Staff will have to sign a new contract to retain their jobs
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Dismissal notices have been handed out to more than 500 staff at the Scottish Environment Protection Agency (Sepa).
About 570 workers have been given three months notice unless they accept new pay and conditions.
The publicly-funded body, which has about 1,300 staff at 22 offices across Scotland, said about 43% of its total workforce were affected.
Public sector union Unison said it would not allow members to be intimidated by the dismissal notices.
It said it would meet workers this week to discuss a response.
Under the new contract, about 130 workers will have their pay frozen to bring wages in line with the new pay grading system.
Sepa said the new arrangement benefited about half of the agency's lowest paid staff and insisted that nobody was being made redundant.
While no immediate pay cuts are being proposed by the new contracts, about 130 employees will not receive rises in the near future, it said.
Their pay "will be temporarily held back in order to bring their salary within their new pay grade", Sepa said.
'Industrial action'
A spokeswoman for the agency, which has its corporate headquarters in Stirling, added that the move was being made to meet legal requirements under equal opportunity legislation.
The notices of dismissal are being accompanied by an offer of re-engagement on the new terms and conditions.
In response, Alan Fleming from Unison said: "The continuing refusal by the Sepa management to listen to the staff, and negotiate a fair set of pay and grading proposals, coupled with a range of other unilateral attacks on conditions is leading to poor morale in the workforce.
"Unison will not allow members to be bullied and brow-beaten in this way, and we will be considering all methods of challenging these Victorian labour relations - including by industrial action where appropriate."
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