Supermarket chain Morrisons is facing the prospect of future industrial unrest, after one of the UK's biggest unions reportedly scrapped a longstanding no-strike agreement.
According to the Times, the T&G union has pressed Morrisons into re-writing a recognition agreement with the union to allow members to strike in the event of a dispute. Previously, any dispute went to binding arbitration.
The company's climbdown comes after a prolonged dispute with the T&G, during which Morrisons attempted to persuade T&G members to join other unions.
Morrisons agreed to a new recognition deal after also offering substantial pay increases to its 2,000 distribution drivers at two depots. Some drivers received rises of nearly 15 per cent, taking their pay to £8.33 an hour.
The move came as Morrisons, which is in the process of integrating Safeway stores into its operation, reported lacklustre sales figures.
Like-for-like sales rose just 0.1 per cent at the core Morrisons chain in the six weeks to 9 January, compared with a 7.5 per cent rise in the 10 weeks from 25 July 2004, the previous period reported on.
Like-for-like sales at former Safeway stores converted to Morrisons rose 4.7 per cent, compared with 12.5 per cent for the same previous reporting period. Sales at unconverted Safeway stores fell 8.4 per cent in the six weeks to 9 January.