Mayor Bill de Blasio’s administration, seeking to be generous to its allies in labor without jeopardizing New York’s finances, is pushing for what would be the longest-ever contract with the teachers’ union: a nine-year deal that would let the city stretch out potentially huge retroactive pay increases.
In intense negotiations over the past week, people briefed on the talks say, the city has asserted that it cannot afford the $3.4 billion in retroactive raises that the union is demanding for two of the four and a half years it has been working without a contract — let alone for the other years.
The administration’s dealings with the union have become all the more tricky, and pivotal, because whatever deal the teachers receive could set a pattern for the city’s other municipal unions, which want billions in retroactive raises of their own.
A meager settlement could enrage the other unions, all 151 of which are seeking new contracts with City Hall after working under expired ones for several years. Taken together, some city officials say, the demands for back pay alone could cost more than $8 billion, with any prospective raises adding further to the tab.
Municipal union leaders voiced bitterness toward former Mayor Michael R. Bloomberg for not reaching contracts with them, and were clearly expecting better from Mr. de Blasio.
A nine-year deal for teachers would actually date to Nov. 1, 2009, when the union’s contract expired. But it would extend for another four and a half years — after Mr. de Blasio, a Democrat, would face re-election in 2017.
Indeed, the city’s negotiations with the teachers could ultimately expand to include officials from other unions in hopes of forging a kind of ambitious grand bargain with municipal labor.
“These discussions are just one part of the process,” said a senior de Blasio administration official, who requested anonymity to avoid antagonizing participants in the talks. “They’re an important part of a much larger conversation that still has a long way to go. We’re looking at a comprehensive approach to labor negotiations.”
The teachers’ union first sought a six-year contract. Mr. de Blasio proposed an eight-year deal. But when officials realized it would have expired a week before Election Day in 2017, the city proposed nine years.
For the city, a lengthy contract would assure predictability in budgeting and years of labor peace.
For now, the other unions have been waiting for the teachers’ union, which represents more than 100,000 educators and other workers, to reach a settlement over its demand for 4 percent annual raises from Nov. 1, 2009, through Oct. 31, 2011. Fully acceding to that demand alone would cost $3.4 billion, officials say.
The teachers’ union is insisting that it is owed that much because other municipal unions received 4 percent pay increases in 2009 and 2010, before their contracts expired.
City negotiators, people briefed on the talks say, argue that they simply do not have the money for all of the raises the unions are seeking. To make more money available, the city is pressing the teachers and other unions to agree to major savings in health-insurance costs, like filling prescriptions through the mail.
But union negotiators are resisting any agreement on health savings until disputes over back pay are resolved for the teachers and several smaller unions, including principals and nurses at city hospitals.
“It’s an Alphonse-and-Gaston situation,” one city official said.
Harry Nespoli, the chairman of the Municipal Labor Committee, said, “We can’t reach an agreement on any health deal without those outstanding contracts resolved.”
Every 1 percent raise for the city’s unionized work force costs about $350 million, budget documents show.
The current talks had their origins when the Bloomberg administration and the teachers reached a stalemate several years ago. The state appointed a fact-finding panel of three labor experts to issue a nonbinding recommendation on a deal for the teachers on retroactive raises and other matters. In the past, such recommendations had generally been accepted.
People briefed on the talks said that Martin F. Scheinman, a mediator and arbitrator named the panel’s chairman, had recently asked the parties to try one more time to hammer out the details of a deal with him as the mediator.
The city and teachers met last Friday, Saturday and Sunday and again on Wednesday at the Midtown Manhattan offices of Proskauer Rose. The two sides, led by Michael Mulgrew, president of the United Federation of Teachers, and Robert Linn, the city’s labor commissioner, met again on Friday and were to meet over the weekend, although the people briefed on the talks said no one anticipated a deal soon.
The negotiators discussed raises, length of the school day, performance evaluations for teachers and revamping the Absent Teacher Reserve, a pool of about 1,000 teachers who are still being paid even though their jobs have been eliminated because of school closings or other reasons.
While Mr. Mulgrew wants the fact-finding panel to award the full 4 percent retroactive raises for 2009 and 2010, that could also hurt him by leaving the city with little money to award teacher raises for 2011, 2012 and subsequent years.
And if no raises, or meager ones, are awarded to the teachers for 2011 and more recent years, that pattern will upset other municipal unions.
Some officials say the city may look for a model to a three-year wage freeze that Gov. Andrew M. Cuomo, a Democrat, reached with the two largest unions of New York State employees. Those five-year contracts include 2 percent raises in Years 4 and 5. But city union leaders say state contracts have not served as patterns for the city before and that such a lengthy wage freeze would leave city workers even further behind inflation.
If the fact-finders recommend less than 4 percent in back pay for 2009 and 2010, that could make life easier, in a way, for the teachers’ union by freeing up more money for subsequent raises.
But Mr. Mulgrew said in an interview that his union wanted the two full 4 percent raises.
The Bloomberg administration told the fact-finding panel that if the panel were to agree to full retroactive raises, accounting rules would require that the $3.4 billion cost be fully included in the current city budget, creating a huge deficit.
To avoid that, people briefed on the talks said, one idea being floated is to convert the retroactive raises into payments made over a few years. The city would avoid the big hole in its budget and city employees might at least feel as if they were receiving more substantial raises.
Mr. Mulgrew disputed the city’s claims that it could ill afford the teachers’ demands.
“There is more money than the city is saying,” he said.
“We want a contract that’s fair,” he added, “We’re not trying to bankrupt the city.”
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