Royal Mail is facing the threat of industrial action following its decision to close its defined benefit pension scheme, affecting 90,000 members.
The privatised UK postal operator announced on Thursday that its £7.4bn defined benefit scheme will close to future accruals after March 2018, saying that “there is no affordable solution to keeping the plan open in its current form”.
Shares in Royal Mail dropped more than 5 per cent after the group reported a drop in letters delivered before the festive period as business uncertainty in the UK hit junk mailings.
Rising parcel numbers failed to make up for the chronic decline in paper-based correspondence at the postal service’s core British business, pushing the division’s revenue down 2 per cent in the nine months ending on Christmas Day.
The 500-year-old postal delivery company stressed that last year was the only time Greene’s pay had been increased since she joined in July 2010. In that period, the pay of postmen and women had gone up by 11%.
Union leaders will be recommending acceptance of a one-year, no-strings-attached pay increase achieved during national negotiations with Royal Mail.
The proposal, which has met with the approval of the union’s industrial executive, is fully consolidated and will lift basic pay by 1.6 per cent for all CWU-represented grades within the business apart from Romec and Quadrant, whose pay awards are negotiated separately.
Backdated to April 4th 2016 for weekly-paid staff and to April 1st 2016 for monthly-paid, the increase flows through to all pay supplements, skills and unsocial attendance allowances, London Weighting, Scottish Distant Island allowance, overtime and scheduled attendance rates and matches the March 2016 retail price index (RPI), keeping members’ earnings up with the cost of living.
Acting deputy general secretary (postal) Ray Ellis, said: “The view of the pay negotiating team, endorsed by the postal executive at its meeting yesterday, is that the offer represents an acceptable conclusion to the 2016 pay talks that meets the policies we have adopted for a clean, one-year, no-strings deal.
“The offer will therefore be recommended for acceptance in an individual members’ ballot, which opens on June 9th and closes on the 30th.”
Post Office reps and branch secretaries from across the UK will be meeting in central London next Monday to decide their response to management’s latest attack on members’ jobs.
Over 500 people working in Post Office Supply Chain – delivering cash and valuables to post offices and other businesses, as well as those processing cash – are threatened with the axe, after this morning’s shock announcement by the company’s chief executive Paula Vennells.
The cutbacks amount to some 50 per cent of the entire supply chain workforce, explained CWU assistant secretary Andy Furey, who notes that, taken together with the controversial Crown Office franchising programme, “over 1,000 jobs are being slashed by the Post Office, which is quite astonishing.
“The Supply Chain job cuts have come as a direct result of the Post Office announcing they’re voluntarily pulling out of external CViT work – which is an almost unbelievably bad business decision.”
Separated from Royal Mail by the 2011 Postal Services Act, the Post Office here in the UK is the only one in the world which has been separated from the national mail delivery service and the CWU maintains that this decision has greatly damaged the network’s viability.
CWU acting DGSP Ray Ellis said: “There’s no doubt that separation has hit both the Crown office counters and the cash in transit operations hard, but Post Office management have also completely failed to develop either of these functions as successful businesses.”
Next Monday’s meeting will consider all options in order to hammer out a strategy to defend members’ jobs and to put forward a positive future strategy for the business.
General secretary Dave Ward said: “With this latest round of job losses, the management of the Post Office has to face the facts that it is in crisis and heading for ruin. If they care about the future of the network they should resign in protest at the straight-jacket government cuts have left them in.
“The Post Office was split from Royal Mail in 2012 in the run-up to privatisation and we are yet to see a plan that will secure its future. With a cut in its funding from £210m in 2013, to zero in 2019, these job losses show that under Sajid Javid’s leadership the Post Office is heading the same way as the steel industry.”
Brian Scott, the Unite union’s national officer for Post Office managerial grades, said that the company’s proposals would “tear the heart out of the Post Office.”
The 79 redundancies of Unite members announced today would “take the total number of proposed job losses to 130 in the last two weeks,” he added.