Sudbury workers could be set for industrial action if a pension scheme agreed only five years ago is scrapped by multi-national company.
GMB and Unite unions have accused Nestle UK of acting in ‘bad faith’ after the company announced plans to close its career average pension scheme which was only agreed in 2010.
Warning that the move could be seen as an ‘act of betrayal’ by the workforce, the unions urged the company to think again.
Under the plans Nestle wants to close the defined benefit scheme, currently offered on a career average basis and replace it with a defined contribution or ‘money purchase’ scheme.
The proposals backtrack on pension changes introduced five years ago which saw the final salary pension scheme scrapped for a career average scheme on the understanding that it would be an industry leading scheme.
If the proposals go ahead the career average scheme will be closed to new entrants from 2016 and closed to future pension build up for existing members from to 2017.
Unions say that the changes will effect workers making Nestle products across the UK including workers at the Nestle Purina factory in Windham Road, Sudbury.
Stuart Fegan, GMB national officer, said: “Over 7,600 Nestle workers in the UK which these proposals will affect will wonder why a company such as Nestle generating significant profit can justify such detrimental plans.
“We urge Nestle to think again as we fear the workforce will not accept these changes willingly.
“Julia Long, Unite national officer, said: “Many loyal workers will feel led up the garden path and see these changes as an act of betrayal by Nestle.
“Five years ago they agreed to pension changes in good faith. Now Nestle is tearing up their contracts with their future with workers facing being worse off in retirement.”
Nestle have said the costs and risks of providing a defined benefit scheme have increased substantially in recent years.
Dame Fiona Kendrick, CEO and Chairman of Nestle UK and Ireland said: “We realise these proposed changes will cause concern for employees.
“We are very sorry that we have to propose these changes but under the circumstances we believe it is the right option.”
The Company will now enter into consultation with employees and trade unions.