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Unite accuses Diageo of ‘corporate greed’ over pensions

Unite accuses Diageo of ‘corporate greed’ over pensions

31 October 2016

Unite the union is to ballot for industrial action at Diageo over plans to slash worker pensions at a time when the company is making massive profits.

Diageo is looking to change The Diageo Pensions Scheme - its final salary pension scheme - into a career average scheme worth much less to members.

The company also wants to close a separate scheme - the Diageo Lifestyle Plan - to new employees, and replace it with a new defined contributions pension with much worse returns for workers. 

The company’s last reported profits were £2.8 billion. 

Unite regional officer Pat McIlvogue said: “Diageo is a company that is making incredible profits from the hard work of our members. But instead of sharing the rewards of success, it has decided to slap their workers in the face.

“We entered into negotiations with the company in good faith. We agreed to work with the conciliation service Acas and put forward a proposal that would help protect our members’ pensions, but would still save the company money. 

“The company has rejected this, and we have no option now but to ballot our members on industrial action.”

Last week, some 80 per cent of Unite members rejected Diageo’s latest proposed changes to pensions provisions. They will now ballot on industrial action alongside members of the GMB union.

Unite Scottish secretary Pat Rafferty said: “This dispute is a clear illustration of where we are going wrong as a country. 

“Diageo’s CEO Ivan Menezes received £3.8 million in total payments from the company in 2015 – including £424,000 in pension contributions. The company recently increased its dividend to shareholders by 5 per cent. It is rolling in cash. To attack our members’ pensions at this time is a shameful example of corporate greed.

“Scotland is facing an inequality crisis, with the richest households now 273 times wealthier than the poorest. That’s come about because workers have been getting less and less, while shareholders and executives have been getting more and more. 

“We can’t go on like this. Unite is determined to make sure that workers get the respect and reward they deserve, and we stand firmly behind our members at Diageo and their fight for fair pensions.”

Diageo has several sites in Scotland, Northern Ireland and Runcorn that could be affected by the dispute.

In recent weeks, BMW, AWE Plc (the Atomic Weapons Establishment), Gatwick Airport Ltd, US multinational Honeywell and the Post Office have all announced that they are planning to close their defined benefit pensions. Unite has pledged to fight to defend pensions at all these organisations.

ENDS

Notes to editors:

For more information or to arrange an interview, contact  Unite Scotland press officer David Eyre on 07960 451631 / david.eyre@unitetheunion.org