Diageo workers end dispute over plant closures

By Guy Montague-Jones

- Last updated on GMT

Related tags Johnnie walker Diageo

Diageo workers have ended their campaign against the brewer following months of negotiations that were kicked off in the summer by news of major plant closures.

The Kilmarnock bottling plant and the Port Dundas distillery in Glasgow are both to be closed in a series of cost cutting measures revealed in July.

Net job reduction is estimated to be 500 over the next two years, but total job losses are expected to reach 900, with around 700 coming from the closure of the Kilmarnock plant in Ayrshire.

New deal

These workers have now agreed to a new redundancy deal that brings their fight with Johnnie Walker makers Diageo to an end.

Diageo agreed to increase termination payments by £4,000 to £9,000 per person, and remove altogether previous conditions based on productivity and attendance.

Trade union Unite said Diageo has also opened up its pension scheme to allow part of the redundancy packages to be paid into worker pension pots.

Unite spokesperson Jennie Formby welcomed the deal saying: “The final package is one that provides benefits for members that are second to none.”

Formby also said that the union has informed Diageo management of the decision to accept its offer and formally end the campaign.

Restructuring plans

Diageo expects the plant closures in Scotland to give rise to cost savings of approximately £40 million per annum in the year ending 30 June 2012. These savings are in addition to other cost reductions that the company expects to achieve following additional restructuring measures announced in February.

Bryan Donaghey, managing director of Diageo Scotland, said the plant closures in Scotland were part of a restructuring plan that will enhance competitiveness, and help secure the sustainability of its business in Scotland.

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