Royal Mail proposes talks with CWU to go to arbitration

Royal Mail proposes talks with CWU to go to arbitration

Royal Mail has provided an update on industrial relations. After five months of talks, including three dispute resolution procedures, no agreement has been reached with the Communication Workers Union (CWU).

The organisation said: “As previously announced, Royal Mail made a loss of £92 million in the first quarter, equivalent to approximately £1 million a day.  Royal Mail needs to adapt much faster to adapt to changing customer demands in a highly competitive market.  The CWU has blocked any meaningful discussion on the change agenda the company has set out, and has not put forward any viable alternatives that will fund further pay increases.

Given the lack of progress made, and the ongoing damaging impact of industrial action on the business and customers, Royal Mail has today [22 September 2022] taken two steps to break the impasse and ensure it can move ahead with its transformation at pace:

  • Firstly, Royal Mail has written to CWU to propose that talks should be taken to Acas (the Advisory, Conciliation and Arbitration Service) in a further attempt to find a resolution.
  • Secondly, Royal Mail has informed CWU that it wants to modernise the ways of working with them. As part of this, Royal Mail will review or serve notice on a number of historic agreements and policies which are currently being used by the CWU to frustrate transformation, and intends to move to a more modern industrial relations framework designed to make the business more agile, and able to compete more effectively.

Over many decades, a complex web of CWU agreements and structures has developed at Royal Mail.  For example, the Agenda for Growth agreement, signed at the time of privatisation, is the only agreement of its kind in the UK that includes certain legally binding undertakings.  This was designed to ensure long term stability and growth, including industrial stability.  The agreement entitles Royal Mail to give notice on certain undertakings in the event that CWU takes national scale industrial action. To date, CWU has taken national industrial action on three dates – 26 August, 31 August and 8 September 2022, and has announced two further strike dates on 30 September and 1 October 2022.

Royal Mail is not changing quickly enough, a reflection of the unique, complex, costly and highly restrictive union agreements and structures built up over many years.  By taking steps to modernise agreements and ways of working with CWU, it will allow Royal Mail, among other things, to:

  • speed up decision making on a daily basis – currently CWU Reps in units across the company negotiate and allocate overtime, annual leave and the hours that people work;
  • trial and introduce new technology more quickly – Royal Mail has invested tens of millions of pounds in new technology to improve the customer experience, but has been restricted from using the information to improve performance and safety;
  • revise attendance policy to address persistent instances of short term absence;
  • reduce complexity and cost – we will review the commercial and IR agreements governing the current CWU structures in Royal Mail to ensure arrangements are fit for purpose;
  • remain competitive and retain our position as the best employer in our industry, with the best pay, pensions and conditions.

To do this we want to work with CWU on what new, modern, ways of working between the two will look like. These changes are important steps towards modernising the industrial relations framework. They will allow Royal Mail to move from a system where the CWU has many powers to veto and block change, to a more consultative relationship.

The business can then move forward on its change agenda to remain competitive for the long term, a necessary step to securing Royal Mail’s future.”

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