Unite could disaffiliate from Labour as relations between Keir Starmer's party and its biggest donor are said to have deteriorated.
Insiders think Britain's most powerful union could cut ties with Labour within months if members force a special rules conference, as the rift between general secretary Sharon Graham and the party leader shows no sign of healing.
Grassroots anger over factional rows and a major clash between the two leading figures over the Coventry bin worker strike have seen tensions boil over in recent months.
It is understood members of the executive surrounding Ms Graham have repeatedly raised the prospect of severing the historic link between the two organisations, and that support now hangs by a thread.
Rapport between Mr Starmer and the union boss is said by Labour insiders to be "non-existent".
Ms Graham was elected in August 2021 and made clear "Westminster politics" would not be a priority.
Relations have grown frosty since the Coventry dispute, however. The Unite boss has failed to have a one-to-one meeting, not just with Mr Starmer but with anyone from his top team for the last six months.
According to the Electoral Commission, Unite has donated £750,000 this financial year, down from £1.8m the previous year.
While some Labour moderates are bullish about a break, others on the left dismiss suggestions that the party - which was forced to shed almost 80 staff as part of a cost-cutting drive - can afford to lose cash.
Unite has around 1.3m members and is the UK's most powerful trade union.
News of the deepening split comes after it emerged the train drivers' union ASLEF will debate a motion to disaffiliate at its conference in May. Bakers' union BFAWU cut ties with Labour last September.
Unite cannot cut all funding unless the union disaffiliates. A motion to do as much can be submitted to the party by branches and a special rules conference called to vote on the issue. Sources say despite widespread anger, breaking ties is not yet on the agenda but cannot be ruled out.
Rows over Unite's Coventry dispute, which spilled into the public arena earlier this year, have further strained the alliance with Labour.
About 75 refuse workers began a two-month strike over pay at the start of February and Ms Graham has repeatedly hit out at the party for failing to back striking members.
Ms Graham tweeted that all Unite funding for Labour was "under review" and Mr Starmer accused her of trying to wield "influence" by "threatening" the party.
A Unite spokesman did not deny there was a prospect of disaffiliation, and said: “ Sharon Graham is completely focused on ensuring that workers and communities do not pay the price for the pandemic.
"The lack of action by Labour to defend working people in the midst of the cost of living crisis has been symbolised by the disgraceful behaviour of the Labour Council in Coventry.
“In Coventry, the leader of the Labour council has engaged in strike breaking and attacked union representatives, all in a bid to suppress the pay of loyal bin drivers who worked through Covid. This disgraceful behaviour has no place in our movement.”
A source close to Keir Starmer insisted the two figures were regularly in touch.
A spokeswoman for the leader's office said: "Keir and the Labour Party have a committed working relationship with Unite.
"We're absolutely aligned in our determination to call out this Tory cost of living crisis, and to work with all trade unions to end the assault on working people.
"Together we are resolutely focused on delivering the next Labour government."
The Unite boss and Mr Starmer were also at loggerheads just days after her election in August 2021, over a series of rules changes the leadership pushed through at the party's conference in Brighton.
Those on the left accuse the leader's allies of refusing to compromise at meetings of the party's ruling NEC, of expelling members and blocking union-backed council candidates.
Party chiefs loyal to Mr Starmer also pushed through changes to parliamentary selection rules earlier this week which restrict campaigning for would-be MP candidates.
Labour moderates accuse Ms Graham of being too close to the Socialist Party and a failure to move the union on from the Len McCluskey era.
One Labour source said: "It would be a tragedy if the trade union link was smashed by Sharon Graham."
Others are more hopeful that relations will improve and underline interventions on policy by Labour's deputy leader Angela Rayner.
One trade union source said: "Working people are facing an assault on their incomes, rights and living standards, with a cost of living crisis threatening to drives thousands into poverty.
"Labour would do well to focus on delivering policies that will help those workers and communities, instead of wasting time and energy attacking the people that make up their support base."
Len McCluskey - An Apology
An earlier version of this article included a Labour source's quote that Len McCluskey had nearly bankrupted Unite.
This is incorrect. In fact, at the time of Mr McCluskey’s departure from Unite, the Union's assets totaled almost £500m, which had increased significantly under his leadership.
We apologise to Mr McCluskey for including this comment and are happy to set the record straight.
