Royal Mail has been given until 6 September to solve its long running pension dispute with workers, or it will face industrial action.
According to FTAdviser sister newspaper the FT, the Communication Workers Union (CWU) extended the previous deadline of 15 August for Royal Mail to settle the current pension reform.
Earlier this year, Royal Mail announced it would be closing Royal Mail Pension Plan, its current defined benefit scheme, to future accruals from next year.
Following union opposition, the company is now offering members the choice of joining either a defined benefit cash balance scheme or a defined contribution scheme.
From 1 April 2018, the DB cash balance scheme would provide members with a guaranteed lump sum at retirement.
Terry Pullinger, CWU deputy general secretary, said in a video posted on the union’s Facebook page that the timetable was extended to give “a further chance to move things forward sufficiently that we don’t have to give notice [to ballot members] for industrial action.”
“That of course is our key objective — to reach an agreement here,” he added.
Mr. Pullinger said: “That builds in a further over two weeks for talks to take place should the company seriously wish to make progress.”
Royal Mail currently pays about £400m a year into the pension pot, but says that could more than double to above £1bn if no changes are made.
The company told the FT it was “committed” to continuing negotiations with the CWU on pay and pensions.
“We believe there are no grounds for industrial action,” the company said in a statement.
“Any potential ballot in the future does not mean there will be industrial action. Industrial action — or the threat of it — undermines the trust of our customers,” it added.