The workers filing back into the Grangemouth petrochemical plant, Ineos, had a look of victory, and relief. The BBC was triumphant; Alex Salmond was triumphant; the local Unite rep was triumphant; the company was triumphant. Everyone had won.
It was the most serious defeat of the British labour movement in years, and there was barely a shot fired.
Not a single concession from the owners; the union concedes everything from pay freezes, an end to final salary pensions, the end of full-time union convenors on site, and no strikes for three years. Employers across the country will be looking admiringly and enviously at what the boss of Ineos, the billionaire Jim Ratcliffe, has achieved, and looking to emulate it.
In principle, this plant was a bastion of union power. The company was at the heart of Scotland’s infrastructure, in a sensitive market position, with chains of suppliers and businesses dependent on its ongoing functioning. Unite workers were well-organised, and knew how to use their disruptive power. They tended to win their strikes. In 2008, they shut down Ratcliffe’s attack on their final salary pension scheme. Tanker drivers saw off an attack on their pay and conditions in March. There was no reason for Unite to think they couldn’t deal with this.
The problem was, the strike wasn’t about what they thought it was about. The provocation behind the strike was the victimisation of Unite rep Stephen Deans. The occasion for the attack on Deans was allegations about his role in the Falkirk selection controversy.
The Falkirk episode will merit further scrutiny in the coming weeks and months. Ed Miliband called in the cops on the basis of claims of vote-rigging. Implicated was not just the Unite-backed candidate, Karie Murphy, but the local constituency chairman and Unite member Stephen Deans. By early September, Labour was admitting ‘no wrongdoing’ on the part of Murphy and Deans. The police had declined to take any action. And Labour ended its internal investigation. By the account given in BBC Radio 4’s documentary, it was a candy floss controversy: mouth-watering but ultimately fuzzy, indistinct and lacking in substance.
But Miliband had used the panic to make an ultra-Blairite, union-baiting speech on ‘reforming’ the relationship with trade unions. Tony Blair and his allies in the party and the press were grossly, deliriously happy. Len McCluskey backed his proposed reforms, putting a left gloss on them. You might argue that McCluskey’s attitude was predictable, that he always says something approving every time Miliband makes a right-wing speech. You might argue, as I did, that Miliband’s reforms might weaken the Labour-link in one sense, but they strengthen the potential financial clout of the union bureaucracy on a clientelist basis. But I’m not totally sure that this is the end of the story.
At any rate, this was the context in which the company decided to suspend Stephen Deans, provoking the ballot for industrial action and strike action that would ultimately lead to the present debacle. I think the company management smelled weakness. They heard that many of the people signed up to the Labour Party in the weeks before the selection had actually been workers at Ineos. They wondered if Deans had not been using company time to engage in suspicious, potentially culpable behaviour. They launched an investigation. Initially, Unite maintains, the company cleared Deans and reinstated him. If that’s the case, however, they clearly quickly re-calculated.
Unite didn’t seem to panic. They held the ballot for a strike, within the usual ponderous procedures and time-frame of industrial action ballots in the UK. An overwhelming 81.4% voted to take action. They began with action short of striking, including work to rule, and an overtime ban. If it was about victimisation, they would stand solid and win.
However, Jim Ratcliffe had already started to leak a different narrative to the press. It was no longer about one union member. The company was ‘at a crossroads’. It was losing money, in dire financial straits. Something had to give. The strike that Unite was fighting as a victimisation case was increasingly a pretext for a far more serious fight.
By mid-October, management had struck hard. The company and the union went through a negotiations process with ACAS, lasting until Tuesday 15th October. Unite alleges that they were on the verge of a deal, before Ineos walked out. This would certainly be in character. At any rate, Unite responded to this by calling off proposed strike action, and the company responded with a further offensive.
On Wednesday 16th, the company locked out the workers whose strike had just been called off. They demanded that the workers agree to redundancies, reduced wages for new starters, cuts to holidays and redundancy pay, and an end to the final salary pensions scheme. They said the company was losing £10m a month, and couldn’t go on without union acquiescence to a ‘survival plan’. (Unite says that its research shows the company’s figures to be fanciful.) They were threatening to literally close the plant unless they got what they wanted. This was “union-busting and industrial blackmail”.
