The deal was thrashed out at a meeting of the Construction Industry Joint Council, a committee made up of the Construction Confederation and union representatives from UCATT, GMB and the T&G.
Under the terms of the deal, basic rates for construction workers rise from £7.30 an hour to £9 over the next three years – a total increase of 23.3%.
The agreement offers improved terms for pensions contributions and travel and subsistence allowances for skilled craftsmen.
Bob Blackman, the national construction secretary for the T&G, said that the deal was good news for the workers and the industry.
He said: “We put the case for a groundbreaking deal to tackle skills shortages, we chipped away and we have come out with a deal that will set the benchmark for other negotiations that follow.”
Blackman added that talks to tackle issues unrelated to pay, such as site safety, would begin next week.
Construction Confederation industrial relations director Gerry Lean said the agreement would provide security for workers and allow companies to plan ahead.
He said: “It is vital to the future well-being of the industry that we move forward together in a spirit of co-operation, ensuring construction is recognised as an attractive career option for young people.”
Lean added that it should be remembered that the increases are minimum rates, and that it is open to employers to pay higher rates if they wish.
