Tesco shareholders jolted the UK's biggest supermarket group yesterday after more than 40% of those voting at its annual meeting in Glasgow opposed changes to its share option scheme.

Tesco shareholders jolted the UK's biggest supermarket group yesterday after more than 40% of those voting at its annual meeting in Glasgow opposed changes to its share option scheme, while the company comfortably saw off union complaints that it should do more to help migrant workers at it meat suppliers.

The Tesco board was asking investors for approval to extend from one year to three years the period during which current and retiring executives can exercise their share options.

RiskMetrics, the voting advisory service, had urged shareholders to oppose the changes, which would give directors 36 months to wait for an improvement in the share price and could be seen as diluting performance demands.

None of the investors who were present at the meeting raised questions about the share options resolution, but 41.03% of the votes cast were against it.

With the support of 57.23% of its investors, Tesco's top executives can push through the plan, but the group will not be happy with the hostile response from its stock market owners.

Lucy Neville-Rolfe, Tesco's corporate and legal affairs director, defended the changes to the options scheme.

"We have shareholders right down to store managers in Tesco. Because of the volatility of the markets, if they are retiring, or retiring for ill-health reasons - or even if there is redundancy - it means they lose out in the current market because they only have one year to exercise the options," she stated.

The protest is the latest sign that investors are prepared to voice their displeasure publicly against company boards - something they have been reluctant to do in the past - particularly over pay.

Tesco is the latest UK blue-chip to face an investor revolt over pay, bonuses or changes to performance targets this year. On Thursday, nearly 36% of Home Retail shareholders at the company's annual general meeting voted against the retailer's executive bonus scheme, with a further 7% abstaining. Home Retail is the owner of Argos and Homebase.

Tesco more comfortably saw off a rebel resolution from Unite, Britain's biggest trade union, which was defeated by 89% of the votes to 11%.

The resolution, supported by protesters wearing yellow chicken suits and waving placards outside the SECC building where the meeting was held, called on the company to do more to ensure the fair treatment of migrant workers at meat suppliers.

The powerful Equality and Human Rights Commission is conducting its first statu- tory inquiry into the UK's multi-billion-pound meat industry in England and Wales for evidence of employment abuse and discrimination.

Earlier this week, Tesco came under fire from another union group, the UNI Tesco Global Union Alliance, which attacked it over its treatment of workers in Thailand, South Korea and the United States.

Tesco described the UNI's allegations as "a travesty" and "untrue" and the Usdaw union, which represents many of Tesco's staff in Britain, said they were not things it recognised in its dealings with the firm.

Jack Dromey, deputy general secretary of Unite and a Tesco shareholder, spoke in favour of the resolution on foreign workers from the floor of the meeting. He later told The Herald that he was not disappointed by the result of the vote.

"We got more than 10%, so that's a bit of a victory. Big institutional shareholders always back the board."

Dromey, a veteran union leader, said the union would continue its campaign to improve pay and conditions for migrant workers, adding that he intends to write a letter to Tesco's chief executive Terry Leahy asking for "urgent talks" on the matter.

Shares in Tesco closed unchanged at 350.50p in London dealing.