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Royal Mail has reached an agreement with its largest union, the Communication Workers Union after a two year dispute over strategy and pay.
“Royal Mail and CWU have committed to rebalance our focus and resources from the declining letters to the rapidly growing parcels marketing, creating a more efficient business that is better aligned to the changing needs of customers,” the FTSE 250 firm said in a statement.
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The CWU separately said that they had jointly agreed to a reversal of the direction Royal Mail were taking under previous senior management.
This “without doubt would have led to parcel growth being pursued through separate structures, whilst leaving Royal Mail to wither on the vine.”
As part of plans the two parties will maximise parcel capacity and develop a 24/7 operation with the introduction of Sunday deliveries, initially on a voluntary basis.
“We have been far too slow to adapt in the past and now need to deliver change much more quickly,” Royal Mail’s interim executive chairman Keith Williams said.
The agreement comes amid a difficult period for Royal Mail, which is predicting a loss of between £400m and £800m this year, and 10,000 to 14,000 job losses over the next three years.
Despite this the mail operator announced it had agreed a 2.7 per cent pay increase for employees, backdated to April 2020, and a further pay increase of one per cent from April 2021.
Read more: Royal Mail awarded contract to deliver and collect Covid-19 home testing kits
In a trading update also published today, Royal Mail announced it had seen strong parcel growth during October and November driven by ecommerce activity amid the November lockdown.
Revenues in the eight months to November was £380m higher compared to the same period last year.
Shares are up 1.5 per cent.
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