Nestlé agrees pension deal with union workers

By Matt Atherton contact

- Last updated on GMT

Nestle agree pension deal with union workers
Nestle agree pension deal with union workers

Related tags: Pension, Nestlé

Nestlé has agreed to a new pension scheme with GMB and Unite workers after a year-long dispute was resolved.

Workers voted overwhelmingly to accept an agreed career average defined benefit pension. The deal means existing staff pensions are an 80th​ of their salary for every year they’ve worked at Nestlé.

The scheme introduced a salary cap for defined benefit pensionable earnings of £45,000, and would only be available to staff employed before July 1. Nestlé’s 7,600 UK employees who are not members of its defined benefit scheme would receive a final opportunity to join.

As part of the deal, the manufacturing giant agreed to a 3% pay rise for production workers for 2016, and also 2017.

Great deal of pressure

Package main points:

  • Career average defined benefit pension
  • Based on 80th​ accrual
  • Salary cap for defined benefit pension of £45,000
  • Scheme not available to staff joining after July 1 2016

Unite national officer for food and drink Julia Long said: A lot of hard work went into safeguarding members’ pension provision at Nestlé, at a time when company pension schemes in the UK are under a great deal of pressure.

“This pension package, accepted overwhelmingly by the workers, secures the future of the career average pension scheme, which a year ago was under threat.”

Nestlé UK & Ireland ceo Fiona Kendrick said: We have always been serious about listening to our employees and working closely with the trade unions. We are pleased union members have accepted the revised company position on pensions, subject to trustee consent, which includes retaining a core defined benefit arrangement.

“The matter of pensions is hugely important to Nestlé, and that’s why it was imperative that we undertook a comprehensive and wide ranging consultation process on the changes that we proposed in July 2015.”

Strike action

The unions had threatened strike action​ last month if the row was not resolved.

The dispute began when Nestlé introduced plans to replace its defined benefit pension scheme with a defined contribution scheme. The company had offered both schemes to its employees, but said in July 2015 that the defined benefit scheme’s costs and risks had significantly increased over the past five years, and therefore planned to stop offering it.

GMB and Unite accused Nestlé of “acting in bad faith”​ after the 2010 negotiations to offer both pension schemes. The unions said in a joint statement that they would not “stand by and let that happen”.

Sites affected by pension changes

  • Nestlé head office – Gatwick
  • York
  • Dalston, Cumbria
  • Fawdon, Newcastle-upon-tyne
  • Girvan,
  • Halifax,
  • Tutbury and Buxton, Staffordshire,
  • Rickmansworth,
  • Welwyn garden City,
  • Bromborough, Wirral
  • Staverton,
  • Sudbury, Suffolk
  • Wisbeck, Cambridgeshire,
  • Aintree,
  • Brunswick Business Park, Liverpool

Related topics: Confectionery, People & Skills

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