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Friday, November 20, 1998 Published at 02:52 GMT

Business: The Company File

Rover talks at delicate stage

Overtime not paid, but saved, in new deal

Long-running talks between management and unions resume on Friday morning aimed at safeguarding the future of the UK's biggest car-making plant.

Stephen Evans: "The carrot is multi-million pound investment, the stick is closure"
A union leader has described as premature reports of an imminent deal to save Rover's Longbridge factory in Birmingham but the two sides are understood to be close to agreement.

National Officer of the Transport & General Workers Union, Tony Woodley, said: "We are treading a very difficult road and we are nowhere near the end.

Stephen Evans: BMW says no future for Longbridge if there's no deal
"The negotiations are extremely difficult and speculation about an agreement makes our job much harder.

"We have made some slow and steady progress but the talks still have a long way to go," he said.

The BBC's Industry Correspondent Stephen Evans says that the basis exists for an agreement, centred on a radical shake-up of existing working practices for all Rover's 40,000 workers.

[ image: Production move to Europe threatened]
Production move to Europe threatened
This would involve 3,000 redundancies. It appears a deal is close but it would then have to be approved by workers.

Rover is seeking to make savings of £150m a year through job cuts and changes to working practices.

BMW, which bought Rover in 1994, says the strong pound and low productivity mean Longbridge is less competitive than similar plants in continental Europe.

The key points of the deal are believed to involve job losses of 2,000 to 2,500 and the introduction of new overtime arrangements similar to those in BMW plants on the Continent.

Instead of workers being paid overtime, extra hours worked during busy periods would be saved and added to leave entitlements to be taken during slack production times.

Rover management met the government last week and it is believed that a government aid package of up to £200m for new investment for Rover plants could be part of the deal.

The main sticking point in the deal appears to have been union representatives' difficulty in securing agreement from shop stewards for the massive job cuts.

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