Royal Mail staff win 'groundbreaking' deal on jobs, pensions and practices

Dave Ward, general secretary of the CWU, which, in return for the deal, has signed up to measures preventing local strikes. Photograph: Fiona Hanson/PA

Royal Mail workers have voted overwhelmingly in favour of a long-term deal on post-privatisation terms and conditions hammered out between their union and the company.

More than nine in 10 workers who voted in the CWU union's ballot supported the "groundbreaking" agreement announced early in December.

The union had pledged not to call industrial action before Christmas but otherwise reserved the option to strike until the deal was ratified by its members.

The agreement, seen as a move towards German-style long-term industrial co-operation, secures a 9.06% increase in basic pay over three years.

It also features five-year guarantees on job security, pensions and other conditions, and increases union involvement in the running of the business.

In return the CWU has signed up to measures designed to prevent local strikes, which have afflicted Royal Mail for years. The union has also agreed to measures removing the threat of national action.

It undertook to bring in national union and company officers immediately to resolve local disputes and move to independent mediation within a week, as well as use more independent mediation at national level.

The union will also take part in a monthly "growth forum" with company bosses, and make presentations to Royal Mail's full board.

The deal stops short of a no-strike agreement, but Royal Mail can withdraw from the employee protection agreement if the CWU holds national industrial action.

Both sides welcomed the vote – with 96% in favour of the changes – held between 22 January and 5 February.

Dave Ward, deputy general secretary of the Communication Workers Union, said: "We are extremely pleased to secure this groundbreaking deal with Royal Mail, which postal workers have overwhelmingly voted to accept.

"The agreement bucks trends in UK employment, and means Royal Mail, as a private company, cannot adopt the type of employment model and practices that are undermining workers everywhere. Although we retain the right to strike, a fresh approach to industrial relations will help create industrial stability."

The CWU fought a long battle to preserve its members' terms and conditions under Royal Mail's new ownership by City investors. The risk of a national strike was cited as one factor in what critics called a cut-price valuation of Royal Mail shares in the company's flotation in October.

The union opposed privatisation but called off its threatened strike before the flotation, to allow talks to continue.

The five-year deal includes:

• No franchising or outsourcing of businesses.

• A ban on zero-hours contracts for Royal Mail employees.

• A full-time workforce with the aim of no compulsory redundancies.

• No downgrades to employees' agreed working conditions.

• Extra payments by Royal Mail into employees' pension schemes.

Moya Greene, Royal Mail's chief executive, said: "I am pleased that our people have voted in favour of the terms of the agreement. This is the first critical step to provide long-term stability and certainty for Royal Mail, our employees and our customers. Now the hard work starts. Working together we will create a strong foundation for the continued success of our business.