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What we can learn from Grangemouth and Unite Union?

Last updated October 29, 2013
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Is it me or do the unions think they run some of our largest businesses here in the UK? Why do the unions think they should be in charge and dictate business strategy?11656817_s

Let me set my stall out now. I've never been a union member, perhaps I have believed that frank, open discussion and debate that doesn't get nasty or personal is the best way to move a problem forward and get resolution even if it is with a compromise.

I don't have the inside track on situation at Grangemouth but as an outsider, it seems that, what the Unite union believed best for its members at Grangemouth resulted in the union finding themselves responsible for over 800 people potentially losing their jobs. All because Unite believed it knew what was best for the company and its shareholders.

When the company announced that it had to close the plant because the unions refuse to accept cost savings, the union then and only then, decided it had to get back to the table quickly and did a complete U-turn.

On the first day of reporting, The Spectator  blog said "Grangemouth no more. For months the Unite trade union has been calling the bluff of the Grangemouth management. The plant was losing £10 million a month but the owner was prepared to put in £300 million investment to upgrade the plant. However, they wanted staff to agree to a pay freeze to 2 years and to close the final salary pension scheme. When the unions refused to agree, the owners decided to close the loss-making business and calling the liquidators."

The following day the BBC News said “Union embraces Grangemouth success plan". The Independent online said "Unite union to make concessions in bid to get plant reopened"

In Fraser Newton’s (Twitter @frasernewton) piece in The Spectator he highlights "..the new militant bent in trade union behaviour.." and  "…they (Unite) played high stakes poker and lost and it's hard to argue that the  Grangemouth workers have had good value for their union dues.”

Perhaps this is a wake-up call for the unions, without business owners they wouldn't have any jobs to be union representatives for.

So where do I think that Unite went wrong?

1. They assumed that the owners were joking about losing money and then insisted on seeing the financials.

2. They played high stakes poker with 800 people's lives

3. They did not appear to assess the risk of losing that poker game

4. They did a complete U-turn when it was clear that they had lost – so much for arguing for so long against all the changes in the first place!

5. In thinking that they knew what was best, then digging their heels in has now severely damaged union reputations.

Fortunately, most SMEs don't have a unionised workplace but if this story highlights anything it's that

  • Clear, open and two way communication, discussion and debate with your team is vital, and
  • how important it is to ensure that your team 'buy-in' to your vision, plan and goals and that includes what's in it for them.

It's been interesting to see #Grangemouth comments on Twitter; definitely two sides and strong opinions being shared on both sides.

Then, 2 days later, Unite has backed down and Grangemouth can return to business as usual and put their investment plans in place. But the damage has been done. And the future?  Let's hope that when the unions play this type of brinkmanship game again they understand the damage that they could cause as well as the risks that they face if they lose the game.

Shirley Mansfield
Master Business Problem Solver

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