Sunday, July 11, 2010

Teacher Salary History

As readers of this blog well know, the labor agreements between Hilliard City Schools and the unions representing most of the employees will expire on December 31, 2010. The compensation terms negotiated into the new agreements will be the major factor in determining the size and timing of the next operating levy. Actually, because our labor agreements typically span several years, they may well determine the size and timing of the next two levies.

It may be worth a moment to review the compensation structure defined in these labor agreements. I'll focus on the agreement with the teacher's union – the Hilliard Education Association (HEA) – as it has the simpler structure of the two agreements (click here for a discussion of the OAPSE agreement).

As the illustration above shows, the compensation structure can be thought of as three-dimensional. For each year, a base salary is set: in 2008 for example, the base teacher salary was $36,160. This represents the salary that would be paid to a teacher with a Bachelor's degree and no experience.

From there, a grid is developed in which the columns represent greater levels of education for the teacher, and the rows represent years of service. The HEA agreement has columns for Bachelor's Degree, Bachelor's Degree and 150 total credit hours, Masters Degree, and Masters Degree plus 15 additional credit hours. As one works across the columns, the 2008-2010 HEA Agreement specifies that the salary goes up 6% for each educational level.

So in 2008, a teacher starting with a BA and no experience would have been paid $36,160 – the base salary. If that teacher had a BA with at least 150 total credits hours, the pay would have been 6% more, or $38,330. If that teacher had a Masters degree, the salary would have been another 6% more, or $40,499. And finally, if that teacher had a Masters degree plus 15 hours of additional credit, the salary would have been $42,669 – another 6% more.

Note that the degree requirements for each column are not uniform across all school districts. Some have more columns, and some grant additional compensation for higher levels of education, such as Masters plus 30 hours, or a PhD/EdD. Nor is the size of the increase granted for each educational level uniform. Ours happen to be 6% for each level, but other districts have smaller or larger increases specified in their contracts.

The rows specify the additional salary paid to a teacher for years of service. These are customarily called the step increase. As is the case with the columns, step increases are uniquely defined in each school district. The HEA contract is pretty simple – an additional 4.15% is granted each year through 15 years of service, then again in the 20th and 23rd years. After the 23rd year, there are no further step increases, meaning that the only way for our more senior teachers to receive a salary increase is to add to their educational level, or to have the base pay increase. Currently, about 65% of the HEA members receive step increases – the other 35% are in a year of service in which no step increase is specified.

As far as compensation is concerned, the practice here in Hilliard has been to change only the base pay from year to year, and to leave the steps and education increases alone. The amount that gets negotiated for the base pay increase is typically all that has been communicated to the public in the past. Here is what those increases have been for the past several years:

2003: 3.75%
2004: 3.75%
2005: 3.50%
2006: 3.65%
2007: 3.65%
2008: 3.00%
2009: 3.00%
2010: 3.00%

It is important to note that the base pay increase and step increase compound to arrive at the final salary for any particular year. For example, a teacher with ten years of experience in 2003 became a teacher with eleven years of experience in 2004. Using the historical numbers above, a teacher with ten years of experience in 2003 would have been paid 8.06% more in 2004. Taken directly from the contracts (available here), the 2003 pay of a ten year teacher with a Masters degree would have been $51,187. In 2004, that same teacher – now with eleven years of service – would have been paid $55,310, an increase of $4,123.

One more example: A teacher with a BA and 7 years of experience in 2002 would have been paid $38,991. In 2010, that same teacher would have 15 years of experience, and would be paid $70,598. This is equal to annual raises of 7.7% in each of the years between 2002 and 2010.

Ohio's current teacher licensing requirements mandate that a teacher must begin graduate studies no later than the fifth year of teaching, and must earn a Masters degree by the tenth year. So let's modify this scenario to take the educational level into account as well. Assume once again that the teacher in 2002 had a BA and 7 years of experience. Then in 2004, the teacher would reach the BA+ level. That would have meant that in the 2004 the teacher would have received the 3.75% base pay increase, the 4.15% step increase, and the 6% increase for advancing in education. This would put the teachers' 2004 pay at $46,333, or 14.5% over 2003.

