Royal Mail Plans to Make Job Cuts Amid Restructuring Program

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By Jonathan Browning

Feb. 6 (Bloomberg) -- Royal Mail Group Plc, Britain’s public postal service, plans to cut jobs as part of a restructuring program to address increased competition and declining mail volumes.

The company is taking account of the “preferences” of its employees as it modernizes itself and does not have a schedule for the job reductions, London-based Royal Mail said in an e- mailed statement today.

The Daily Mirror reported that the company may shed as many as 16,000 workers, citing the Communication Workers Union. Royal Mail is planning to cut one in 10 of its workforce to reduce its wage bill by 470 million pounds ($687 million) a year and is writing to workers with details of redundancy offers, the paper reported.

“There’s no figure you can put on jobs, going forward,” spokesman David Simpson in a telephone interview. “We will carry on modernizing the company,” he said.

Royal Mail is restructuring itself as it faces competition for postal services in the U.K. from companies including TNT NV as well as from the Internet. The postal service has shed 50,000 people since 2002, Simpson said. The government is considering proposals to sell a minority stake to boost investment in its services.

“We want to work with our people so that we take into account their wishes and preferences as Royal Mail continues to modernize and transform its operations,” Royal Mail said in the statement.

A call to the CWU, a U.K. labor union, by Bloomberg News was not immediately returned.

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