Finance
Royal Mail reaches three-year pay deal with workers union
Published by Global Banking & Finance Review®
Posted on July 3, 2025
2 min readLast updated: January 23, 2026
Quick Summary
Royal Mail and CWU have agreed on a three-year pay deal, including a 4.2% increase in 2025 and inflation-linked increases for 2026 and 2027.
Royal Mail reaches three-year pay deal with workers union
(Reuters) -International Distribution Services said on Thursday Royal Mail and the Communication Workers Union (CWU) have agreed on a three-year pay deal.
Royal Mail, whose iconic red post boxes with the Royal Crest dot the country, has struggled with labour strikes, competition and loss of market share.
CWU, the largest union of the UK's Royal Mail, has held multiple strikes in 2022 and 2023, with workers as well as businesses grappling with soaring inflation.
The CWU will shortly issue a ballot with a recommendation to accept and the agreement that includes a three-year basic pay increase made up of a 4.2% increase in 2025, an inflation-linked increase of at least 2% in 2026 and 2% in 2027, IDS said.
Subject to a positive ballot outcome, the increase will be backdated to 1 April 2025.
IDS agreed to a takeover by Czech billionaire Kretinsky in May 2024. The deal was cleared in December after Britain secured commitments from Kretinsky to protect the more than 500-year-old company and the future of thousands of workers and customers.
In late June, EP Group said Kretinsky will become the chairman of Royal Mail.
The CWU did not immediately respond to a Reuters request for comment.
(Reporting by Chandini Monnappa in Bengaluru; Editing by Shreya Biswas)
Key Takeaways
- •Royal Mail and CWU agree on a three-year pay deal.
- •The deal includes a 4.2% pay increase in 2025.
- •Inflation-linked increases of at least 2% in 2026 and 2027.
- •The agreement follows multiple strikes in 2022 and 2023.
- •Kretinsky's takeover of Royal Mail was cleared in December.
Frequently Asked Questions about Royal Mail reaches three-year pay deal with workers union
1What is the duration of the new pay deal for Royal Mail workers?
The new pay deal agreed upon by Royal Mail and the CWU is for three years.
2What are the key components of the pay increase?
The agreement includes a 4.2% increase in 2025 and an inflation-linked increase.
3When will the pay increase be backdated to?
Subject to a positive ballot outcome, the pay increase will be backdated to 1 April 2025.
4Who is the largest union representing Royal Mail workers?
The Communication Workers Union (CWU) is the largest union representing Royal Mail workers.
5What challenges has Royal Mail faced recently?
Royal Mail has struggled with labour strikes, competition, and loss of market share.
