Royal Mail threatens split if union strikes

In the face of industrial action from its postal workers, Royal Mail has now claimed it is losing £1 million a day and may split its business unless it achieves ‘significant operational change’.

The announcement came the day after the Communication Workers Union (CWU) announced a large vote in favour of industrial action.

Royal Mail has indicated that it could split its domestic and international businesses under a rebranded holding company that will be rebranded International Distributions Services.

The CWU called Royal Mail ‘pathetic’ and accused it of “pleading poverty and threatening fragmentation” as part of the labour dispute.

Between April and June, Royal Mail said its adjusted operating loss was £92 million and revenues were down 11.5%. This is in part due to the postal operator’s bungling of the opportunities during the pandemic, including a current plunging demand for covid-19 test kit deliveries and a ‘disappointing performance’ in making the business more efficient.

On Tuesday the CWU announced the results of its postal worker ballot on industrial action – almost 97% voted in favour of strikes on a 77% turnout. Both it and the postal operator have said they will return to negotiations but the union has said that if a deal cannot be reached, strikes are set to take place in August.

“We need to discuss the change that will actually pay for the pay,” CEO Simon Thompson told reporters. “It is the change we need to actually win and compete in the market and I am absolutely ready, we are absolutely ready, to have that discussion as long as it’s about change and pay.”

A CWU spokesperson said: “It is pathetic that Royal Mail, a company which announced profits of £758m mere weeks ago, is now pleading poverty and threatening fragmentation unless they get their way.

“Our members are committed to growing Royal Mail as a high quality public service – they deserve a decent pay rise.”

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