All staff, including teaching assistants, cleaners, caretakers and school meals workers, will receive a minimum of 7.7 per cent extra by April 2003.
A 3 per cent rise will be backdated to April, a 1 per cent increase will follow in October and a further 3.5 per cent next April.
The lowest paid will see their basic salary rise by 10.9 per cent, from pound;4.80 to pound;5.32 an hour, after marathon talks, covering the whole of local government, were brokered by the conciliation service ACAS.
There is also to be an independent inquiry into the wages of council staff.
The deal comes after a one-day national strike last month by members of UNISON, the GMB and the Transport and General Workers' Union saw hundreds of schools close. A further one-day strike, planned for next Wednesday, has now been suspended.