Royal Mail Faces Threat of Christmas Strike, Sunday Times Says

(Bloomberg) -- Royal Mail Plc faces the prospect of Christmas chaos, with letter and package deliveries grinding to a halt, should its workers agree this week to strike, the Sunday Times reported.

About 110,000 Communication Workers Union members have been balloted and the results on Tuesday are expected to lead to a mass strike over pay, conditions and employment terms, the newspaper said. The CWU could decide to strike at Christmas or at the end of November on Black Friday, the Times said.

The union fears the U.K.’s Royal Mail is trying to undermine the universal service obligation, which says it must deliver letters six days a week to all U.K. addresses for a fixed price, according to the newspaper. Royal Mail denied this and said “we believe the USO will be strengthened by the transformation strategy we want to deliver in the U.K.”

Royal Mail said last month it received formal notice from the CWU union that it intends to ballot its members for industrial action. A strike during the busy holiday season would be yet another headache for Royal Mail, whose shares have fallen almost 20% so far this year after a 40% slump in 2018.

The 500-year-old U.K. postal service has faced a continued drop in letter volumes and is trying to gain market share in the growing parcels market. In May Royal Mail slashed its dividend to free up 1.8 billion pounds ($2.3 billion) in spending on a planned overhaul to help improve service standards, efficiency and productivity, while introducing digitally enabled work tools and financing any acquisitions.

To contact the reporter on this story: James Amott in London at jamott@bloomberg.net

To contact the editor responsible for this story: Andrew Davis at abdavis@bloomberg.net

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