Entergy Nuclear and Local 1-2 of the Utility Workers of America reached a settlement just hours after the union's contract was to expire at midnight Friday. That deadline was suspended amid movement in the talks with federal mediators in a hotel conference room about 20 miles from the plant into the early hours of Saturday.
Union spokesman John Melia confirmed the settlement, and said the agreement benefits the workers, the union and Entergy.
Union members still have to approve the deal in a vote expected within the next few weeks.
John Ventosa, site vice president and Entergy's top official at Indian Point, applauded the determination of the union's team throughout the negotiations and said the agreement benefits all parties.
"The agreement reached today allows all our employees to focus on their continuing mission to safely provide affordable and reliable power to millions of New Yorkers every day," Ventosa said in a statement announcing the deal.
Melia had said that talks had bogged down Thursday night after plant owner Entergy Nuclear made an "insulting and regressive" offer on wages and benefits.
He said the union's 395 members, including control room workers, radiation safety workers and maintenance workers, had wanted to avoid a strike.
He said members' hourly wages range from $40 to $60.
In the past, labor talks at Indian Point have commonly gone past the deadline before ending with an agreement. The last strike there was in 1983, when the two reactors were separately owned and workers at Indian Point 2 walked out on Con Edison for nine weeks. The plant remained open.
In June 2012, Entergy locked out 242 union workers at the Pilgrim nuclear power plant in Plymouth, Mass., when their contract expired. An agreement was reached after four weeks. A few months later, the company locked out union security workers at its plant near Port Gibson, Miss. That lockout lasted nearly seven weeks.
The agreement avoided either scenario at the plant.
Melia earlier said, "The stakes are a little higher here," referring to the plant's location 35 miles north of midtown Manhattan and Entergy's application for new 20-year licenses for the reactors.
Hearings on the licensing are underway, with New York state opposing the bid.