Royal Mail could slash 40,000 jobs

Royal Mail could reportedly cut up to 40,000 jobs over the next five years – equating to almost a quarter of its workforce. Chief executive Moya Greene is on the verge of agreeing to a “revised business plan with the government”, according to a report in The Sunday Times.

The company is looking to downsize employee numbers in light of imminent privatisation plans, under the Postal Services Bill, and dwindling mail volumes.

As well as allowing private investment into Royal Mail, the Bill outlines that Post Office Ltd could move to a mutual ownership model, Ofcom will become the regulator to the UK postal industry, and the government will take on Royal Mail Group’s pension deficit. The Government made a number of amendments to the Bill in April.

The Bill passed through the House of Lords last month, with amendments due to be heard in the House of Commons later this month.

The consideration session in the Commons is the final stage before Royal Assent.

The current three-year deal between Royal Mail and the Communication Workers Union will see the operator annually reduce its headcount by 8,000 until 2013, The Sunday Times said, before adding that Greene is expected to instigate another 15,000 job cuts by 2016.

Royal Mail currently employs around 165,000 people, and is the second largest employer in the UK after the NHS.

A Royal Mail spokesman said: “We cannot comment on future jobs losses numbers. We have always been clear that Royal Mail would be a smaller and more efficient company over time.

“This change is naturally a difficult process for our people and we are committed to working closely with our unions.”

In response to the reports, a CWU spokesperson said: “CWU is not aware of plans to cut 40,000 jobs. We are not going to accept compulsory redundancies and we don’t believe that you could lose 40,000 jobs without them. We would ballot for national strike action.”