PHILIP Baxendale is quitting as a Preston heating firm Baxi director - ending a 130 year family link with the firm - in the middle of a fat-cat row over bosses pay.

His decision to step down comes as the company's chief executive has been attacked for taking a £9,000 a year pay-rise only months after workers were forced to take a huge pay cut.

George Tomlinson, of the engineering union AEEU, said workers at the Bamber Bridge based heating firm were furious at the pay rise - taking top director Bryan Gray's salary to a staggering £143,585 a year. He said: "Baxi workers are angry. It's a case of directors lining their own pockets from profits earned by the workers."

The pay bust-up comes only a year after Mr Gray - who is also chairman of Preston North End Football Club - cut workers wages by 19 per cent to save the firm.

The latest row about bosses pay is a far cry from the day when Mr Baxendale sold the family-owned firm for a fraction of its value to its employees. He turned down millions of pounds to create a successful employee-owned business where work and wealth were shared.

And in an ironic twist to the pay uproar, Baxi chairman David Erdal paid tribute to Mr Baxendale's vision to 'create a company where everyone shared in the fruits of its success'. Writing in the company's latest annual report, he said: "Peter Baxendale is warm-hearted, helpful and unpretentious. Many people say that they care about their employees, but few translate concern into action as completely as Philip did."

Mr Baxendale officially retires at the company's Annual General Meeting on July 7.

Converted for the new archive on 14 July 2000. Some images and formatting may have been lost in the conversion.