Companies operated a blacklist of union activists ... they took people's livelihoods away. They should be jailed

The reason why didn't emerge until he discovered he was one of thousands on a secret blacklist maintained by the construction industry.

The file on Graham, 68, who had been a union shop steward on several occasions, stretched from 1975 to 2007. He said it had a massive impact on his family's life as he was forced to move away from his hometown to seek work.

"Basically since my early 20s, I travelled for over 40 years," he said. "There were also times when I wasn't working and I couldn't get a job. I have basically had to travel for a lifetime. There was only me and my wife – and I left my wife mostly as a loner."

The existence of the list came to light when the Information Commissioner raided a Worcestershire-based firm called The Consulting Association. It found files had been kept on thousands of individuals listing their personal relationships, trade-union involvement and employment history, and was used by more than 40 firms to check the backgrounds of potential workers.

Campaigners say it is a greater scandal than phone hacking and are now calling for a public inquiry on the issue. The spotlight is also being thrown on the practice with an investigation by the House of Commons Scottish Affairs Select Committee underway and victims gearing up for a legal battle to gain compensation for years of lost wages.

Graham's friend Steuart Merchant, 66, also an electrician from Dundee, didn't think for "one minute" his name could be on a blacklist. But it was. He believes that explains why he could never get work with many of the major construction firms.

"I always knew there was something wrong because other people were getting jobs and I wasn't getting them," he said.

Merchant, who is retired, added: "I thought it was terrible when I found out about the blacklist. It doesn't say any reasons why I am on it.

"I have always been involved in trade-union activity – I have been a shop steward a few times, but I have also been the foreman on sites. I was never disciplined for bad workmanship or bad timekeeping or anything like that."

There had long been rumours of the existence of blacklists in the construction industry. When whistleblower Alan Wainwright, a former construction manager, confirmed that the practice went on, it triggered a major investigation by the Information Commissioner's Office (ICO) in 2009. Few took any notice.

The watchdog raided the offices of The Consulting Association, run by Ian Kerr, and discovered records on more than 3,213 workers. So far only around 200 people have been made aware they are on the list – which has not been made public – and the story is finally making its way into the spotlight.

The ICO says the files stretch back decades and it is not possible to use the addresses in the files to contact people, in case it leads to information being sent to the wrong individual. Anyone who suspects they are on the list has to get in touch with the ICO.

But following criticism that not enough is being done to alert the victims, the list has now been made available to lawyers at the GMB union, who will now attempt to contact any members who may have been on the list. The union believes a public inquiry should be held.

Harry Donaldson, regional secretary of GMB Scotland, said: "We believe this practice has been really significant – when you think of just over 3000 people who were on that blacklist and only a few hundred have any knowledge of it at all."

Dave Smith, of the Blacklist Support Group, said blacklists could have prevented workers from raising concerns about safety issues.

"The construction industry has got the worst safety record in the country", he said. "It was absolute common knowledge in the industry there was a blacklist going on – we could just never prove it as we never had the documents."

Employment blacklisting is the subject of a current inquiry by the House of Commons Scottish Affairs Committee, which initially began examining the issue of health and safety north of the border.

Committee chair Ian Davidson, MP for Glasgow South West, said: "It was drawn to our attention that health and safety statistics in Scotland were worse than those in the rest of the UK - one of the issues that kept coming up was people were being deterred from being health and safety representatives or pursuing health-and-safety issues because of blacklisting and finding it difficult to get jobs." Davidson said he intended to bring some firms to give evidence to the committee.

According to the ICO, the firms that subscribed to the Consulting Association included names such as Balfour Beatty, Sir Robert McAlpine Ltd, Emcor Rail Limited and C B & I UK Limited.

It has now also emerged that workers who allege they were affected by being blacklisted have launched a High Court group action in a bid to gain compensation for loss of earnings, which is directed at construction group Sir Robert McAlpine as part of an alleged "unlawful conspiracy" by the wider industry.

The company Carillion has already submitted written evidence to the Scottish Affairs Committee inquiry. It states it was not involved with the Consulting Association, but confirmed a business unit – Crown House Engineering – used the database until early 2004.

