THE threat of industrial action on lifeline ferry services to Orkney and Shetland was lifted yesterday after an agreement between a shipping union and the route's new operators.

Serco Northlink Ferries took over from NorthLink Ferries Ltd, and there were fears they would seek changes to terms of employment. However, the RMT union said pensions, jobs and conditions were protected.

The settlement follows a meeting last week between RMT and Serco Northlink Ferries managing director Stuart Garrett. According to the RMT, the firm recognises that changes to terms and conditions or staffing levels must be subject to negotiation and agreement.

RMT General Secretary Bob Crow said: "The dispute is now resolved."