New York Mayor Eric Adams said the city has reached a five-year contract agreement with its largest union, in a deal that grants 3% annual raises for the first four years and creates a remote-work pilot program for some municipal employees.
The agreement with the 90,000-member DC 37 announced on Friday includes multiple measures aimed at retaining employees, including a provision requiring that as of July workers will earn at least $18 per hour, more than the current minimum wage. It marks the first major labor deal of Adams's administration and signals a pivot in his attitude toward allowing municipal employees to work remotely.
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After taking office in January 2022, Adams and senior officials in his administration insisted city employees return to in-person work, arguing that remote work was damaging to the city's economy. New York City "is not a city where you can remotely have employment," Adams said last March. "I need the accountant in the office, so that they can go to the local restaurant, so that we can make sure that everyone is employed."
But New York is facing significant vacancy rates across municipal agencies, with some employees citing the city's rigid return-to-work policy as a factor inhibiting its ability to hire and retain workers.
Adams insisted Friday that the change doesn't represent an "evolution" of his thinking on remote work. "People keep defining it as my evolution. and it's just not," Adams said at a briefing with union officials. "My personal beliefs cannot get in the way of running a city of this level of complexity."
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Adams still believes remote work is having a massive impact on the city's economy. When asked about the challenges the city faces from work-from-home schedules, Adams cited a Feb. 12 Bloomberg News
"We realize that the post-Covid era has brought a new dimension to work," Adams said. "But when you have over 300,000 employees, you cannot do it with a knee-jerk reaction. You must be thoughtful and calculative and make sure you bring equity in how it is carried out."
Retaining workers
DC 37 members collectively make up about a quarter of the city's workforce and staff everything from hospitals and schools to libraries and social services centers. The tentative deal will give them a one-time $3,000 bonus once the contract is ratified, and create a $3 million child-care fund. It also will set aside a $70 million fund to help fill jobs where hiring has been difficult.
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The labor agreement, which still must be ratified by DC 37's members, is slightly larger than the pattern set out in the union's previous agreement with the city. That arrangement ran from 2017 to 2021 and provided 2% wage increases in the first year, a 2.25% increase the following year and 3% increases the remaining three years, and which cost an estimated $1 billion over five years.
The new agreement will cost the Adams administration an estimated $4.4 billion through fiscal year 2027, even though mayor's budget set aside only $1.5 billion in its labor reserves to cover the cost.
The Adams administration still must settle contracts for the remaining 75% of its workforce. Historically, those labor deals are likely to follow the 3% salary increase pattern set by the DC 37 contract, despite the fact the city has only set aside funding in its labor reserves for contract negotiations that yield 1.25% annual increases. That could mean the city will face billions in additional labor-related costs over the next five years.
