Arbitrator orders New York City to pay $900M in deferred wages to teachers union

NEW YORK CITY (WABC) -- New York City and the teacher's union struck a deal Friday to pay educators' $900 million in deferred wages.

An independent arbitrator on Friday overturned New York City's attempt to avoid paying deferred wages to thousands of city teachers.

The arbitrator ordered the city to pay half of the amount owed now and the other half in 2021.

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The deferred wages are the result of a decision made by former Mayor Mike Bloomberg, in a previous fiscal downturn in 2009 and 2010 to withhold from teachers a wage increase that had been granted to other municipal workers.

After Mayor Bill de Blasio took office, an agreement was reached to pay the deferred amounts in a series of lump sums over six years.

The final lump-sum payment - worth an estimated total of $900 million, had been scheduled for October of this year.

Under the arbitrator's decision, half the total amount will be paid to an estimated 90,000 active and retired UFT members before the end of the month.

The balance will be paid in July 2021.
"This is far from a perfect solution for thousands of our members who are still owed deferred wages that can go back as far as ten years," UFT President Michael Mulgrew said. "The decision recognizes the city's difficult financial circumstances because of the coronavirus pandemic, but makes it clear that the city must find a way to meet its financial obligations to its educators."

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The decision also orders the city to make a no-layoff pledge to UFT members for the rest of the current school year, and also secures teachers' 3% wage increase on May 14, 2021.

In addition to the no-layoff pledge for the remainder of this school year, the decision orders the city to extend that pledge to the following school year, subject to certain provisions of a federal stimulus package.

The decision from Arbitrator Martin Scheinman came after a four-hour hearing involving the UFT and city officials.

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