A major contract crisis has been averted after Cricket Australia (CA) and the players union struck an agreement over the new pay deal, which ends months of negotiations.

The CA board on Sunday endorsed the proposed four-year Memorandum of Understanding (MOU), which lets Australia's world champion side retain its right to a 25 per cent share of CA revenue.

CA and the Australian Cricketers Association (ACA) are yet to sign off on the new document, however no changes are mooted and the new deal will come into effect on July 1.

The agreement ends months of pain-staking negotiations, which began late last year when the Australian team was preparing to host New Zealand and Pakistan.

The agreement is a major victory for the ACA, which retained its right to have its members earn a share of CA revenue as opposed to bowing to CA's initial plan to have players allocated fixed contracts.

"I think you'll find we're quite happy with where we're at, the two parties were poles apart at the start and they've come to an agreement in quite a short time from where they were, so it's a good result," an ACA spokeswoman said.

CA chairman Bob Merriman said the new deal was fair to all parties.

"It pays Australian elite cricket players well, it encourages young, up-and-coming athletes to choose cricket as their professional sporting career option and it offers Australian cricket improved ability to more aggressively drive participation in the game at a community level," Merriman said.

Had the two parties been unable to reach an agreement on the new MOU before June 30 it would have meant players could sign sponsorship deals with rival companies to CA's sponsors.

That sort of scenario could have cast doubt over players' long-term futures, similar to the problems confronting West Indies cricket where players have rival sponsorship deals to those companies who back the board.

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