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Pay and Flexibility Agreement 2007/08

04 May 2007, 21:08

Thanks to Darth Postie

1. Introduction

Royal Mail has developed a strategic plan that takes advantage of substantial investment and is designed to ensure it continues to succeed in an increasingly competitive environment.

The plan demands substantial change to ways of working, greater responsiveness and efficiency to meet customer need. Royal Mail and the Communication Workers Union have agreed that the business must be:

A successful company that is sustainable for the long term.
Capable of generating sufficient funds to allow it to pursue change, to develop and to maintain competitive advantage.
Providing a culture of empowerment, pace and a collaborative approach for commercial success.
Working with stakeholders to create a business environment, which gives the company every opportunity to succeed.

1.3 Royal Mail and CWU agree that in order to achieve these aims an unprecedented focus is required on driving up the efficiency of the operation and the productivity of our people. It is agreed that individuals must be treated fairly and with respect. They must only be asked to undertake work which is safe, legal and for which they have been trained. However given these constraints, individuals will be expected to be flexible and offer every assistance to the business as it makes change and reduces costs. Specific change programmes are set out in section two of this agreement, but CWU agree that efficiency improvements are not limited to these and that every opportunity must be taken to improve our competitive position.

1.4 This agreement applies to OPG, OSG, MDEC, Mail Screener and Engineer grades and sets out the timetable for changes to working practices and agreed pay and benefits for the financial year 2007/08. This agreement applies from October 2007 for MGV drivers, but excludes LGV Drivers in line with the Professional Drivers Agreement. These are designed to enhance business flexibility and improve efficiency as the first step on our 4 year journey. Further talks designed to create an exciting new pay and benefits package will be agreed by September 2007 to be implemented as soon as possible and no later than April 2008.

2. Flexibility Package

2.1 Removal of night shifts in delivery units - Increasing levels of automation and low levels of indoor efficiency have created an opportunity to make better use of indoor time in delivery units. The standard is to cease all night shifts in delivery offices, although a small number of exceptions may be required in city centre units with very high proportions of firms deliveries. This work will be completed on a phased basis starting April but will be completed in all units by Monday 30th July 2007.

2.2 Retarding Delivery Start Times – The Network 2007 project is driven by legislative change to 7.5T vehicle maximum speeds. This will impact on arrival times for mail into delivery units. Consultation on the detail of this project has commenced and it has been agreed that the change will be implemented in August 2007. The existing delivery specification of last letter by 14.00 for town and 15.00 for rural will remain. But it is agreed that retardation of duty start times is required with 0600 – 0630 as the norm for the majority, some duties may start earlier to receive feeder services, cut tip and commence mails preparation. Saturday attendance times may include a finish earlier than 1400hrs if operationally practicable. In order to provide reassurance where changes in attendance times are being considered Royal Mail confirms that the full value of the MTSF – protected allowances will be included in the forth coming review of the pay package.

2.3 Weekend Working – Royal Mail and CWU have agreed to minimise expenditure at premium rates by radically overhauling the weekend and Bank Holiday operation. Royal Mail intends to cease offering Sunday and Bank Holiday collections. Consultations with Postcomm and Postwatch are underway. Meanwhile, by 2nd July 2007 all Mail Centres will revise Sunday working arrangements to eliminate spend on non time critical products and focus only on 1C and express products. Meanwhile all MC’s will review their weekend inward operation to move non-time critical inward work to Monday mornings and adjust weekend resourcing to ensure focus on 1C and express products only. Where weekend working is required to meet customer specifications existing terms and conditions will apply.

2.4 Efficient Summer Scheduling – During the summer, traffic volumes fall and productivity is reduced, as we are unable to flex resourcing to levels that maintain efficiency. Royal Mail and CWU have agreed that summer scheduling must be reviewed to take account of reduced workload. This will offer opportunities for additional summer leave in the popular weeks. Units must scope opportunities to absorb absence by transferring responsibilities between duties during the summer weeks. For example – in delivery, town residential walks could be reduced on a ratio of 6 into 5 from week 8 of the financial year until week 24. A similar review will be undertaken for firms walks where the ratio could be 4 into 3. This will be introduced into all DO’s in time for summer 2007, and a similar approach applied to other operational units such as MCs and RDCs.

2.5 Door to Door – The Door to Door product continues to offer genuine scope for revenue growth for Royal Mail at a time when other revenue streams are being constrained by the impact of e-substitution, competition and price regulation. Royal Mail and CWU have therefore agreed to take radical steps to maximise the opportunity offered by D2D. With effect from Monday 4th June 2007 the current cap of 3 items per week will be increased to 5. The existing D2D unit payments will be paid to individuals up to a maximum of 3 items per week. Items over the first 3 will be absorbed without unit payment. Each individual will deliver the D2D items for their delivery. Payments will be reviewed as part of the Future Pay Structure discussions detailed in section 5 of this agreement.

