Unite Scottish secretary and the leader of the GMB union in Scotland are to have a crisis meeting with the Scottish Industry minister about BiFab this week.
Pat Rafferty, Unite Scottish secretary, and Gary Smith, the leader of the GMB union in Scotland will meet with the Scottish Industry minister, Keith Brown MSP, at the Scottish Parliament on Wednesday at 3pm.
Trades unions at the company have been told that BiFab’s financial crisis is a direct result of the main Dutch- owned contractor, Seaway Heavy Lifting (SHL), not paying BiFab for contract work already completed.
Following meetings at the yards today (Monday) the workforce voted unanimously to continue working until further notice to give the company time to sort the financial crisis.
Pat Rafferty said: “As far as we can see BiFab is being held to ransom by the main contractor.
“It beggars belief that 1400 jobs are now in jeopardy over who owes how many millions of pounds to whom. The workers have taken a courageous stand to save these jobs. The Scottish Government must match that commitment by doing whatever it takes to safeguard the future of the yards.”
The BiFab contract is for the construction of a 25 turbine wind farm in the Moray Firth for the Scottish energy giant SSE.
Pat continued: “This is a Scottish contract for a Scottish company sponsored by the Scottish government. And it looks as if the whole project is about to come crashing down, and with it 1400 jobs - due to a financial dispute instigated by the main Dutch contractor, SHL. There’s too much at stake for us to stand by and watch this happen.”
The move comes after Martin Adam, BiFab managing director, issued a statement today which said that BiFab is not yet in administration, but is struggling to survive in the wake of cashflow difficulties.
He said the company is currently facing a critical cash position as a result of a challenging situation regarding its ongoing contracts.
These are understood to be two significant contracts involving the Beatrice Offshore Windfarm which is being construction in the outer Moray Firth.
One contract is nearing completion whilst the other is at a much earlier stage and is expected to run to April next year.
Mr Adam said the directors of BiFab have been seeking to secure an immediate financial solution with its key stakeholders and are actively in discussion to consider options/solutions that will allow the business to continue trading/overcome this temporary difficult position.
He said the company has been encouraged by the rapid communication between the parties in the later part of last week and over the weekend.
However, the statement went on to say that given the financial position of the company, the directors have taken steps to protect the company via the filing of a notice of intention to appoint administrators.
It continued: “For clarity, please note that the company is not currently in administration and the directors remain hopeful that a solution can be reached to secure the future of the business and the workforce.”
Mr Adam said: “We are very disappointed that we have found ourselves in the current position which has arisen as a result of a challenging situation in respect of our ongoing contracts which have been providing much needed employment locally in Scotland.”
He added: “We are seeking a rapid solution with our key stakeholders and the Scottish Executive to our current cash flow position and are hopeful that this can be achieved quickly to secure the future of the business and the 1,400 strong workforce.”
BiFab operates three facilities – at Burntisland and Methil on the east coast of central Scotland, and Arnish on the Isle of Lewis. It is a major employer in Scotland with a workforce of 1,400 people across the three sites. This includes 251 permanent staff, and 1,132 employed via agencies.
At the weekend, the group’s two main unions – GMB and Unite – said they were concerned for the future of the workers.
The Scottish Government and Fife Council have also been urged to step in to help BiFab amid fears the business is in serious financial difficulties.
The situation has caused widespread concern among politicians.
Lesley Laird, Labour MP for Kirkcaldy, said: “This is very sad and disappointing news. BiFab is a key strategic player in Scotland’s renewable energy sector and has built up an enviable reputation for carrying out this type of work.
“Moreover, BiFab is a significant employer having provided work for thousands of highly skilled workers at its yards in Burntisland and Methil for nearly two decades.
“Disappointingly, trade unions and employees had not been advised that BiFab was in financial difficulty before the firm’s announcement and, while questions need to be asked why that was the case, I now urge BiFab to engage with the trade unions going forward.”
Ms Laird added: “This is obviously a very difficult time for the firm and its employees but, crucially, there is still work on the books and the focus must be on protecting the workforce, skills and delivering the orders that are still there.
“That should help give the company breathing space to work out a medium to longer term plan in conjunction with Scottish Enterprise, the Scottish Government and other key partners, including the trade unions.”
David Torrance, Kirkcaldy SNP MSP, said: “BiFab is a vital part of the local economy in Burntisland and Methil, and it is devastating that so many families in Fife are now left fearing the worst; particularly at this time of year. “Like everyone, I am deeply concerned at this news – therefore as a matter of urgency I have contacted GMB, spoken with Paul Wheelhouse, minister for Business, Innovation and Energy and today I submitted a topical question to the Scottish Parliament asking what support the Scottish Government is giving to Burntisland Fabricators to secure jobs in Fife and Lewis.
“It is essential that the firm sit down with Scottish & Southern Energy (SSE) and its partners, the Scottish Government and Scottish Enterprise to explore all avenues and ensure the company carry on producing highly skilled work and continue to lead the way in the renewable sector.”
He added: “The potential impact of redundancies on this scale to the local economy, in addition to the devastating effect on hundreds of local families, cannot be overstated - which is why I will continue to do everything in my power to secure a long term future for the company and its employees.”
Claire Baker, Labour MSP for Mid Scotland and Fife, said it was ‘vital’ the Scottish Government stepped in amid fears any slide into administration would also impact badly on a number of suppliers.
Councillor Ken Caldwell, who chairs Levenmouth’s local area committee, has written to the Scottish Government Aurging it to step in. And he has also made the same call to senior officers within Fife Council to do what they can avoid any devastating closures.
Cllr Caldwell SNP member for Buckhaven, Methil and Wemyss villages, said: “The loss of Bifab would be a huge blow to the local economy, not just financially, but it would hurt the moral of the community.”
He described the local yard as “the cornerstone of the hopes for a better future for the area.”
Shadow Cabinet Secretary for Economy, Jobs and Fair Work Dean Lockhart MSP (Mid-Scotland and Fife) said: “This is very concerning news for not only the hundreds of employees at BiFab, but also for the Fife economy as a whole.
“I urge the Scottish Government, worker representation bodies, stakeholders and BiFab to engage constructively in discussions to find a solution as soon as possible.”
Meanwhile, on Monday evening GMB Scotland urged the Scottish Government and industry stakeholders to pull together and battle for the financially-stricken fabrication firm.
Gary Smith, GMB Scotland secretary, said: “This is a critical moment for the future of BiFab, its workers and the communities these yards support.
“Yesterday we were told that despite the evident problems, it would be business as usual and our members should report to work as normal.
“This morning we were told that there is no money to pay our members wages, stemming from a cash flow problem with the contractor Seaway Heavy Lifting (SHL).
“Everyone with an interest in these workers, their communities and the welfare of the Scottish economy must pull together now and the Scottish Government must lead this effort.
“This is a viable workforce and these are viable yards - important strategic assets - and they stand ready and able to help deliver the future of Scottish manufacturing. Letting these workers and their communities go under is not an option.”
He added: “We’ve got to battle for BiFab.”