A walkout, which posed a major threat to Germany's railway transportation services, was pre-empted by two days of urgent negotiations, Deutsche Welle reported.
"It's a good day today, and what we had planned from tonight ... will not happen," said Manfred Schell, head of Gewerkschaft Deutscher Lokomotivfuhrer, a German train engineers' union.
The union reportedly planned for its drivers to walk off their jobs Monday morning, potentially affecting 50 percent of regional services for passengers in western Germany.
Train operators will be given a specific status "that will fit into Deutsche Bahn's collective wage contract without problems," Bahn Chief Hartmut Mehdorn said.
"We have a result which brings calm for the next few years," Mehdorn said. "I am very happy for Deutsche Bahn and for our clients."