Members of the largest craft workers' union in the State have voted by an overwhelming majority to reject the new partnership programme, Sustaining Progress.
The decision by the TEEU's membership to reject the agreement by a majority of almost nine to one was described by the union as a "major boost for the No campaign".
The union has 37,000 members in the private and public sectors, including the health service, local authorities and State companies such as the ESB.
It had been expected to reject the programme, but the 87 per cent vote against indicates the depth of feeling within some unions about the terms of the deal.
The programme offers workers a phased 7 per cent pay increase over 18 months. This was described yesterday as "an insult" by the TEEU's assistant general secretary, Mr Eamon Devoy.
It would result, he claimed, in a 3 per cent pay cut in real terms after tax and inflation were taken into account.
Mr Devoy also claimed the proposed agreement was "anti-worker" and undermined the fundamental rights of trade unions.
"One of the main objections the TEEU has to the new agreement is the binding arbitration proposed for the Labour Court if companies plead inability to pay, when workers make a claim in return for major change, or any claim is deemed in breach of the agreement."
The TEEU vote, he added, strengthened the potential for the agreement to be rejected at next Wednesday's special delegate conference of the Irish Congress of Trade Unions.
It also gave the union a mandate "to press ahead and secure the best possible terms for our members through free collective bargaining".
