Both sides aren't commenting on the details of the new deal until it can be looked at by union membership and the full city council. But both sides are happy to avoid a strike.
Employees had signs ready but they were not needed.
"We're going back to work today, taking care of not only our families but the citizens here in Sunnyvale and we can go back and do all our blue and white collar jobs and taking care of every aspect of the city," said John Simontacchi the President of the SEA.
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The employees do a variety of jobs including at the library, community center, water pollution control plant, public safety, and the one-stop permit center.
The city says the union covers about half of all city workers who already averaged more than $123,000 in wages and benefits before this latest deal.
"I think the city works within the budget that it has and we're able to put a good strong competitive offer on the table for our employees," said Glenn Hendricks, the mayor of Sunnyvale.
"On Friday night I got a phone call from the city telling me that the inspectors had gone on strike. They had to cancel the inspection. So I was a little bit worried," said Tom Corliss, with Skyline Construction.
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The city was preparing residents for a possible strike warning about limited service but instead of a walk out its business as usual.
"I called the inspector. Spoke to him. And we're back on. We're back in business. So we should be alright now," said Corliss.
The deal will last until June of 2019, if approved by the union and city council.