Royal Mail proposes three-year pay deal
Monday, February 10, 2020
Royal Mail has proposed a three-year pay deal to the Communication Workers Union (CWU), in its latest bid to avert strike action.
In a video posted on Twitter on Friday evening, the postal operator said it wants to get into detailed talks with the CWU about both its proposal and what it wants from the union for its business.
“There is no time to waste, our competitors are circling. They aim to take business away from us because of the industrial relations issue,” the company said.
“We want to agree a three-year pay deal, of course that has to work with the finances of the business, and they are pretty tough right now. We want to have an open and honest conversation with CWU about the shorter working week.
“Over a year ago we reduced the working week from 39 to 38 hours; we did that with no reduction in pay. That was expensive for the business alongside the two pay rises. In total, a 9.6% pay rise.”
The company added it will not be able to reduce the working week by another hour “at this time” because it does not see how such a move could be funded, with every hour reduction costing the business £100m.
“We want to see, no promises, how in the future we might grant more of the shorter working week. We want to invest £1.8bn in Royal Mail – your business – to turn it around. We need to grow; that’s how we can keep our great terms and conditions. We have the best people, so nobody beats us on service. But there’s only so much customers will pay for that.
“So, from your perspective, what difference would that £1.8bn investment make? We want to use the money to make sure you have modern tools and better equipment to do your job, change your routes so they are fairer and more manageable, win and keep more business to give Royal Mail a secure future.
“To sum up, we want to get into detail with the union as soon as possible. We want to reach agreement. We will get on with changing your business for the better.”
The CWU posted a series of tweets in response to the video after it went live, with the first questioning why the company had used an actress to present it.
“Rather than try and negotiate with our members via actors and actresses it would [be] great if you stopped moving ahead with unagreed changes and sat down seriously with the union,” it said.
In a Thursday trading update for the nine months to 29 December 2019, Royal Mail said it may be unable to meet its three-year turnaround plan targets as the threat of strikes continue to loom over the business.
The High Court halted industrial action at the firm in November when it declared unlawful the CWU’s ballot for action over grievances about job security and the terms and conditions of their employment.
Royal Mail’s share price fell by more than 10% to 168.05p following the announcement on Thursday. Group chief executive Rico Back bought £537,676.80 worth of shares in 13 transactions on the same day, purchasing 300,000 shares at an average price of £1.79 each.
The company’s share price closed at 177.55p on Friday, just before the video was published, and opened slightly lower at 176.85p this morning. It was down again to 175.5p at the time of writing.