By the 15th year of service in 2010, this hypothetic teacher would have a Masters degree, and the salary would be $79,072. During the span of years between 2002 and 2010, this teachers' salary would increase at an annual rate of 9.24%.

Because the entire pay grid is derived from the base salary, when the base salary increases, so does the maximum salary. In 2002, the maximum salary was $69,092. For 2010, the maximum salary is $90,362.

The chart below depicts the base pay, maximum pay, and two scenarios. The line labeled "Typical" is for a teacher who would have had a BA and 7 years of service in 2002, and reached MA+ level in the 15th year, 2010. The line labeled "New" is for a teacher who began the first year of teaching in 2002 with a BA, and reaches BA+ in 2010.

click to enlarge

One other compensation change which needs to be mentioned relates to the cost of health insurance. In the 2008-2010 contract, the union employees agreed to pay part of the premium for health insurance. Prior to 2008, the employees made no contribution at all to the cost of health insurance. For 2010, their contribution is 10% of the actual premium, or $122.10 per month (capped at $135.52/mo) for family coverage.

Teachers do not participate in Social Security, and instead have their retirement benefits paid by the State Teachers Retirement System. Contributions to fund STRS are made by both the teacher and the school district with the teacher is working. Currently, the teacher contributes 10% of their salary, and the school district contributes another 14%. The fiscal stability of STRS has been called into question, and the proposals being made to 'fix' the system include an increase to the contribution rate for both employers and employees. The timing and amount are yet to be worked out, but the proposals suggest that the employer – the school districts – and the teachers will each be asked to contribute an additional 2.5% of salaries on a schedule to be phased in over five years.

Overall, the benefits for employees add another 34% of salaries.

In May, Treasurer Brian Wilson updated our Five Year Forecast. In constructing this forecast, he assumed that there would be no base pay increase for the years 2011-2013. However, the total salary expenditure for  the current employees would still increase 2.3% each year due to step increases, assuming the current step formula is used. In 2011 - the coming school year - he assumes there will be a net reduction of $700,000 in salaries - presumably through layoffs. For 2012 and 2013, he is assuming that we will add a net $200,000 in new employee salary dollars each year. In 2013, an additional $1 million in new salaries are assumed to be required to hire sufficient teachers to provide full-day Kindergarten, as mandated by state law.

Adding on the cost of benefits, and Mr. Wilson forecasts that our total cost of compensation, which was $131 million in 2009, will rise to $155 million in 2013 - an increase in annual spending of $24 million.

The levy math is straightforward: Each additional mill of property taxes generates $2.4 million more money for the schools, and costs $30/yr for each $100,000 in home value. If our spending is going to increase by $24 million/year, then by 2013 we'll need 10 mills of additional property tax income - or $300 more for each $100,000 in home value - to fund it.

However, we can't wait until 2013 - the Five Year Forecast shows the District running out of cash in 2012, and so as has been reported in the news, an operating levy request is very likely to be on the ballot in 2011.

On top of this, there are real concerns about the stability of our funding from the State of Ohio. We already know that the State will be reducing our funding by $12 million/yr as they phase out the reimbursement for the elimination of Tangible Personal Property tax. Replacement of that alone would require 5 mills of new property taxes. Our FY10 and FY11 revenue includes close to 1 mill worth of funding each year from the Federal stimulus money. That too will have to be replaced if we want to spend at forecasted levels.

There has been no time in recent history when the fiscal future of our school district was less clear. As a community, we need to figure out how much we're willing to pay in additional property taxes to fund the operations of our schools.

If your answer is zero, then please offer suggestions for what needs to be cut to reduce spending. Opinions without basis in fact or understanding don't help. For example, one thing I hear often is a variation on this theme: "What about all those big school buses that run past my house carrying only a few kids?"  I tell people who say this that if they followed those buses a little further, they would be completely empty!  Designing a transportation system that moves thousands of kids from their neighborhoods to all the various schools in a reasonable period of time while keeping costs minimized is a complex task, and I think our transportation team is pretty good at what they do.

