The deal involves cutting 1,600 jobs in Munich, part of the telecom equipment maker's ongoing restructuring program, which includes 17,000 job losses globally.
The outfit was formed by Nokia and Siemens in 2007. It had already indicated that it wanted to slash a quarter of the group's workforce as it struggles to make a profit amid fierce pricing competition from China and Ericsson.
Nokia Siemens said it plans to cut 1,300 jobs at its other sites in Germany to reach the 2,900 cut target for the country.
German trade union IG Metall said it had agreed with the company that it would keep its German headquarters in Munich and continue to employ around 2,000 people there.
The union thinks that it will protect the remaining 1,600 employees working in Munich, for three years. Those approaching the age of retirement will get part time contracts.