The decision to bring in hundreds of European contractors to work on an oil refinery project is "like a red rag to a bull" for unemployed British skilled workers, according to the local MP.
The dispute at the Total Lindsey Oil Refinery, in North Lincolnshire, has led to scenes reminiscent of the industrial disputes of the 1970s with hundreds of placard waving protestors watched by ranks of police.
Workers walked off the site on Wednesday following weeks of discontent over the contract to build the £200 million HDS-3 de-sulphurisation unit.
Staff working on the project were joined by others from the South Killingholme site for the unofficial action.
Yesterday they were joined by union supporters, from Unite and the GMB, and contractors from other refinery sites for a mass demonstration.
They were also joined by protestors from the Staythorpe Power Station construction site, in Nottinghamshire, where protesters gathered earlier this month following claims workers were being hired from overseas.
The refinery dispute erupted after Total put the contract to build the new unit, which will allow the refinery to process crude oil with a higher sulphur content, out to tender.
Total hopes the plant will give the refinery the capacity to process oil even when North Sea reserves begins to dwindle.
A total of five UK firms and two European contractors tendered for the work.
It was awarded to the Italian company Irem on the basis it was supplying its own permanent workforce.
It is understood 100 Italian and Portuguese workers are currently on the site. They are expected to be joined by 300 more next month.
The foreign workers are being housed in large, grey housing barges which are moored in Grimsby docks.
Earlier this month Cleethorpes MP Shona McIsaac met Total executives along with union officials and North Lincolnshire Council leader, Mark Kirk.
The MP says contractors walked out following the break down of talks.
Ms McIsaac said: "While Italian company Irem won a construction contract on Lindsey Oil Refinery following a successful tender in which British companies were also involved but sadly unsuccessful, it's like a red rag to a bull for people in our community who are out of work and who have skills that could be used in this construction project.
"Although I'm told there are no redundancies arising from the contract going to the Italian company, if you are out of work, it can seem so unfair.
"I have raised workers' worries with senior executives at Total, as well as with the trade union, Unite."
Ms McIsaac said she had brought the matter up with Prime Minister Gordon Brown.
Some of the protesters have seized upon a pledge last year by the Prime Minister to guarantee a "British job to every British worker".
The MP said: "This is a massive project and no doubt there will be more contracts up for grabs on the refinery so I hope that firms in our area are successful in winning future bids for the work at Lindsey and other firms on the south Humber Bank."
As well as repeating its assurance that the Irem contract will mean no anticipated redundancies from the existing contractor workforce, Total stressed local companies will be providing additional support services to the project.
The firm also said Irem staff will be paid at the UK nationally agreed levels for the engineering construction industry under the same terms and conditions as agreed with unions for the existing contractor workforce.Reuse content