A PAY dispute involving hundreds of striking workers at one of the south's biggest aerospace factories is over.

Blue-collar employees at Aerostructures in Hamble, near Southampton, voted by a slender majority to accept a four per cent pay increase for this year, backdated to January 1.

They also agreed to a three per cent pay increase for the whole of next year.

Trade union chiefs welcomed the revised offers by Aerostructures, which employs more than 1,000 people, in the wake of five 24-hour stoppages last month.

Mike Budd, the regional officer for manufacturing and engineering union Amicus, said: "We always believed our members deserved that pay rise. We're pleased it's all over."

Bob Stokes, a negotiator on behalf of the trade unions involved, including the general union GMB, said: "The issue is resolved."

As previously reported in Business South, factory staff are paid an average of £16,516 a year. Unions say this year's pay deal - equivalent to about £520 - will lift the average salary to £17,036.

Aerostructures, which is owned by parent company Smiths Group, was keen to sort out the industrial action before it further disrupted contracts.

A company spokesman said: "We are happy to come to an agreement with the Works Committee, enabling work to continue as usual. The resolution is for a two-year period and includes flexible work options."

A number of big-spending customers are on the order books, including defence giant BAE Systems, aircraft manufacturer Boeing and the Ministry of Defence.

Factory floor staff, who assemble sections of aircraft and produce fibreglass mouldings, downed tools and worked to rule after rejecting a three per cent pay offer.

They said they had been feeling the pinch because of a rise in pension and National Insurance deductions.