The statement insisted the use of the database was not to deny trade unions members or activists employment, but highlighted "serious employment-relations problems" concerning electricians at the time. It went on: "A number of militant electricians, where employed in significant numbers and on big projects, were engaging in unlawful, costly and damaging walkouts/industrial action.

"The Committee will probably not be surprised that in relation to such unofficial action, perpetrated without the authority or approval of recognised trade unions, there was suspected or actually reported sabotage, threatening behaviour and intimidation.

"Such disputes could cost millions of pounds in contractual penalties, and of course impacted workers who may have been victims of intimidation."

The Scottish Affairs Committee has also heard evidence from ICO investigations manager David Clancy that the files seized during the raid on the Consulting Association only retrieved "5-10%" of the material.

This has raised concerns that the extent of the blacklist could be much wider, covering more individuals and industries. However the ICO has insisted their investigation found no evidence of this.

What is known is that it was not just workers whose names were on the blacklist. A file was found on Professor Charles Woolfson, dating up until 1996, which appears to have been opened after he began writing on the safety of oil rigs while at Glasgow University.

Woolfson, who is now based at Linköping University in Sweden, said: "I was writing about offshore workers who at that time were being blacklisted. It is paradoxical that in writing about blacklisted workers you get yourself blacklisted."

Meanwhile Willie Black, 62, a retired electrician from Edinburgh, discovered his blacklist file stretched into 2002 – despite the fact he had stopped working in the construction industry in 1984.

Ian Kerr, who ran the Consulting Agency, was fined £5000 in July 2009 for breaching the Data Protection Act in the wake of the ICO investigation, with the 40 companies who subscribed issued with a warning.

A year later, new regulations were introduced making it unlawful to operate a list - but there are suspicions the practice is still going on.

EMPLOYMENT law expert Keith Ewing, professor of public law at King's College London, said: "It is a secret, destructive dirty business and blacklisters don't operate in public, they don't conduct their business where they can be seen.

"We don't know the extent to which it is going on, but from the day trade unions were created, trade unions have been blacklisted and it would be implausible to believe that some formal or informal blacklisting was not still going on."

He argued the regulations around blacklisting should be extended to make it a specific criminal offence, rather than leaving the onus on individuals to take employers to court.

He said: "If the courts take the view that phone-hacking is a criminal offence, I think I would take the view that blacklisting is just as serious. Putting the [Milly] Dowler case to one side – which was clearly quite a disgraceful incident – I would argue that the impact on people's lives of blacklisting is just as great as the impact of phone hacking on other people's lives."

Francis Graham also thinks harsher penalties should be introduced for firms that blacklist.

"They don't know what the situation is in life when you are out of work," he said. "They should be given custodial sentences. That is what they need, as what they have done is taken people's livelihoods away."

How one secret blacklist was exposed

THE concern over the files is not the first time the issue of secret employment blacklists has been raised in the UK. Former Glasgow MP and anti-blacklist campaigner Maria Fyfe gave evidence to the House of Commons Scottish Affairs Committee this year about the Economic League, a right-wing vetting agency which accumulated files on thousands of people it considered subversive.

It was originally set up in 1919 at a time when British industrialists were afraid of Bolshevism breaking out in Britain, the inquiry was told.

Thousands of companies paid for information to vet employees, but the league came under scrutiny over allegations it was holding inaccurate records and was wound up in 1993.

Fyfe said the methods used by the league to identify names included combing letters to newspapers, especially the left-wing press.

She cited the case of a war veteran, whose name appeared on the blacklist after writing a letter to a newspaper praising a council for buying a painting of Nelson Mandela.

Other names included novelist William McIlvanney, who was listed as a Marxist – despite saying he has never been committed to any party – and several MPs, Fyfe said. The MPs blacklisted included Adam Ingram, Tom Clarke, Tommy McAvoy, Peter Hain and Maria Fyfe herself.

Fyfe said: "This was described by one victim as McCarthyism in Britain, but he said – and I agree with him – it's worse than that because at least McCarthy was open enough to stand up in front of an American grand committee and say what he thought and believed. All of this was done in secret.

"It is amazing for MPs to be blacklisted, but there were thousands whose job chances were wrecked through this and they never knew it had been done."