British Columbia teachers signed a deal with the province's school boards late Friday, avoiding a potential strike — and the loss of a signing bonus for the 38,000 members of the B.C. Teachers' Federation.

The government had offered a signing bonus of about $3,700 per teacher provided a deal was reached by midnight Friday. The bonus was upped to $4,000 per teacher, the federation said, and negotiators made the deadline.

The government said the bonus is still $3,700 now, but "up to $4,000 in 2010 because of the length of the agreement."

The teachers had earlier voted more than 85 per cent in favour of strike action to back their demands, and the threat of a strike at the start of the school year hung over the talks.

The deal includes a 16-per-cent total increase over the five-year term, of which 12 per cent is increases to the salary grid and the rest is special adjustments, such as money for long-term disability allowance, the government said.

"We know they haven't done the catch up that was needed, but this is a significant step in the right direction," federation president  Jinny Sims said.

Both the union members and the B.C. Public School Employer's Association, which represents the province's 60 school districts, have to approve the deal.

Sims and employers' association head Hugh Finlayson welcomed the deal.

"It's the start of a new relationship," Finlayson said.