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Unions prepare for battle over Royal Mail’s future

Sparks will fly between government and the unions if Royal Mail is sold off. Andrew Milligan/PA

Union opposition to the Royal Mail sell-off comes as no surprise to any of us. Postmen and women are well known within the public sector for their militancy. But their response must be careful; both the government and potential corporate buyers have dealt with rowdy unions many times before.

The Communication Workers Union (CWU) has always made its position on ownership abundantly clear: the Royal Mail should remain in public ownership and the government cannot sell us something we already own. The very real prospect of Royal Mail falling into the hands of private mail providers TNT or DHL will be very worrying for the union and its 100,000 members. Neither company has a long tradition of unionisation nor of good union relations.

Attracting condemnation

TNT gained infamy during the 1985/6 News International dispute when Rupert Murdoch shifted newspaper distribution away from British Rail to avoid “blacking” by the rail unions. Routes through the Wapping picket line were kept open for TNT’s trucks and vans.

In the past three years or so TNT’s rival Deutsche Post DHL has attracted the attention and condemnation of the UNI Global Union, the International Transport Workers Federation (ITF), and the International Trade Union Confederation (ITUC) over alleged differential treatment of workers outside of Germany. We’re not talking about poor treatment in developing countries, although there is some. The allegations extended to countries with strong trade unions such as Canada, New Zealand and the US.

In Canada it was alleged that DHL threatened to close their operation there if no agreement was reached with the Canadian Autoworkers’ Union (CAW). In New Zealand it is alleged that DHL acted in a discriminatory way by refusing to allow women, mostly from Polynesia, to be covered by a collective agreement.

In 2007 DHL was accused of unfair labour practices in the US and of intimidating workers attempting to organise with the American Postal Workers Union at its facility in Pennsylvania. A national labour judge was highly critical of DHL’s alleged interference in the union election. In response, DHL closed the plant entirely in 2009. Such strategies are not uncommon with powerful multinational companies.

Militant posties

Whether deserved or not, postmen and women have a reputation of being militant. They were famously quick to come to the aid of the strikers during the two-year dispute at the Grunwick photo processing laboratories in the late 70s, and this activism continues today. The recent ballot of CWU members saw a hefty 96% vote against the sell-off, on a turnout of 74%. That is an unambiguous thumbs down for the plan.

Michael Fallon, the government minister responsible for Royal Mail, may argue this was a consultative ballot and not a mandate for action. But a ballot over possible strikes is very much on the cards. However, the CWU will need to be careful to ensure the industrial action is for a legitimate reason to preserve trade union immunity. In recent years employers such as British Airways, Metroline and Johnston Press have not hesitated in seeking High Court injunctions over irregularities in industrial action balloting.

In an attempt to appease the CWU, the Royal Mail is offering a share investment plan, which becomes tax-free after five years, and a legally binding contract over pay and conditions which cannot be changed unilaterally. The CWU leadership is understandably wary of the offer and is demanding a 10-year deal, including the retention of the final salary pension scheme.

Elsewhere in the public sector final salary schemes are being replaced with the Career Average Revalued Earnings (CARE) which are generally regarded as less generous and it’s not surprising the union is trying to delay the inevitable. Whether they get the deal they are looking for remains to be seen. If the union doesn’t get the assurances it wants from Royal Mail management, then expect threats of strike action to follow.

The CWU knows it has the capacity to scupper the floatation, and this is their window of opportunity. But the plan could easily backfire. If the new owners turn out to be DHL or TNT, the new management are likely to be less accommodating towards the CWU. With their own systems and infrastructure already in place, the new owners would have the ability to divert operations away from troublesome Royal Mail facilities.

DHL and TNT didn’t grow their businesses by being stupid: my guess is that strategies to avoid the unions are already being developed.

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