Hyundai Motor and its labour union have struck a deal to avert a strike that would have dashed hopes of a strike-free World Cup football tournament.

Hyundai Motor, a top sponsor of the World Cup in co-host South Korea, said its union cancelled the strike due to start on Tuesday after the company promised a hefty increase in allowances.

However, the agreement still needs to be put to a vote and is therefore being described as 'tentative'.

Hyundai Motor has said that it has agreed to increase salaries by 95,000 won ($77) a month along with annual performance bonuses on top. It falls short of union demands. The union had demanded a monthly pay hike of 128,880 won and 30 percent of net profit as bonuses.

On June 10, about 38,000 of the company's 50,000 unionised employees started a 'partial strike' involving a walk out of work for four hours daily.