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Amaravati, Feb 6:  The government employees in Andhra Pradesh dropped their plans to go on strike from Sunday midnight after a breakthrough in the talks with the state government over their demands.

While the government accepted few demands of the employees' unions, the latter softened their stand on few demands, leading to an amicable solution.

The breakthrough was reached late Saturday during the talks between the ministerial committee and PRC Sadhana Samithi, the apex body of employees' unions. Both sides announced the agreement at a joint news conference.

The government agreed for a marginal upward revision in House Rent Allowance (HRA) and to continue City Compensatory Allowance (CCA). It also accepted the demand to implement an additional quantum of pension for pensioners aged 70. The government also agreed to the demand of employees not to resort to recovery of Interim Relief (IR) and continue the current system of a Pay Revision Commission (PRC) every five years.

The government did not accept the demand to enhance the pay revision beyond 23 per cent.

However, some sections of the employees and teachers opposed the agreement. Few leaders walked out of the press conference. They said PRC Sadhana Samithi failed to achieve their main demand of 27 per cent pay revision.

United Teachers' Federation (UTF) president Venkateshwarlu said the talks between teachers and the government have failed.

He said the agreement reached between the government and PRC Sadhana Samithi was not acceptable. He said all teachers' unions will be united to continue the struggle.

Venkateshwarlu said the government was ready to give only 10 per cent HRA to teachers. He demanded that the government should pay a minimum 12 per cent HRA or continue the old system of HRA.

The UTF president also demanded 27 per cent pay revision. He said denying them an opportunity to raise their demands before the chief minister was undemocratic.

The employees have been protesting against Government Order (GO) issued last month fixing new pay scales as per the 23 per cent revision announced by Chief Minister Y.S. Jagan Mohan Reddy. They had claimed that with the implementation of the GO there will be downward revision in their salaries.

Intensifying their protest, the employees' unions had organised a massive protest in Vijayawada on February 3. Despite police denying permission for 'Chalo Vijayawada' and imposing restrictions, thousands of employees from across the state had gathered in Vijayawada to press for their demands.