The Communication Workers Union has reached a three-year pay deal with BT worth 9.3%, in a bid to avoid strike action from staff.

The deal will mean a 3% increase to base pay which will flow through to pay-related allowances, including the pay and pension supplement, backdated to 1 January 2010 for all employees in post at the point of implementation.

This will be followed by a 3% increase to base pay from 1 January 2011, then a 3% pay increase from 1 January 2012.

Andy Kerr, CWU deputy general secretary, said: "Following a very difficult set of negotiations and the first national ballot for strike action in BT since 1987 we're delighted to have resolved this pay dispute through talks.

"This is a fantastic deal for our members providing a fair rise in their basic pay this year and for the following two years. This deal is among the highest pay settlements in the country this year recognising the contribution of staff and BT's success over the past year.

"Although our ballot for strike action was ultimately withdrawn, we believe it played a major part in getting BT back to the negotiating table with a significantly improved pay offer."

The offer is fully consolidated and pensionable and it provides a 9.3% increase to basic pay over three years.

CWU will hold a consultative ballot of members recommending that they endorse the deal in the coming weeks.