Vauxhall Motors has agreed a three-year hourly pay and conditions deal with its UK workforce. The deal will be backdated from this September through to September 2004.

"This is a good day for Vauxhall, working in partnership with the trade unions we have achieved a simple package of measures that will allow the company to plan for the future," said managing director Kevin Wale. The package was 'overwhelmingly' accepted by the hourly employees, in the results of ballots made public on Friday.

"This agreement will allow our workforce to prosper and to continue to have one of the most competitive packages in the industry. Which, along with our strong product line-up and manufacturing restructuring, will result in a stronger Vauxhall Motors. It will also help us in our efforts to return to profitability - which is a 'must' for our company," Mr Wale said.

The terms of the pay settlement include a poay increase in year one of 3% and in year two and three an increase of the rate of inflation +0.5%; ongoing implementation, of 'world class' standards across the organisation and improved availability of various car plan schemes to employees, and changes to productivity bonus schemes.

Vauxhall's Luton and Ellesmere Port plants were hit by strike action earlier this year in a protest by the biggest workers' union, the Transport & General Workers Union at redundancies.