The Communication Workers Union (CWU) has recommended that its members accept the latest pay offer from the Royal Mail, signalling an end to a long-running dispute over pay and conditions.
Royal Mail said the offer includes a 10% salary increase along with a once-off payment of £500 and commitment to no compulsory redundancies.
Both parties described it as a "good deal".
International Distributions Services, the Royal Mail’s parent company, said that if the deal was accepted by CWU’s members it would represent a "good outcome for customers, shareholders and employees".
The offer also includes changes to sick pay, working patterns, attendance standards and ill health retirement
New employees will be required to work on Sundays, which will allow the company to compete with heavyweights like Evri and Yodel.
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The Royal Mail said in a statement: "This agreement is an important step forward in the turnaround of Royal Mail and, if approved by the CWU membership, represents a good outcome for customers, employees and shareholders.
"The agreement provides a platform for the next phase of stabilising the business whilst continuing to drive efficiency and change.
"The operational changes in the agreement are designed to improve competitiveness, particularly in next-day parcels, reduce cost and environmental impact and improve quality of service for our customers.
"A three-year pay deal will provide certainty for our employees and ensure Royal Mail remains the industry leader on pay, terms and conditions."
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A CWU spokesperson said: "This situation has been arrived at only because of the sheer determination of every postal worker in this country who stood up for themselves, their jobs and their industry.
"We intend to put this deal to our members’ vote as soon as possible."
Union members will be balloted on the offer in the coming weeks.
Postal workers have been locked in increasingly bitter negotiations over pay, jobs, and conditions for nearly a year.
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CWU members have been involved in the action after being offered a 5.5% pay rise last year – an increase they claimed is equivalent to a 2% increase in real terms.
115,000 postal workers from the CWU staged 18 strikes last year in the run-up to the crucial Christmas period. Royal Mail claims action cost it in excess of £100m.