The company says the agreement will provide stability during this market cycle.
Essar Steel Algoma says the two sides have agreed to amend the defined benefit pension plan, but didn't announce details.
USW Local 2251 posted a brief message on its website saying the agreement had been reached just before midnight Thursday night.
The union said earlier in the week that Essar Steel had proposed putting less money into the pension fund than required by current government regulations.
The local had been seeking to changes in changes in workplace conditions and other non-monetary issues as well as benefit and wage improvements.
Essar Steel is a multinational company based in India. It acquired the formerly independent Algoma Steel and took it private in 2007.