IN these grim days of cuts, freezes or paltry rises in pay, the decision of workers at the Alexander Dennis bus manufacturing plant in Falkirk to strike in recent days, in protest over a proposed 3.5% increase, was eye-catching indeed.

 

Many people who have seen the real value of their remuneration reduced seriously, during a period in which annual consumer prices index inflation has been well above the 2% target, might wonder just what the hundreds of unionised staff at Alexander Dennis's Falkirk factory are complaining about.

After all, these employees secured annual pay rises of 4% in both 2011 and 2012.

So just why should we feel sympathy for the workforce at Alexander Dennis, a business that has enjoyed a dramatic uplift in its fortunes under the leadership of award-winning chief executive Colin Robertson?

And what about the danger that their strikes could destabilise a business that has had to fight hard to get itself back on the right road, and employs about 900 people at Falkirk?

These might well be the conclusions many would arrive at from a cursory look at the situation. And Alexander Dennis workers no doubt have their work cut out to win much sympathy from many people, given the most unfortunate but perhaps predictable tendency of some to cast envious eyes in the direction of anyone else getting a substantial pay rise in such times of economic strife.

But a proper look at the wider context leads to a different conclusion.

The case for Alexander Dennis's workers put forward by trade union Unite is quite compelling.

And the industrial dispute at Alexander Dennis raises important wider questions about how the benefits of a corporate success story, especially one which has been achieved as a result of previous sacrifices by the workforce, should be shared between shop-floor staff and management.

It is not as if employees are asking for the earth - they are looking for the same 4% rise they secured in 2011 and 2012 as opposed to the proposed 3.5%.

Accounts filed last year by Alexander Dennis show the remuneration of the highest-paid director leapt from £402,000 in 2010 to £760,000 in 2011.

Unite proclaimed earlier this month that "management, led by CEO Colin Robertson, himself the beneficiary of an eye-watering 89% pay increase... are refusing to budge on a 0.5 (percentage point) reduction from previous annual increases" for the workforce.

The latest Alexander Dennis accounts show the remuneration of the highest-paid director increased by a further 7.5% in 2012, from £760,000 to £817,000. This 7.5% rise might look small in comparison to the 89% hike in 2011, but it is still more than twice the 3.5% offer to the workforce, which is the subject of the current dispute. That said, there are many corporate leaders who have taken huge remuneration rises while slashing jobs and freezing or cutting the pay of their workforces. And there is no doubt Mr Robertson has done a good job.

Workers have no doubt benefited from Mr Robertson's management acumen. The financial performance of the business has been impressive.

In 2012, pre-tax profits surged from £15.5m to £24.2m on the back of a jump in turnover from £357m to £481m.

Orders have flooded in, not just from the UK market-place but increasingly from abroad. Mr Robertson's focus on geographical diversification has been an important move, not just in terms of achieving rapid growth in sales and profits but also in making Alexander Dennis less vulnerable to ups and downs in a UK bus market dominated by a few big players. A strong financial performance boosts employees' job security. And we should not forget the precarious place from which the Alexander Dennis operation has travelled.

The business was rescued from administration in 2004 by a consortium including Stagecoach co-founders Sir Brian Souter and Ann Gloag, Sir Angus Grossart's Edinburgh-based Noble Grossart merchant bank, and entrepreneur Sir David Murray. And the journey since has not always been smooth, with Unite itself highlighting a need for employees to volunteer to work only a three-day week for a period in 2009/10.

However, it is this voluntary sacrifice that strengthens further the argument Alexander Dennis employees should now be sharing more of the upside.

After a 75% vote for strike action on an 80% turnout, Unite declared on September 6: "Vehicle-builders are dismayed after playing a massive part in the remarkable turnaround of ADL's (Alexander Dennis Limited's) fortunes, including months of voluntarily undertaking a three-day week throughout 2009/10 and successfully lobbying the Scottish Parliament for the introduction of a Green Bus Fund from which ADL has been the main beneficiary."

After failing last week to reach agreement with management after the dispute went to the Advisory, Conciliation and Arbitration Service, Unite claimed the demands of its members had been met with "arrogance and belligerence".

Alexander Dennis meanwhile described the decision of its workforce as "hugely disappointing".

However, it should focus instead on the disappointment of those loyal employees who made considerable personal sacrifices to help Mr Robertson's grand plan work.

There were thankfully signs last night that the company might at last be shifting its stance with the word that staff were going to a consultative ballot on a new offer with further strike action called off.

There was little if any problem with alignment of the interests of management and the workforce in the dark days. Both should now share in the rewards of their joint labours.