Newly-privatised Royal Mail to cut 1,300 jobs

LONDON (Reuters) – Britain’s newly-privatised postal operator Royal Mail is to cut around 1,300 managerial and head office jobs in order to deliver annualised savings of 50 million pounds ($82.45 million).

Royal Mail, sold off last October in Britain’s biggest privatisation for decades, has shed 50,000 jobs in 11 years as part of a lengthy restructuring designed to allow it to better compete in a market shifting heavily from letters to parcels.

The company, which said the new wave of cuts would not affect postmen or women, had started talks with the Communication Workers Union and Unite about the proposal to cut 1,600 jobs, with around 300 new or enhanced roles created.

The savings will help Royal Mail respond to increasing competition and pension charges, it said.

Unite, which represents the majority of those staff to be affected, called the cuts ruthless in a statement on Tuesday.

“Unite is demanding a commitment to no compulsory redundancies on fair terms and an effective method for redeployment within the restructured organisation. If Royal Mail refuse we will have no alternative than to consider a ballot for industrial action,” Unite’s Royal Mail officer Brian Scott said.

Royal Mail has rarely been out of the headlines since the government sold off part of its stake in the firm, attracting criticism from opposition lawmakers that it was privatised too cheaply after its shares surged almost 80 percent above its offer price.

The company also avoided a strike at Christmas after reaching a deal on pay and terms with the vast majority of its workforce, and in February its decision to announce above-inflation increases for the price of stamps, the first for two years, stoked anger among critics of the flotation.

Royal Mail said it would incur a charge of 100 million pounds in relation to the job cuts in 2013-14, taking the total transformation costs to a higher-than-expected 230 million pounds for the year.

Royal Mail, which will announce its full-year results on May 22, said underlying trends for the full year were expected to be broadly in line with those seen in the first half.

(Reporting by Neil Maidment; editing by Kate Holton)

Newly-privatised Royal Mail to cut 1,300 jobs