Royal Mail could withdraw from key trade union agreement

Royal Mail will take on the striking union. This is by dismantling a “groundbreaking agreement” to protect jobs, conditions and wages that was signed nine years ago when the company was privatized.

Senior sources revealed to The Telegraph that legal advisors and executives have been gathering evidence in order to trigger the break clause of Royal Mail’s legally binding agreement with the Communications Workers Union.

Royal Mail is prohibited from employing new staff on terms different to those of existing employees; outsourcing; franchising any part of its business, or making compulsory redundancies.

As it loses £1m every day, the company has made arrangements to notify the union. Royal Mail is facing a declining letter market, and an ever-growing and evolving need for parcel deliveries. Its network of local sorting offices and unreformed work practices are finding it difficult to keep up with this growing demand.

Royal Mail signed a deal with the CWU under Moya Greene, the former chief executive. This was in response to the company’s need for stability after a turbulent stock market debut in October 2013. It was described as “groundbreaking…the first of its kind in Britain” and will help “create a culture that is capable of achieving anything”.

However, current management, headed by Keith Williams, executive chairman, views the contract increasingly as an unreasonable obstacle to essential change.

After rejecting a pay offer at 5.5pc, the union has announced four 24-hour strikes in the past fortnight.

Royal Mail insists that staff accept changes to their working practices in order to be able to compete with smaller parcel delivery companies. These include the ability to deliver on Sundays and later in the evening.

Royal Mail spokesmen stated that while our competitors work seven days a week, delivering up to 10 pm to satisfy customer demand, the CWU wants to work six days a month, starting earlier and finishing earlier.

Their plans to transform Royal Mail have a 1 billion price tag. They are based on a completely unrealistic revival of letter writing and will prevent Royal Mail’s growth and competitiveness in an industry that is constantly changing.

“The CWU’s vision of Royal Mail would lead to a vicious cycle of falling volumes and higher prices, greater losses, and fewer job opportunities.

“We can’t continue to use outdated work practices, ignore technological advances, and pretend that Covid hasn’t significantly changed the public’s expectations from Royal Mail. We need to make the changes that the public demands.

Dave Ward, the general secretary of CWU, claimed that Royal Mail was trying to “level down the company.”

He stated that he was not surprised and would not be intimidated by the news. We are ready for the fight and are confident that the public will support our efforts.

“Royal Mail is trying to change the entire foundation of the company’s purpose. The proposals of the board will make it just another parcel carrier. They are all about making as much profit and abandoning the universal services obligation.

“We believe they are taking liberties not only with our members but also with the public. That is why we are striking.”

Linking Shareholders and Executives :Share Talk

If anyone reads this article found it useful, helpful? Then please subscribe or follow SHARE TALK on our Twitter page for future updates. Terms of Website Use All information is provided on an as-is basis. Where we allow Bloggers to publish articles on our platform please note these are not our opinions or views and we have no affiliation with the companies mentioned

Weekly Newsletter

Sign up to receive exclusive stock market content in your inbox, once a week.

We don’t spam! Read our privacy policy for more info.