Grocon, union chiefs reject truce

THE stage is set for one of the most controversial workplace relations legal battles in Victorian history after construction company Grocon and union chiefs rejected the independent regulator's recommendation for a 14-day truce.

Emergency negations broke down in the early hours of Friday morning.

The Industrial Relations Commission recommended a two-week cooling off period but Grocon would not allow further disruptions.

The company has since announced it will sue the union for damages.

Federal Workplace Relations Minister Bill Shorten warned against a state-wide building industry strike but would not be drawn into taking sides.

Speaking to reporters at the protest site Mr Shorten said the confrontation was "right up there in terms of futility".

"This dispute will end - the question is how quickly we can make it end," Mr Shorten said.

"It should never have reached this point."