To be sure, there is always a way to reduce spending in a budget as large as this. But when nearly 90% of the spending is for salaries and benefits, any real cost reduction has to come from reducing pay increases and/or employing fewer people. This is why the upcoming union contract negotiations are so critical to the health of our school district.

Adding to the challenge, the State of Ohio may yet surprise us with further funding cuts. We should begin to think now how we will apportion this risk among the stakeholders of our district, including students, employees, suppliers and taxpayers. No one group - e.g. the taxpayers - should bear the full weight of this risk alone.


  1. Paul, thank you for the update.

    A couple of questions first off.
    1. When will the community find out what the new teacher contract demands will be from the HEA.? What they are going to want as far as increases, medical cost, time off, etc.

    2. Given past experience, the commitment should be all negotiations kept away from the students, and the classroom buildings.

    If no commitments and dialogue up front and in the open. No $$$$for a levy in 2011, and moved to 2012 at the earliest. Then make a business decision, eliminate classes with electives and low participation. AP classes exempt.
    Priority cuts where such instruction can be obtained outside the district system.

    Otherwise a 3.5 mill levy in November 2011.

    1.0mill toward upcoming increase in STRS contribution. 2.4 million.

    1.5 mill allocated for increased instructional cost IE Kindegarten all day and increased supply costs
    technology updates 3.6 mil

    1 mill for a salary increases.
    2.4 mil

    Also, a hard look needs to be
    taken at the supplemental contract area. I am aware some are funded by grants et al. However, I think there are savings to be looked at in this area. IE Why does Bradley need 5 persons for weight room
    supervision. The coaches shoould be supervising and if they need 1 or 2 helpers ok, but 5 is ludacrious.
    There allways seems to be a personal connection with these supplemental contracts.

    Also a hard look to save some $$
    at the medical insurance costs.
    $125 a month for family coverage
    needs some serious adjustment.
    If you delve into the increased costs to the everyday community member over the last decade this amount is far out of whack

    Over a 3 year period would cost
    a homeowner, at $100,000 of home assessed value about $115.00 per year additional. or $345.00

    Given the economy, the many people who are on the edge financially, this time around there should be a minimal increase for the next 3 years.

    At first sign of a "you dont get it" then a concerted effort of no more $$$ for at least two years is in order.

  2. Rick:

    Thanks for your comment. Addressing your questions:

    1. The most honest answer is I don't know. There is an interaction between the Ohio's Sunshine Law and its labor laws which I don't yet understand well enough. I'll be attending a seminar put on by the Atty General's office this Friday to learn more. At this point, the only time I know for sure that information may be disclosed is when a tentative contract is presented to the School Board for approval.

    2. I agree, but again Ohio's labor laws grant all kinds of freedoms and powers to unions. The reality is that a union of service employees has no power unless it can withhold its services. Of course, in the case of teachers, that means withholding some or all services from our kids (ie to go on strike). It may be the law, but I don't believe its ethical or moral to use our kids as pawns in an employer/employee negotiation.

    Thanks for the clear description of what you believe should be the size of the next levy.

  3. With my own education, I found that class size was far less the determinent of educational success than teacher quality. So I propose: fewer administrators, fewer teachers, bigger classes, greater reward for top performing teachers.

