Grangemouth oil refinery: future in doubt after workers reject pay offer

Permanent closure a possibility after half of staff at Scottish site vote against owner Ineos's proposal to cut costs

The Grangemouth oil refinery faces the threat of permanent closure after half its staff rejected management proposals to cut costs at the Scottish site.

Unite said 665 of its members – out of 1,370 staff – had rejected the deal offered by Ineos, which owns Scotland's only refinery and has said it will make a decision about the site's future on Tuesday.

Ineos had given its permanent employees until 6pm on Monday to accept its plan, which included less generous pensions and a three-year pay freeze.

Ineos shut down the giant site on the Firth of Forth last Wednesday and has threatened to leave it shut if its demands are rejected.

Ineos's shareholders, led by its billionaire chairman Jim Ratcliffe, are set to decide on Tuesday whether to go through with their threat of permanent closure.

Pat Rafferty, Unite's Scottish secretary, said the workers who had rejected the plan were "the backbone of the plant, the people who keep the site running and the oil flowing". He called on Ratcliffe to reopen the plant and restart talks.

Ineos attempted to bypass Unite on Friday by putting its "survival plan" for Grangemouth directly to the workforce after months of wrangling with the union. Unite has asked its members, who constitute about 80% of the permanent employees, to give their responses to the union, not to Ineos.

Ineos said it had received about 300 acceptances by Sunday evening. The company had said it would not reopen Grangemouth unless Unite pledged not to strike until the end of this year. Unite said it would give the guarantee if Ineos withdrew its ultimatum to employees and let talks resume.

Grangemouth is a big employer in Scotland, produces most of the country's fuel and supports the economy indirectly in other ways.

Grangemouth houses a refinery that processes about 200,000 barrels of crude oil a day and a petrochemicals operation that produces more than 2 million tonnes of chemicals a year.

Ineos says petrochemicals is its worst-performing division but that closing that operation would damage the refining business because the two are "deeply integrated" and the refinery's byproducts feed the petrochemicals arm.

The company has offered workers up to £15,000 as a one-off payment plus a top-up to the new pension if they accept the deal.

The company claims employee costs contribute hugely to the losses of £10m a month at Grangemouth and that it will only invest to secure the site's future if the workers take some pain.

Article Source : http://www.guardian.co.uk

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