Bus drivers in Brighton and Hove have won an inflation-busting 13 per cent pay rise.
The news follows a troubled time for Brighton and Hove Buses, which has been forced to slash services because of staff shortages.
The company hopes the increase will enable drivers to remain in their jobs, following complaints the wages left them unable to keep up with spiralling property prices.
The rise, agreed following talks between management and the Transport and General Workers Union, will also apply to engineering staff.
Managing director Roger French said: "We have been in discussions with the unions representing drivers and engineers for some months.
"I am pleased that we have been able to reach agreement on a bold plan to make significant increases in rates of pay."
The rise is being paid in stages, with two increases already paid and more agreed for October and February.
Mr French said: "Over the two-year period, pay will have increased by 13 per cent.
"Such a large increase has proved necessary to ensure wage rates keep up with the high cost of living in this area.
"We need to retain existing staff as well as attract new staff in the increasingly competitive local job market."
Mr French said the company regretted the disruption passengers had faced recently through the staff shortage.
He added: "Our drivers are doing their best to keep services running at this busy time of year and we are working hard to ensure services run more reliably in future."
Brighton and Hove Buses employs more than 800 staff and is one of the largest companies in the area.
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