Premier Foods has averted a third week of strikes at its Wigan Hovis site following a “landmark” deal that sees an end to zero-hours contracts at the plant.

The strikes over Premier’s use of agency workers and zero-hour contracts, which the Bakers Food and Allied Workers Union (BFAWU) had claimed were paid less than contracted staff, had threatened to disrupt operations at the site this week.

Following fresh talks on Thursday (19 September), a new proposal was put to the BFAWU on Friday, with members voting to accept it on Saturday.

The settlement includes a review of manning levels and 24 members of staff, who had previously been on zero-hour contracts, have now been taken on full-time.

The deal also avoids the “Swedish derogation”, whereby a third-party hires and pays workers on behalf of the business, who are given a form of contract but are not directly employed, in a practice that “avoids legal obligations to pay people the same amounts of money”, explained Ian Hodson, national president of the BFAWU.

He said: “We’re really pleased the company has sat down and reached an agreement with us.

“The onus is on our members to do additional hours, so there shouldn’t be any need to bring agency workers in. [Premier] won’t be using the Swedish derogation now, which they were suggesting they would do. Significantly, they have resolved the zero-hour contract issue: there won’t be any zero-hour contracts, either directly or indirectly.

“The issue was around workers being treated fairly and equally and we believe we’ve managed to achieve just that,” he added.

Hodson hoped the settlement would signal an end to the “exploitative practices carried out by other companies in the country”.

“We’re extremely happy with Hovis – we believe this is a landmark decision,” he said. “Zero-hours is a huge problem in the baking industry. There are factories working with 70-80% agency workers, and all the skill is leaving the industry.”

A spokesperson for Premier Foods said: “The agreement reinforces our previous assurances that the company has no intention of replacing permanent employees with agency staff or using agency staff as a lever to erode existing employees’ terms and conditions.

“In the event of temporary labour shortages, the union has committed that such shortages will be covered by existing employees utilising overtime and banked hours. 

“In the unlikely event that this is not possible, it is then agreed that the company can use agency staff to cover any gaps. The company has further committed to move any agency employee who works a minimum of 39 hours per week for 12 consecutive weeks to parity pay with existing employees.”