  4. As a silent reader of this blog, I felt compelled to provide some input at this time. In 2008, the small company with which I was employed ran out of cash. As a result, I was put out on the street with little recourse. I was able to find employment at a 60% pay cut from June 2008 levels. The recession of 2008-2009 came into play. My wife and I were put into a position where we were living on one third of the income we previously had, while the property taxes were being adjusted, to about $450 per month. At this moment in time, employment has been obtained, at a 20% decrease of the June 2008 timeframe. Additionally, our monthly healthcare premium is at $800. Likely our situation is neither all that unusual nor different, than many of our neighbors. That being said, I would be in favor of increasing the teacher contribution to their respective healthcare provider; relieving the taxpayer of that burden. I would encourage the notion of holding the present salary line, without benefit of increase, or step increase, to reflect the economic situation of the community at large. Based upon my personal situation, it would not be out of the question to ask the teachers to accept a salary decrease, based upon the economic conditions which have played out in our situation, and in our community. The taxpayers are being asked to adjust budgets to income levels lower that a few years previous. It seems just that the school district should be asked to adjust their budgets to reflect the economic climate of the community which foots the bills.

  5. Anon:

    Thanks for speaking up, and giving me a clear picture of your views. Very helpful.

    Other readers - please weigh in on this!


  6. I've had the kool-aid.......

    This levy is so much less important than the longer term strategy that keeps everybody (all the sides) at a similar state of happiness/unhappiness.

    On one hand, we're sick and tired of passing levies for the school district. These levies raise our taxes so that the salaries of our rated-excellent teachers and administrators continue on what we think is a rate of increase good enough to keep our HCDS education excellent.

    On the other hand, we've chosen to live in this commercial-poor bedroom community. So as I understand the current system, the homeowner can expect taxes to increase about the same rate as the school district's salaries.

    Passing levies every 2-3 years isn't the answer no matter how many mils they are.

    I'm thinking of the old adage you can cut wide or deep, not both. It would seem to me HCSD is doing both right now. In good times, that's fine. But now, not so much. If the teachers' union and the school board could plan a contingency path for us in these lean years that's our best bet.

    So, for example, maybe some "elective" chunks of the curricula could be cut. If we teach 5 foreign languages now, perhaps that could be reduced. That's just one example where it could be argued that the quality doesn't decrease much....though certainly some would disagree. I'd just prefer the two sides came up with choices upon which all parties could agree besides passing levies. But no matter what, the "right-size" has to be relative to long term income.

    To close, I'm just way too ignorant to suggest a millage for this next levy. I wonder what options there are besides going to the polls.

  7. I would not complain if Anonymous got his wish, but I don't think it is realistic. I will agree that increased contributions to health benefits should be mandatory and my feeling is the same as in other posts on this subject - no increase in base pay. I don't think we can avoid the steps as they are addressed by state law (or guidelines? correct me if I am wrong?)To achieve this, we may have to settle for a 1 year contract, and I am sure that the Board would prefer to not have to go through this every year, but the only way we are going to get agreement on a usual 3 year contract is to give more than we can afford, and it will only hurt the chances for the upcoming levy. That upcoming levy should be the driving force behind this years negotiations.
    I really abhor the fact that we are not privy to the negotiations - I do understand that
    in order to streamline the process, it must be done in the background, but I think that any offer that is presented to the HEA, or to the union by the Board should at the same time be released to the public. I don't recall that happening 3 years ago.
    Seems we only heard about a possible strike vote without hearing any details of the proposal. WE pay the bills - we deserve to be kept in the light, not the dark.

  8. CE:

    Thanks for your comment

    One of the things we hope the Audit & Accountability Cmte will help us with is figuring out how much of our staffing cost is being driven by the No Child Left Behind mandates. It's not that any of us take the position that NCLB is a bad thing, but if satisfying its mandates is what has caused us to add significant staff, we should at least be able to let the community know that.

  9. Thanks, Paul.

    I assume that A&A Committee is part of the SB.

  10. Hillirdite:

    Thanks for the comment.

    Here's an article I wrote a couple of years ago about step increases. The short version is that while the law contains a grid which specifies the minimum salary for a number of combinations of experience and education, and goes on to say that each school district must have a salary schedule in which increments are based on "training and years of service," it does not specify the parameters of those increments,

    So since the highest salary required by law is $32,460, we could construct our grid so that every combination of service and experience is paid the $38,362 base amount in our 2010 grid, and be in compliance with the law. We would not likely get any teachers to apply for jobs here, but it would be lawful.

