Workers are worried their pensions will be cut

The Transport and General Workers Union (TGWU) is threatening industrial action over proposals by the company to change retirement benefits.

Union national organiser Jack Dromey claims members are being asked to pay up to �20 a week more to save the four final salary pension schemes in BAE.

A spokesman for BAE said they could not comment on the meetings, but they were conducting a statutory review or pensions and asking workers for their opinions.

The company has plants at Barrow in Cumbria, Manchester, Bristol, Govan in Glasgow, and other parts of the UK.

No final decision on industrial action will now be taken before the outcome of the meeting on 3 March.

Contract difficulties

Mr Dromey said: "BAE must come back from the brink.

"We stand ready for a sensible settlement that safeguards good final salary schemes ensuring security and dignity in retirement."

In February the company, Europe's biggest defence contractor, reported a sharp fall in earnings for 2002.

The group also announced that its chairman Sir Richard Evans would step down at the company's annual general meeting in 2004.

BAE has seen its stock market value fall by two-thirds in the past year, as difficulties with its UK Ministry of Defence contracts have mounted.

Although BAE has now agreed new terms of its contracts with the MoD, the changes have cost the firm �750m ($1.2bn; 1.1bn euros).