Royal Mail has stated that it will cut 10,000 jobs by the end of next August due to continuous strike activity and growing company losses. The postal service announced that it will start informing employees of its proposal, which might result in up to 6,000 layoffs.
In addition to the redundancies, the company will eliminate positions through natural attrition, such as by failing to replace departing employees. Royal Mail added that it anticipates losing £350 million for the entire year.
There were fewer parcels being mailed, as well as “the immediate consequence of eight days of industrial action,” according to the statement. However, the company issued a warning that losses might exceed £450 million “if consumers move volume away for longer periods” as a result of strike action.
Royal Mail To Cut 10,000 Jobs by Next August
Royal Mail’s chief executive Simon Thompson 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.”
Royal Mail workers, who are members of the Communication Workers Union, began a fresh round of strikes this week over pay and conditions which will include 19 days of industrial action, including Black Friday.
The next strike date is scheduled for 20 October followed by a further walk-out on 25 October. The CWU’s general secretary, Dave Ward, said Royal Mail’s 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”.
But Mr Thompson said on Friday: “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.” Royal Mail said that if workers go ahead with further walk-outs “the loss for the full year would increase materially and may necessitate further operational restructuring and headcount reduction”.
ulie Macken, co-founder of natural skincare firm Neve’s Bees, told the BBC the prospects of more strike action “makes me really scared actually”.
“It could have a huge impact on our business especially at this time of year. Much of what we sell is gifts and obviously Christmas is a key gifting period for everybody.”
Ms Macken, who is also a beekeeper and runs the firm with her family, said the business has already outsourced some of its larger parcel deliveries to a courier business “because Royal Mail was just becoming unreliable and we can’t risk losing those packages”.
She added: “The system used to work really well – it was reliable, it was good value for money, the people were all really nice. But now I don’t feel like I can trust them to give our products to our customers on time anymore.”
Royal Mail also revealed that it will have to enter talks with the union because, it said its legacy voluntary redundancy scheme, which offers up to two years’ of pay, “is now unaffordable”.