A 20 month-long industrial battle comes to halt with a management and union decision to increase pay by eight percent.

Telecommunications company Telstra Corporation Limited (ASX: TLS) and the Communications, Electrical and Plumbing Union (CEPU) have sealed a new enterprise agreement which will give employees an eight percent pay increase over the next two years. Moreover, under the agreement, employees who perform well will earn between 1.5 percent and 2.5 percent extra each year.

However, CEPU divisional president Len Cooper said, “It's a victory for our members' rights and conditions at work but more work needs to be done to improve pay and conditions for employees not on the union agreement.”

The union is seeking an end to the Australian Workplace Agreements (AWA) era by fielding strikes and overtime bans within segments of the telecommunication's transformation program. The actions have affected Telstra's relations with big-ticket corporate customers, but the company remained adamant on its March 17 pay offer to its workers.

The same offer was accepted yesterday but other concessions were included in the deal. Cooper said, “For instance Telstra workers now have access to arbitration in any condition disputes which they never had for 15 years.”

One issue up for dispute is the union's allegations that Telstra management secretly listened in an member-only conference calls to gain advantage in the industrial dispute. The Australian Federal Police is investing the allegations.