The Bee's chief scout John Griffin sees the 24-year-old midfielder's capture as a real coup for the club.
Griffin said: "I have known Ricky since he was a 16-year-old at Crystal Palace. He comes here with a good reputation and I know that he has the capability to hold the midfield together.
"The signing is a good one for the club as [Reading boss] Steve Coppell was contemplating retaining him for another year in the Championship."