The Irish Congress of Trade Unions and employers' group IBEC have accepted the second phase of the current national wage deal, Sustaining Progress.
At an ICTU special delegate conference in Dublin, there were 267 votes in favour and 110 against.
But IBEC director general Turlough O'Sullivan warned that the agreement's pay terms were 'at the very limit' of what employers could afford. He added that if jobs were to be maintained, everybody had to adhere to the spirit and the letter of the deal.
Mr O'Sullivan pointed to provisions for businesses that could not afford to pay increases, saying that this reality had to be recognised.
Earlier, ICTU general secretary David Begg told a special delegate conference that the agreement would deliver a pay increase of around 5% above inflation over its full three-year term.
Begg said that better investment in public services should be achieved by broadening the tax base without increasing the burden on PAYE tax payers.
He said that ICTU would expect the Government to introduce tax measures to take minimum wage earners out of the tax net and to ensure that 80% of tax payers pay at the standard rate.
He also stressed that Congress expected the Government to deliver on ten special initiatives agreed in Sustaining Progress including the completion of 10,000 affordable houses.
