THOUSANDS of Scottish employees are reportedly facing redundancy unless they accept significant pension cuts, a major oil and gas firm has warned.
Baker Hughes, a major employer in Scotland’s oil and gas sector, has issued formal advance redundancy notices affecting more than 4500 employees across the UK, according to The Courier.
The company said the redundancies are linked to a proposed change in employees' terms and conditions of employment, specifically their pension contributions, according to internal documents seen by the newspaper.
One employee reportedly said the firm has proposed to reduce employer pension contributions by up to 25% for nearly 4600 active members of its UK pension savings plan.
It is understood that the changes would apply to all current employees, except those who joined after August 1, 2024, who are already enrolled in a lower-contribution scheme, with the changes coming into effect on January 1, 2026.
Staff have been informed that if agreement is not reached, Baker Hughes may carry out the process commonly called fire-and-rehire in a bid to force through the changes.
The dismiss and re-engage process is where employees are made redundant and rehired on new, less favourable terms, and is legal in the UK.
“Essentially, the business is looking to impose a 25% reduction in pension contributions under an excessive timeline, which currently is legal, but looks to be timed just before the amendment of the employee rights bill that would outlaw this practice,” a source close to the company told The Courier.
They asked to remain anonymous due to fear of reprisals, but added, “too often oil and gas workers of the UK are forgotten about, and need to be vocal”.
Baker Hughes is headquartered in Aberdeen and has sites in Montrose, Portlethen, Peterhead, and Dyce and operates across Europe and the Caspian.
A significant portion of the firm's workforce is based in Scotland.
The proposed pension cuts come just weeks after Baker Hughes completed a £900 million buy-in deal, securing pensions for more than 7000 retired and deferred members across three legacy schemes.
A Baker Hughes spokesperson said: “Baker Hughes regularly reviews its global benefit offerings to ensure that we remain an employer of choice, while also maintaining sustainable business practices.
“In the wake of a review that began in 2024, the company recently communicated an upcoming proposed change in pension plans which would align with the current offering to new hires in the UK from 1st August 2024.
“These plans would keep Baker Hughes within the top 25% of employers in the UK in terms of pension contributions.
“The HR1 form is statutorily required by the UK government. It was part of a broader communications package to our employees. This communications package provided additional context and background on this proposal.”
