Sign up United Kingdom
Proactive Investors - Run By Investors For Investors

Royal Mail heads higher as threat of Christmas strike action fades

Following the release of a mediator’s report, Royal Mail and union bosses suggested discussions over pay, pensions and jobs were progressing
red post box
The CWU said it wouldn’t hesitate in taking industrial action if talks start to “dry up” again

Royal Mail PLC (LON:RMG) shares headed higher on Thursday as the threat of workers walking out over the key Christmas period subsided, following an apparent breakthrough in discussions with union bosses.

The postal operator has released a report of recommendations made by Lynette Harris, who was called in to mediate talks between the company and the Communications Workers Union (CWU).

It said the mediation process helped both sides to “better understand their respective positions”, adding that, although the recommendations aren’t legally binding, they have been useful in framing further talks.

Progress in talks

Royal Mail claimed agreement on some issues is more advanced than others but “all issues remain open for negotiation and final agreement”.

In its own statement the CWU said it was clear it had “successfully shifted the employer’s position and secured the basis for a far better agreement”.

Royal Mail and CWU have been at loggerheads for a few months now after workers voted overwhelmingly in favour of industrial action back in October amid a dispute over pensions, pay and jobs.

The strike was due to be held shortly after the work but the postal group was granted an injunction after it took the case to the High Court and argued that the 48-hour walkout would be “unlawful”.

Both sides subsequently moved into dispute resolution talks, which mediators were called in to facilitate.

Harris’ report called for the introduction of a collective defined contribution pension scheme with a defined benefit element for all Royal Mail workers.

The CWU said this would provide employees with a “wage in retirement scheme” – slightly different to earlier proposals from Royal Mail which offered a choice between either a new defined benefit scheme or a defined contribution scheme.

Ongoing talks

Talks are still ongoing over pay but Harris suggested a 2.6% pay rise backdated to April this year, followed by another 2% increase to base pay in 2018.

Royal Mail staff currently work 39 hour weeks, but the report proposed that be cut to 38 hours during 2018-19.

Talks are continuing over the next couple of weeks. Despite the progress, the CWU cautioned that if discussions “dry up” or Royal Mail move the goalposts, it would “not hesitate in giving notice to take industrial action”.

Shares jumped 0.9% to 425p on Thursday morning.

View full RMG profile View Profile

Royal Mail PLC Timeline

Related Articles

Intellectual property sign
April 11 2018
The AIM-listed intellectual property group’s investments were worth £8mln as at the end of December 2017, helped by the additions of The Vaccine Group and water pollution tester Molendotech
June 06 2018
Financial services have been especially strong and driven by fears over cybersecurity ...
drill rig
June 18 2018
The last few months have seen an increase in demand for exploration rigs, which will benefit Capital Drilling's utilisation rates from this segment of the market - chairman Jamie Boynton

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2018

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use