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Workers at JCB's British assembly plants have chosen to take a £50 a week paycut in order to prevent 350 staff from losing their jobs.

Over 4,000 employees will now work a four day week, as the credit crunch begins to take its toll on the firm.

The machinery company which employs 8,000 people worldwide, and 5,000 people in the UK has experienced a sharp drop in demand for products, and made the decision last week to cut output at its factories by 19%, leaving 500 jobs at risk.

After a week of discussions with the GMB union, members voted more than two to one to accept a shorter week, starting next week for a minimum of six months.

Around 150 workers will still be made redundant at the end of the year, however.

Factories in North Wales, Cheshire and Staffordshire will be among the sites affected.

Four hundred jobs were cut by JCB in July after the firm said business confidence had worsened, with its customers being squeezed as construction work dried up, and it became harder to arrange finances for new equipment.

JCB has expanded significantly over recent years. Over 72,000 units were sold last year, compared with 36,000 in 2004 and the company recorded sales of £2.25bn making a pre-tax profit of £187m in 2007.