Oshkosh Corp says the compromise is important so they can prepare to bid for a military contract to replace the humvee.
Neither side will go into details about the agreement at this point.
Instead UAW local 578 will present the deal to its more than 2500 members Sunday before taking a vote.
The agreement calls for an new 5-year contract for Oshkosh's defense union employees - from 2016 to 2021.
"With added security on our tentative agreement to be presented for a yes vote on Sunday will mean a future of stability here in Oshkosh again for years to come." says Joe Preisler, UAW local 578
According to Rod Wedemeier with Oshkosh Defense "This proposal is a balance package that takes care of our production employees and gives Oshkosh a competitive cost structure that will put us in the position to compete for the JLTV program".
Oshkosh Corp, is competing with two other firms for the contract.