The importance of the trade unions


The Trade Union of a firm is an association formed by the employees of that organisation to ensure that all workers are given fair and equal treatment; to try and settle the grievances of employees; improve their working conditions and develop better worker-employer relations.

The Royal Mail Group employs over 176,000 people in the UK. However the total number of employees has gone down from last year. Most dramatically hit was the Corporate and Group Property with the numbers falling from 2654 to a mere 597 on a head count basis. "The Communications Workers Union (CWU) represents non-managerial staff, with Unite the Union - Communication and Managers' Association (CMA) sector representing managerial staff" (Annual Report, 2009). The organisation states in its policy that it intends to work with the CWU and CMA to "engage staff in the development and execution of business decisions" (Annual Report, 2009). The Company's remuneration policy follows the Combined Code and best practice in other UK organisations. A look at the director's remuneration report shows that an important part of the executive directors' salaries is an annual performance-related bonus, thus emphasising on performance-related elements and encouraging equality.

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This report begins by looking at the subject of diversity of staff in the Royal Mail Group, followed by an examination of the firm's health and safety standards. Next, there is a review of the social policy and pension schemes of the company. Finally, the report is concluded by pointing out the problems that have occurred in relation to the above mentioned issues and an assessment of the firm in comparison to its competitors.


The element of Diversity in an organisation incorporates not only aspects of equality and equal opportunities but also recognises matters of workplace attitudes and cultures that influence the behaviour of staff. The Royal Mail Group has placed in each of its business units an officer which acts as the Head of Diversity & Inclusion whose job description is to promote diversity and implement activities and policies across the business to support this. The company has also set up a website for diversity which provides the users with comprehensive information regarding diversity and inclusion; it also lists some contact details where users can send their queries.

The Group also set up a free of charge confidential helpline staffed round the clock by professional, autonomous counsellors which the employees, who advice and support relating to matters concerned with bullying and harassment, can call. Royal Mail has also tried to improve its procedure regarding worker complaints. Other steps taken by the organisation to improve diversity and equality are "appointing diversity champions across the business to promote inclusion, completing a company-wide programme of diversity training to ensure everyone is aware of what types of behaviour are unacceptable and where to go to get help, and promoting diversity and inclusion through an awards recognition programme..."

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Royal Mail has recently attempted to become more "diversity-aware" by signing a deal with the government to help make it easier for the organisation to employ disabled people" (Berry, 2008, web reference). Lastly, Royal Mail Group has also, in the past, won a number of awards for its work in promoting gender equality and diversity in the workplace including the Diversity Excellence Award and the Opportunity Now Silver benchmarking award.


Provision of health support and a healthy working environment to its employee is an important part of most organisations' corporate social responsibility. Offering employees with better health care and support helps reduce employee absence at work. Managing absenteeism not only allows managers to achieve their targets more easily but also "reduces dependency on replacement labour, including agency staff" (Marsden & Moriconi, 2008).

Royal Mail is one of the leading organisations in the UK which offers occupational health screening service to its entire staff. The Royal Mail Group has launched several schemes and taken many initiatives to improve the health and well-being of its workforce. Royal Mail's health and wellbeing programme, "which demonstrate the value of each employee's contribution to the organisation, has earned it the accolade of the Business in the Community (BITC) Example of Excellence in the category Healthy Workplace Award" (Washington, 2009, web reference). The company has set up health clinics spread across more than 90 of its sites across UK. Some of their bigger sites also enclose fitness centers with trained instructors. They have also, in the past, executed a number of promotions including anti-smoking, stress management and reduction, pro-fitness and better nutrition. The Group has also installed a round the clock telephone helpline which not only provides the staff with health related advice but also helps employees in arranging health and health related services for themselves and their families.

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In 2008, Royal mail introduced "an online health checking and assessment service will let staff analyse their lifestyles and design improvement plans by accessing information on a range of areas, from nutrition to stress and exercise" (Berry, 2008, web reference). Employees "returning to work after illness or injury benefit from a national physiotherapy and occupational therapy service"

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The benefit provided by such investments and initiatives can be seen from the fact that the Group "successfully reduced employee absence from 7 to 5% between 2004 and 2007...saving Royal Mail Group more than £227 million over three years" (Marsden & Moriconi, 2008). Apart from these savings, introduction of health-related policies and programmes has also helped facilitate the Group's effectiveness and better its level of service, giving the organisation an advantage over its competitors in the newly liberalised postal services market.


To get a clear picture of whether the company provides a safe working environment for its employees we need to explore the safety standards of the firm and investigate its commitment towards its safety issues by looking at how the company performs its safety management.

If we look into the Company's past, safety management was initially carried out by separate business units. Recently, however, the organisation widened its safety management to spread across all business units with the "regional teams managing safety in eight regions across the country".

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New policies, procedures and safety management measures were also introduced in recent years, including the setting up of a "driver training" scheme wherein a committee synchronizes issues concerned with road risks throughout the Group. Royal Mail has also initiated an electronic system to simplify the reporting of incidents and the locating the root cause of the problems for the Electronic Reporting of Incidents for Collation and Analysis (ERICA). A new CSR Audit Programme along the audit of their employees in control and performance reporting was also introduced.

The number of work accidents lodged over the years, though has decreased over the years, the actual figures still remain quite high. Majority of the mishaps and work injuries are sustained due to employees falling outdoors; injuries caused by animal; colliding with objects or tripping. The following diagram illustrates the most widespread sources of accidents over the past few years.

