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Royal Mail has requested the federal government’s permission to chop its letter supply service from six to 5 days, because it appears to be like to stave off a deepening monetary disaster amid a long-running dispute with postal employees.
The corporate, which at the moment delivers letters Monday to Saturday, urged ministers on Wednesday to allow the change rapidly and assist to “defend the long-term sustainability” of its common service, a authorized assure to supply the identical worth for deliveries throughout the UK.
The announcement was made as Royal Mail’s mother or father firm, Worldwide Distribution Companies, reported it swung to a lack of £127mn in the course of the six months to September, from a £315mn revenue throughout the identical interval a yr earlier.
Royal Mail benefited from a increase in on-line purchasing and parcel deliveries in the course of the Covid-19 pandemic, however is going through one of many largest crises in its 506-year historical past.
The previous state-owned enterprise is in search of to modernise and shift from letter deliveries to extra worthwhile parcel deliveries, because it faces elevated competitors from newer rivals which have grown quickly by using employees on decrease salaries and extra versatile contracts.
However a below-inflation pay supply and modifications to working circumstances have angered postal employees, who this yr staged their first nationwide walkout since privatisation.
Royal Mail warned it had already taken a £100mn hit from eight days of strike motion, saying additional walkouts would result in extra restructuring and job losses past the ten,000 introduced in October.
After final week getting into eight days of “intensive negotiations”, Royal Mail and the Communication Staff Union have but to succeed in an settlement.
“It doesn’t really feel like a decision is in sight,” Liberum Capital analyst Gerald Khoo stated this week.
Royal Mail warned it could stop talks if additional industrial motion was introduced past the 4 strike days deliberate within the coming weeks.
The CWU stated on Tuesday that “the prospect of attaining an settlement rapidly is unlikely”, until the corporate strikes “considerably in direction of the union on a variety of points”.
On the time of privatisation, Royal Mail dedicated to numerous authorized protections on jobs. However the settlement additionally allowed the corporate to inform the union that it may bypass these commitments within the occasion of a nationwide strike.
The corporate stated it had already begun imposing modifications, equivalent to altering contracts for brand spanking new starters and eradicating a cap on freelance supply employees.
It additionally warned {that a} cut up of Royal Mail and the group’s worldwide parcels enterprise, which isn’t beholden to the identical commitments on jobs and has remained worthwhile, remained on the playing cards.
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