# Royal Mail warns of thousands of job cuts as it slides into red
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-10-14
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Royal Mail Job Cuts and Strikes: Up to 10,000 Roles at Risk
Meta Description: Royal Mail may cut up to 10,000 jobs due to strikes and financial troubles. Urges union to halt strikes for resolution. Shares drop 10%
URL: https://financedigest.com/royal-mail-warns-of-thousands-of-job-cuts-as-it-slides-into-redhtml

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By Yadarisa Shabong

(Reuters) -Royal Mail could cut up to 10,000 jobs and the loss-making business warned of more layoffs if planned strikes go ahead, as the company that is locked in a dispute with its largest union flags even deeper losses this year, sending shares 10% lower.

The Communication and Workers Union (CWU), representing 115,000 Royal Mail postal workers, have held strikes in September and early October, and have threatened more strikes this month and next after months of failed negotiations over pay and operational changes.

Royal Mail urges CWU to immediately call off planned strike action and embrace our offer of Acas [talks to urgently find a resolution to the current dispute,” parent company International Distributions Services said on Friday](https://www.financedigest.com/extraordinary-rollercoaster-good-friday-talks-remembered-25-years-on.html "‘Extraordinary rollercoaster’, Good Friday talks remembered 25 years on").

Its proposals last month to take the pay [dispute to arbitration and change](https://www.financedigest.com/dispute-management-mindset-changing-the-disputes-game.html "Dispute Management Mindset: Changing the disputes game") its policies had angered the CWU.

The holding company said 5,000 to 6,000 [jobs could be made redundant by the end of August next year](https://www.financedigest.com/inpost-sees-better-margin-in-poland-plans-no-job-cuts-this-year.html "InPost sees better margin in Poland, plans no job cuts this year"), and up to 10,000 roles would be cut on a rolling 12 month basis, including reductions in overtime, temporary staff and natural attrition.

This [announcement is holding postal workers to ransom for taking legal industrial](https://www.financedigest.com/eu-announces-plans-to-lead-green-industrial-revolution.html "EU announces plans to lead green industrial revolution") action against a business approach that is not in the interests of workers, customers or the future of Royal Mail,” CWU General Secretary Dave Ward said on Friday.

The CWU is [calling for an urgent meeting with the Board and will put forward an alternative business](https://www.financedigest.com/uk-businesses-call-for-looser-immigration-rules-to-boost-growth.html "UK businesses call for looser immigration rules to boost growth") plan at that meeting.

Royal Mail has been working on a transformation plan to shift its focus to parcels amid sliding letter volumes, and while it got a boost from the [online shopping](https://www.financedigest.com/the-high-street-is-dead-long-live-online-shopping.html "The high street is dead – long live online shopping! ") boom during the pandemic, it is now dealing with inflationary pressures, a cost-of-living squeeze and a fall in parcel volumes.

Royal Mail swung to an adjusted operating [losses of 219 million pounds in the first half of the year, and losses for the year is expected](https://www.financedigest.com/dollar-set-for-weekly-loss-amid-expectations-fed-will-slow-hikes.html "Dollar set for weekly loss amid expectations Fed will slow hikes") to be around 350 million pounds, it forecast.

That could [increase to 450 million pounds in losses this year if customers switch to other providers and the UK business](https://www.financedigest.com/frances-ynsect-to-refocus-bug-business-after-capital-increase.html "France’s Ynsect to refocus bug business after capital increase") could go deeper into the red if more strikes are held during the holiday period.

The ongoing uncertainty means that the [Board is unable to give a clear outlook for the full year,”](https://www.financedigest.com/ericssons-board-rebuked-by-shareholders-at-agm-for-second-year-in-a-row.html "Ericsson’s board rebuked by shareholders at AGM for second year in a row") it said.

Shares fell as much as 17% to their [lowest since](https://www.financedigest.com/uk-mortgage-approvals-hit-lowest-since-june-2020.html "UK mortgage approvals hit lowest since June 2020") September 2020.

GLS, its international distribution network, has been performing in line with expectations, the company said.

[Royal Mail](https://www.financedigest.com/uks-royal-mail-workers-to-strike-in-run-up-to-christmas.html "UK’s Royal Mail workers to strike in run-up to Christmas"), the former British postal monopoly, recently changed the name of its holding company to International Distributions Services from Royal Mail Plc.

(Reporting by Yadarisa Shabong in Bengaluru; Editing by Savio D’Souza and David Evans)


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