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Social policy of organisations helps facilitate and emphasize the contributions of the company to its employees and the society in general. The Royal Mail Group's social policy has been founded on certain fundamental themes: "A 'major supported charity' programme; employee volunteering; revitalising payroll giving; recruiting from socially excluded groups; and education & community engagement" (;jsessionid=1TVSGUOQOYJYOFB2IGVUUBQUHRA0UQ2K?catId=23200539HYPERLINK ";jsessionid=1TVSGUOQOYJYOFB2IGVUUBQUHRA0UQ2K?catId=23200539&mediaId=23300523"&HYPERLINK ";jsessionid=1TVSGUOQOYJYOFB2IGVUUBQUHRA0UQ2K?catId=23200539&mediaId=23300523"mediaId=23300523)

In 2008, the charity Barnardo was voted by the employees to be Royal Mail's new charity partner. Barnardo aims at eliminating discrimination and abuse against children. Prior to this, the organisation 'Help the Hospices' for which they helped raise £2 million. The Group offers its staff the opportunity for volunteering and according to their convenience and willingness they can opt to work towards "fundraising or one-off projects, by working on a regular or extended basis and in any other ways that help" ( ""&HYPERLINK ""mediaId=23300527). Royal Mail also offers training and support to the people willing to volunteer. Employees who might not have the time to volunteer are also given the option of donating to various charitable organizations through payroll giving.

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An important part of their social policy is the Group's effort to recruit people from socially excluded groups of the society. For this purpose they have even set up partnerships so that they can connect successfully with people from various sectors and different areas of social exclusion. The organisations with which they have entered into collaborations include Mencap, Business Action on Homelessness, Remploy, Project Compass, Job Centre Plus and Reed in Partnership. Recently the Royal Mail has commenced recruitment and offer placement opportunities "as a part of our 'business as usual' recruitment processes to people from a wide range of backgrounds such as those with a history of homelessness, physical and learning disabilities, ex service personnel and lone parents" ( ""&HYPERLINK ""mediaId=23300528)


Royal Mail Group's pension trustee board for the main pension plan consists of "an independent chairman plus 10 people including employees, union representatives, a pensioner and independent members" (Annual report, 2009). The company takes external legal advice from Sacker & Partners LLP, actuary advice by Watson Wyatt Limited and financial counsel by PricewaterhouseCoopers LLP. These firms are responsible for acquiring regular actuarial appraisals of the plan so that its statutory funding objective can be accomplished, which involves attaining consensus with Royal Mail Group on "the statement of funding principles, the recovery plan and the schedule of contributions. There is a separate trustee board for the senior executives' pension plan which comprises the chairman plus 5 individuals including employees, pensioners and an independent member" (Annual Report, 2009).

The Group previously offered its most senior people membership of the Royal Mail Senior Executive Pension Plan they have from 31st March, 2008 closed to new members. The Company is also shutting its Retirement Savings Plan and has also initiated a consultation in relation to the closure of the scheme The Plan is a financed, Inland Revenue-registered defined benefit occupational pension scheme. The pension is paid to the employee beginning from normal retirement age (60yrs) and is subject to the maximum pensionable service. Payment of these pensions are then increased every year subject to the Retail Prices Index (RPI), and sometimes also to a restriction of 5%. In the event of the death of the member; the dependents of the member are then eligible to claim the pension. They can also collect the collective amount of the pension is payable if death in occur while the member was still in service. Senior executives for whom "membership of the Plan is restricted by the earnings cap, pension provision is made by a combination of the Company scheme and a cash pension supplement or its equivalent" (Annual Report, 2009).

Despite their efforts for provision of pensions the company is facing a current liability off £8 million as of 2009, against payments to the pension schemes with regard to redundancy.

To recover these liabilities Royal Mail over the year made payments of £32m relating to redundancy. "On 23 March 2007, the Group established £1bn of investments in escrow as security to the Royal Mail Pension Plan in support of the 17 year deficit recovery period" (Annual Report, 2009).


The Royal Mail Group appears to have extensive policies concerning its staff starting from their recruitment to their retirement and pensions. The Company also seems to have put in efforts to become more diversity aware and to improve their safety management procedure. However, there have been some differences between the Group and the trade unions; this can be seen by the number of strikes by the workers in the past. This has caused quite some disruptions of deliveries leading to a lot of inconveniences for its customers. Just presently, thousands of postal staff across Britain launched a series of strikes because of a dispute over wages and jobs that caused the biggest disruption to Royal Mail deliveries in years. "Workers are protesting against "panic-driven" cuts being made at Royal Mail to pay, jobs and services, the union said", while the Company is blaming the union of "reneging on a modernisation deal that ended the 2007 strike" (Kollewe, 2009, web reference). CWU has stated that the strike will only end through meaningful negotiations. Union representatives declare that staff is not happy about the manner in which the Company wants to amend its working system which might lead to workers covering their colleague's shifts without extra money. The Group might also implement a policy which makes it necessary for the workers to complete their allocated hours rather than leaving after finishing their work as had been done in the past. Royal Mail has also issued statements about downsizing staff which "could affect five jobs in Skegness", in response to this the Union said that "a national walkout could take place at the end of September" (Bell, 2009, web reference).

Thus it can be clearly seen that despite efforts on behalf of the Group there are not very good employer-worker relations within the firm. Royal Mail will evidently have to work harder to improve their bond with its employees through better communication. Its competitors like DHL also have quite comprehensive policies and procedures in relation to its employees and work environment; however, they have smoother relations with their trade unions.