Royal Mail may face more strikes as talks with union end without deal

Long-running talks between Royal Mail and the Communication Workers Union are on the brink of collapse, with the company’s board thought to have threatened to put the loss-making postal service – the regulated UK entity that delivers to every address in the country – into a form of administration if a deal cannot be agreed.

Talks between Royal Mail and postal workers have ended without a deal, raising the prospect of further strikes disrupting the UK’s letter and parcel deliveries.

The talks between postal service bosses and the Communications Workers Union (CWU) at the Westminster-based Advisory, Conciliation and Arbitration Service ended after 1am on Wednesday with the two sides failing to reach agreement on pay and conditions.

The dispute has lasted for almost a year, with 18 days of strikes held between August and the end of 2022. The CWU won a strong mandate to take further action in a member ballot in February, and its leaders were last week considering further strikes in April if talks failed. Its postal executive will meet on Wednesday to discuss further options.

The latest negotiations were led by Dave Ward, the CWU’s general secretary, and several Royal Mail board members, although the chief executive, Simon Thompson, and chair, Keith Williams, were not directly involved.

The company on Wednesday said it had increased its offer to the union, but that it was “not an option” to carry on without significant changes. The CWU said that “unacceptable pressures” were being placed on postal workers.

Royal Mail is owned by the recently renamed International Distributions Systems (IDS), the FTSE 250 company created when the postal service was privatised. IDS has said that Royal Mail, the part that runs the UK’s regulated letter delivery business, is expected to lose between £350m and £400m this year, and had even raised the possibility of putting the company into a form of administration if talks fell through.

A source close to Royal Mail said the final breakdown related to differences in terms and conditions for new employees, who were paid less than longer-serving staff. The company had offered to bring new employees to pay parity over five years, but the CWU wanted parity within three years, the source said.

However, the CWU argued that was a “selective” account. A spokesperson said: “The company advised the union that the directors who have been leading negotiations are no longer available and that the board will be meeting today to determine their next steps.

“There has been progress in several areas, and the union made it clear last night that we are willing to continue negotiations today and tomorrow to finalise an agreement. This offer has been reiterated to the company this morning.”

A Royal Mail spokesperson said: “After 11 months of talks, including mediation by Sir Brendan Barber and Acas, we are deeply concerned that our talks with CWU have concluded without an agreement. We made substantial efforts to reach an agreement, including making a number of further improvements to our offer. These improvements were all based on feedback from the CWU, and we were hopeful that the CWU would put a deal to its members.

“We remain committed to reaching an agreement with the CWU. We have been clear throughout the dispute that not transforming our network and working practices is not an option in a business losing mo