Royal Mail hailed the agreement as the first of its kind in the UK. It will affect 139,000 employees and is designed to allow the workforce to adapt to accommodate an increasing number of parcels.
The terms will see workers receive a 9.06% pay rise over three years, beginning with a 3% increase on pay and overtime rates backdated to 1 April 2013.
Royal Mail has also agreed not to outsource, sell or transfer any part of its business, or hire any new employees on inferior terms and conditions.
Workers will still be able to strike, but the agreement will see Royal Mail apply defined processes and strict timescales to resolve any disputes, as well implementing as a new mediation procedure to help reach agreements.
More than 94% of Communication Workers Union (CWU) members voted for the proposals, which will also safeguard pensions, in a postal ballot.
CWU deputy general secretary Dave Ward said the deal was “ground-breaking”.
“The pay deal is at the very top of the range in either the public or private sector and the commitments to legal protections and industrial stability changes the dynamic of privatisation,” he said.
“The agreement bucks trends in UK employment and means Royal Mail, as a private company, cannot adopt the type of employment model and practices that are undermining workers everywhere.
“Although we retain the right to strike, a fresh approach to industrial relations will help create industrial stability and new governance arrangements will increase CWU influence in the day to day running of the business.
"This agreement commits Royal Mail to an agenda for growth, rather than managing decline. There will be no tolerance for a race to the bottom on services and jobs and we believe this agreement will set the standard for pay, employment rights and services for the rest of the postal industry."
The legal protections agreed under the deal are not time-limited, and include a review date of January 2019.
Royal Mail chief executive Moya Greene said the agreement was the “first critical step to provide long term stability and certainty for Royal Mail, our employees and our customers".
“Now the hard work starts,” she continued. “Working together we will create a strong foundation for the continued success of our business."
In November 2013, staff in more than 370 post offices staged a half-day strike over jobs, pay and branch closure disputes.
Post office workers reach ‘ground-breaking’ deal
Post office workers have agreed a deal with their employer that will increase pay and job security and safeguard pensions.