But the company did not neglect to include a material inducement in their threats, in the form of one-off compensation payments in exchange for the concessions. They addressed this proposal to workers individually, not via their union. This was smart. They were both dramatically displaying the irrelevance of the union for workers’ future living standards, and appealing to people’s short-term economic need, their worries about the near future in austerity Britain. Unite rightly urged members to turn it down, about half of whom did. But if half the workers were ready to accept this kind of deal, perhaps people were not as confident as they had been when the dispute began. With the employers on an offensive that gave no quarter, that only seemed to intensify, and with the union ineffectually trying to bargain even while it talked a good fight, perhaps the calculation was changing for many workers. It does not sound, at any rate, like a workforce ready to embark on a wave of occupations and flying pickets. And I would guess that the company bosses, noses ever attuned to prey, scented the weakness.
Still, it is profoundly strange that Unite caved to the extent that they did, in the way that they did, at the time that they did. It’s quite possible that Ratcliffe was ready to walk, but right then? True, past investments are no reason to hang around: capitalists know what the term ’sunk investment’ means. But if Unite had any faith in its own figures, they must have believed Ineos had a profitable future that a capitalist could not just walk away from. And would the Scottish government have let Grangemouth sink and devastate a chunk of Scottish industry? It’s possible that Salmond and Swinney told McCluskey that the only buyers they would consider would be anti-union buyers. It’s possible they said that they would be more than justified, if the plant was abandoned, in selling it off to the lowest bidder and allowing them to shred the workforce under the guise of ‘Saving Grangemouth’. It is possible they said that Unite was being irresponsible with Scotland’s future, and that Ratcliffe’s deal was the best they were going to get, and the union had better learn the reality of the modern world - who has final salary pensions these days? Maybe Labour’s leadership doubled down on this, and added more. It’s possible there was all sorts of pressure, all sorts of threats. But such threats must have been extremely acute, and mortally threatening to the Unite bureaucracy, to force it to conduct such a swift, comprehensive and humiliating reversal, and accept a defeat of historic proportions.
For there was, let us be clear, a real potential for political solidarity in this strike. As it went on, even front-bench Labour MSPs felt compelled to demonstrate support, instigating squeals of disgust from the party’s Blairites who demanded that Johann Lamont stamp her authority on the rogue MSPs. The workers themselves were not unpopular in Scotland, and Unite has never really suffered from any stigma that actually sticks in the public mind - unlike, say, the RMT.
Ratcliffe, by contrast, rules Ineos from a £6m estate in Hampshire. He has wealth that most people cannot fathom. He is a tax dodger, who has moved his company’s headquarters to Switzerland to avoid paying taxes, a move prompted by the refusal of the UK government to allow him a one-year delay in payment of a VAT bill. He is litigious. Ineos has threatened defamation action “with the abandon of the powerful who wish to silence those less powerful”. He was insolent enough to demand a personal apology from the unions for one of their alleged defamatory remarks as a ‘deal-breaker’. He is the clear, unyielding aggressor in this fight. His rhetoric is cold and ruthless. He is what people mean by the term ‘ruling class’. He is what people mean when they contemptuously spit, ‘the rich’.
Not only that, but Ineos had shut down the refinery, impacting on a big sector of the economy that was dependent on the plant. This was a huge deal. The biggest economic impact of this dispute was caused not by the workers’ strike, but by the employers’ strike. And in Scotland, at this time, when the debate about independence rages, to have an English capitalist clearly holding an essential part of the infrastructure to ransom - well, if that doesn’t induce a yearning for Brumaire, Year I, what would?
And this would have helped keep pressure on the union leadership not to relent in the tempo of its counter-attacks, and not to wilt under pressure from management.
In this vein, there were some laudable sentiments. The unions called for the Scottish government to take Ineos into public ownership if Ratcliffe ran off with his billions. Some on the Left concurred, and the idea seemed to resonate. This was really prime material for a 'Save Grangemouth - Nationalise Now’ campaign. I think it still might be. Who says Grangemouth is safe in Ratcliffe’s sticky little fingers? But there does not appear to have been a campaign to capitalise on it. It was treated very much as an industrial dispute, with at best a passive, cheerleading role for supporters. Who saw it coming? Hardly anyone. The bosses played a blinder.
As a coda to its successful attack on the union, the company has decided to leak the emails which they had collected from Deans account to the Murdoch press. The Sunday Times has published a story based on some of them today. And if the leak has its intended effect, the Falkirk inquiry will be re-opened. Perhaps if that happens it will shed more light on this dispute and its conclusion. There seems to have been a curious constellation of forces producing and shaping this defeat from the beginning - right-wing Labourism, tabloid red-baiting, ruling class union-busting in a general climate of austerity, and somewhere in it all a complicitous Scottish nationalism. About this, I suspect, we don’t know half the truth yet.
Ratcliffe is lying flat on his back on his yacht, Hampshire II, in the south of France. Ineos, as everyone has quickly learned to say, has a bright future ahead of it.