Union tells JLR workforce to reject pay deal

The Unite union is recommending that its members reject a pay deal offered by Jaguar Land Rover ahead of a ballot due to take place on Thursday.

“There will be a recommendation to reject the pay deal,” Alex Flynn, a spokesperson for the union Unite, told BusinessLine .

The ballot of union members across JLR’s plants in the UK is set to take place on Thursday, with results due at the end of the day or on Friday, and will determine whether or not they accept a recent pay deal put forward by JLR following pay and condition negotiations.

“Senior shop stewards have met and don’t think the deal meets expectations of members,” Flynn said.

The ballot follows a final pay offer made by Jaguar Land Rover last month, which includes a pay rise of 3.6 per cent in the first year and a bonus and 3 per cent in the two following years.

JLR has expressed its disappointment over the failure to reach an agreement and says it remains committed to reaching a negotiated settlement.

Last month, at the opening of JLR’s new engine plant near Wolverhampton, Executive Director Mike Wright said it was “unfortunate” that trade unions had rejected what JLR deemed a “very generous pay offer.”

“We are confident we will get a negotiated settlement,” he said at the time.

In addition to the proposed pay rise, shop stewards are concerned about proposed changes to the pension scheme, the spokesperson for Unite said.

“The company is looking at making 240 million pounds of savings from the pension scheme….people will understand why our members are unhappy — there are people who have been paying into it for the past 20 years.”

He added that another point of contention was a proposal that it would take six years for new starters at the company to reach a full rate of salary. “It’s simply too long.”

“Broadly speaking, our members have made great sacrifices when the company was in great difficulty, including taking an 18-month pay freeze…this is a company that is highly profitable and our members feel they should be getting a bigger share of its success.”

Should members vote against accepting the pay offer — in the ballot determined by a simple majority — the union would be urging Jaguar Land Rover to get round the negotiating table to reach a deal that did meet expectations, the spokesperson said. In 2009 JLR and its workers struck a deal whereby a temporary freeze in pay and a four-day working week was introduced in return for no compulsory job cuts as the company contended, along with the rest of the auto industry, with a sharp drop in demand.

Since then, JLR has seen a dramatic change in fortunes with sales globally driven by a raft of successful new launches such as the Range Rover Evoque and demand from new growth markets such as China.

In the quarter ending in June this year JLR made a pre-tax profit of £924 million.

Last month, it opened its first engine manufacturing centre in nearly 20 years near the English city of Wolverhampton, which will employ 1,400 by the time it reaches full capacity.

It also recently opened a factory in China in partnership with Chinese automaker Chery and is set to open one in Brazil in 2016.

Since 2009 it has nearly doubled its workforce from around 16,000 to over 30,000.