The first stage of industrial action has already begun after unions failed to reach a consensus over an outstanding labour agreement.

As of last night, blue collar workers within the Swedish pulp and paper industry refused to work overtime.

Pappers, along with the employers' forest industry association Skogsindustrierna, is trying to reach a new collective agreement after the three-year old one expired on 31 March.

If no agreement is made, the second stage of industrial action will see strikes hit six mills from 16 April.

The mills affected are: SCA Kraftliner Munksund, Holmen Iggesund, Stora Enso Skoghall Mill, Korsnäs Gävle, Södra Cell Värö and Billerud Skärblacka.

Tony Burke, assistant general secretary at Unite, said the agreement covers 62 pulp and paper mills owned by 10 companies. He added that the union would be supporting its Swedish colleagues.

A spokesman for Stora Enso said: "By saying no to the latest proposal from the mediators, we think that Pappers is not acting responsibly if we want to secure a competitive industry.

"The proposal from the mediators was completely in line with the other agreements made in the Swedish industry – a 3.2% salary increase during a period of 22 months."

He added that the company feared the strike action could lead to disturbances in its production at its Swedish units.

Talks between Pappers and the Swedish Forestry Association were due to be held yesterday (13 April).