Royal Mail blames financial losses and strike action for 6,000 redundancies

The long-drawn out dispute between Royal Mail and its staff has seen the business announce it will make 6,000 people redundant by next August – blaming those on strike and a struggling business model for the decision.

The postal company has been at loggerheads with staff workers who are also members of the Communications Workers Union (CWU), following a series of picket lines across 2022 in protest of pay terms and job security.

Royal Mail expects a full year adjusted operating loss of around £350 million, which it says “further highlight the need for significant and urgent change” at the business.

Royal Mail bosses have said the firm could be damaged by strike action. | Photo: Ellis Karran for The Lincolnite

This has prompted bosses to confirm plans for making between 5,000 and 6,000 redundancies at Royal Mail by the end of August 2023, and around 10,000 full time operational roles will be cut by August 2032. You can read the full statement via the Royal Mail website.

More than 100,000 workers have gone on strike and walked out of their Royal Mail, Fleet and Parcelforce jobs since protests began, and Royal Mail bosses are now citing those taking part in industrial action as a major factor for the redundancy announcement.

Strike action has continued across the country, with a picket line outside the Grantham sorting office on Thursday – part of the sixth day of national action against Royal Mail.

The postal firm has been formally notified of two further days of action by the CWU, taking place on October 20 and 25, and says it has been threatened with 16 more days of strikes through November and December.

The CWU is calling for fairer pay terms for its members. | Photo: R.S. Mortiss

Simon Thompson, CEO, Royal Mail, said: “This is a very sad day. I regret that we are announcing these job losses. We will do all we can to avoid compulsory redundancies and support everyone affected.

“We have announced today losses of £219 million in the first half of the year. Each strike day weakens our financial situation. The CWU’s decision to choose damaging strike action over resolution regrettably increases the risk of further headcount reductions.

“We call on the CWU leaders to immediately call off their planned strike action and accept our invitation to enter talks through Acas to find an urgent resolution to our change and pay dispute.”

Strike action in August from the Communication Workers Union by Lincoln’s Royal Mail delivery office. | Photo: Ellis Karran for The Lincolnite

During strikes outside the Lincoln sorting office in August, CWU members told The Lincolnite they were after a no-strings pay rise, after rejecting a 2% pay increase that would have translated to a real terms wage cut when considering inflation and the rising cost of living.

The union has accused Royal Mail of “gross mismanagement”, pointing the finger at bosses who they say have turned the service into a “gig economy style” courier.

| Photo: Ellis Karran for The Lincolnite

CWU General Secretary Dave Ward said: “The announcement is the result of 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.

“What the company should be doing is abandoning its asset-stripping strategy and building the future based on utilising the competitive edge it already has in its deliveries to 32 million addresses across the country.

“The CWU is calling for an urgent meeting with the Board and will put forward an alternative business plan at that meeting.

“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.”