Jaguar Land Rover has struck a deal with trade union Unite to cut thousands of workers' pensions

 
Mark Sands
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On The Factory Floor At The Jaguar Rover Factory
Pensions will no longer be calculated on the basis of final salaries (Source: Getty)

Jaguar Land Rover has reached a deal with union bosses allowing the carmaker to cut thousands of workers' final salary pensions.

The agreement with trade union Unite, means staff will no longer calculate their pensions on the basis of their final pay package.

It brings to an end years of dispute over the future of the Tata-owned firm's retirement offering, with a deficit of almost £900m in the carmarker's final salary scheme reported at the end of 2015.

And it comes as staff at BMW kick off their own strike action over the decision to close the German company's final salary scheme.

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Jaguar Land Rover will maintain the Defined Benefit plan, but terms of the deal mean workers will instead calculate their final pension based on the average of their salary from now until they retire.

Staff will also stop contributing to a previous final salary pot, although this will continue to increase in line with inflation.

The DB scheme was closed to new entrants in 2010.

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Less than half of Jaguar Land Rover's 42,000 UK staff are expected to be affected.

A spokesman said: "We worked hard to establish a package of changes that are intended to improve the sustainability of the pensions schemes wile maintaining defined benefit provision for current active members."

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