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Royal Mail Seeks High Court Injunction Over Pensions Strike

The company claims that plans for a strike by CWU trade union members are in defiance of a “legally-binding” agreement between the two parties.

  • Joe McGrath

Royal Mail, the largest U.K. mail company, is applying for a High Court injunction to stop its workforce from going on strike over changes to the group’s pension scheme.

The Communication Workers Union outlined plans for a walkout last week in a dispute over pension benefits, wages, and other issues. The plans followed a vote in which 73 percent of the union’s 110,000 Royal Mail members voted in favor of industrial action. The strike is scheduled to start on October 19 and last for 48 hours.

Royal Mail, which was privatized in 2013, said earlier this year it is planning to introduce two pension fund choices starting in April. The first is a so-called cash balance scheme — where members receive a guaranteed lump sum at retirement — and the second is a defined contribution alternative. Royal Mail’s management team had received several warnings from unions that proposals to replace the £7.4 billion ($9.7 billion) DB scheme with a DC alternative could lead to industrial action.

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In a statement following Monday’s announcement that it will take legal action to stop the planned CWU strike, a Royal Mail spokesman said the company had previously written to the CWU, invoking an external mediation and dispute resolution process that, the company claims, the union had previously agreed to. The company added that this process was “legally-binding.” As the CWU declined to withdraw its strike notification, the company filed the injunction with the High Court to force the CWU to follow the mediation process.

Royal Mail’s spokesman added that any strike action before the dispute resolution processes have been followed will be considered “unlawful strike action.”

The CWU issued a strongly-worded statement in response to Royal Mail’s application for an injunction. “The fact Royal Mail Group have tried multiple angles to stop our members exercising their democratic right to take strike action shows how desperate they are,” said Dave Ward, CWU General Secretary, in the statement. “Instead of playing court room politics they should be listening to the overwhelming ballot result. We call on the public and businesses across the country to back their postal workers in what was always going to be a watershed dispute.”

CWU Deputy General Secretary Terry Pullinger added in the statement, “Our members voted by 9 to 1 to back their union. This underhanded act from the employer is a deliberate attempt to misinterpret and use the agreement to stop postal workers exercising our right to strike and will only anger members further. This union is not going away and will stand up for our members in the court room and in every workplace across the UK.”

In April, Royal Mail said that while its DB plan was currently in surplus, it projected that the surplus would be eradicated in 2018 if the plan continues in its current form. The company said it pays in around £400 million to the retirement scheme each year and that these contributions could “more than double” to around £1 billion in 2018 if it doesn’t make changes.

To that end, Royal Mail in July unveiled its proposals to offer two pension options. In August, members of Unite, a smaller trade union within Royal Mail, called on the company’s management to offer more clarity on the new pensions proposals after 51 percent of its members voted in a poll to reject the new proposals.