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Diageo dodges UK strike after negotiations
Members of UK trade union Unite have accepted proposed changes to Diageo’s pension scheme, therefore preventing strike action.
Diageo will not be hit by strike action after agreeing changes to its pension scheme with union members
Both GMB and Unite have now accepted the compromise following negotiations through conciliation service ACAS.
The decision follows an earlier ballot in December, when Unite members rejected Diageo’s initial proposal and members of GMB voted to accept.
In November, members from both unions voted in favour of strike action over proposed changes to Diageo’s pension scheme, accusing the Johnnie Walker maker of “shameful corporate greed”. Plans for industrial action were then put on hold during negotiations.
The group decided to end its final salary pension scheme, which it claimed was an escalating cost for a small part of the overall workforce whose life expectancy was collectively increasing.
The scheme closed to new members on 22 September 2005, but about 1,700 employees are currently covered by the plan. As such, up to one third of Diageo’s workforce stood to be affected by the changes.
However, GMB and Unite said the terms of the new scheme were “inferior”.
“Following the split vote on the pension proposal, we took the necessary steps to safeguard our members’ position, and used our strong union democracy to consult with members,” said Unite regional officer Pat McIlvogue. “That process has led us to this overwhelming vote to accept.
“We are now focused on the future. Unite has been given a mandate by our workplace representatives to negotiate with the company on new collective bargaining structures to deal with our members’ future concerns and we will be looking to discuss that with the company as soon as possible.”
Under its ‘final offer’, Diageo will change its final salary scheme to a Career Average Revalued Earnings Scheme from 1 April 2018.
The company’s separate Diageo Lifestyle Plan will not be closed immediately as was originally planned. It will remain open to new employees until 31 Dec 2017 and will not be closed to existing employees.
“We are proud of the pay and benefits we offer our colleagues at Diageo and we are committed to providing competitive and sustainable pensions,” said a Diageo spokesperson.
“For over a year now we have been in extensive talks with employees in the UK with regard to the future of the final salary pension scheme. In December we agreed a highly competitive proposal, negotiated with the GMB and Unite Trade Unions at ACAS and this proposal has now been accepted by the members of both trade unions.
“We are pleased by this result as it moves us closer to a fair, secure and sustainable outcome for all colleagues. We will now move into formal consultation on this proposal before deciding whether to implement it.”