Yes. The safety must be depressed by the web of the hand. As you probably noticed, there is also a manual safety lever, the purpose of which is to lock the grip safety in its rear position.

Here's a short history of the grip safety in the Luger pistol:

The grip safety was a feature of the original Borchardt-Luger design and appears on the 1900 Model Lugers (the Old Model). I gave a detailed photo array of my 1900 Model Luger at this link:

Luger - DWM 1900 American Eagle - 7.65mm

Beginning in 1904 the Luger design was improved. It's flat leaf mainspring was replaced with a coil spring, along with several other changes. The culmination of this design change became what collectors refer to as the "New Model Luger" or the Model of 1906. This model retained the grip safety, and it is the pattern of the Luger featured in my original post.

In 1908 the German Army adopted the Luger; but in doing so, the army specified elimination of the grip safety to simplify the design and save some cost. This became the ubiquitous P.08. Millions of Lugers were made on this pattern.

So, in photos, here is the progression:

Model 1900 (Old Model)

Model 1906 (New Model)

Model 1908 (P.08)

Even after adoption of the P.08 some purchasers preferred the 1906 pattern with grip safety, so DWM continued this design in manufacture. The Swiss preferred this design. Pistols manufactured both for the Swiss military and for Swiss commercial sale were of the 1906 pattern with grip safety. Later, when the Swiss were licensed to manufacture Luger pistols in Bern, the pistols they built all featured a grip safety.

All this gets back to the subject of my original post. Part of the reason this "1920 Swiss" Luger is of interest to collectors arises from its context.

Under the Treaty of Paris the Wiemar government was severely restricted in the production of arms. In particular, the restrictions prohibited arms that would be useful to military application. Pistols were generally limited to smaller calibers with barrels no longer than 98mm.

As Lancaster pointed out, most DWM Luger production of the early 1920s was made up of surplus parts on hand after the war or of re-worked military Lugers. These were presented to the world markets. They varied greatly in quality of workmanship, reflecting the desperate hardships of the times.

This particular Luger was made of newly manufactured parts. The "long frame and receiver" had not been in production for some time. (I'll not get into the distinction of "long frame" compared to "short frame"). Here is a 1906 pattern Luger, with a 100mm barrel, built on a long frame soon after 1921. All-in-all, that makes it a very interesting variety.

Curl