updated 12/12/2005 8:59:21 AM ET 2005-12-12T13:59:21

The telecommunications company AT&T Inc. and two unions have reached a tentative agreement on a contract for more than 11,000 workers, and union members are expected to vote on it over the next several weeks.

The union had authorized a strike last week if a deal was not reached by the time the old contract expired at 11:59 p.m. Saturday.

The proposed deals with the Communications Workers of America and the International Brotherhood of Electrical Workers was announced late Sunday. It would run through April 4, 2009, and provide for an 11.2 percent increase over the life of the contracts, AT&T said in a news release.

"We're pleased to have an agreement that rewards our valued employees with outstanding wages and benefits and still preserves our ability to control our cost structure," said AT&T Chairman and CEO Edward E. Whitacre Jr.

The agreement also increases pension benefits by 6 percent next year and by an additional 5 percent in 2008.

Ralph Maly, CWA's vice president for communications and technologies, described the agreement as "fair and equitable."

The agreement increases the employee co-payments and maximum out-of-pocket limits for medical and prescription drug benefits for employees and retirees, AT&T said. Also, the agreement makes provisions that before an employee is laid off, AT&T will offer employees a position in the company.

The agreement will be submitted for union member ratification over the next several weeks.

Negotiations between the two continued past midnight Saturday, AT&T spokeswoman Claudia Jones said. Talks resumed Sunday afternoon.

The negotiations affect technicians and customer service representatives who were part of the old AT&T. San Antonio-based SBC Communications purchased AT&T Corp. for $16 billion last month and renamed the merged company AT&T Inc.

Copyright 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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