Norwich reaches pension amendment agreement with 10 labor unions
Norwich — The City Council on Monday approved several amendments to pension agreements with 10 labor unions representing employees of city government, Norwich Public Utilities and public schools that collectively are expected to save the city several hundred thousand dollars per year.
The changes, effective Jan. 1, 2018, and running through Jan. 1, 2028, include increased pension contributions by employees, a reduction in the multiplier used to calculate pensions for new employees and the enactment of three options for spousal survivorship payments.
City Manager John Salomone said the agreement already has been ratified by the 10 participating unions: AFSCME Local 2422 City Hall Union, MEUI Local 506 City Hall Supervisors, AFSCME Local 818 Public Works Supervisors, United Steel Workers Local 9411 Public Utilities, AFSCME Local 818 Public Utilities Supervisors, IBEW Local 457 Public Utilities, MEUI Norwich Public Schools Para-educators, MEUI Norwich Public Schools Custodians/Maintainers, AFSCME Norwich Public Schools Administrative Assistants and 1199 SEUI Norwich Public Schools Nurses.
According to a color-coded chart, the new agreement is expected to save approximately $650,000 in the early years of the agreement to about $1.5 million by 2038 based on contributions over time by existing employees and those hired as of Jan. 1 of this year projected forward. Salomone said it's impossible to calculate exact city contributions and savings, because employees come and go and retire at different ages and with varying numbers of years of service.
Pension contributions will rise from 8 percent to 8.5 percent for all members. For new employees hired from Jan. 1 on, the multiplier used to calculate pension payments — applied to the number of years served — will drop from 2.2 percent to 1.95 percent.
Instead of the previous 90 percent spousal survivorship, employees will have the option to choose from among three spousal benefits at 50 percent, 90 percent and 100 percent values, with varying contribution rates.
“It’s always difficult to negotiate with 10 unions, but they were very professional, and we reached an agreement amicably, I thought,” Salomone said Tuesday.
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