The 291 staff at JDE (Jacobs Douwe Egberts) factory - formerly Mondelez and Kraft - have been put into a 'Section 188' process after talks with management about future terms and conditions 'failed to progress'.
Their union, Unite, described the company's treatment of the key workers as 'immoral and unethical' after a year hiking production to meet the increased demand for coffee during lockdowns.
Some workers believe Unite should take legal action against any 'Fire and Rehire', which they say is unlawful in Europe. They say strike action and demonstrations could follow if the situation escalates.
JDE said S188 is a legal process in the UK and the company follows all local legislation in its markets. The company wants to modernise manufacturing in Banbury. Bosses believe the factory's performance does not compare well with other coffee producers, or its sister plants within JDE worldwide. They say such change would make it more sustainable and protect jobs into the future.
Discussions between management and staff stalled last March when lockdown interrupted negotiations but these were re-started this January.
A year ago the Banbury Guardian revealed that JDE wanted staff to accept 12-hour shifts among other changes. They said workers who did not accept the changes would be assumed to have resigned and would not receive redundancy payments.
This time it is understood Unite, is also unhappy about prospective changes to the company's pension scheme for new recruits, ending the final salary system and introducing an 'inferior' defined contribution scheme.
Joe Clarke, Unite's National Official Food Drink and Agriculture officer, said: "The company issued notification last week of dismissal and re-engagement in addition to an announcement to close the pension scheme for new accruals.
""From the union's position it is clear we have had formal legal notification of section 188 HR1. As of Thursday, February 25 we received formal notification of the implementation of section 188 and HR1 and it was stated that the notification was given to the union under the company's legal obligation."
"Unite raised the issue in a dispute procedure and are involved in discussions with our membership. Once we have consulted in more detail we will be making the appropriate statements to the media in relation to the treatment of the JDE workforce (who are key workers from Banbury) and the immoral and unethical way the company are treating them, when they have worked tirelessly throughout a global pandemic."
Rob Williams, JDE Banbury Plant Director, said: “We appreciate that now is difficult time for all involved but there is an overwhelming need for change because our UK manufacturing operations are not competitive compared to our external UK competition and internal JDE factories.
"This is why we are proposing changes to working practices at the factory which include changing shift patterns and resetting other terms and conditions. The proposals will help to make sure we are in the strongest possible position to compete in the future and do not include any redundancies within the manufacturing unit.
“We notified our associates and the trade union of the proposed changes in January followed by five weeks of full-time, informal discussions. We were hopeful to reach mutual agreement during this time but this has not been the case.
"We have not issued a notice of dismissal and re-engagement but have begun the S188 legal process which moves to a formal collective consultation process with a view to reaching mutual agreement. We are hopeful that everyone can work together to reach an agreement that benefits both our associates and the business,
"We are proud of how our associates have embraced new ways of working to keep each other safe during the pandemic. The last year has shown that we can operate in a Covid-secure way to protect everyone’s health and safety so we are confident that these conversations can take place while following Covid regulations,” he said.
JDE said that 'fire and rehire' would not happen until a 45 day consultation, a 'sign-up' window and a 12-week notice period had expired. At that point, if they did not accept the new contracts they could choose to leave the business or work on the new terms.
A JDE source told the Banbury Guardian: "This is illegal in Europe. A Section 188 means the company intends to fire the entire workforce of some 290 staff, and re-hire them on inferior contracts. Some staff feel this is really unacceptable and they would support the union taking legal action against it.
"If it really got serious I can see there being overtime bans, staff working to rule, demonstration and even strike action. It feels incredibly unfair. The workforce has gone way beyond the call of duty during the pandemic when many people have been working from home and demand for coffee has gone way up. Production's gone right up too.
"It's true that Banbury needs more investment - the European sites have newer equipment and because ours is older we get more problems. But the cost of that shouldn't be put on the shoulders of the staff."
In January the Banbury Guardian reported that dozens of staff in the research and development department at JDE faced redundancy. These changes are still in formal discussion.
JDE makes Kenco, L'OR, Tassimo and Douwe Egberts coffees in Banbury.