Fleet News

Workforce votes to accept Vauxhall pay deal to secure future of plants

VAUXHALL'S 9,000 workers have voted to accept a revolutionary pay deal which links their wages to the strength of sterling. The three-year arrangement will strengthen Vauxhall's hand as it bids against continental General Motors factories to build the replacement Vectra, and was immediately followed by a commitment from Vauxhall to continue substantial investment at its Luton and Ellesmere Port plants.

Acceptance of the deal effectively removes the threat of closure hanging over the plants, and particularly the Luton factory. Under the new three-year arrangement, salaries will rise by 3.5% from August 3, 1998, and by 3% or the rate of inflation (whichever is higher) in the following year.

In the third year, however, pay will rise by the rate of inflation, with an extra 0.5% paid if the average exchange rate for sterling falls below Deutschmark 2.70 (the current exchange rate is just under DM3) for two consecutive months. This radical third-year proviso reflects the huge impact of the foreign exchange markets on the costs of manufacturing in different countries.

Vauxhall's white collar staff voted to accept the ground-breaking deal early last week, but it was the approval of the company's 10,000 car workers which was critical to its success.

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