CWU rejects three-year Royal Mail pay offer

LONDON Mon Jul 1, 2013 3:43pm BST

Sorted packages are seen at the Royal Mail Mount Pleasant Sorting Office in London May 10, 2012. REUTERS/Stefan Wermuth

Sorted packages are seen at the Royal Mail Mount Pleasant Sorting Office in London May 10, 2012.

Credit: Reuters/Stefan Wermuth

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LONDON (Reuters) - A British union rejected a three-year pay offer from Royal Mail on Monday, warning industrial action was inevitable if bosses did not meet its demands ahead of the post group's planned privatisation later this year.

The offer, which would apply to around 125,000 employees, included an 8.6 percent pay increase over three years and a lump sum payment of 300 pounds.

"The pay rise is only there as a sweetener to swallow some very bitter pills on damaging changes to pensions, and a raft of workplace uncertainty," said Dave Ward, the deputy general secretary of the Communication Workers Union (CWU).

"If we can't get the assurance we want over our members' future then industrial conflict is inevitable."

An initial public share offer (IPO) of Royal Mail, which could value the near 500-year old business at between 2 billion and 3 billion pounds, is expected later this year and banks have been appointed to run the flotation.

The CWU has opposed privatisation, saying it would lead to a worse deal for customers and staff. It is particularly aggrieved by uncertainty around changes to the company pension plan.

In June, CWU members voted 92 percent in favour of boycotting the delivery of competitors' privately sorted mail, though it later accepted legal advice to back down.

Royal Mail Group Chief Executive Moya Greene said there would be further discussions this week with the CWU.

"Cooperation is central to the future success of the company," she said on Monday. "This offer represents Royal Mail's commitment to a long-term engagement strategy with the CWU and with our people."

The company said unless it got a collective agreement with the CWU, the pay increases would not be introduced.

The previous pay award, agreed in March 2010, was a 6.9 percent basic pay increase over three years plus lump sum payments totalling 1,000 pounds linked to a modernisation programme.

(Reporting by Christine Murray; Editing by Mark Potter)

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