New Albany has its first union contract with service department workers who have joined United Steelworkers Local 9110.
New Albany City Council on Dec. 3 approved the three-year contract that includes a 2.5-percent pay increase for employees in 2014, a 2-percent increase in 2015 and a 1.5-percent increase in 2016.
Union members voted Nov. 15 to approve the contract, said Donnie Blatt, staff representative to the United Steelworkers.
City officials have budgeted $2,001,310 in the 2014 budget for salaries and related expenses for all service department employees, but Finance Director Chad Fuller said that figure does not include increases associated with the new union contract.
Fuller said City Council will have to approve an appropriations ordinance in 2014 to cover the increase.
The $2 million figure was an increase from $1,674,054 in 2013.
City officials had budgeted $2,061,349 for 2015, $ 2,123,190 for 2016 and $2,186,885 for 2017.
Negotiations with the union began in January.
Debra Mecozzi, New Albany deputy city administrator, told City Council the union workers could not receive a pay increase for 2013 while negotiations were incomplete.
The contract includes a provision for workers to receive a one-time payment of $1,000 and receive a 3-percent increase for November and December 2013.
Service Director Mark Nemec said 11 workers were eligible to join the union: 10 maintenance workers and one mechanic.
He said eight of the workers decided to join the union.
Both sides said they are pleased with the contract.
"I think it's a fair agreement that was fair for the city and for the employees," Blatt said. "Being it's the first contract, it gives them something they can build on."
City Councilman Sloan Spalding said he was impressed with negotiators who remained open-minded during the talks.
The city maintains management rights and the contract includes a provision that allows workers who do not want to join the union to refrain from paying union dues, Spalding said.
Blatt said employees who do not join the union will benefit from the contract negotiated, receiving the same wages, benefits and ability to file grievance procedures.
Spalding said the contract includes another provision that allows the city to consider factors other than seniority if layoffs occur.
"Seniority isn't the only factor," Spalding said. "It's also based on merit and performance, which is important to help keep your best employees."
City Manager Joseph Stefanov said other pay increases also are tied to performance and are "not longevity-based."
The benefits package is similar to what other city employees receive, Stefanov said.
The service department workers will pay 5 percent of the cost of their benefits and the city will pick up the rest, said New Albany spokesman Scott McAfee.
McAfee said a contract provision also says the workers would not pay more than 15 percent for benefits during the contract term.
Stefanov said any increases associated with benefits in 2014 would be tied to the Affordable Care Act.
The service department employees voted to join the United Steelworkers in October 2012.
The union first attempted to organize in New Albany in fall 2010, several months before the village became a city after the 2010 census certified its population exceeded 5,000 residents.
New Albany appealed to the state and the union was not allowed to organize because New Albany still was a village. Per state law, employees of villages cannot join public-employee unions.