    There is some logic to having the negotiations take place in private - so the negotiators have some room to work - but I agree that before any contract is signed, there should be an opportunity for the public to read the tentative agreement and make their thoughts known to the School Board. I hope my fellow Board members will see the merit of this as well.

    It never hurts to have folks from the community come forward at the Board meetings and say this too.

  11. Thanks for the comments Paul...

    One thing I think folks need to understand is that step raises are not mandatory, as long as the salary is above the minimum for the education / years experience. To me, the administration has done a very poor job of explaining this to the public - they act like the steps are required and statuatory. Do you ever notice when a contract is announced that they specify the raises, then add a footnote later about the steps? As far as I know, step raises are NOT statuatory in districts like Hilliard where salaries are above the state minimum grid.

    I even asked this question in an email to someone in the administration who should know the answer. They responded that they did not think that they were required by law, and CC'd the superintendent for his opinion. I never heard back from him, though I do recall the administration stating in a board meeting that they were required. It would be helpful if we got a clear answer on this.

  12. Anon, very insightful comments

    Communication is one of the things that has been discussed all along and
    Paul has put many a discussion on the blog here about it, or lack there of.

    Paul, if you catch this post, why not ask our wonderful AG when you go to that seminar. And tell him for me I dont want to hear "We will get back to you" Election year after all Mr Cordman.!

    Also, while I welcome the opportunity and I am sure others do to to be asked for our opionions
    and make them known and how important it is (Thanks Paul!)
    when are we going to hear from the HEA supported board members, superintedent, HEA, OAPSE. on all of this.

    We get criticized here for our comments by district supporters, but we never can get a straight answer from some of these folks
    The step raise is a good one !

    Perhaps soon the other board members will tell us what they are thinking, or is Paul doing all the thinking ! LOL

  13. I totally agree with the posting from "Anonymous" on July 13.

    Our situation is we are retired on a fixed income. No cost-of-living increase in 2010 from Social Security. Our health care premiums, deductible, and out-of-pocket expenses all increased.

    Teachers should not be an exception. Neither should administrators or school employees. I have the greatest respect and admiration for all those employed by our school district. I don't doubt they work hard or are dedicated to their jobs. In our present economy, those who have jobs and especially jobs with access to healthcare should be satisfied with just that. We CANNOT AFFORD pay increases, step increases, and supplementals. By the way, I also feel "supplementals" need to be addressed. I would like to see a list and description of these responsibilites that warrant additional pay.

  14. Sam:

    Thanks for your comments. I understand your situation completely - we are retired as well, living off the earnings of our IRAs, which is pretty meager of late.

    While lots of folks are celebrating the historically low interest rates on debt, they tend to forget that there are those of us for whom interest is an income source, not the cost of debt. When interest rates go to near zero, so does our income.

    This is hurting school districts like ours as well, who have in the past been able to generate a decent amount of interest income on the 'float' of cash generated between the collection of taxes and its expenditure for operations.

    For the immediate future, our Treasurer has assumed near-zero interest income as our current cash investments mature. If we don't adjust our spending according, the taxpayers are going to have to cover this lost income.

    On the other hand, the State Teachers Retirement Fund is counting on being able to earn 8% on its money. Since you can't do that with 'safe' investments, they're taking all kinds of risk, mostly in the stock market.

    But that's okay. If they take a big hit - like they did in 2008, when they lost $35B of their $80B investment fund - they'll just come back to the taxpayers to bail them out. That very thing is in the works right now, and will cost the active teachers and the taxpayers each an extra 2.5% of the teachers' salaries.


  15. Regarding tax payer contributions to STRS: I am totally opposed to the employer contributions to STRS being raised. We need to cut expenses not increase them. Teachers should supplement their STRS pensions with their own investment accounts or pay into Ohio Public Employees Deferred Compensation with their own tax deferred contributions. I have made my feelings known to my legislators. Is it true that some administrators and superintendents do not pay their share of STRS contributions? Does the employer (tax payer) pay the employee and employer portion? That would be equivalent to my employer paying my share of social security taxes. That would never happen. If true, can this be eliminated in future contracts?

