Royal Mail said it will re-enter talks to settle a long-running pay and conditions dispute after the union called off a one-day strike due next week.

The walk-out on 16 February was set to involve 115,000 delivery workers and sorting office staff in response to a dispute over pay and working conditions.

However, the Communication Workers Union (CWU) has announced that it will not contest a legal challenge by Royal Mail as losing in court could impact a new strike ballot.

Royal Mail, which is owned by stock market-listed International Distributions Services, said it would focus on reaching a settlement with the union.

The union said that if the talks fail it will significantly step up the programme of strike action.

The company challenged the industrial action on the grounds of a “legal error” related to the reasons for the strikes.