Comment on Royal Mail pension plans

Edited by the Marketingservicestalk editorial team Sep 28, 2007

Kerry Hallard, Communications Director of the National Outsourcing Association and Managing Director of Buffalo Communications, discusses Royal Mail's plans to close its final-salary pension scheme.

Royal Mail plans to close its final-salary pension scheme to all employees in a move that could plunge the business further into industrial turmoil.

The decision is expected to trigger strikes by thousands of postal managers, in addition to unrest among its 130,000 employees who are in dispute over pay and working arrangements.

Royal Mail is expected to write to employees soon to outline sweeping changes to the pension scheme, including raising the retirement age by five years.

Its move to close the final-salary scheme for existing employees, along with new ones, is almost unprecedented.

Rentokil is one of the few other large organisations to take such drastic action.

Usually companies that change pension schemes pull down the shutters on final-salary arrangements to new employees only.

However many millions (or hundreds of millions) pounds the Royal Mail has recently spent on developing their brand is quite evidently money down the drain.

It's all well and good having a fantastic logo and beautiful shining new collateral but with a communications disaster like this they might as well not have bothered.

The true test of a brand and its values is the way that it is perceived, both internally and externally, and no amount of money can rectify this fiasco now.

It is typical of the lack of joined-up thinking synonymous with big company culture to treat employees with such disdain.

Every single element of best practice in communications has gone out of the window.

There was no internal communications before the decision was revealed in the press (how could Royal Mail be writing to employees after the story has appeared?).

Royal Mail is only now meeting unions - there should have been weeks of negotiations leading up to this announcement.

It also seems that Royal Mail has made its decision already.

It was only days ago that the plans were denied - lying and then backtracking is the worst possible communications error.

Royal Mail has declined to make a statement until employees have been informed.

That's fine in theory, but the fact is that the media reports are going to leave some very worried and unhappy workers today.

Is it too late for Royal Mail? The answer is probably yes - it has been dishonest and secretive, leaving employees angry and in the dark.

Even discussions with the unions and employees at this stage will leave them with a bitter taste in their mouth.

Moving forward, Royal Mail needs to develop communications and HR procedures, both internal and external, that keep everyone informed when such an important decision is to be made.