The company that runs the Grangemouth oil refinery has been accused of “economic vandalism” after deciding to keep the site shut even though a planned strike has been called off.
The Unite union said Ineos was “holding Scotland to ransom”, as Government ministers were drawn into the bitter dispute.
The union announced it was calling off a planned two-day strike from Sunday even though peace talks at the conciliation service Acas ended without agreement after 16 hours.
The union accused the company of “walking away” from the talks just as a deal was close to being agreed in a row about union convener Stephen Deans.
Union members were due to walk out for 48 hours from Sunday over the treatment of Mr Deans.
He was involved in the row over the selection of a Labour candidate in Falkirk, where he is chairman of the constituency party.
He was suspended by Ineos and later reinstated, but is facing an internal investigation by the company over issues linked to the Falkirk affair.
A company spokesman said Grangemouth “is shut down and will remain shut down”, and added: “Grangemouth is financially distressed. The industrial action called by Unite the union has inflicted significant further damage on the company.
“Ineos will put a proposal to the workforce tomorrow and expects a response on Monday, after the weekend. The company will review its position with its shareholders on Tuesday.”
Unite regional secretary Pat Rafferty said: “Ineos’s decision to keep Grangemouth shut is an act of economic vandalism. There is absolutely no reason for the site to remain shut - the company is holding Scotland to ransom.
“The Scottish and Westminster governments must now act without further delay.
“Unite acted in the national interest by calling off the strike because Ineos had no right to initiate a cold shutdown - a shutdown against the wishes of the Health and Safety Executive, and against the economic interests of the country. Unite is calling for the Health and Safety Executive to visit the site urgently as we believe this is reckless behaviour.”
Speaking in Downing Street following the joint ministerial council, Scottish Secretary Alistair Carmichael said keeping the site closed was “a bit of a setback”, adding: “I will not rush to judgment on it but it is a disappointment. I am concerned and will want to know why the management has chosen to attach pre-conditions in the way that they have done.
“At first sight it doesn’t look helpful, it doesn’t look constructive because this is a dispute which has enormous danger of damaging Scotland’s economy and confidence. For that reason, I think there is a legitimate interest for government both in Edinburgh and London to hold both parties to account here.”
He added: “There is a great deal at stake here. I’m not going to start a run which is going to lead to a loss of confidence, but there is no underestimating the importance of this to Scotland’s economy. In fact, it has the potential to stretch right through the country.
“Be in no doubt that the stakes are exceptionally high here. This could be seriously bad news for Scotland’s economy.”
Scotland’s First Minister Alex Salmond said the immediate threat in terms of disruption of fuel supplies in Scotland was less than before but “there’s still now huge uncertainty about the long-term future of what is a major chemical and industrial complex”.
“Both governments would prevail on both Ineos and Unite to find a solution that gives Grangemouth a future,” he said.
“The dispute has moved from being an immediate threat to fuel supplies continuity in Scotland to one that is about the survival of Grangemouth as a chemical (plant) and refinery in Scotland.
“Therefore it’s important that both sides have a commitment to that long-term future.”
He said both governments were likely to support financial backing for the plant “but that’s on the basis that the plant continues - clearly neither the Scottish Government nor the UK Government are going to provide financial backing for a plant that ain’t there”.
“We want to be part of the solution and I would appeal to everyone not to be part of the problem,” he said.
Ineos has warned that Grangemouth is losing £10 million a month and will close in 2017 without investment and cost-cutting.
The company said it had agreed to restart all plants as quickly as possible provided that the union agreed not to take further industrial action before the end of March, adding that Unite refused to comply, offering to limit any action to 24 hours a month during the first quarter of next year.
“This was not acceptable to Ineos, due to the significant safety risk (especially in the winter months) of having to shut down and restart plants multiple times.
“Ineos had asked the union to stop the wave of protest actions against Ineos’s customers, suppliers and financial lenders. The union had refused.”