Computer giant IBM has agreed a $320m deal with older staff, who had argued that changes to its pension scheme left them worse off.
IBM remains a heavyweight in the computer industry
The deal, which caps the firm's future liability at $1.7bn, must still be approved by a US court.
IBM had earlier feared the pensions dispute could cost it up to $6.5bn.
Older staff complained that their pension was set to be less under the new scheme, introduced in 1999, than the previous plan.
Traditional pension plans reward loyalty to a company, with benefits increasing most in the person's last years with the firm.
Under the new 'cash balance' system, benefits rise at a steady rate every year, disadvantaging older staff who had expected their benefits to rise.
A federal judge hearing the case ruled in favour of the workers earlier this year, but IBM challenged the verdict.