Seven thousand city tradespeople would continue to receive the prevailing wage paid to their counterparts in private industry, thanks to a five-year contract ratified Thursday by a City Council committee.
The five-year agreement is retroactive to July 1, 2022 and continues until June 30, 2027. It will guarantee labor peace well past next summer, when Chicago plays host to the Democratic National Convention.
“We’re a city that believe in paying its workers well. That helps with retention. It helps attract people to our city. One of the greatest resources in our city is our people and we need to invest in them,” said Ald. Michael Rodrigez (22nd), who chairs the Committee on Workforce Development, which ratified the agreement.
“The private sector and government compete for labor. If the private sector is offering more in salary, we’ve got to be competitive in order to have a great workforce.”
Cicely Porter Adams, chief labor negotiator for the city’s Law Department, did not reveal the cost of the entire five-year deal or how the city intends to pay for it, saying only: “We believe that each of these agreements represents the best deal possible for the city of Chicago, the employees represented and the city as an employer.”
Rodriguez, however, did peg this year’s cost of the contract at $30 million.
The prevailing wage portion of the agreement covers 7,000 members of 30 different trade unions employed by 16 city departments. For the first time, they will be able to accrue a half-day of sick leave every month. They will also be eligible for 12 weeks of paid parental leave.
“Unlike the rest of the city, where employees receive vacation days and sick days, this bargaining unit only receives vacation days. They have to use vacation for sick days. Coming out of pandemic, this was top of mind during negotiations,” Adams said.
The “prevailing wage,” set by the U.S. Department of Labor, is based on the hourly wage, usual benefits and overtime paid in the largest city in each county to the majority of workers, laborers and mechanics. Prevailing wages are established for each trade and occupation employed in the performance of public work.
In Chicago, the prevailing wage dates to former Mayor Richard J. Daley. In exchange for handshake agreements, the elder Daley paid city trades the same hourly rate as their private sector counterparts — though city trades work year-round, while private sector work is seasonal with fewer fringe benefits.
Under separate, five-year agreements, 40 members of the Illinois Nurses Association employed by the city’s Department of Public Health and the Office of Public Safety Administration and 30 members of the Illinois Council of Police who work for the Department of Aviation will receive 3% retroactive pay raises, also effective July 1, 2022.
That will be followed by annual increases ranging from 3% to 5% depending on the consumer price index for that year. If the index is 3% or less, the pay raise will be 3%. If it is 5% or more, they’ll get 5%. If the index, considered a measure of inflation, is between 3% and 5%, the pay raise will match it.
On Jan. 1, 2027, the pay raise will be 2.5%.
All covered employees, including the trade unions, will receive a “lump-sum pandemic bonus” of $3,000, paid in two installments.
“This is to recognize the work of these bargaining units during the pandemic. Most of them, if not all, were on the front lines and didn’t have the ability to work from home,” Adams said.
Starting Jan. 1, 2024, the city will also contribute $1.50 for every dollar contributed by each employee, up to a maximum of $750, to help employees save for their retirement health care. On Jan. 1, 2027, the city will contribute $1.75 for every $1, up to a $875 annual contribution.
In 2007, then-Mayor Richard M. Daley opened the city’s wallet to guarantee labor peace through 2016, when he hoped Chicago would host the Summer Olympics. Daley signed a 10-year contract with the building trades that locked in the prevailing wage standard in private industry,
The late Laurence Msall, then president of the Civic Federation, applauded the city at the time for taking other cost-saving steps: reduced overtime, broader use of “break-in pay” for newly hired employees, and implementing a groundbreaking incentive plan to encourage employees to undergo health risk assessments, lose weight, and lower their blood pressure and cholesterol.
But Msall noted then: “City pensions, health care and vacations are much more generous than the private sector. There are good reasons the city should be negotiating lesser wages, rather than the prevailing wage.”
