Consignia delays £1bn deal to avoid a strike

Consignia has offered to delay a £1bn plan to part-privatise its facilities department by three months in an attempt to see off a national postal strike.

The proposal was made at a heated meeting with Communication Workers Union (CWU) officials on Thursday, hours before the union was due to ballot its members on industrial action.

But it is understood the union has given the postal group a two-week ultimatum to agree to concessions before it asks its 180,000 Consignia members to vote on a series of one-day walkouts.

Consignia, chaired by Allan Leighton, wants to transfer 7,000 postal workers to a new company, 49 per cent owned by construction company Balfour Beatty.

The union is worried this will affect its members' rights, particularly on redundancy and pension terms. It is understood that at last week's meeting Consignia executives agreed to retain pay, pension and redundancy rights for staff transferring to the new company, named Romec. But, critically, executives refused to yield to two union demands: assurances Consignia won't sell its 51 per cent stake in the joint venture company for three years; and Consignia employment terms for new Romec recruits.

The CWU fears that if Consigna sells its stake in the new company, staff will lose full Consignia employment rights. On top of this, it believes that refusing to give new Romec recruits Consignia terms will create a "two-tier workforce".

In April, Balfour Beatty was chosen from over 20 companies to form the joint facilities company. It was originally due to sign contracts early next month. While union officials have given Consignia management specific reasons for objecting to the deal, the CWU is thought to be philosophically opposed to outsourcing and want it abandoned altogether.

It believes recent decisions to scrap plans to outsource Consignia's human resources department and halt the £300m sale of its 40,000 fleet of vehicles are signs that executives may be prepared to axe the deal with Balfour Beatty.

But a Balfour Beatty spokesman said: "That is not an option. We are moving towards signing final contracts."