3. 2007/08 Pay Arrangements

Royal Mail has set two alternative options for pay, both are dependant on commitment to flexibility detailed in section 2 above. One of the options will be agreed for National implementation.

Option 1 - Royal Mail has made an offer of £600 (paid pro-rata for less than full time people) as a non-consolidated, non-pensionable lump sum.

3.3 Option 2 - Royal Mail has made an offer 2.5% on basic pay flowing through to allowances, overtime and scheduled attendance. This will be implemented Monday 2nd April 2007

4. 2007/08 Productivity Scheme

4.1 Employees will have the opportunity to enhance their earnings through an office-based lump sum bonus scheme, which will run for financial year 07/08, based on the success of their local unit (delivery office, mail centre, distribution centre or distribution hub).

4.2 This scheme will not operate with pre-determined targets. It simply relies on the local parties considering if there are any pragmatic and realistic opportunities to make their office more efficient, whilst ensuring that all mail is cleared to workplan. If savings are achieved beyond the budget the staff will receive a 50% share.

4.3 In postal units any saving above the local mails operations staff cash budget will be split 50:50 between the business and the OPG and OSG employees in the unit. The actual financial performance of the office between April and March each year will be calculated for each half-year accounting period. Any savings made against the mails operations staff budget will contribute.

4.4 The bonus pool will be divided by the number of eligible employees (pro-rata to hours for part-time staff) giving individuals their lump sum payments. Payments will be made twice during the year, once just before Christmas and once in late May. Bonus units will be defined as per the 06/07 scheme.

4.5 In order to receive bonus employees will have to be in paid employment during the period concerned, and on the payment date. Payments will be adjusted for industrial action in any 24-hour period.

4.6 Royal Mail accepts that CWU has not signed up to RM operational budgets and that operational budgets will not set a precedent for any future incentive schemes. CWU reserves the right to raise any material anomalies in relation to the level of savings and budget. The national parties jointly will oversee the fair application of the scheme, and CWU will have access to all information relating to it.

4.7 Royal Mail and the CWU will jointly identify and agree at the local office if there are any opportunities to make further efficiency savings. The local parties should seek the views and support of our local people. The enablers in this Agreement will provide the basis for local deployment plans and earnings opportunities.

4.8 Section 4 of this agreement does not apply to MDEC keyers who are covered by a separate bonus scheme.

5. Future Pay Structure

5.1 In the 2005 Shaping our Future Agreement Royal Mail and CWU agreed that we must continue to work together to ensure that we become the most efficient, customer focussed and flexible company in the market place and at the same time raise the value and status of a postal workers job. We also reaffirmed our intention to introduce a new package based on consolidating and simplifying pay. These aspirations can only be realised if the business is generating profits and has a sustainable future based on revenue growth and cost reduction. A separate consultation on future pension arrangements has commenced and is outside the scope of this agreement.

5.2 Royal Mail’s aspirations are for a more flexible way of working. We will expect our people to have different work patterns based on workload. We will expect people to move locations with notice and consultation. We will organise the work differently once we have deployed new technology including covering each others leave and sick absence. Finally we would expect our people to work together to help improve the organisation’s performance. It is agreed that individuals must be treated fairly and with respect. They must only be asked to undertake work which is safe, legal and for which they have been trained. However given these constraints, individuals will be expected to be flexible and offer every assistance to the business as it makes change and reduces costs.

5.3 The CWUs aspirations are contained in the pay claim letter dated 06-Mar-07 (ltr to Jon Millidge – 6.3.07. doc).

5.4 Royal Mail and CWU will each nominate five team members to work on the revised package. Independent experts will facilitate initial meetings. Their objective will be to assist both parties in framing the issues and identifying areas of common ground upon which we can build an overall solution and their costs will be met equally by CWU and Royal Mail.

5.5 The timetable for talks will be:

Team members nominated by 11th May 2007
Inaugural meeting by 30th May 2007
Scoping phase complete by 29th June 2007
Detailed strand activity completed by 31st August 2007
Agreed proposal completed by 28th September 2007

20 May 2007, 07:40

Last edited by mpeard on 27 Jun 2007, 21:37, edited 1 time in total.

20 May 2007, 10:28

mpeard wrote:I see this agreement says it applies to MDEC's. Does it apply to admin grades (MA's)? I hear in other posts that it doesn't. Can someone clarify please.


Quite simply at this moment in time it does'nt, which is one reason y we r being balloted. :roll: :roll:

20 May 2007, 13:10

With effect from Monday 4th June 2007 the current cap of 3 items per week will be increased to 5. The existing D2D unit payments will be paid to individuals up to a maximum of 3 items per week. Items over the first 3 will be absorbed without unit payment. we have to prep and deliver 5 but only get paid for 3?? :mad

20 May 2007, 13:38

This may have changed, I've heard rumours, or something on this site saying their removed the D2D part from the pay negotiations.

20 May 2007, 13:47

The existing D2D crap that was in the strings was taken out,it's back to normal on those.

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