Workers at Jaguar Land Rover are due to vote next week on a proposed four day week and one year pay freeze.

The ballot is aimed at avoiding compulsory job losses for two years and includes increased pension contributions, reports the Financial Times website.

Yesterday the company said it had reached an agreement with officials from union Unite which represents hourly-paid workers to cope with a drop in demand.

Staff represented by Unite account for about 8,500 of the firm's 15,000 workforce and in effect will lose an hour's pay a week as most plants shift to a four-day week.

The company, owned by Tata, laid off 850 agency workers last year and has been seeking volunteers for redundancy from hourly-paid staff.

It aims to save about £70 million a year from the changes.

A spokesman for the firm said of the vote: "If this goes through, it will take the pressure off the need for any compulsory redundancies."