The UN General Assembly ordered a staff and the budget cut for the world body under pressure from the United States and other austerity-stricken industrialized powers.
After protracted negotiations, the 193 nation assembly on Friday agreed to cut 221 staff at the UN headquarters and ordered a one-year pay freeze for the more than 10,000 workers in New York.
UN members also voted to cut the UN's general budget to $5.5 billion for 2014-15, $50 million below the final spending level for the previous two years.
Joe Torsella, the US diplomat in charge of UN management affairs, hailed the move to "eliminate unnecessary, duplicative or outdated" jobs.
The budget talks went past the traditional Christmas Day deadline for the first time ever as the United States and European nations pressed for cuts while developing nations battled to maintain UN spending.
The United States provides about 22 percent of the UN budget and France, Britain, Germany and Japan are also top contributors.
"These milestone measures mark a new commitment to real fiscal discipline at the United Nations at a tough time for hardworking families around the world," Torsella told the assembly.
The general budget does not include UN peacekeeping activities which cost more than $7.5 billion a year or to operate several major UN agencies, such as UNICEF and the World Food Programme, which are funded by voluntary contributions.