The new pact came after a long-running wage dispute that included several strikes.
Beginning in October, salaries will be increased by 3.6 percent, the head of the employers' group, Bernhard Strippelmann, said.
Steelworkers will also receive a one-off payment of €150, while apprentices will see a monthly increase of €40.
The contract, which also included new payment agreements for temporary workers, will be valid for 14 months.
Small details still need to be confirmed, Strippelmann said.
The workers' union IG Metall had been demanding a salary increase of six percent on the grounds that Germany's economy is improving.
As the first major wage negotiations since the end of the financial crisis, the process has been carefully observed by other industries. Their outcome could be a template for upcoming negotiations with chemical industry, construction and retail workers in early 2011.