SALEM — Mayor Kim Driscoll appears to have made another dent in sick leave buybacks, a high-cost and often unpredictable budget item, in a three-year contract agreement announced last week with the Salem Firefighters Union.
After focusing on health insurance in the last round of municipal contracts, Driscoll has taken aim at sick pay in the latest talks.
Salem has paid out more than $700,000 this fiscal year to retiring city workers for sick days they never used, a benefit put in contracts years ago, when city salaries were lower, which has come back to haunt municipal budgets.
The contract with the city’s 85 firefighters, which provides a cumulative 6 percent raise over three years, places limits on the amount of sick leave benefits that new firefighters can collect. In addition, language was added allowing current firefighters to tap into those funds before retirement, but at a lower rate.
“This will provide substantial savings and enable us to reduce those very expensive costs,” Driscoll said.
“We think it’s a fair deal for our members and the city with the economic climate out there,” said Richard Thomas, president of the Salem Firefighters Union.
This is the first pact signed with any of the city’s eight municipal unions, most of which have been working without a new contract for more than a year. It likely reflected a tone, if not specific goals, that the mayor will try to reach with other unions.
Thomas called the sick leave buyback agreement a “good compromise.”
Under the pact, new firefighters will not get sick leave buyback at retirement. However, new hires who use less than half of their annual sick time can get paid for up to two days each year, but at a “capped rate,” allowing the city to make smaller annual payments and to avoid a big payout upon retirement.
“This will save us significant dollars,” Driscoll said.
From the firefighters’ standpoint, it allows a worker to put money into a deferred compensation plan every year and still have a “nest egg” upon retirement.
In another change, current firefighters can voluntarily withdraw money from their sick leave buyback total before retirement, but at a lower rate.
Currently, retired city workers can be paid for as many as 90 unused sick days upon retirement. Buybacks are paid at the highest rate an employee is earning when he or she retires. For example, a retiring police captain would be paid at a captain’s pay rate for sick days accrued over an entire career.
In past contract talks, the unions agreed to reduce the number of unused sick days paid to newly hired employees.
The city is also in negotiations with other unions, so a series of contract deals are expected to be announced over the coming weeks and months.
Most eyes are focused on talks between the city and the Salem Teachers Union, the largest municipal union with 500 members.
The two sides went to mediation months ago after reaching an impasse on several issues, including sick leave buyback and compensation for working an extended school day. The city is pushing to add an hour to school schedules, in response to pressure from the state to improve standardized test scores.
Mediation with the teachers will resume after Thanksgiving.
Tom Dalton can be reached at email@example.com.