CWU and postal bosses cut a deal which workers should reject

By a CWU rep

After three months of negotiations, CWU leaders are recommending members vote to accept the deal, claiming it ticks all the boxes in the union’s ‘Four Pillars’ campaign – pensions, legal protections, 35 hour working week, and shift and workload changes. The sweetener is a pay rise touted as 12 per cent by April 2019.

Royal Mail is praising the deal too, but from a different angle, claiming that despite the headline gains on pay and the shorter working week, it does not expect its costs to increase “materially”. The skyrocketing share price if proof that bosses are confident whatever concessions are made to the workforce will be recouped – with interest – from the rest of the deal.

Flawed gains

The deal delivers real gains for postal workers on pay, hours, and retention of agreements on union rights and job security. The biggest step forward is a two hour cut in the working week by 2019, worth an additional 5.33 per cent in pay per hour, with a “flight path” to a 35 hour week by 2022. While the instinctive response of many posties has been “they’ll just want us to do the same work in less time”, and whilst it is true that the cuts are dependent on efficiency changes at each step, a shorter working week will absorb the loss of indoor work from mechanised sorting, will stop the delivery span becoming a crippling length and causing injuries that force many (particularly older) posties out of a job. It also means part timers will see a pro-rata wage hike.

But after that things go downhill. Later delivery duty times are some distance from the 5:30pm finish Royal Mail wanted, but will still hit many workers who rely on finishing before 3pm to pick up their kids from school. PDA scanner data is to be used to try to increase workload, whilst our “future job” is left unresolved – to be set out in a series of reviews, working groups, forums and trials. The priority given to “efficiency” in the deal increases the prospect of this settlement ending up the worse for posties.

A repeat of the experience of the last few years seems inevitable: agreements pushed to one side on the shopfloor, the IR framework and grievance procedures dead letters, workload speedups and management bullying to push them through, while CWU leaders look the other way and focus on trying to keep Royal Mail on board with the agreement. And while part timers will see a hike in pay and their pension rights, and convergence if we get to the 35 hour week, for the present the deal does little to upgrade the contracts of part timers doing full time hours.

Other problems are built into the original Four Pillars demands. The union has not succeeded in getting the 2014 legal protections – a ban on zero hour contracts or the breakup of the company – guaranteed until 2022. Instead these will be reviewed in 2019, which allows Royal Mail to pressure union negotiators to make concessions elsewhere. The protections include forced mediation which effectively imposes a no strike clause on the union.

Meanwhile Royal Mail has accepted the CWU proposed Wage in Retirement Scheme (WInRS), an untested “collective defined contribution” (CDC) pension scheme developed by the union. While this ends the current two-tier pension, benefiting newer members with worse pensions, the flaws outweigh the benefits. The CDC leaves the union carrying the can for any future decline in its value. It turns legal commitments into targets dependent on the ups and downs of the stock market and riskier investments, and seemingly lowers Royal Mail’s contribution from 17 per cent to 13.6 per cent. And since it requires a legal change to go ahead, so its not signed, sealed and delivered. According to John Ralfe, a pensions analyst quoted by The Times, “This deal gives Royal Mail exactly what it wants — the defined-benefit plan is closed and replaced with an annual pension costing 13.6 per cent of salary. But that is a million miles away from the ‘wage in retirement’ which the CWU promised employees.”

Whether he’s right or wrong about the CDC, it is a big risk. Overall, the pension cuts, efficiency hikes and job changes will pay for the deal from Royal Mail’s standpoint.

Bosses and workers BFF?

The new deal has an unusually large amount of hot air about “reaffirming our mutual interest approach”, improving workplace culture, the company’s commitment to its employees, etc. But every mention of fixing the shopfloor culture is followed by references to efficiency. Maximising profits and share price for the millionaire owners still comes first. At some point this deal will begin to erode and we will be back where we were before.

The CWU’s pro-deal message comes with the new hashtag “Power of the union”, celebrating the 89.1 per cent yes vote as the key driver of success. But the union leaders did not use the “power of the union” to stand up to the power of the courts, which imposed mediation, denied us our right to strike and handed the advantage to Royal Mail’s bosses.

If we had gone on strike in the run up to the biggest Christmas on record for Royal Mail, it is likely some of the concessions in the current deal could have been avoided, while postal workers would be in fighting form to enforce a deal on the shopfloor.

Many workers were angry that the strikes were called off, but many will also say with resignation “this is the best we’ll get” and vote for a pay rise and shorter working week. But along with risks and pension cuts, the loss of union independence in the pension and legal protections are enough to argue for a no vote. While some will posties will feel that the deal is adequate and the tactic worked, there is no reason why it will next time – the legal protections can bind our hands just as much as they protect us.

Whatever the ballot result at the end of March, postal workers will have to be vigilant and prepared to act unofficially to beat back over-eager managers.

But we also need a change of perspective and direction as a union at the top. There is an alternative to the eternal downsizing of the company. A left wing Labour government should be pressured to not just renationalise Royal Mail – but to take over the whole logistics sector, and create a nationally planned logistics service, operated under democratic and workers’ control.

The impressive strikes by university workers in the UCU and the groundswell of opposition to the terrible deal proposed by the UCU leadership shows we don’t have to accept the managed decline of our terms and conditions. But to achieve this means building a network of reps and activists on the militant wing of the CWU to start debating alternatives and organising to reorient the union to rank and file democracy and a fighting strategy.

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