STATEMENT

North Penn Board of School Directors

Teachers’ Contract Settlement

The North Penn Board of School Directors is pleased to announce that a settlement agreement has been reached between the Board and the North Penn Education Association regarding the teachers’ collective bargaining agreement.  Both the Board and the union voted to approve the settlement report that was recently recommended by the state mediator.

According to the terms of the agreement, the teachers will receive salary increases of 0%, 2%, 2%, 2.25%, and 2.50% over a five-year period, ending with the 2013-2014 school year.  These increases are in addition to the “step” increases that teachers receive based on their years of experience and level of education.

The new agreement is a dramatic change from the recommendations of the union-supported Act 88 Arbitration Report, which the Board voted unanimously to reject.  The settlement agreement represents a savings in teacher salary payments in the amount of approximately $9.208 million as compared to the arbitration report.  Additionally, this savings results in an additional PSERS contribution savings of $2.08 million.  The total five (5) year savings to the District from the Act 88 Arbitration Report is, then, $11.288 million.

In contrast to the arbitration report, the settlement agreement is very similar to the contract offer that the Board made to the union on April 18^th.  In fact, the Board’s offer of April 18^th included teacher salary increases of 0%, 2%, 2%, 2%, and 2% over a five year period.  The settlement agreement includes teacher salary increases of 0%, 2%, 2%, 2.25%, and 2.50% over a five year period.  The difference in cost to the District between these two offers would be $811,000 were it not for the savings incurred by the District in the amount of $744,000 due to the teachers working 190 days instead of the contractually-required 192 days in the 2009-10 school year.   Therefore, the actual difference in cost to the District between the Board’s offer of April 18^th and the settlement agreement is an increase of $67,000, essentially $67 per teacher.  The effective percentage increases for the five year period are, then, 0%, 2%, 2%, 2%, and 2.08%.

The Board is grateful to the members of the North Penn Community who overwhelmingly demonstrated their support of the Board’s efforts to exercise fiscal responsibility during these difficult and turbulent economic times.  It was this outpouring of public support and awareness that likely led the union to abandon the costly arbitration report and accept an offer of more than nine million dollars less in salary.

Although the efforts toward negotiating and obtaining this new agreement did come at a price, the overall associated costs, such as attorney fees and public relations, including communications to District residents, are estimated at less than two percent of the amount saved through the rejection of the union-supported arbitration report.  These efforts will allow the Board to better prepare the District for upcoming economic uncertainty associated with Act 1, the teachers’ pension fund, and soaring State deficits. 

The approval and adoption of the settlement agreement represents a victory for the District’s taxpayers, teachers, residents, and most importantly, students.