Letter to Alisdair Cameron Chief Finance Officer

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Letter to Alisdair Cameron Chief Finance Officer

Please take the time to read this important letter.


Dear Alisdair

FUTURE OF SUPPLY CHAIN – AVOIDING COMPULSORY REDUNDANCIES & FORMAL CLAIM FOR MTSF ENABLERS


I am deeply troubled by the scale of the job losses planned for Supply Chain and particularly in the depots. Consistently the feedback we are receiving from members and Reps alike is the numbers being proposed to handle the internal work are woefully inadequate and will result in considerable service failures and ongoing problems.

Essentially there is a widely held belief the cuts proposed are too severe and will cut far too deep, inflicting a mortal wound to Supply Chain. Some might say they are cynics but many members are saying this is a deliberate plan to fail and a contrived situation that will ultimately be used as an excuse to say we are not fit for purpose to deal with the internal work. This would lead to the remnants of Supply Chain being hived off to the highest bidder and our surviving members will eventually be TUPED to the likes of either Loomis or G4S. I fully understand you will deny this is the purpose and design of the approach proposed but nonetheless this is what many members perceive to be the plan and this feeling is increasing by the day.

Whatever the truth is, the job cuts are savage and there is absolutely no doubt in my mind that we are facing widespread Compulsory Redundancies on a large scale with the vast majority of depots remaining being impacted by this unprecedented position. Indeed many of our members in the closing sites wish to retain employment in the Post Office but are facing a stark reality of no choice other to take a compensation package as there is no prospect whatsoever of redeployment through bumping.

In view of the decision to exit the external market and the legitimate concerns described above, our members are now demanding from the Post Office the following:

1) a firm and unequivocal commitment from the Post Office there will be no "Compulsory Redundancies" arising from the decision to exit the external market.

2) the Post Office offers real hope and certainty for the future that they are serious about retaining the internal operation in house by providing a guarantee there will be no outsourcing of the internal work for a 5 year period from the 1st April 2017.

It should be noted we still haven't been convinced in regards to the case for exiting the external market; however, we are being practical in attempting to deal with the consequences of the Post Office’s plans.

You will be aware the union sees the position of Compulsory Redundancy as completely untenable and frankly something our members won't tolerate. The demography of the Supply Chain members means the vast majority have spent much of their working lives in the Post Office/Royal Mail and in most cases this amounts to over 20 years service. In fact over 50% of the workforce is aged over 50 and the reality is, members who need to have another 10/15 years employment are potentially being thrown on the scrap heap with very little prospect of finding decent employment with comparable earnings. The harsh fact is workers aged over 50 struggle to find stable and secure employment at this time in their working lives.

In view of this prevailing situation I believe it is imperative and indeed incumbent on the Post Office to respond in an exceptional way and to compensate members for leaving with a package that is materially and significantly better than the standard MTSF terms. In turn this will have a positive impact on arresting the Compulsory Redundancy threat as the more lucrative the offer the more volunteers there will be.

Accordingly please accept this letter as a formal claim to improve the Voluntary Redundancy compensation terms associated with MTSF. This approach is necessary to encourage more volunteers for VR which will in turn take the pressure off the Post Office from seeking to instigate compulsory redundancies. Specifically I am seeking the following "Enablers" to be introduced for the entirety of the programme:

a) Removal of the two-year cap on costs for members aged 55-60 who are eligible to draw an enhanced and early pension when taking VR. The cap is something that has previously been relaxed in Royal Mail when they were reducing headcount in large numbers and in fact the introduction of the cap is something relatively new and by agreement didn't apply to approximately 8 members when the Manchester Cash Centre was closed a couple of years ago. So the precedent is there to remove this cap.
This particular proposal is vitally important as approximately 220 employees (about 20% of the workforce) are in the 55-60 age bracket.

