite members to Labour. He was suspended and reinstated by the company, but continues to be investigated even though he was exonerated by Labour.
Unite began to suspect something more was at stake than Deans' continued employment. It began to think the likelihood of his sacking was an attempt to decapitate the union in order to allow Ineos to push through reductions in terms and conditions.
This is known as a reforming conflict. Presented with such an opportunity, management decides to use it to drastically reconfigure the balance of power between it and the union by systematically escalating a dispute, going far beyond what is required to settle it.
In other words, it's union-busting and industrial blackmail. Management seeks not only to win the issues at hand, but also to impose a crushing defeat so that the union is no longer an effective bargaining opponent.
Ineos repeatedly refused meaningful talks over Deans. Unite then balloted members to defend him, returning an overwhelming mandate. Unite again called for Ineos to enter talks (with Acas if necessary). Ineos refused, so Unite began an overtime ban and work-to-rule, and re-issued calls for talks. Ineos refused again so Unite issued a strike notice.
Finally, the Acas talks then happened but Unite believed Ineos deliberately torpedoed them by demanding an apology to its founder and main shareholder Jim Ratcliffe. Then Ineos pressed the nuclear button.
A strike at the plant requires an orderly shutdown for safety reasons. Ineos could have used a "hot" shutdown – where the plant is on standby so that operations can be quickly restarted. Instead, it went for a "cold" shutdown, which takes much longer to come back up to operational level.
Simultaneously, it issued demands directly to employees, deliberately bypassing Unite: abolishing the final salary pension, freezing wages and scrapping bonuses until 2017, and cutting shift allowances, overtime pay, holidays and redundancy terms. Workers were given three working days to agree if they wanted to secure the one-off compensation payments for the concessions.
The deadline expires at 6pm on Monday. Otherwise, they'll be imposed without compensation after a 60-day consultation period, and continued employment is not guaranteed. Indeed, Ineos said production would not restart until it obtained its concessions.
Along the way, Unite called the strike off and offered talks on the plant's future because Ineos repeatedly stated Grangemouth was losing £10m a month and without £300m investment it would close in 2017.
Ineos stated Grangemouth was financially "distressed", demanding Unite sign a legal document agreeing to the company's analysis. Unite refused, commissioning research suggesting that Ineos may have used creative accounting methods to engineer the distress.
Ineos in Latin and Greek means "dawn of something new and innovative". If it gets its way, this is what Ineos will achieve – a subservient staff and a busted union.
While there are many idiosyncrasies to the Ineos case, it does indicate that more employers are approaching industrial relations with a "put-up-or-shut-up" attitude. The current battles at the Royal Mail, the ambulance service and Hull council testify to this.
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