Part of the giant Grangemouth site is to close following a bitter row over pay and conditions.
Owner Ineos has decided to shut down the petrochemical side of the complex, which is situated next to the firm’s oil refinery.
Workers were given the grim news at a meeting with Grangemouth Petrochemicals chairman, Calum MacLean.
“This is a hugely sad day for everyone at Grangemouth,” MacLean said.
“We have tried our hardest to convince employees of the need for change but unsuccessfully. There was only ever going to be one outcome to this story if nothing changed and we continued to lose money.”
“As a result of this decision, the directors of the petrochemicals business have had no option but to engage the services of a liquidator. It is anticipated that a liquidation process will commence in a week.”
The news follows the passing of a deadline on a survival plan put to employees which asked them to accept changes to pensions and other terms and conditions.
The Unite union said around 680 of the site’s 1,370-strong workforce had rejected the company’s proposals, which include a pay freeze for 2014-16, removal of a bonus up to 2016, a reduced shift allowance and ending of the final salary pension scheme.
“Employees were asked to support the changes necessary to save the business. Management held direct meetings with all employees to explain the very serious nature of the problem,” Ineos said in a statement.
“The company made it clear that rejection of change would result in closure. Regrettably, the union advised union members to reject any form of change.
“Sadly, the shareholders reached the conclusion that they could not see a future for Grangemouth without change and therefore could no longer continue to fund the business.”
Around 800 workers are employed on the petrochemical site, with an estimated 2,000 working for contractors and other firms supplying the site with goods and services.
The adjoining oil refinery will remain open, but the company said it had not yet decided whether to restart production after the site was closed last week because of the dispute.
Ineos said owner Jim Ratcliffe and other shareholders met yesterday to study the response from the workforce to their survival plan, and wanted the employees to be the first to know of any decision the company makes.
“This is not a bluff. The clock is ticking,” Ratcliffe said.
“Grangemouth could have a future but that is absolutely in the hands of the workers. If we go down the wrong road, then I’m afraid this story will not have a happy ending.”
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