Royal Mail bosses have announced plans to axe 6,000 jobs by August 2023, singling out excessive losses and industrial action as blame factors.
With Royal Mail saying that it expected full-year losses as high as £350 million, it declared that it was looking to reduce its overall 140,000 workforce by 10,000.
The swathes of redundancies will make up most of the cutbacks, with other headcount reductions made from reducing overtime, offloading temporary staff and not hiring replacements when staff members leave.
Simon Thompson, Royal Mail’s chief-executive, said: “I regret that we are announcing these job losses. We will do all we can to avoid compulsory redundancies and support everyone affected.”
Royal Mail said that its excessive losses were down to the “direct impact of eight days of industrial action” and a reduced number of parcels being posted.
The mail handler also warned that losses could be closer to £450 million if further upcoming industrial action leads to more customers shifting postage volume to other couriers for longer spells.
The Communication Workers Union [CWU], of which Royal Mail workers are members, have this week started a further round of strikes over pay and conditions. The courier offered a two per cent wage increase and a further 3.5 per cent rise depending on workers agreeing to conditions such as mandatory Sunday working, which is currently voluntary.
The CWU rejected the pay offer on the grounds that it failed to keep pace with inflation. The new wave of industrial action spans 19 days, including Black Friday.
Thompson said that every day of striking “weakens our financial situation”, calling the walkouts “damaging”.
“(Striking) regrettably increases the risk of further headcount reductions,” Thompson added.
During the first half of its financial year, Royal Mail said that the strikes cost £70 million and culminated in an operating loss of £219 million. The courier posted a £235 million profit last year.
However, the CWU’s general secretary Dave Ward accused Royal Mail’s financial situation of being down to “gross mismanagement and a failed business agenda of ending daily deliveries, a wholesale levelling-down of the terms, pay and conditions of postal workers, and turning Royal Mail into a gig economy style parcel courier”.
He added: “This announcement is holding postal workers to ransom for taking legal industrial action against a business approach that is not in the interests of workers, customers or the future of Royal Mail. This is no way to build a company.”
Royal Mail has altered the way it operates to become more “parcels-led” as online shopping has increased and customers have been sending fewer letters through the post.
Royal Mail has also said that it will engage the CWU in talks, since the courier’s voluntary redundancy scheme which offers up to two years of pay is no longer affordable, meaning it will have to renegotiate the terms of voluntary exit.
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