Royal Mail Makes Best and Final Offer to the CWU in Last-Ditch Effort To Avoid Strike Action — Gets Rejected

Earlier this week we reported on how Royal Mail was facing strike action throughout December including the two days before Christmas Day. Today Royal Mail publicly announced that they have submitted their best and final offer to the CWU for consideration to avoid disruptive strike action.

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You can see the full statement from Royal Mail below.

Royal Mail’s Best and Final Offer

“International Distributions Services plc announces that after seven months of talks between Royal Mail and the CWU – including Acas talks over the last four weeks – the company has tabled its best and final offer.

The revised offer includes extensive improvements that have been made during the negotiations with the CWU, including:

• Offering an enhanced pay deal of up to 9% over 18 months
• Offering to develop a new profit share scheme for employees
• Making the voluntary redundancy terms more generous than the original proposals – Royal Mail offered up to nine months of redundancy pay, based on age and length of service, plus an additional enhanced one-off payment of £6,000 for employees who choose voluntary redundancy in the first phase
• Committing to no compulsory redundancies until the end of March 2023 at the earliest
• Offering to buy out a number of legacy allowances
• Making Sunday working voluntary and phasing the removal of the Sunday allowance
• Staggering the introduction of later start and finish times over three years, and committing to accommodating family-friendly working where possible
• Changing the seasonal working proposals so that employees would only work around two hours less a week in the summer, and two hours more in the winter – with 4-10 weeks’ notice for employees
• Agreeing to trial Yearly Flexi Hours before they are introduced at a later date
• Offering to work with the CWU on projects to diversify and grow the business beyond letters and parcels and a joint campaign to level up employment standards across our industry to avoid a ‘race to the bottom’ on terms and conditions in our sector

Although Royal Mail has made a number of concessions and improvements over seven months, the CWU leadership has consistently rejected offers without putting them to their members.  Royal Mail has urged the CWU to accept the offer and call off planned strike action. Further deterioration in the company’s financial position caused by industrial action will rapidly make the pay offer unaffordable and it may need to be withdrawn.

During the negotiations, a broad agreement was reached on pay and most elements of the deal. However, over recent days, plans the company thought had been agreed became open-ended ‘reviews’ and three-month-long working groups to delay transformation, in proposals presented by the CWU.  Unaffordable initiatives previously suggested by the CWU reappeared, including demands to reduce the current 37-hour working week without any corresponding change in pay, estimated to cost around £100m a year.

Simon Thompson, Royal Mail CEO, said: “Talks have lasted for seven months and we have made numerous improvements and two pay offers, which would now see up to a 9% pay increase over 18 months alongside a host of other enhancements. This is our best and final offer. 

“Negotiations involve give and take, but it appears that the CWU’s approach is to just take. We want to reach a deal, but time is running out for the CWU to change their position and avoid further damaging strike action tomorrow. 

“The strikes have already added £100m to Royal Mail’s losses so far this year. In a materially loss-making company, with every additional day of strike action, we are facing the difficult choice of about whether we spend our money on pay and protecting jobs, or on the cost of strikes.   

“The CWU’s planned strike action is holding Christmas to ransom for our customers, businesses, and families across the country, and is putting their own members’ jobs at risk.”

The CWU have announced ten further days of strike action between 24 November and 24 December, of which four have been formally notified (24, 25, 30 November, and 1 December 2022).

In October 2022 Royal Mail announced losses of £219m in the first half of the year. Further industrial action, in addition to the eight days that have already taken place, will inflict additional damage to the company and it will become rapidly more difficult to afford the improved offer. As previously stated, further action would also necessitate further restructuring and headcount reduction – on top of the reduction of 10,000 full-time equivalent (FTE) roles already announced.“

The CWU Responds

The CWU publicly responded to Royal Mail’s “Best and Final” less than an hour ago at the time of publishing. In news that I’m sure will not be welcomed by Royal Mail bosses, they have rejected their offer, and strike action is set to continue.

The response was published on the CWU Facebook page and you can see the full response from General Secretary Dave Ward below.

“A message to CWU members – strikes to go ahead.

We have this morning met with Royal Mail Group. CEO Simon Thompson did not attend the meeting.

We put a further offer to the company yesterday aimed at settling the dispute. Royal Mail have rejected this approach.

They have presented their proposals as a final ‘take it or leave it’ offer and the Postal Executive have just met and unanimously voted to reject their offer.

We will hold a CWU live event tonight at 7:30pm and we want the whole union online. We will set out exactly why Royal Mail’s offer will destroy your jobs, terms and conditions, and the service as we know it.

This is the most serious situation that has ever faced postal workers. We are facing compulsory redundancies and thousands more job losses than what the company will admit to. It will also result in later starts, total flexibility, Royal Mail being turned into a gig economy employer, and the end of the public service as we know it.

Make no mistake, this attack directly impacts every single member, workplace, and function in The Royal Mail Group.

The job of all is us is to deliver the biggest ever support for strike action.

See you at 7:30pm.

Dave Ward General Secretary
Andy Furey Acting Deputy General Secretary (Postal)“

What Happens Now?

The honest answer is…nobody knows. It is like the hypothetical battle of the unstoppable force vs. the immovable object. Right now it sounds as if Royal Mail is unwilling to budge from their ‘best and final’ offer, which the CWU still thinks is unacceptable for their members.

For customers and businesses, this is of course bad news as it means the Black Friday and Cyber Monday strikes are going to go ahead and by the looks of things, so are the ones throughout December. The potential disruption to not just Royal Mail but many SMEs is huge, which is of course the point the CWU is making.

For eCommerce business owners our advice remains the same as it was months ago, start looking for alternatives to Royal Mail services as this problem is no closer to getting resolved.

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