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Royal Mail faces backlash over gig economy workforce plans

More than half (56%) of Royal Mail’s revenues for 2021/22 were made up of package deliveries
More than half (56%) of Royal Mail’s revenues for 2021/22 were made up of package deliveries

Royal Mail employees will strongly oppose plans to introduce gig economy style measures into the company following the latest breakdown in pay negotiations.

The company plans to introduce owner drivers into its workforce in a service similar to Uber.

As well as bringing in new workers on lower terms, Royal Mail has informed employees of proposals to close mail centres, with a potential view to wholesale site closures.

Strike plans from employees, organised by the Communication Workers Union (CWU), were cancelled on 30 November after Royal Mail threatened legal action.

The company followed up by proposing a below inflation 7% pay rise over two years, which has been rejected.

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CWU general secretary Dave Ward said workers will resist plans to make the Royal Mail more of a gig economy. 

He told HR magazine: “It couldn’t be more obvious that Simon Thompson’s (Royal Mail chief executive) plan is to turn the Royal Mail into something more like Uber, where the lives of postal workers will be turned upended and their hard-won rights shredded.

“But this country’s postal workers are made of stronger stuff than the people currently running Royal Mail. Posties won’t be bullied into submission and they won’t accept their industry being turned into a substandard gig economy employer. We will continue to stand up for decent jobs and for British industry."

Royal Mail also proposed changes to Sunday working, start times and flexible working as part of a revised pay offer.

More than 115,000 postal workers have gone on strike since August 2022 as negotiations with their employer have continued.

Matt Jenkin, employment specialist at law firm Moorcrofts, said the courts may end up having a say on any decision to introduce owner drivers.

Speaking to HR magazine, he said: “From an employment law perspective, the exact nature of the owner driver arrangements will be interesting to see and could well face legal scrutiny.

"There can be a fine line between genuinely self-employed drivers and workers, and I would expect at some stage there is an attempt to claim workers status by owner drivers to achieve some employment law rights such as the right to paid holiday. 

"As we have seen from the decisions of the courts including Uber, Deliveroo and Pimlico Plumbers, the courts have been prepared to look past the contractual wording and consider the reality of the relationship. If the arrangements create a worker relationship, simply labelling it driver owner is unlikely to be effective."