Post offices to receive additional payment on Royal Mail products from April trading

Following a new agreement between Post Office and Royal Mail last December, postmasters will receive an interim additional monthly remuneration payment from April 2021 trading on the Royal Mail products and services that they sell.

Post Office said this will reflect the benefit from the new agreement now being linked to customer prices, adding that postmasters are set to benefit from an estimated additional £10 million worth of remuneration compared with the financial year 2020-21.

The new long-term commercial agreement, known as the second Mails Distribution Agreement, has taken effect on 29 March and is expected to operate at least until 28 March 2032. The agreement provides shoppers at Post Office branches with the opportunity to purchase a wide range of Royal Mail and Parcelforce Worldwide products.

Post Office has also begun a consultation with all postmasters on how it proposes to change the remuneration structure and as part of this, postmasters will receive specific data in relation to their branch(es).

Post Office said the new commercial structure rewards postmasters for selling more because remuneration for sales will be linked to the price of Royal Mail products. The agreement will also ensure that postmasters are rewarded when a customer requires product add-ons such as additional compensation or guaranteed delivery days which will generate increased remuneration.

Post Office plans to implement the new commercial structure from December 2021 so that all postmasters will have a chance to review how their branch(es) could be impacted by the new structure.

“This new Mails Distribution Agreement will see postmaster remuneration for sales linked to the price of Royal Mail products and services and provides them with opportunities to maximise their remuneration,” said Mark Siviter, Mails Product Portfolio Director at Post Office.

“Mails makes up most of the remuneration that Postmasters receive which is why we are providing every postmaster with detailed information as to how their branch or branches could be impacted by the new commercial structure. The vast majority will benefit and overall Postmasters will receive an estimated additional £10 million worth of remuneration this year.”