Royal Mail workers have overwhelmingly accepted the three-year pay deal that the postal operatorand the Communication Workers Union (CWU) agreed on last December thus putting an end to the
ongoing dispute between the two parties.Over 94% of the Royal Mail staff voted in favour of the deal, which covers 139,000 employees, inthe single member postal ballot that opened on 22 January and ended yesterday.
The approved agreement includes a compound pay increase of 9.6% over three years and also givesworkers legal protections on their terms and conditions. In concrete terms, Royal Mail workers willget a 3% rise on pay and overtime rates for the financial year 2013/14 backdated to April 2013against a 2.9% rise in the Retail Prices Index. The next 3% salary increase will be implemented inthe 2014-15 fiscal year, followed by another 2.8% hike in 2015-16, subject to a review if the RPIis 0.5% higher or lower.
Beyond salary increases, the agreement provides legal protections that benefit Royal Mail andits employees, with the industrial stability framework setting out a new approach to workplaceissues at a much faster pace and without disruption. The employee protections include maintainingexisting terms and conditions of employment; a commitment to retain a predominantly full-timeworkforce; no additional franchising or outsourcing; and an objective to continue to manage changewithout recourse to compulsory redundancy, as stipulated in the new agreement.
These legally-binding terms are subject to a first review from January 2019 while Royal Mail hasthe right to end the protections earlier than agreed in exceptional circumstances such as a threatto the financial sustainability of the business. Under certain conditions including the breakdownof industrial stability, both parties have the right to an ‘earlier termination of thelegally-binding undertakings’.
Royal Mail and CWU have also committed to create an Agenda for Growth with both parties to worktogether on business strategies responding to competitive challenges and developing new approachesfor higher efficiency. Joint Royal Mail/CWU training programmes will also be implemented.
Royal Mail has welcomed the CWU ballot results saying that the agreement builds on the previous“Business Transformation 2010” agreement and other existing agreements. “It represents a jointcommitment to radically improve industrial relations and create a can-do culture in the interestsof customers, employees and the company,” the postal operator said in a statement.
Royal Mail CEO Moya Greene said: “I am pleased that our people have voted in favour of the termsof the agreement. This is the first critical step to provide long term stability and certainty forRoyal Mail, our employees and our customers. Now the hard work starts. Working together we willcreate a strong foundation for the continued success of our business.”
CWU members also voted to accept a separate Pensions Agreement reconfirming the amended proposalfor the Royal Mail Pension Plan, which followed a consultation last year and set out Royal Mail’scommitment to make higher employer contributions to the Royal Mail Defined Contribution Plan. ”Theimplementation of the pay and pensions agreements does not change the financial outlook for RoyalMail plc or our medium term objectives,” the company added.
CWU deputy general secretary Dave Ward said: “We are extremely pleased to secure thisground-breaking deal with Royal Mail, which postal workers have overwhelmingly voted to accept. Wehave achieved extensive and unprecedented legally binding protections for employees that not onlystrengthen their job security but also shape the values and principles that the Royal Mail Groupwill operate under as a private organisation.”
“The pay deal is at the very top of the range in either the public or private sector and thecommitments to legal protections and industrial stability changes the dynamic of privatisation. Theagreement bucks trends in UK employment and means Royal Mail, as a private company, cannot adoptthe type of employment model and practices that are undermining workers everywhere. Although weretain the right to strike, a fresh approach to industrial relations will help create industrialstability and new governance arrangements will increase CWU influence in the day to day running ofthe business,” he added.
Separately, Royal Mail has backed six-day delivery with its latest survey revealing that morethan 8 out of 10 (81%) UK households across the country’s seven major cities would like to receivemail at least six days a week. Nearly two thirds (66%) of households said they were dependent tosome extent on a six day a week service (every day except Sunday).
The findings follow intensive competition around direct delivery from rival mail serviceproviders who currently deliver mail less frequently including TNT Post UK launching a directdelivery ‘every other day’ postal service in West London in 2012.
