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Royal Mail workers vote to strike in pension dispute

Royal Mail workers vote to strike in pension dispute
October 4, 2017

LONDON (Reuters) - Royal Mail workers have voted to strike following the company’s move to replace its defined benefit pension scheme, potentially threatening postal delays at Christmas.

The Communications Workers Union (CWU) said 89.1 percent of its members at Royal Mail voted for the strike.

The CWU told Royal Mail last month that it would ballot more than 100,000 of its members over whether to take industrial action. The union has said Royal Mail’s move to replace the pension scheme would result in members losing on average up to a third of their future pensions.

Royal Mail said it was committed to further talks as a matter of urgency. “A ballot result for industrial action does not necessarily mean there will be industrial action ... There are no grounds for industrial action. We want to reach agreement,” Royal Mail said in a statement.

The company said industrial action would be “damaging” for its business, undermining the trust of its customers. “National industrial action means the current offer from Royal Mail, including on pensions, will be taken off the table,” it also said.

The CWU said 73 percent of workers voted, meeting the threshold required under new laws passed last year, which require more than 50 percent of union members to take part in the vote for industrial action to be legal.

CMU Deputy General Secretary, Postal, Terry Pullinger said the vote was a “massive vote of no confidence in the managerial leadership of the Royal Mail Group.”

A spokesman for CWU said the union would meet on Thursday to decide any potential strike dates.

Royal Mail said that independent external mediation, related to a legally binding agreement that Royal Mail and the CWU had signed in 2013, could take close to Christmas to be completed, and might take longer.

Parcel price comparison website ParcelHero warned that a strike at Royal Mail could effectively cancel Christmas.

“For some families, the timing of any strike or work to rule could mean that Christmas is cancelled by this action,” David Jinks, ParcelHero’s Head of Consumer Research, said.

Jinks said Britain was preparing for record sales on “Black Friday”, which is when retailers cut prices at the end of November.

“If Royal Mail strikes then the remaining parcel delivery companies will be stretched to breaking point. This could create significant log jams and delayed orders over this vital period for retailers,” Jinks said.

Royal Mail was privatised four years ago and is one of the few big British companies to still have a defined benefit pension scheme, which pays out a proportion of a member’s final salary determined by their length of service.

But rising costs, falling investment returns and people living longer have made it increasingly tough to fund defined benefit pension schemes. Royal Mail wants to replace its scheme with a modified defined benefit or defined contribution pension plan.