Dublin's LUAS workers have voted narrowly in favour of a new agreement that will give them minimum increases of 11.5% over the next five years.
LUAS employees also now have a right to strike clause in their contracts, receive an extra lump sum payment of €750 and the vast majority are expected to qualify for annual bonuses of up to 6.25% on top of the pay increases.
In a letter to staff, Managing Director of Veolia Transport Brian Brennan said the company will be facing difficult times over the next few years.
It will be getting 6% less from the Rail Procurement Agency next year because its fee is linked to the Consumer Price Index, but it says staff costs will now be rising by 3.5% during the same period.
Mr Brennan also said that contracts for new lines to the Docklands, Cherrywood and Citywest due to open over the next two years were won on less favourable terms compared to existing lines.
Drivers currently start on a salary of just over €35,000 a year.
