About

Team size: 40 in the UK

Major legal advisers: Addleshaw Goddard, Bryan Cave Leighton Paisner, Herbert Smith, DAC Beachcroft, Weightmans, Dentons, Slaughter and May, Macfarlanes

What are the most important transactions and litigations that you have been involved in during the last year?

The principal transactions and litigations we have worked on – in addition to a host of different Covid-related activities – are below. Firstly, participating in the negotiations for the company’s agreement with the Communication Workers Union (87% of our colleagues in the UK are in the Communication Workers Union), facilitating and advising on the various different arrangements for postal and logistics services post-Brexit, dealing with Ofcom on the “emergency period” confirmation following Covid and numerous other regulator and government Covid issues, involved in many of the negotiations with the government around distributing Covid test kits, Covid vaccination letters and PPE for the NHS and other government organisations, dealing with the legal arrangements for an internal management restructure which saw the company make redundant circa 2,000 of its 9,700 most senior managers. We also successfully renegotiated the ten year agreement with the Post Office and were involved in several well reported Supreme Court or Court of Appeal employment cases, supporting on numerous Royal Mail initiatives for customers such as parcel collect (collecting parcels from customers doorsteps), drone deliveries and Sunday deliveries. We changed executive twice during that period, and championed – via Charlie Ryan in the legal team – the safe spaces initiative which helps to prevent against domestic abuse. This initiative has now been adopted by numerous companies and law firms in the UK on their websites.

What were the main difficulties your company faced during the initial Covid lockdown?

The first lockdown was like a perfect storm. On the safety front, our priority was to protect our people and our customers. There was a huge amount of work on sourcing PPE and getting it distributed to our 140,000 colleagues, as well as creating apps and systems that enabled the 1,250 delivery offices, 37 mail centres, six regional hubs, 130 vehicle service centres and numerous other sites to source the PPE they needed. Also, in having sensible and practical guidelines that sought to keep people safe whilst at the same time ensuring that we could continue to deliver letters and parcels to customers. As everyone knows, the increase in parcel volume became ever so important to the country during lockdown. On the operational front, soon after that first lockdown, absence rose to almost 20% as people were either ill or shielding. To put that into context, almost 30,000 people were not coming into work. That meant trying to find ways to still get letters delivered and to cope with the increasing parcel volumes when some delivery offices were less than half staffed. It also required us to put in place different methods of operation. Many deliveries are made with two post people sharing a van (we have almost 50,000 vehicles in total including trucks and vans), however Covid ruled that out for quite a period of time. One person per van instead of two put a huge logistical and resourcing strain on the business. On the trading front, the first period of lockdown led to a huge reduction in letter volume. In the first three months following lockdown, letter volume was reduced by 33%; in excess of one billion letters less were sent in that three-month period. In the immediate post lockdown, there was also an initial tail off on parcel volumes. The reduction in volumes was such that in that early period, Royal Mail announced it was losing in excess of £1m per day. Hence, on the financial front there needed to be a lot of work carried out in that first crucial 8 weeks on the company’s finances, banking covenants, bank facilities and cash flow. We sought to position ourselves to be able to take advantage of all the government’s initiatives to support companies such as emergency funding facilities, rates holiday and furloughing. In the end though, the company did not take up that support, as it was able to navigate its own finances as parcel volumes rose to record levels from about June 2020 and letter volume reductions started to lessen. Our share price dropped to as low as £1.24 last April and we dropped to about number 220 on the FTSE. I am pleased to say that we have managed to really turn that around. Later, our share price rose to over £5 and we were just on the verge of the FTSE100. Talk about a rollercoaster ride!

The legal team was central to each one of the activities noted above and played an important role in helping the company to do what it needed to do to be able to continue to trade. The legal team did this with a pragmatic “can do” approach – providing appropriate legal advice in giving pragmatic commercial advice to help the company implement any necessary steps.

How have you and your team found working from home, and is this a work practice you intend to carry forward post-pandemic? How important is face-to-face interaction for a legal team to function well?

The legal team dealt with this really well. We already had an existing team mantra about working hours. Our theory was that the company paid our lawyers and legal teams for their experience, their time and their advice, not for where they worked or when they worked. For instance, we already communicated to the team well before Covid that if their children were in a sports day at 10am on a Thursday then they should go watch the kids play sport and not feel guilty that they were not “in the office”. We trusted them to do the right thing and do the work whenever they needed to do it. That team philosophy seemed to set the legal team up really well going into Covid lockdown as people were encouraged already to fit their work life around their home life. The company also ensured very quickly that everyone had access to appropriate equipment and videoconferencing – primarily Skype and later Teams – which everyone got much more used to using very quickly! Our marvelous social committee also make sure that we had a good selection of meetings, team meetings, quizzes, and team drinks.

So by and large, we think the legal team embraced working from home. My conclusion is we have a good legal team full of good people who are good company – supportive, generous with their time and kind. It’s nice to spend time with people like that and it will be good to get back together to remind ourselves first hand that we do work with a good group of people, so going forward we will do a bit of both. We will all work more often from home but we will also make sure that we have time set aside to get together, collaborate face-to-face, support each other and have a laugh. As one of our other team mottos says – you have to laugh every day, a day without laughter is a wasted day.

Did the Brexit deal reached at the end of 2020 give you and your business greater clarity for the future?

For postal and logistics business like ours, Brexit brings both threats and opportunities. A huge amount of work went into providing support for customers to help them to understand better how to fill out the data fields necessary for trading with Europe. However, this has been complicated for many – in January trade with Europe is said to have dropped by 40%. We envisage that will come back up as people get more used to the rules and in particular the documentary requirements. But at the moment it presents a slight trading deficit for Royal Mail.

In what ways do you see the in-house legal role evolving over the next few years?

As all the commentators seem to say, the advent of AI and legal technology to speed up and simplify activity is becoming ever more important. Again, this is an area where Dinesh Jadav, our excellent Legal Operations Director, is leading up a small team making inroads to how we provide quicker, more focused support to the business and “teach people to fish”.

The other area that in-house legal teams really need to continue to add value is to better appreciate that they are not just there to give legal advice: their primary function is to help the business to deliver its strategy. A legal team has a huge role to play in that. For example, businesses are generally constrained in their scarce resources – people, time and money. Our lawyers know that if they spent an hour preparing a form that 1,000 people must complete, and it takes each person ten minutes to complete it, we would prefer the lawyer to take two hours to draft the form so that the thousand people can each complete it in five minutes. The net saving to the business in time is colossal.