Royal Mail could cut as many as 5,000 to 6,000 jobs by the end of August next year and warned of more layoffs if planned strikes go ahead, as the British company remains locked in a bitter dispute with its largest labour union.

The Communication and Workers Union (CWU), representing 115,000 Royal Mail postal workers, have held strikes in September and early October, and have threatened more strikes this month and next.

The announcement, made in a trading update by the postal service’s parent company, has been blamed on industrial action taken by Royal Mail workers, delays in improving productivity and falling parcel volumes.

A process of “consulting on rightsizing” is to begin. Jobs are to be reduced by an estimated 5,000 full time roles by March 2023 and 10,000 by end of August 2023 to achieve short-term cost efficiencies, International Distributions Services plc said.

More jobs may need to go, the company warned, if 16 days of strikes take place in November and December. It expects such action would “materially” increase the company’s loss for the year.

A voluntary redundancy scheme is to be offered in an effort to avoid compulsory redundancies but the company has said its traditional redundancy package of up to two years’ pay is no longer on offer: “The financial position of the business means that our legacy voluntary redundancy policy, which offered up to two years’ pay, is now unaffordable.”

The parent company reported a loss of £219m for the first half of this financial year, compared to a profit of £235m during the last financial year.