Thousands of Australia Post workers walked off the job today in a dispute over a new workplace agreement, but Australia Post has tried to minimise the impact of the walkout.

The organisation says it still has plenty of people to sort Christmas mail, but postal workers call it their biggest industrial action before Christmas in 30 years.

Hundreds of striking postal workers put their own twist on a familiar union slogan as they marched to Australia Post headquarters in Surry Hills, in Inner Sydney.

"Postal workers united, will never be defeated," they chanted.

They were there to voice their anger over working conditions.

The Prime Minister, Kevin Rudd, today weighed into the dispute, calling on both sides to iron out their differences.

"I really do think it's time for calm heads to prevail, both on the part of Australia Post on one hand and the unions on the other," he said.

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