Deutsche Telekom reached what analysts called a victory after labor union ver.di accepted more working hours and lower wages for 50,000 service workers in exchange for protection from lay offs through 2012, the Associated Press report said.
The Associated Press report said the deal, reached after a week of talks and after nearly six weeks of strikes, saw the union agree to workers taking a 6.5% pay cut and increasing their work week to 38 hours from the current 34.
'We can live with this compromise,' ver.di chief negotiator Lothar Schroeder was quoted as saying.
The agreement is important for Deutsche Telekom, which is trying to right its fixed-line business, the report said.
The unit has been bleeding money as competition from lower-cost rivals and regulatory measures aimed at forcing it lower prices.
The talks centered on a dispute over a plan by Deutsche Telekom to transfer some 50,000 jobs into its new T-Services unit, part of CEO Rene Obermann's plan to redefine its fixed-line service and make it more cost-effective, the Associated Press report said.In April, the carrier said it wanted to trim wages by 12% over a 2 1/2-year period and pledged to forgo any layoffs through 2011.
The carrier said doing so would help it save between 500 million euros ($670 million) and 900 million euros ($1.2 billion), the report said. The union had sought layoff protection through 2013, it added.