b) Remove the ceiling for VR calculations which currently means that service after 21 years is not included in the compensation monies. This proposal would mean that all long serving members would receive the full amount of compensation based upon total years service rather than having an artificial ceiling imposed whereby a substantial amount of years service is not taken into account when working out the compensation.

c) That all earnings be included in the calculation for redundancy rather than just "pensionable pay". In practice this would include earnings arising from Scheduled Attendances (which are contractual and paid for 52 weeks a year and only applies to CVIT Crew members), bonus payments and ad-hoc overtime earnings.
The reality is, members are told they will be eligible for up to two years compensation yet the calculation omits large elements of pay, meaning that the VR terms bear no relation to actual earnings. For members performing SA duties regularly - which by definition they do as it is contractual - this will have a huge impact (detriment) on the value of compensation versus real earnings.

d) That the minimum compensation is increased to 52 weeks rather than the current 26 weeks - this has the potential to entice newer and younger members to take VR and again help us to avoid Compulsory Redundancies.

e) The restoration of Pay in Lieu of Notice - PILON - which as you are aware has been a regular feature in most recent redundancy exercises. In this respect, the £3,000 offer of a transition payment is grossly inferior to 12 weeks PILON, which for crew members could amount to as much as £6-7,000.

This list is not exhaustive and is in no particular order of importance as a basket of measures are required to achieve the fundamental objective of avoiding Compulsory Redundancies. In this regard whilst acknowledging that the offer of a £3,000 transition payment is a step in the right direction, the fact remains this particular development does nothing whatsoever to avoid the unwelcome prospect of Compulsory Redundancies.

I am disappointed to learn from our Representatives and members (not the Post Office) that you have unilaterally proceeded to issue a preference exercise to our Supply Chain members despite the fact we have not reached an agreed conclusion to our negotiations. This unagreed activity is not in the spirit of working together to find a meaningful way forward.

As a consequence, you have left us with no option other than to encourage our members not to complete the preference form. This approach is necessary as it is vitally important for both parties to address the legitimate concerns expressed within this correspondence. You may feel you gain a tactical advantage by seeking to find out the scale and appetite for VR. I can however assure that significantly more members require employment going forward than the current number of jobs available in the future structure. I suspect you know this to be the case and that is why the Post Office has used the following language in the Colleague Briefing document dated 30th June “...or they hope to remain in Supply Chain in the future” (the bold and underline is my emphasis). This is a very unfortunate choice of language; the word “hope” is not what our members wish to hear. The overriding feeling our members are expressing is they “want” to retain employment and this is why it is so important for the Post Office to offer a no Compulsory Redundancy guarantee.

I’m sure you will agree it is essential we work together to explore every possible avenue to avoid Compulsory Redundancy which is something I hope the Post Office, as an ethical employer, is also anxious to avoid. Indeed Paula Vennells was quick to point out in her communication entitled “Proposed Changes to Post Office Supply Chain” dated 17th May that she is
“...proud of our strong track record for supporting our people through change and I am committed to ensuring that we continue to act in line with Post Office values as we move forward".

Paula Vennells also reaffirmed this position when stating the following in yesterday’s “One” communication on the proposed changes in the Network Transformation team:
“As always we are committed to providing as much support as we can to everyone who is affected by the changes”.

Not least in view of Paula’s comments above, I propose we focus our joint efforts on finding an agreed way forward sooner rather than later taking into account the key Union policies outlined in this letter. This is my preferred approach; however, if the Post Office is not willing to engage in meaningful negotiations, then frankly the only alternative would be a formal breakdown. Subsequently, due to the extreme circumstances facing our members with regard to the real threat of Compulsory Redundancies, I would consider that a formal trade dispute exists between us.

I naturally wish to do everything possible to avoid conflict. I therefore hope to receive formal confirmation that the Post Office will immediately enter into meaningful negotiations in keeping with the proposals and claim contained within this correspondence.


Yours sincerely


Andy Furey
Assistant Secretary