Independent senator David Pocock has agreed to support Labor's workplace laws, carving out key concessions to back the reforms following negotiations with the government.
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Senator Pocock struck the deal following talks with Workplace Relations Minister Tony Burke and Prime Minister Anthony Albanese on Saturday.
Under the changes to the laws, the government has agreed to set up an independent body that would review the adequacy of social support payments before every federal budget.
Small businesses with fewer than 20 employees will be excluded from single-interest multi-enterprise bargaining.
Businesses with fewer than 50 employees will have extra safeguards if they want to opt out of multi-employer bargaining, while the minimum bargaining period will also be increased from six to nine months.
Senator Pocock said while the process on the bill was rushed, the changes were a good step forward.
"My team and I've used that time to engage in the committee process to consult widely and to really push the government in negotiations to as far as they would go and then a little bit further to address a number of concerns," he told reporters in Canberra on Sunday.
"This is a great outcome and really strikes the right balance to get wages moving for those who need it, but also to have some really important safeguards in place, particularly for small businesses."
Labor has pushed for the laws to be passed by the end of the year despite there being just one sitting week left before parliament rises for the summer break.
But business groups have opposed the multi-employer bargaining changes, arguing they will lead to more industrial action.
The independent senator said a review of social support payments would be critical to addressing poverty levels.
"It makes no sense to me for one of the wealthiest countries in the world to have one-in-six children growing up in poverty, that's not good for all of our collective future," he said.
"There'll be a level of transparency there and then government will have to make the case of why they are or aren't taking those recommendations (of increasing payments) on board."
Workplace Relations Minister Tony Burke said the negotiations were an intense process.
"It hasn't been an easy negotiation and Senator Pocock has been very clear on a series of the principles that he wanted to look at," Mr Burke told ABC Insiders on Sunday.
"He would have preferred that everything was dealt with next year when we said we wanted to make decisions this year. It has involved a very intense process."
The minister said it was likely the lower house would have to sit on Saturday to pass the laws when they cleared the Senate later this week.
Greens leader Adam Bandt said the party had secured changes to the bill that would protect the better-off-overall test for workers.
"This is an important win for all workers, especially low-paid workers in the retail and the hospitality industries," he said.
"Workers will now have an enforceable right to unpaid parental leave and better work-life balance."
Australian Council of Social Service chief executive Cassandra Goldie welcomed the news of the deal on the bill, along with the advisory panel on payments.
"This is great news for low-paid workers, especially women, who stand to achieve better pay under this legislation," Dr Goldie said.
"It will be crucial that the government acts on the committee's recommendations, which will no doubt shine a light on the inadequacy of JobSeeker and related payments to meet essential costs."
Master Builders Australia chief executive Denita Wawn said she supported civil construction be carved out of the bill, but urged for the bill not to pass.
"Builders don't operate in an economic silo and while many have been spared from multi-employer bargaining, they will still experience impacts from disruptions along the supply chain," she said.
Australian Associated Press
