February 4, 2023

Royal Mail management has told staff that neither the government nor the regulator will come to the aid of the struggling 506-year-old former monopoly in a last-ditch effort to convince postmen to end their strike over the Christmas period.

“We are now fighting for the survival of this company,” employees were told in a letter sent to them last week, signed by CEO Simon Thompson and eight other senior executives.

Staff at the former state-owned company, struggling to keep up with rival delivery services, first voted for union action five months ago over a dispute over pay and work practices. The CWU union has ramped up union action this month with a series of strikes, with postal workers set to strike again for 48 hours on Friday.

“There is no one else who will save this company,” continued the letter, obtained by the Financial Times. “The politicians and the regulator have been very clear. It’s up to us.” Royal Mail, which was privatized in 2013, confirmed the letter referred to ministers and Ofcom, the communications regulator.

The letter is management’s latest attempt to ramp up pressure on postal staff after Thompson last week threatened to bring in more freelance delivery workers to make changes workers opposed.

The group, which has been trying to shift its business model to focus on more profitable parcel delivery as the widespread use of email undermined its traditional letter business, said last month it was appealing to the government for help to cut losses. checkers that it said ran up. £1 million a day.

But company secretary Grant Shapps said last week he had rejected the request to reduce the legally binding requirement to deliver letters six days a week by cutting Saturday shifts. This is part of Royal Mail’s “universal service obligation” enforced by Ofcom, which was imposed by the government when it was privatised.

The long-running dispute, part of the UK’s worst industrial unrest in decades, has allowed rivals to grab more market share. The latest wave of industrial action in the run-up to Christmas hit Royal Mail at the peak time of the year for parcel deliveries with images on social media of sorting offices overflowing with items.

Management is now preparing for the prospect of union action extending into the new year, with another vote scheduled by the CWU in January.

The CWU’s original vote for union action in July came when staff rejected an offer of a 2 percent pay rise, with any further increase contingent on accepting terms such as Sunday shifts and later start and end times.

Last month, Royal Mail returned with a “last and best offer” of a 9 per cent pay rise over 18 months, along with voluntary Sunday work and a staggered introduction of later hours.

“We would love it if our employees would do that [agree to changes]Thompson said last week. “But if they don’t follow the work, then we look for alternative models to do that, whether it’s an owner-operator model or we get [international partner business] Parcel force to help.

CWU Secretary General Dave Ward said the union remained concerned about a “race to the bottom” even after these concessions, warning Thompson that any change without the mailmen’s approval would plunge the company into “chaos”.

He added: “When they start [forcing through change]will elevate this to the most serious dispute since the miners’ conflict”, referring to the year-long, bitter strike in 1984-85 during Margaret Thatcher’s Conservative government.

Royal Mail is concerned that protracted industrial action will lead to the loss of more business for other couriers, several of whom have grown rapidly by recruiting delivery drivers at less generous wages and benefits.

“It seems the union has deliberately delayed things to influence Christmas,” Royal Mail chairman Keith Williams told the FT, accusing the CWU of deliberately delaying the start of talks at the brokerage service Acas, which eventually started in October. He declined to say how much delivery volumes had dropped in the run-up to Christmas, but said the company had put accountants and lawyers on the frontline to get as many packages to customers as possible.

Ward, acknowledging that the strikes have led to “huge backlogs” in deliveries, denied that the union had deliberately focused on Christmas. “We didn’t want to be in this position,” he said, but added, “We’re not going to burn out members. We’re in this for the long haul.”

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