Royal Mail faces strike as union to ballot staff

LONDON, June 27 (Reuters) The possibility of a strike by workers at Royal Mail, Britain's state-owned postal operator, moved closer today as the Communications Workers Union (CWU) said it would ballot its members for industrial action.

The ballot comes after the CWU rejected a 2.9 per cent pay offer it says was imposed on employees and that notice would be issued to Royal Mail on July 3 and the ballot would close at the end of July.

''Notice to the employer has been set to demonstrate the union's determination to reach an acceptable negotiated agreement,'' the union said.

Royal Mail said on Sunday it was calculating the added benefit of the productivity scheme it agreed with the union earlier in the year which would add a further 1 per cent to the 2.9 per cent offered increase.

The group said it faced a huge challenge to modernise its business and that it was ''very keen to involve all our people and the unions in that process.'' Britain's 6.5-billion-pound mail industry was de-regulated on January 1 and Royal Mail lost its monopoly on mail deliveries, with bulk operators licensed by industry regulator Postcom able to compete fully in the market for letter delivery.

Royal Mail had no immediate comment today.

REUTERS SHB ND1538