Diageo is facing mass walkouts across its Scottish bottling operations in the run up to Christmas as staff voted for industrial action over pension cuts.
GMB Scotland members at the Johnnie Walker maker’s plants in Scotland, including bottling facilities at Leven and Shieldhall and distilleries across the country, voted for strike action by a majority of 63% and action short of strikes by a majority of 69.7% after a two-week ballot.
Unite, which has more than 700 members at Diageo sites around the UK, said the action could also affect Diageo sites in Northern Ireland and Cheshire.
Diageo called the results “clearly disappointing” and the “premature“ while discussions were ongoing.
The dispute arose after the distilling giant announced plans to save £30m a year from pensions by shutting down its final salary scheme, as well closing the ‘lifestyle’ plan to new members.
Diageo’s UK final salary pension scheme closed to new members on 22 September 2005, but about 1,700 employees are currently covered by the plan. Unite members across Diageo’s UK sites voted 82% in favour of industrial action short of a strike, and 77% in favour of strike action.
The spirits group has been consulting with employees since February 2016 as part of a review of its pension scheme and started formal consultations on proposed changes on 18 July.
Diageo is proposing to introduce a ‘defined contribution’ scheme, based on an employee’s average career salary, which the unions claimed would be worth much less to members.
GMB Scotland, which represents about 1,100 Diageo employees across the country, and Unite criticised the Smirnoff and Guinness owner for slashing pensions as it made “eye-watering” profits and executive pay levels.
Operating profits at Diageo rose 3.5% to £2.9bn in the year to 30 June in what CEO Ivan Menezes said was a turnaround year. The business had been struggling in the previous three years with sluggish growth in the US and emerging markets.
Menezes also bagged a 16% hike to his total remuneration package for the year to £4.4m.
Unite regional officer Pat McIlvogue said: “No-one takes industrial action lightly – especially with Christmas coming up – but Diageo is behaving like Scrooge.”
GMB Scotland Organiser Louise Gilmour added: “Our members have sent a strong message to Diageo that the company needs to think again if it wants to avoid damaging strikes across Scotland.
“Diageo is happy to significantly increase executive pay in the wake of billions of pounds of profit but they won’t protect the pensions of the workforce who have contributed massively towards the success of the business.
“It’s another example of the obscene disparity between executive pay and the ordinary worker and if there is one company that can most certainly afford to sustain decent pension arrangements for its workers then it’s Diageo.”
A Diageo spokeswoman said: “If and when strike action is taken the company will focus on ensuring that our business continues as usual as far as possible. Strong plans are in place for this while we seek to move back into dialogue on the pension scheme.
“Management at Diageo remain committed to finding a sustainable solution on pensions that helps to manage the long-term needs of employees in a competitive pension with the growing risk and cost to the company of the DPS scheme. As such the company will seek to move back into discussions with unions and ACAS.”
Current pensioners and deferred members of the pension scheme will not be affected by any changes.
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