INEOS issues safety warning ahead of Grangemouth strike

Runcorn, UK -  The Unite trade union has informed INEOS that union members will not provide safety cover during a planned strike 27-29 April over pensions at its Grangemouth oil refinery. Unite has also told INEOS  that it had just ten days to remove all oil and gas from the plant to make the site safe – a physical impossibility,  the company said.

INEOS is deeply concerned about the union’s cavalier approach to safety. Grangemouth CEO Tom Crotty said, “I have written to Tony Woodley, Unite’s joint general secretary, expressing our concerns. INEOS is also extremely worried that the strike action called over proposals to make changes to the pension plan will threaten the future prosperity of the site."

UNITE is objecting to proposals by INEOS to change the pension scheme as part of this wider modernisation. Currently over a quarter of the entire salary bill at Grangemouth goes into the pension scheme. Independent pension’s experts say that this figure could rise to almost 50% going forward. INEOS said this is unsustainable in the longer term and will harm the future of the Grangemouth site.

The amended pension scheme proposed by INEOS is very generous. It will remain a final salary scheme for all existing members. It will pay 1/60th salary for every year worked and the company will still pay the lion’s share of the costs. The main difference will be that the current workforce will have to make a contribution towards their pension for the first time, bringing them into line with the vast majority of employees in the UK and with other INEOS employees. The company proposes to phase these contributions in over a period of several years.

"The company proposes a different pension plan for future new employees, one that it considers will continue to allow it to attract highly skilled workers to the Grangemouth site where the typical remuneration package for qualified technicians is valued at almost £60,000," said an INEOS statement.

"The vote for strike action is particularly frustrating for INEOS given that the nine month consultation process has not been completed. Talks have been scheduled to continue until the end of June. The company continues to seek open discussion with the trade unions and Independent representatives to continue to emphasise how the pensions issue is part of a bigger picture surrounding the whole long term future of the Grangemouth site," the company added.

INEOS said it is developing plans to invest hundreds of millions of pounds in plant modernisation projects to secure Grangemouth’s long-term future. These include an improvement programme on the G4 ethylene plant before 2011; modernisation of the butadiene facility which supports G4 operating; improving economics on  polymer plants; and improving the performance of the benzene plant and gasoline treatment unit.

INEOS acquired Grangemouth from BP in 2005. There are five INEOS businesses at Grangemouth. INEOS Olefins, INEOS Polyolefins, INEOS Refining, INEOS Technologies and INEOS Enterprises. INEOS employs around 1400 people and the site occupies almost 1,700 acres of land.