  16. Thanks for your comment.

    I haven't read the Superintendent's contract yet, but it wouldn't surprise me if it requires the school district to pick up the employee share of his STRS contribution. It's also not uncommon for a school district to provide its superintendent with an annuity policy that further enhances the retirement benefits.

    I'll suggest that it's less important what these individual components of Mr. McVey's compensation package looks like than it is that we understand the package as a whole. In other words, what is the all-in cost of his contract - salary and benefits combined?

    As is the case with the union contracts, the contracts with the Superintendent and the other administrators are the product of a negotiation process.

    And I'd argue that negotiating these contracts is among the most important activities performed by the School Board. I'll spend some time examining these contracts and let folks know what they say.

  17. I might be wrong, but didn't the state of Ohio get sued about 10 years ago to stop using the property tax system to pay for local schools? And wasn't the state legislature supposed to come up with a formula to pay for education fairly across all communities? What ever happened with that? I'm also be curious to know what each household in Hilliard would have to pay if the state cut off all educational funding to local districts? I ask because I think we, as a community, need to start thinking differently when it comes to funding local institutions like schools.

  18. This matter of property taxes for school funding is one of the most misunderstood things about Ohio's system. Here is an explanation that may help. The punch line is that the problem expressed in the lawsuit, and ruled on by the Supreme Court, was never about the use of property taxes as a component of school funding. It was the inadequacy of state funding.

    Hilliard City Schools currently receives 38% of its funding from the State of Ohio, so our property taxes would have to increase by 63% to fund it all with local money.

    I favor a way of organizing schools that was once articulated by economists Milton and Rose Friedman in their 1980 book "Free to Choose." The notion is variously called a "voucher system" (Ohio's so-called 'voucher system is something quite different) or "the money follows the child" but the general idea is that kids (and their parents) are free to send their kids to any school they want, and the tax supported funding goes where the kid goes. Schools that get the job done attract kids - and funding - and thrive, while schools that fail to serve kids lose both their students and their funding, and go out of business.

    I acknowlege that there are some who disagree that the government has the right to require kids to attend school at all; that even this choice should be left up to the parents. I agree that we have allowed the government to encroach too deeply into personal liberty, but I can't quite bring myself to condemn the kids of uncaring parents to a life without a basic education.

    The Friedmans' system seems like a reasonable solution.

  19. Gov. Christie of New Jersey has been taking on the teacher's union there very vociferously. Hopefully it will give aid and comfort to similar efforts elsewhere across the country. It *feels* like some sort of tipping point has been reached, in that citizens are expecting teachers to tighten their belts too during this tough economic time. The visibility Christie is shedding on the issue is useful, and most people seem to be in sympathy with his position.

  20. It is my understanding that EVERY administrator has their full STRS contribution (employee share and employer share) paid for by the school district. Is this true?

  21. The contracts for the both the Superintendent and the Treasurer contain the following language:

    The Board will pick up the Superintendents (Treasurers) contributions to STRS (SERS) in the amount of the employee percentage of contribution required by law by implementing the Pick-Up on the Pick-Up plan prescribed by STRS/SERS

    That's a foreign language to most of us, so I went to the SERS website to see what it said about this (you may have the click the "Read More" link to see all the examples).

    So this deal the Superintendent and Treasurer have works like this. Let's assume they each have an annual salary of $100,000:

    Salary: $100,000
    SERS/STRS Contribution: $11,000 (10% of $100,000 plus $10 of that)
    Take Home Pay: $100,000
    Taxable Income: $100,000
    Income Reported to SERS/STRS: $110,000

    So yes, both the employer and employee portion of the retirement contribution is being made by the Board (ie the taxpayers), plus an extra 1%. In addition, the whole contribution is recognized as income by the retirement system, which also boosts how much the administrator will receive in pension payments at retirement.

    The standard contract for the other administrators in the system contains no language regarding pick-up of retirement benefits.

