Articles  •  News & Analysis

Grangemouth surrender: time for a rank and file movement

26 October 2013

By Jeremy Dewar

UNITE, THE biggest union in Britain, which is under the leadership of Len McCluskey, one of the most outspoken left general secretaries, has accepted the most humiliating terms of surrender from Ineos, owners of the Grangemouth refinery and petrochemicals plant.

On Friday 25 October the workforce cheered the announcement of a deal that will keep the plant open. That was a natural feeling of relief but it was hardly an endorsement of the terms or the actions of their union’s leaders. Their sense of relief will be short-lived.

Unite has surrendered on every single point in its dispute. Workers and their families will face three years of falling real wages, as their pay is pegged and all bonuses are cancelled, while inflation adds 10 per cent to their cost of living. They will see their final salary pension scheme scrapped, ensuring poverty in their later years.

Their right to a trade union that can defend them will be shackled: no strikes for three years, no facilities for elected convenors, management by diktat. All this is enshrined in an agreement with Unite. This defeat without a fight – the very worst sort of defeat – gives a green light to every boss, CEO and manager in Britain to go on the offensive. If even an exceptionally skilled workforce, like the one at Grangemouth, and a mighty union like Unite with its left-talking general secretary, can be forced to eat humble pie, then aggressive managers everywhere will be tempted to do the same.

As we recently put it, recovery or not, workers will have to fight.

McCluskey has shamefully fled the battlefield at the first threat from Ineos’ billionaire boss, Jim Ratcliffe, directing his campaign from his £130 million yacht in the south of France.

How Ineos blackmailed its workers

For all the media furore about Unite overplaying its hand and even “holding the country to ransom” – and Ratcliffe claiming he was not anti-union – history tells another story. Although most of the action occurred in the last week, the dispute’s origins lay in Ineos’ decision in July to suspend one of Unite’s two convenors at the plant, Stephen Deans, and to investigate him for using company facilities for union and Labour Party business.

A ballot for an overtime ban, work-to-rule and two-day strike produced a Yes vote. The strike was due to commence on 20 October. Ineos’ response was to pre-empt the strike and close the plant on 14 October, laying off over the next two weeks 2,000 contractors and threatening the livelihood of 1,370 employees. Ineos itself admits that 10,000 people in the locality depend on the plant for their living. But this was seen as just another bargaining chip for the world’s fourth largest chemicals company in its cynical game of brinkmanship.

Encouraged by the Unite leadership’s evident unpreparedness – and lack of guts – Ineos issued an ultimatum to the workforce: accept a three-year pay freeze, the closing of their final salary pensions scheme (which had survived only due to a successful strike back in 2008) and agree to a three-month no-strike clause. The plant would remain closed until Unite and the workforce signed away their pay, terms and rights.

For Unite Scottish secretary Pat Rafferty, the first thing to go was the right to strike: “Unite [is] committed to conducting no industrial action ballots or industrial action before 31 December 2013,” he announced outside Acas offices. All Unite asked for was that Ineos open talks under the auspices of Acas, the notoriously pro-employer conciliation service.

Ineos was far more bullish, threatening to sack 800 workers and re-employ them on worse terms unless a Unite ballot of its Grangemouth membership ratified the deal.

Ineos claimed to be losing £10 million a month at the plant, though a Unite accountant claims this was deceitful and that, discounting costs of investment (as is the usual accounting practice), it in fact made £6 million and £7 million profit in the last two years. On top of that, Ineos recently negotiated a £9 million grant from the Scottish government and a £125 million loan guarantee from the UK government (plus a subsidy from BP) to help pay for the £300 million gas plant it now wants the workers to pay for. Hardly the business of a company considering closure. In any case the union should have said: “We don’t believe you – open the books to the workers’ inspection.”

As the ballot drew to a close, Ineos boss Ratcliffe upped the ante: “This is not a bluff. The clock is ticking. Grangemouth could have a future but that is absolutely in the hands of the workers.”

Despite all this and the media and politicians, from nationalist Alex Salmond to Tory David Cameron, urging a climbdown, the workers and their shop stewards, who bravely campaigned for a No vote, refused to be blackmailed. Over half the workforce and nearly two-thirds of those affected – 665 workers – rejected the plan on Monday 21 October.

Following a shareholders’ meeting the next day (Ratcliffe owns a majority of the shares, Ineos being Britain’s largest private company despite moving its HQ to Switzerland to avoid tax), Ineos retaliated by announcing the permanent closure of the plant on Wednesday 23 October. For the next 49 hours, Grangemouth’s future was on the brink.

What followed was an utter disgrace to trade unionism and a total betrayal of the loyalty of the workforce to its union. So-called socialist general secretary and darling of most of the left, Len McCluskey, not only accepted all of Ineos’ demands, but “embraced” a deal that extended the strike ban for three years.

Rank and file alternative

Jerry Hicks, who gained 36 per cent of the vote against Len McCluskey in the Unite general secretary election earlier this year, was quoted by the Financial Times as saying, this was “botched from the very beginning” and “ended in surrender”. He is absolutely right.

Unite could have altered the whole history of the dispute by organising the immediate occupation of the plant as soon as the lock out was threatened in mid-October. Its members would have been called on to close down the refinery; with union backing they could have refused and the workforce could have seized control of the equipment and the dispute.

Flying pickets and solidarity action around Britain’s other refineries would soon have had an effect in the petrol stations across the country. From a position of strength, Unite should have demanded that the British and Scottish governments nationalise Grangemouth, and that the Labour Party and the TUC support the workers. Workers could have demanded that no compensation should be paid to filthy rich parasites (Ratcliffe is one of the 10 richest people in the UK) and that the plant be run under workers’ control. In return for all the millions that Unite donates to Labour, this was an ideal opportunity to demand the party backs nationalisation. After all, Ed Miliband was elected as leader with Unite’s support.

Another key weapon at a time when the cost of living of ordinary workers is soaring, in large measure due to the cost of fuel bills, was to point out that here was another example of a company trying to further add to these problems. Given the plant’s importance in the energy industry, a fightback would have helped undermine a government, becoming ever more unpopular for its defence of the rip-off energy companies.

Grangemouth supplies 70 per cent of Scotland’s petrol pump supplies as well as a considerable amount in the North of England and the North East of Ireland. It processes 200,000 barrels a day and powers the Forties pipeline, which transports a third of the North Sea’s output. At least 10,000 Scottish jobs depend on Grangemouth, which accounts for £1 billion of trade and makes up 8 per cent of Scotland’s manufacturing output.

If the banks were “too big to fail”, then Grangemouth certainly is. On the other hand, Unite, with 1.3 million members, is too big for workers to allow it to fail so spectacularly.

The only way we can turn Unite around is to build a rank and file movement capable of wresting control of the union, starting in every workplace, including Grangemouth, but seeking to replace the union’s army of unelected and unaccountable fulltimers and replacing them with elected lay officers and officials, with the latter paid the average wage of the members they represent. Such a movement would have to be prepared to, and be capable of taking unofficial action whenever the officials prevaricate or sell out, as well as breaking the anti-union laws, which undoubtedly would have been resorted to by Ineos.

This is the urgent task of Unite Fight Back, the rank and file organisation set up in the wake of Hicks’ campaign. It should urgently meet up to discuss the crisis in Unite and prepare to go on the offensive.

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