Diageo Unions Demand 5% Pay Rise As They Prepare For Strikes
Unions at Diageo are demanding a 5% pay rise for workers due to go on strike in Scotland later this month and believe the stoppages will cost the drinks company £1 million (€1.12 million) a day, a source familiar with the matter has said.
A Diageo spokeswoman said that the unions had initially demanded 5% pay hikes when talks started in May, but had since come down to 3.5%.
The source said that the unions "never" agreed to settle at 3.5% and that their previous demand still stood.
Members of Scotland's Unite and GMB unions, who make up half of Diageo's 3,000 Scottish workforce, are set to go on rolling strikes at the company's Cameronbridge, Leven and Shieldhall sites in Scotland between September 17 and 27, after talks with Diageo collapsed last month.
On August 30, the unions again rejected Diageo's offer to increase wages by 2.8%, after rejecting a prior offer of 2.5%. Last year, workers received a 3.2% hike.
Bob MacGregor, the regional industrial officer of Scottish union Unite, has previously said that production would come to a standstill if the strikes go ahead.
"We are willing to listen to any offer from the company above what they offered last year…but what our members won't accept is a pay cut," MacGregor told Reuters.
The Diageo spokeswoman said the union's estimate that the strikes would cause losses of £1 million a day did not have "any ground in reality" and that the company was unable to verify the number.
The unions have said that their demands should be taken in the context of the world's largest spirits maker's annual profits, which were £4.2 billion (€4.7 billion) last year.
The unions have also voiced frustrations over Diageo's plan to build a £150 million (€168 million) Johnnie Walker visitor attraction in Edinburgh as part of an investment in Scottish whisky tourism.
Diageo has 29 distilleries in Scotland and exports 80% of the whiskey it produces there to 180 countries. The company is the single biggest exporter of whiskey from Scotland and produces for brands including Johnnie Walker, Lagavulin and Talisker at the three sites.
Diageo's pay offers year-over-year take into account the Consumer Price Index (CPI), which is regarded as the UK's rate of inflation, and the Retail Price Index (RPI), the spokeswoman said.
UK CPI stood at 2.1% while RPI was 2.8% in July.
"We want our employees in Scotland to continue to be well paid for the great job they do and receive a rise above the cost of living," a Diageo spokesperson said. "Everyone receives a broad range of strong benefits, which this month included free shares worth 8.56% of salaries for every employee."
The company said that it has contingency plans in place for a strike, but wants to reach a deal via "meaningful talks".