LABOUR's biggest trade union backer is considering industrial action at the Grangemouth oil refinery over the key figure in the Falkirk selection fiasco being investigated.

Unite has condemned what it describes as the "sinister" victimisation of Stevie Deans by Grangemouth operator Ineos, which launched the probe amid concerns over his recruitment of Labour Party members.

But a spokesman for Ineos said the firm was "disappointed" with the industrial action ballot, and defended the investigation into Deans' "activities".

Unite and Labour have been at loggerheads over the union's tactics in trying to secure the Westminster candidacy in Falkirk for left-winger Karie Murphy.

The union signed up around 100 new members to the party, some of whom were linked to the Ineos plant, a recruitment surge that caused suspicion and triggered an internal Labour investigation.

Murphy and Deans, who as well as being an Ineos shop steward was the chair of the constituency in Falkirk, were initially suspended by Labour.

The suspensions were lifted after evidence was withdrawn by witnesses.

It has now emerged that the Falkirk saga is still rumbling on.

The Sunday Herald revealed that Ineos had suspended Deans, but made a u-turn after the union threatened to close the plant.

However, Ineos is continuing with its investigation into Deans, a decision that has angered the union.

Pat Rafferty, Unite Scotland's regional secretary, said: "This is nothing other than a sinister campaign to victimise and hound Stevie Deans out of his job. He is an innocent man, and has been a loyal worker for 24 years at this site.

"Unite will not tolerate an attack on its shop stewards, so we are balloting for industrial action."

The ballot is due on September 27 and has been condemned by Ineos.

A spokesman for the firm said: "Ineos is fully aware of the published outcomes of the Police Scotland investigation and the Labour Party inquiry into Falkirk West. These matters do not affect the central questions which are the subject of the company's investigation, namely whether Mr Deans' activities are in line with company policies and with his role as an employee and a convener."

Labour leader Ed Miliband has said he does not regret his handling of the row, saying he had "followed the right process" in dealing with the situation in Falkirk, which resulted in candidate Murphy withdrawing despite both her and her union being cleared of wrongdoing.

It was a big climbdown as the party had initially referred to the police claims that Unite - its biggest donor - signed people up as party members without their knowledge to get its candidate picked.

The bitter public row with Unite boss Len McCluskey pushed Miliband to propose radical changes to Labour's historic links with the union movement. On the eve of the Labour Party conference, Miliband said: "With every stage in the process we have followed the correct procedures. All the way along we've followed the right process."

Earlier this month Labour lifted the suspensions of Unite-backed would-be MP Murphy and local party chairman Deans, saying they too had done nothing wrong.

Murphy announced that she was withdrawing as a potential General Election candidate for the seat for the sake of "unity".

But Brian Capaloff, a member of Falkirk Labour and Unite, said the lack of an apology to Murphy was "disappointing". He said: "What Ed Miliband needs to do is get on a train and come and meet members here in Falkirk, who have been distinctly absent from any considerations.

"The imposition of special measures on the local party was done to gain publicity. It was extremely heavy-handed. The very least he could do would be to say we could have handled this better."