Initially, IG Metall had demanded 5% hike, employers offered 2.1%. Also, employers wanted to fix the deal for the next 2 years, whereas IG Metall was only offering one year.
A spokesman for the employers' group confirmed on Friday there has been an agreement but, as well as the IG Metall spokesperson, declined to be more specific. Further announcements are expected soon.
The trade union demanded the hike after Germany’s economy grew at the fastest rate in four years in 2015. Germany is the strongest European Economy.
The agreement is expected to be adopted also in other states, meaning up to 3.8 million workers at companies like Siemens, ThyssenKrupp and Daimler can count on a pay hike.
Tens of thousands of workers have staged token strikes across the country in recent weeks to underline their demand.