Its 319 staff have agreed to change working practices and to introduce more flexible working – at the cost of 65 jobs.
As a result, the Subway will now be able to open late on the four Sundays before Christmas to get shoppers home and be able to stay open late to get people away from big city events.
However, regular late night opening will not be possible until a £289million system upgrade is completed.
The deal, which has been signed by Strathclyde Partnership for Transport bosses and union leaders, will result in 65 jobs being axed through voluntary redundancy and not filling vacancies. This will lead to annual savings of £1.1m.
Staff have been given a one-off payment of £750 for the changed working practices.
SPT chief executive Gordon Maclennan said: "If we had to continue the way we were, the Subway would have closed in five to seven years because we could not afford the subsidies to run it."
Eric Stewart, SPT assistant chief executive in charge of operations, said: "The old agreements were causing us bother and we started a consultation on flexible working.
"The majority of the workforce agreed something had to happen and saw this as the right thing to do."
After months of talks, a deal has been reached that is vital to the upgrade plan.
SPT bosses say they understand some people will be disappointed the Subway will not open late every Sunday.
But they explained the tunnels have to be available on Sunday evenings and overnight to allow maintenance and modernisation work.
If late night opening was introduced, completing the upgrade would take longer and, as a result, cost substantially more.
Eddie Duffy, Unite official for the Subway, said: "Members recognised there had to be change, but it was a painful exercise for some.
"But the workforce believed the management was listening to them, which is a good basis to work on."
The first stage of the £289m modernisation project – of which £246m is being paid by the Scottish Government – began at Hillhead station.
New escalators have been installed and work is almost complete. There will also be new artwork.
Mr Stewart said: "There is wow factor starting to emerge and we have done that on time and on budget."
A further 14 stations still need to be modernised as part of the upgrade, which will also involve driverless trains.
This week, SPT members will be asked to agree the £1.2m cost of improvements to Partick station.
The upgrade of Kelvinhall and Ibrox will be completed in advance of the 2014 Commonwealth Games in Glasgow as each is close to a stadium hosting events.
Plans for Govan, St Enoch and Buchanan Street stations are progressing through the detailed design stage.
Next year, a smart ticket – similar to London's Oyster Card – will be introduced on the Subway and bus and train companies are already showing interest in getting involved with the scheme.
SPT is this week also likely to agree to £1.3million of improvement work on the tunnels between Buchanan Street and Cowcaddens.
vivienne.nicoll@ eveningtimes.co.uk
