Under the deal, players will now receive £6,000 per appearance, which will double in the event of a victory. The payments will be the same regardless of the standard of competition. There will also be bonuses for winning the Six Nations, achieving a grand slam or winning the World Cup in New Zealand in three years.
England manager, Martin Johnson, said: "It's important that these matters were resolved ahead of the 2008-9 season so everyone involved in the squad knows where they stand on commercial issues. Everyone has bought into, and supports, the agreement and the squad are looking forward to preparing for the Investec Challenge series of matches in November."
The deal with the squad follows the eight-year agreement between the RFU and the Guinness Premiership clubs over the management of elite players which came into force last month.
