Loctite Ireland has warned that it will have to review its position and take necessary action, which could include placing all staff on protective notice, if strike action by three trade unions at the plant continues. The company employs more than 500 workers at two plants in Dublin.

More than 300 employees placed official pickets on its two production plants in Tallaght and Ballyfermot yesterday in a dispute with the company over improvements in the employee pension scheme. The striking workers are members of the SIPTU, MSF and TEEU trade unions.

In a joint statement, the unions said improvements had been sought in the pension scheme since 1995 and came to a head when it was discovered that senior management had transferred £4.6 million in surplus funds from the main pension scheme to a newly established senior executive scheme for 15 executive employees in the company.

While unions were angered by this move and challenged it at the time, a review by the Pensions Board found it to be legal.

Since then, the unions said they have sought improvements in the main pension scheme, including pension indexation of 5 per cent, a reduction in the retirement age from 65 to 60, improvements on State offset reduction for the company pension payments, and four times gross salary payment for death in service.

SIPTU branch secretary Mr John Harmon said these improvements had been recommended by a pension review group under an independent chairperson, but management had rejected them.

But, in a statement yesterday, Loctite said it had undertaken a consultative process with its employees to discuss and explore all aspects of the company's defined benefits pension scheme and that significant advances had been made to the pension scheme over the past year.

"The process culminated in the company offering further additional improvements to its employees on 29th May, 2001," Loctite said in a statement.

"This offer substantially improved the provisions of the pension scheme for all employees, making it one of the most financially attractive employee pension schemes available in Ireland."

It is understood the company had offered pension indexation of 3 per cent, advancements on the State offset reduction, a 62 year-old retirement age and agreed to the death in service payments.

Staff in non-union groups - more than 200 employees - have accepted the offer, Loctite said.

The company also said it had initiated an independent actuarial review of the improved pension scheme offer.

"The outcome of this review confirms that the union demands are not economically feasible for the company," it said.

"The company has also relayed to staff the damaging effect that the current downturn in the global economy is having on business, and that further loss of revenue as a result of this action will be very serious."

However, as well as pension improvements, the unions said they are also seeking changes in the management of the pension scheme which have been rejected by the company's management.

"The unions have sought shared control of the main pension scheme, with rotating chairpersons in order to ensure transference and equitable treatment for all workers in Loctite. However, the company stated to the unions that they are unwilling to relinquish control of the main pension fund," the unions said.

Mr Harmon said the union members would again place pickets on the two Loctite plants next Monday and Friday, if there is no response from management.

This development will culminate in an all-out strike on September 17th if no progress is made, Mr Harmon said.