Unite CMA To Ballot On Industrial Action

Royal Mail faces new strike threat from Unite

Royal Mail is facing industrial unrest on a new front after the Unite union said it would ballot thousands of managers on strike action for the first time since 1979, the year of the winter of discontent.

The threat of industrial action comes as the government prepares on Wednesday to debate in parliament for the first time the controversial postal services bill to privatise Royal Mail.

Unite, which represents about 15,000 Royal Mail managers, said that it would begin balloting members over the company's plans to make 1,500 job cuts in London – a figure that could include compulsory redundancies if there are not enough volunteers.

Royal Mail has been plagued by industrial unrest for years but disputes have been led by the Communications Workers Union (CWU), which represents most of the rest of the company's 160,000 workforce, one of the largest union memberships in the country. Relations have often been tense between members of the two unions, with many managers, represented by Unite, breaking picket lines on strike days called by the CWU.

The CWU is opposing government plans to privatise Royal Mail, mindful that new owners are likely to impose mass redundancies, and the move by Unite could see both unions combining to fight the privatisation plans.

Paul Reuter, national officer for Unite, said: "If Royal Mail are allowed to push ahead with forced redundancies it will keep coming back for more, so Unite intends to stop Royal Mail in its tracks. There have already been 5,000 job cuts over the last five years without any compulsory redundancies. Such a drastic step is not necessary now."

The ballot will take place at the beginning of next month.

A Royal Mail spokesman said: "We continue talking with Unite and have stressed we will continue doing our utmost to manage any job losses by voluntary means and that we have increased our existing voluntary redundancy package. As they know, these reductions are essential as we continue adapting to our rapidly changing and declining market, where mail volumes have fallen by 13m letters a day in just five years."

Also on Wednesday, the government will announce a substantial three-year funding package for the Post Office, which could be turned into a Co-operative Group-style mutual company once Royal Mail is privatised.

Ministers will outline how much will be provided to modernise and refurbish the 9,000 branches in the Post Office network, many of which are struggling to stay in business.

The new three-year package is much more generous than many executives expected, given the pressure on public finances, and is likely to run into hundreds of millions of pounds.

But despite this, the future of an independent Post Office, currently owned by Royal Mail, remains uncertain. The Post Office relies on Royal Mail for about a third of its revenue.

The National Federation of SubPostmasters (NFSP) wants the government to force the new owner of Royal Mail to sign a contract lasting at least 10 years, committing it to continue to use the Post Office to provide services and process mail.

But government officials are instead proposing a maximum five-year contract. The NFSP is warning of "serious consequences" for the survival of the network if a longer contract is not secured, and it could try to block the privatisation.

George Thomson, general secretary of the NFSP, said: "There is no point mutualising the Post Office or privatising Royal Mail if it does not have a viable future – and it won't without a long-term agreement with Royal Mail."

This week, the CWU will lobby Labour MPs to add their voice to the campaign against privatisation. But with Conservative and Liberal Democrat backbenchers committed to the plan, it is almost certain to go ahead.

The government has said that Royal Mail staff will receive 10% of the privatised company's shares but has not specified whether it will float the business on the stock market or sell it to a rival such as Deutsche Post or the Dutch group TNT.