Collective bargaining for the approximately 160,000 employees of Deutsche Post in Germany entered its second round on Wednesday.

The two-day negotiations began in Cologne, said representatives of the Group and the trade union Verdi. Both sides are facing difficult talks: the union is demanding a 15 percent wage increase over a period of twelve months, while the Post had already rejected the salary demand as unrealistic. Verdi had called on the Bonn-based company to submit a "negotiable offer". Verdi's head of negotiations Andrea Kocsis said that she was hoping for a big step forward in the second round.

If this does not succeed, the Post could face protests and warning strikes before a new round of talks at the beginning of February. The peace obligation expired at the turn of the year. In the first round of talks, the two sides made no progress and, according to Kocsis, Swiss Post insisted on a contract term until mid-2025. Now both sides have to go into detail about the term and wages. If there is no progress, Verdi will decide whether the union will "press its demands in the companies", Kocsis said. At Swiss Post, around 140,000 of the 160,000 tariff employees are grouped in pay grades in which the basic monthly salary is between 2108 and 3090 euros gross. These employees are "particularly affected by the high inflation". Without a substantial pay rise, they are threatened with a real wage loss.

Swiss Post and Verdi last agreed on wage increases in September 2020. At the time, the 28-month agreement included a three percent increase in wages and salaries on January 1, 2021 and a further two percent increase on January 1, 2022. Swiss Post has long been generating the lion's share of its profits outside of the traditional mail business in Germany. Overall, the Group is expecting a record operating profit (EBIT) of 8.4 billion euros for 2022, with the letter and parcel business in Germany contributing around 1.35 billion euros.

(Report by Matthias Inverardi, edited by Myria Mildenberger. If you have any questions, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and the economy) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)