German services union Verdi said it expected a decision to be made on Friday in negotiations over a wage increase for around two million public sector workers in Europe's largest economy.
Years of restrained pay growth has boosted Germany's competitiveness and helped cut its unemployment rate to a two-decade low. But many economists expect bigger wage increases in 2012 than last year and say they may outpace inflation.
"I think it's going to be clarified today - it's make or break," Verdi chief Frank Bsirske said, adding that a number of issues would be fiercely debated in what is now the third round of negotiations.
A deal in Germany would prevent a series of recent warning strikes spreading into broader walkouts that could disrupt the economy. Overall, wages for some 9 million workers are up for negotiation in Germany this year.
Airlines had to cancel hundreds of flights scheduled at Germany's largest airport Frankfurt on Tuesday because of warning strikes by ground handlers.