  22. Would you please explain the salary freeze agreed upon by administrators and teachers for 2011. Does the freeze
    include both the step increase of 4.14% and the base pay increase of 3.00%? Also, since teachers are public servants paid by the tax payer, I'm wondering if we could compare their salaries and benefits to those of our public defenders. Thus comparing them to another group of well educated professionals serving the public.

  23. Click here to read the article I just posted that addresses the contract extension just signed.

    I don't believe it's useful to compare salaries between professions. Salary levels are something that should be set by supply-and-demand, where as employers we have to keep raising the salary until we no longer have problems filling open positions with qualified candidates.

    Then you have to keep salary levels high enough to retain effective employees performing necessary roles.

    This year, Hilliard Schools hired 50 new teachers, mostly to fill spots vacated by retirees. We had approximately 2,000 applicants.

  24. Paul,

    I'm curious how the most recent contract (fall of 2011, I believe) has changed these base and step increases. I've seen some references to it on your blog, but not a significant amount of info. Also, how long is the contract that was signed?

    An average increase of 7%+ per year since 2002 is appalling for those of us who have had no increase in 4 years (plus 1 year where I took a 7% cut). Going back 10 years when I started my current job, my pay is currently 15% higher now in total. Had I been a teacher, that would have been closer to 100% higher if my shorthand math is right.

  25. The most recent contract with the teachers union (the HEA), signed in June 2011, is a simple 2 page agreement which incorporates all the language of the 2008-2010 agreement, plus some short but very significant adjustments. The new agreement is in effect through December 31, 2013.

    The key points of the new contract are these:

    1. Effective 7/1/11, the teachers will begin paying 15% of the health insurance premium. Beforehand, it was 10% (and was zero% prior to 2008).

    2. The teachers will get no base pay increase for the duration of this agreement. For teachers no longer getting steps (>15 years of service), this means that at minimum, they will go from Jan 2010 to Jan 2014 without a base pay increase - 4 years. Of course, we don't know what will be negotiated at the end of this agreement, which will of course be significantly influenced by the outcome of the SB5 referendum (Issue 2).

    3. For many years, it has been customary for teachers with 15 or fewer years of service to receive step increases each July. However, the extension they signed in Oct 2010 postponed the July 2011 step increase to December 31 of the same year.

    That was superseded by the June 2011 contract, which postponed the July 2011 step increase to February 2013, the July 2012 step increase to July 2013, and eliminated the July 2013 increase altogether. The effect is that in July 2013, teachers will be paid the step which is numerically one less than the actual years of service (ie - a teacher with 10 years of service will be on Step 9).

    This means that no teacher will get a step increase between July 2010 and February 2013, but will get two step increases in 2013.

    4. For teachers who give notice by February 2012 of their intention to retire at the end of this school year, a one-time bonus of $40,000 will be paid (in 5 annual payments of $8,000 each).

    The payback on this is about one year. Teachers at the top of our pay scale earn $90,000/yr, and could, for example, be replaced a teacher with 5 years of experience and significant progress towards a Masters degree for $45,000.

    It should be noted that the master agreement has had for many years a provision (Article 26) for payout of unused sick days, and this continues with the new contract. The contract grants teachers 15 sick days each year, and unused sick days may be carried forward to a maximum of 255 days.

    At retirement, these unused sick days a converted to a retirement benefit equal to 25% of the number of unused sick days multiplied by the teachers' terminal per day salary (annual divided by 184 days). For a teacher with the full 255 days built up, who retires at the $90,000 max salary, this works out to about $30,000.

    This kind of delayed compensation provision was negotiated into the teachers contracts in years when the Board was unwilling to meet the salary demands of the union.

    It might not have seemed so painful a couple of decades ago when we were hiring boatloads of new teachers to staff all the new schools being built - at the rate of one per year for almost a decade. But that bird is coming home to roost now, with many of those teachers - hundreds - now hitting their retirement years.

    It's truly the proverbial perfect storm.