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Royal Mail strike ballot to go ahead unless pension scheme closure reversed

More than 100,000 Royal Mail workers will be balloted for strikes if the company does not change plans to close its defined benefit pension scheme, a union has said.

The Communication Workers Union attacked the controversial decision to close the scheme next March and warned of a campaign of industrial action.

A private session of the union's annual conference in Bournemouth decided to press ahead with plans for a strike ballot unless the company changes its position.

Delegates condemned Royal Mail's announcement earlier this month, and approved a motion which read: "Conference recognises that Royal Mail's decision - along with their proposals - is a clear signal that they intend to attack our terms and conditions to maximise profit for the shareholder."

Deputy general secretary Terry Pullinger said the mood was one of "anger".

He added: "If we cannot make genuine progress and get an agreement by August, we will have to take a serious decision about balloting for industrial action."

The union has put forward an alternative proposal for a defined benefit "wage in retirement" scheme.

The conference decided that if Royal Mail introduces changes by executive action, there will be an immediate ballot for industrial action.

Royal Mail said the pension plan was currently in surplus but it expects this to run out in 2018.

The privatised company's annual pension contributions are currently around £400 million.

It said that if no changes are made, the contributions could more than double to over £1 billion in 2018.

A Royal Mail spokesman said: “We know how important pension benefits are to our colleagues. We continue to work closely with our unions on a sustainable and affordable solution for the provision of future pension benefits. We will write to Plan members once further decisions have been made.

“Alongside pensions, talks on a range of issues are underway for CWU-grade employees within Royal Mail. We are committed to fair and affordable arrangements, including remaining the best employer in a very competitive sector. Our industry is changing rapidly so working together with our unions to deliver change quickly and maintaining our industry position is very important.

“Customers choose Royal Mail because they trust us to deliver. Any industrial action – or threat of it – undermines this trust between Royal Mail and our customers.”

The CWU said that in place of the current defined benefit scheme, Royal Mail plans to put all members into "inferior" money purchase alternatives.

On average, employees face losing up to a third of their future pensions, said the union.

For a 50-year-old worker earning £25,000 a year and retiring at 65, this would equate to a loss of £4,392 a year, it was estimated.

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