Thousands of postal workers in London began a 24-hour strike yesterday over cost-of-living allowances.
About 25,000 members of the Communication Workers Union took part in the strike. The union seeks allowances of $6,600 (U.S.) a year to accommodate higher London living costs, while Royal Mail has offered a maximum of $6,244.
Reportedly, the work stoppage cost Royal Mail up to $16.6 million and is likely to be followed by further action later this month. Royal Mail urged people not to post letters in London during the one-day strike, and said it could take several days to clear the backlog caused by the walkout.
Adam Crozier, Royal Mail chief executive, said that the strike was unnecessary and that postal workers in London are already in line for increases in basic pay of 14.5 percent over 18 months.
Meanwhile, Postcomm, the postal regulator in the UK, gave Royal Mail 28 days notice on Sept. 30 that it intends to impose a financial penalty of $12.5 million for failing to meet targets in two of its business services.
Postcomm said the company's performance was 6 percent below the agreed targets for the past year. The two business services are Response Services and Postage Paid Impression services.
Businesses use Response Services to provide customers with postage-paid, return-addressed envelopes. Typical uses are by film-processing firms, which provide envelopes for customers to post film for developing free of charge, or by mail-order firms, which provide postcards to allow customers to send for catalogs.
PPI services involve envelopes used by businesses and printed with a postage insignia. Typical uses include the envelopes used to send bank statements and bills.