Tram strikes planned to disrupt the Australian Grand Prix have been cancelled after the Victorian government intervened.
The Rail, Tram and Bus Union has agreed to call off its industrial action during the month of March and will take part in discussions convened by the government to reach a new pay deal with Yarra Trams.
Public Transport Minister Melissa Horne had for months resisted calls by the union to intervene in the dispute, describing it as a negotiation involving the union and a private company.
"It is not my job to do either the union's job for them in negotiating that or to do Yarra Trams job in negotiating their agreement," she said last month.
Mediation between the two parties will begin on Tuesday and will include senior leadership from both Yarra Trams and the RTBU.
The session will be facilitated by the head of Industrial Relations Victoria, with Ms Horne expected to attend "when required".
"The government facilitating mediation does not make the state party to the agreement," a government spokesman said in a statement.
"We continue to encourage both parties, Yarra Trams and the RTBU, to come to an agreement as soon as possible."
The agreement means legal action to put a stop to the strikes will also be withdrawn.
"We welcome a return to productive negotiations," Yarra Trams CEO Julien Dehornoy said in a statement.
Talks between Yarra Trams and the union broke down last year as the tram operator pushed for a new enterprise agreement that would allow more part-time rostering.
The tram operator wants to lift the current cap on part-time employees from four per cent to 15 per cent and has offered 12 per cent wage increases over four years.
The union is calling for a five per cent pay rise a year over as well as improved rostering and job security.
Australian Associated Press