The labor union covering about 1,200 U.S. employees at The Associated Press said Friday that its members had overwhelmingly approved a new contract.
Newsroom employees in the News Media Guild voted 418-116 to approve the deal. Technicians in the union approved it 34-15.
Ratification follows six months of negotiations that ended in April.
The main dispute involved management's proposal to freeze a longstanding pension plan, in which monthly payments in retirement are defined. The proposal called for future retirement contributions to go into an employee-controlled account similar to a 401(k). The union ultimately agreed to the pension freeze, and the company said it would increase contributions to the alternative plan for affected employees for eight years.
The new contract will expire in August 2013.
The AP has said the contract will help the company stay competitive and focus on growing revenue. It had no further comment Friday.
Tony Winton, president of the News Media Guild local that represents AP workers, said the agreement was the best possible short of a strike. The pension freeze was "a very difficult adjustment for our members to make," he said.
In return for the pension freeze, the AP agreed not to seek an increase in employees' health insurance payments. Employees will get three raises of 1.5 percent each and improved job security.
The agreement comes after several years of financial hardship for many of the newspapers and broadcasters that receive AP's services. Newspapers have been the hardest hit as billions of dollars in advertising revenue has shifted to less expensive alternatives on the Internet. The turmoil has triggered layoffs and pay cuts at many newspapers.
Those troubles have led the AP to lower its fees for U.S. newspapers and broadcasters by $80 million during the past two years. The fee reductions are one reason the AP's annual revenue fell from $748 million in 2008 to $631 million last year. To save money, the AP has reduced its payroll from nearly 4,300 employees in 2008 to about 3,560.
AP sought the pension freeze to help lower its costs in the future and make up for a more than $100 million shortfall in the plan.
Only dues-paying members were eligible to vote; about 66 percent of them did.