HONOLULU -- Bus negotiators for the Teamsters Union and the company that runs Oahu's bus system reached a tentative agreement early Thursday morning after a monthlong strike.

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The agreement comes after a 16-hour marathon session of talks between the union and Oahu Transit Services that ended at about 2:30 a.m.

The two sides met in several sessions starting Wednesday morning. Negotiators sounded positive about reaching an agreement soon after the first session.

Union members will vote Saturday on whether to ratify the tentative agreement. Union leader Mel Kahele said the package includes pay raises. It includes no pay raises for the first three years. However, there is a 50-cent payraise in the fourth year and and 65 cents in the fifth year. There will be 20 cent pension hikes starting in the third year for a total 60 cent pension hike.

"It's never enough money. Are we happy? Of course not. We're not happy, but the people are going to make the decision. That's where its at. They're the people that kept it strong," Teamster International Union Vice President Jim Santangelo said.

Bus drivers, mechanics and clerks began their pickets Aug. 26. If the contract is approved by the membership, OTS said it hopes to have the bus system running 4 a.m. Monday.

The bus system would be free for riders for the first week, according to city officials.

Now that the negotiations appear to be over, the two sides expressed relief and confident that the agreement would be ratified.

"We're pleased with that and we look forward to having the employees back and service up and running as quickly as possible," OTS negotiator Perry Confalone said.

Word of the tentative agreement was welcome news for union members walking the picket line.

"Well, they're really in a high-spirited mood right now because you know there's light at the end of the tunnel," strike captain Ben Asato said. "It was a tense moment because the company really gave us their best last and final offer. It's like they're saying we either sign it go back to work, or we're going to be out a lot longer most people are ready to serve the public right now."

The Honolulu City Council Wednesday gave unanimous approval to a bus-fare increase.

The rate hikes are expected to generate enough money to cover a projected $6.8 million budget shortfall that could have led to layoffs and reductions in bus service.