Royal Mail set to tear up nine-year trade union deal
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Royal Mail on the brink of breaking a nine-year union agreement as battles over the company’s future heat up
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Royal Mail has announced plans to break a nine-year deal with unions as the battle over the company’s future intensified.
The postal operator FTSE 250 said the agreement it signed when it was privatized in 2013 was used by the Communication Workers Union (CWU) to “frustrate” attempts to reorganize the company.
Bleeding £1 million a day, the 506-year-old company has sought to change working methods and improve technology to compete with competing delivery services such as Amazon.
Wage rule: Royal Mail said the deal it signed when privatized in 2013 was used by the Communication Workers Union to ‘fumble’ attempts to overhaul the company
But it said the CWU has blocked “any meaningful discussion” about the changes, nor has it put forward “viable alternatives.”
The 2013 agreement prohibits Royal Mail from hiring new employees on terms other than existing staff, making redundancies or using temporary workers.
But management sees the agreement as a barrier to making critical changes they believe are necessary to keep the company competitive.
The deal includes a clause that allows the company to break the agreement if it can demonstrate “material adverse effects” on the company, including strikes.
As a result, Royal Mail said it planned to either ditch or “review” the deal, as well as others signed with union bosses over the years to “move towards a more modern industrial relations framework.”
It’s thought that such a move could pose a legal challenge, but the company said it needed to “break the deadlock and ensure it could move forward with its transformation.”
The CWU said the company’s action was “sickening” and amounted to “a total attack” on the union.
Shares of the group, which traded in the stock market at 330p when it was privatized in 2013, fell 4.8 percent or 10.3p to 204.6p yesterday after the announcement.
The decision comes amid a long-running wage dispute between Royal Mail and the CWU, which represents around 115,000 postal workers.
In late August and early September, the union went on strike. More strikes are planned for next week as relations continue to deteriorate.
CWU leaders have insisted that Royal Mail staff would receive a pay rise at least in line with inflation, which is currently at 9.9 percent, after having previously slashed the company’s offer of a standard pay rise of 2 percent. potential of 5.5 percent. cents if certain changes were agreed.
The union also opposes changes in work patterns, such as parcel delivery later in the day as part of the company’s modernization plans.
The union is also pushing for its members’ working hours to be shortened and for people over 55 to be given lighter duties.
Aside from severing previous deals with the unions, Royal Mail has also written to the CWU to suggest that negotiations be conducted with Acas, the dispute resolution service.
The group said it is considering splitting the company and separating its UK arm, Royal Mail, from the more profitable international company GLS if it fails to implement its turnaround plans.
Earlier this month, Royal Mail also had to deny claims by CWU general secretary Dave Ward that it was having “secret talks” about a possible sale of the company to a private equity firm.
Aside from Royal Mail, industrial action has hit Britain’s railways over the summer, while airline staff and even lawyers have also staged strikes over fights over pay and conditions.