Bosses from Solihull-based Lil-lets UK have clashed with workers over pension settlements for those being made redundant from the firm's Birmingham factory.

The trade union Unite has accused Lil-lets - one of the UK's largest producers of women's hygiene products - of cheating workers at its Alum Rock Road site out of their full pensions.

Unite said that 46 employees - all aged between 50 and 60 - had believed they would receive "consent" pensions - equivalent to what they would have received if they worked until normal retirement age - as part of the redundancy package.

But, the union claims, the company U-turned on this policy and announced it was only prepared to pay benefits accrued up to the factory's closure tomorrow.

This, Unite claims, will reduce some pensions by up to a third.

But Lil-lets chief executive Duccio Baldi denied the accusations and said the company had been clear from the start that it would not be able to afford enhanced pensions.

He said: "The union have not got their facts right. In 2004 we made the decision that we no longer pay consent. That is just a black and white fact.

"I also have a set of minutes issued to staff and the union in January stating that the company was not in the position to enhance pensions.

"We have talked this through with those concerned and we have been categorical in our decision. After the redundancy packages there was not the funds to cover the additional £1.8 million needed to pay consent.

"It would have been unfair on everyone else in the scheme to place this additional strain on the pension fund."

Mr Baldi added that the firm had already paid £3.5 million in redundancy packages - four-and-a-half times more than the statutory requirement.

Lil-lets announced six months ago - while it was still owned by Solihull-based Accantia Health & Beauty - that is was to transfer production to Taiwan and South Africa with the loss of 150 jobs in Birmingham.

It was bought by private equity firm Electra in December and, since then, the new management has clashed with Unite over its redundancy packages.

Lil-lets - which expects its pension deficit to stand at between £2 million and £4 million at the next assessment - is under no legal obligation to pay full consent on the pensions of workers over the age of 50.

But the union argues that Lil-lets should offer Birmingham workers the same pension terms given to staff at the firm's Corby site, which closed in 2003.

Unite official Lynne Shakespeare said: "This company is unbelievable. It is shutting a highly profitable UK business and casting off a highly skilled work force to produce the same products in countries where they will exploit cheap labour and then ship the product back to the UK market.

"Then to rub salt in to the wounds of their workforce they are refusing to acknowledge our members' pension rights. This will mean that workers over 50 will only receive a vastly reduced pension, leaving many of them to work on past normal retirement age to make ends meet. These people will also face difficulty in finding employment at the same level they are currently receiving.

"We say that what Lil-lets are doing is highly immoral and unfair to their Birmingham workforce when they have honoured consent payments in another UK site at which they closed in 2003."

Unite said it will now launch a protest campaign at major customers of Lil-lets products. The first of these demonstrations will take place a week this Saturday at a Birmingham branch of Tesco, the union said.