A major Angus employer has told staff to accept changes to its pension scheme or face the sack.
Energy firm Baker Hughes, which has more than 200 staff in Montrose, has issued formal advance redundancy notices as it tries to implement changes to its pension scheme.
The notices have been issued to around 4,500 employees in the UK.
A worker claims the changes to the pension scheme will cut the employer contributions by up to 25%.
This would apply to all current employees, except those who joined after August 2024, who are already enrolled in a lower-contribution scheme.
The changes would come into effect in January.
Staff have been informed that if agreement is not reached, Baker Hughes may carry out a process known as “dismiss and re-engage” – commonly called fire-and-rehire – where employees are made redundant and rehired on new, less favourable terms.
This practice, though currently legal, is set to be restricted under upcoming UK legislation.
Baker Hughes said it was prepared to take this step as a “last resort” if workers don’t accept the change.
“Essentially the business is looking to impose a 25% reduction in pension contributions under an excessive timeline, which currently is legal, but looks to be timed just before the amendment of the employee rights bill that would outlaw this practice,” said the employee.
They asked to remain anonymous due to fear of reprisals, but said, “too often oil and gas workers of the UK are forgotten about and need to be vocal”.
From Montrose to the world
In 2019, Baker Hughes opened a £31 million subsea centre of excellence in Charleton Road, which created 160 jobs.
The structures designed for challenging conditions at sea that are manufactured in Angus go all over the world, via the town’s port.
However, it’s been a challenging few years for its Angus operation.
There was a round of redundancies that saw around 80 job losses in 2021.
Then, in 2022, the firm issued redundancy notices to 250 Montrose staff – around half its workforce at that time – and offered new contracts on reduced terms. Following a strike by workers, a pay deal was reached.
In 2023, Baker Hughes sold its machining facility at Brent Avenue to AME International. This saw the transfer of 118 staff.
At the time the firm said it remained committed to Montrose despite the sale.
Baker Hughes on pension changes
The pension cuts plan comes just weeks after Baker Hughes completed a £900m buy-in deal, securing pensions for over 7,000 retired and deferred members across three legacy schemes.
A Baker Hughes spokesperson said: “In the wake of a review that began in 2024, the company recently communicated an upcoming proposed change in pension plans which would align with the current offering to new hires in the UK from 1st August 2024.
“These plans would keep Baker Hughes within the top 25% of employers in the UK in terms of pension contributions.”
The spokesperson said the HR1 form, issued when more than 20 staff in a business face redundancy, is “statutorily required by the UK government”.
The firm said: “It was part of a broader communications package to our employees which provided additional context and background on this proposal.”
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