Centrica PLC’s (LON:CNA) British Gas arm is to set to fire hundreds of engineers who refused to sign new contracts with longer hours and no boost for unsociable hours.

The nine-month dispute with the boiler repairers came to a head today after dismissal notices were handed out on 1 April to 1,000 who had not agreed to the new terms and conditions.

There was a two-week grace period for a change of mind but 500 had still refused by close of play yesterday.

British Gas said it expected between 300-400 engineers to lose their job.

The company set out the plans last summer to increase productivity, but the move sparked a furious response from the GMB union.

The union has staged several strikes against the new contracts including a five-day stoppage by engineers in January and said that many who had signed had done so under duress and the ‘fire and rehire’ contracts had tarnished British Gas’s reputation.

A spokesman for British Gas said: While change is difficult, reversing our decline, – which has seen us lose over three million customers, cut over 15,000 jobs and seen profits halved over the last 10 years –is necessary.”

Shares in Centrica dropped 2.4% to  55.64p.

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