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Barely four months after taking over the transport operation at Tesco's Middlewich, Cheshire site, Eddie Stobart could be facing an employment crisis with more than 150 drivers being offered a choice between new terms and conditions or redundancy.

The operation has run  into difficulty due to the hours system that Stobart inherited when the drivers transferred across from Tesco, which it says inhibits its flexibility. Problems at the site have been compounded by soaring levels of absenteeism, which have shot up to an average of 20%.

An internal review of the transport operation seen by Motor Transport concludes that the annualised hours worked by the Tesco drivers are hampering efficiency. It says: "This has had a significant impact on our ability to achieve the network efficiencies that form an essential part of the business plan for the Tesco Middlewich operation." Peak days are also not adequately resourced, it adds.

The firm has now started a 90-day period of consultation with the drivers and the Unite union over the proposed changes.

Drivers who choose to transfer across to Stobart's terms and conditions will receive compensation.  

Dave Pickering, operations director for Eddie Stobart, says: "From our point of view, we have to plan to deal with both [extremes] and anything in the middle. We'd be over the moon if all 156 drivers decided to make some kind of compromise."

But with long-serving drivers eyeing lucrative redundancy payouts under Tesco terms and conditions, he predicts that it will be at "the lower end of half" that choose to come across.

The 90-day consultation started on 17 June; Stobart will meet drivers and union representatives again on 9 July to put the terms of the compensation package to them.

However, Pickering admits that there is currently no budget in place for the compensation or redundancy payouts, although he stresses that this will not be a problem.