Diageo fight ends as axed workers back pay-off deal

Published on Wednesday 9 December 2009 22:05

THE dispute over Diageo's decision to end Johnnie Walker whisky's historic link with Kilmarnock is over, after workers voted overwhelmingly to accept a redundancy package.

The ballot result of Unite union members draws to an end the highest-profile industrial controversy in Scotland in 2009, but means that 900 jobs in Kilmarnock and Glasgow will be lost.

Members of the GMB union also supported the redundancy package last week.

The deal means that former employees will walk away with redundancy packages worth about six times the legal minimum and 400 jobs will be created in Fife. Diageo is closing its bottling plant in Kilmarnock, the town where Johnnie Walker was first created in a shop more than 150 years ago, along with its Port Dundas Distillery in Glasgow.

A high-profile, cross-party political campaign failed to persuade the company to change its mind. The campaign involved a demonstration, which included a speech by Alex Salmond, leading to fierce criticism of the First Minister from within the business community.

A working group tried to come up with options to keep Kilmarnock and Port Dundas plants open, but they were quickly rejected by the drinks giant.

Yesterday, it was announced that staff had voted five to one in favour of the package, which Unite described as "good". Workers with about 25 years' experience will walk away with between 50,000 and 73,000. Those who want to relocate to the new 100 million plant in Leven, Fife, will be given a 5,000 payment, plus expenses. Others have been given 9,000 over and above their redundancy payments.

On top of that, Unite officials persuaded Diageo to allow workers to defer part of their redundancy payments into their pension funds.

This had been the sticking point in the negotiations, but Diageo agreed to the pension demand when workers threatened to go on strike.

Unite's regional official, Billy Parker, said: "It was a good package in the end after some hard negotiations. It was important that some workers who are unlikely to work again because of their age were able to get something that would give them a future income."

A spokesman for Diageo said: "Through the well-established negotiation framework, all the trades unions representing employees have recommended acceptance of the proposals.

"Last week, the GMB union approved an offer and now Unite confirmed that – following a vote of the membership – the vast majority of the Diageo workforce has fully accepted the offer and the proposals.

"The agreement, which includes targeted voluntary redundancy, has been reached within the financial business case laid out in the original announcement."

The campaign to halt the closure plans had also seen finance secretary John Swinney present Diageo with alternative proposals, which would have seen production continue at Port Dundas and the creation of another factory in Kilmarnock.

However, these proposals failed to persuade the company to change its strategy.