THOUSANDS of town hall workers in Blackburn have been warned they could be given 90 days notice unless they agree to end a dispute with bosses over working conditions.

And workers have been told they may be hit even harder in the pocket if an agreement is not reached soon, as council cost saving measures would slip behind schedule.

But council bosses, who are counting the cost of a new national agreement which has seen the imposition of a 37 hour week, today insisted the issuing of dismissal notices would not lead to redundancies.

Blackburn with Darwen Council has decided to recoup some of the £1million per year the agreement will take from town hall coffers by cutting the holiday entitlements, overtime payments and mileage allowances of its 5,300 staff. But Blackburn with Darwen workers have rejected the package put to them by the council and in March hundreds took to the streets around the town hall to demonstrate against what they described as "bullying and threatening" tactics.

Now, chief executive Phil Watson has warned staff in a memo that if agreement is not reached soon savings plans will be thrown into chaos, leading to an even stricter tightening of working conditions to save cash.

In the memo, leaked to the Lancashire Evening Telegraph, Mr Watson warns that unless an agreement is reached with unions, authority bosses may be forced to issue dismissal notices to those who have not accepted the new deal and offer them revised contracts of employment. Mr Watson says in his memo: "I know this is a difficult time for everyone. I understand everyone's natural concerns about the issue and, throughout negotiations, the council has tried to balance the conflicting demands of equality, budget limitations and protection of jobs.

"I am concerned about the impact of further delays on our ability to make the necessary savings and protect jobs and services.

"The council has set its budget which includes a target of achieving £560,000 with effect from April. This will have to be achieved in the financial year."

The failure of town hall bosses and unions to agree on a package of working conditions has now triggered a conciliation process run by the North West Employers Organisation and regional trade union bosses.

If conciliation fails, the council will continue to consult with workers for 90 days, which would eat into the time the council has earmarked to make its financial savings.

Steve Weaver, the council executive director (corporate resources), said: "If there is no agreement and we have to go into the long consultation process this will have the effect, for instance, of mileage allowance being much less pence per mile in October than it would have been with an agreement in April."

Jim Noble, spokesman for the town hall union, UNISON, said he did not wish to comment on the issue until conciliation had been completed.

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