Ryanair has pledged in writing to recognise an Irish trade union - a first for the airline.
The low-cost carrier said it had sent a letter to Impact officials with proposals on pay and conditions and procedures for dealing with industrial relations disputes.
In a statement Ryanair said it was recognising both the trade union and the pilot council for employees.
"Ryanair has also submitted a set of proposals on pay and conditions, procedures and dispute resolution for its Irish-based pilots, and looks forward to concluding an early agreement on these issues with its Irish Ryanair pilot company council," it said.
The decision by one of Europe's largest airlines to deal with unions after years of opposition follows threatened pre-Christmas strike action by Irish-based pilots, which was called off earlier this week.
Impact said the move - recognising the union for collective bargaining issues, with immediate effect - means the threat of a strike has receded.
The airline and the union will meet on January 3 to agree a comprehensive recognition agreement.
Impact said it expected management to reach agreement on procedures quickly so the parties could move on to negotiate substantial issues around pilots' pay and working conditions.
Union official Ashley Connolly described it as a historic achievement that would resonate beyond the company.
"This advance is good news for Ryanair pilots, passengers and shareholders," he said.
"We also think it will assist thousands of workers elsewhere, who want independent workplace representation but whose anti-union employers had been encouraged and emboldened by Ryanair's previous antipathy towards Impact and other unions."
Mr Connolly said the breakthrough was made possible by the resolve of Ryanair pilots.