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Last Updated: Tuesday, 11 April 2006, 14:48 GMT 15:48 UK
Union deal averts strike at Asda
Asda store at night
A strike would have crippled supplies to Asda's stores
Supermarket giant Asda has averted a possible strike by offering to recognise a workers' union at its 21 distribution depots.

The GMB union called off plans for a ballot on strike action after Asda's chief intervened in a row over national bargaining on pay and conditions.

After talks between the union and Asda chief executive Andy Bond a ballot of 25,000 distribution workers was halted.

If a strike had gone ahead it could have crippled supplies to Asda stores.

The GMB said Asda had agreed to demands for national recognition at the supermarket's 21 distribution depots across the country.

"We have both agreed an action plan to work together to form a National Joint Council for distribution and are now going to develop the detail of this arrangement," the union and supermarket said in a joint statement.

Discussions on bonuses are set to continue.

More talks

The two sides accepted that other issues such as working conditions, could go back to the negotiation table, GMB leader Paul Kenny told the BBC.

Mr Kenny described it as a fresh start in the relationship with the supermarket.

"I have dealt with this company for number of years. I have to say it was one of the most constructive meetings that I have had in two decades," Mr Kenny added.

Relations between Asda and unions have been troubled for some time.

In February the retailer was fined 850,000 for breaking new trade union laws by offering a 10% pay rise to 340 workers at a depot in Washington, Tyne & Wear if changes were made to working conditions.

Meanwhile, the group's US owner Wal-Mart has come under severe criticism for its working practises.

Wal-Mart is currently facing dozens of lawsuits in the US, including a huge class action case involving more than a million current and former female workers which accuses the firm of discriminating against women over pay and promotions.

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