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Chivas workers threaten to strike over pay freeze

Employees of Chivas Brothers in Scotland will be balloted for strike action after Unite members voted to reject a pay freeze.

Chivas Brothers is the Scotch whisky arm of French firm Pernod Ricard

Members of Scotland’s largest union, Unite, voted by 91% to refuse a pay freeze in a consultative ballot after a ‘breakdown in talks’.

Unite said the decision to reject the pay freeze was made as a number of major drinks firms, including William Grant & Sons, Edrington and Diageo, offered substantial pay increases to their employees.

Chivas Brothers, the Scotch whisky arm of French firm Pernod Ricard, employs around 1,600 workers in Scotland. Unite did not say how many Chivas Brothers workers are members of Unite, but it is confirmed to be in the hundreds.

Elaine Dougall, Unite regional coordinating officer, said: “Unite’s members at Chivas Brothers are absolutely furious at the pay freeze being offered by the company and have demonstrated this through rejecting it by 91%.

“Other players in the industry are offering significant pay rises whereas Chivas Brothers workers who have continued to work throughout the Covid pandemic and continued to boost the profits of the company are being offered nothing. It’s completely unacceptable.”

Unite pointed to Chivas Brothers’ financial results in 2019, which saw the firm make a pre-tax profit of £539 million (US$733m) last year, a 22% increase from £442m (US$601m) in 2018. In full-year 2020, Chivas Brothers’ organic sales declined by 11% due to the pandemic.

Unite said it would now move to ballot its members for strike action, which could affect Chivas Brothers’ Kilmalid site, Strathclyde grain distillery, and southern and northern operations.

Dougall added: “We will continue to press hard for a fair pay offer but all options are now on the table. Chivas Brothers have an opportunity to do the right thing or they will face an escalating dispute unnecessarily created by their arrogance.”

Chivas response

Jean-Christophe Coutures, Chivas Brothers’ chairman and CEO, said: “We deeply value the hard work and commitment of our teams during this crisis, and we are proud that we have been able to navigate these unprecedented times while maintaining 100% of jobs and salaries. We are equally proud of the open dialogue we have maintained with unions over the course of this year, having worked very closely with them throughout the Covid-19 crisis to develop an industry-leading safe system of work to ensure the wellbeing of both our team and partners, as well as the continued viability of our business.

“Like many others, the Covid-19 crisis has negatively affected our business – and the wider Scotch whisky industry. The pandemic has led to record low Scotch whisky sales (down 11% in our financial year 2020), a significantly-impacted global travel retail channel – an extremely important market for Scotch – and increased costs to make all of our sites Covid-secure.

“We are very optimistic about the future of our business, but in order to protect our long-term resilience while the crisis is ongoing, we took the necessary decision to implement a salary freeze across the entire business for the past financial year, while continuing to invest in our working environments, conditions and people – including our intention to create 75 additional permanent roles by June 2021.

“We entered into discussions with unions several months ago to seek alternative means to reward our teams, including an increase to this year’s profit-related share plan and a guaranteed pay increase in 2021. Despite the rejection of this offer, we have nevertheless honoured our commitment to enhance the share scheme, in recognition of the hard work and dedication of our teams during this most extraordinary year.”

In 2017, workers at Chivas Brothers’ Kilmalid production site in Dumbarton went on strike in response to a pay offer from the company.

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