Update on New Teacher Contracts

Three Michigan districts recently signed new contracts with their teachers union. All three include across-the-board pay raises for teachers for this year and the next. Each district also modified the type of health insurance package it offers teachers, all which are still much more generous than than can be found on average in the private sector.


Teachers in Rochester have a new three-year contract that includes a 0.5 percent pay hike in 2010-11, 1 percent the next year and a 1 percent "bonus" payment this year. These are in addition to “step” increases for individual employees, averaging between 4.3 and 7 percent in all three years, granted for spending another year on the job and obtaining additional pedagogical degree credits. The contract does not grant a union demand for retroactive across-the-board salary increases for last year.

In addition, in return for the local school union president being carried as a full-time employee with full salary and benefits — but no requirement to teach — the union will also now pay 50 percent of one starting teacher’s salary. Previously, the district had paid the entire cost of the union president conducting union business on a full-time basis, plus the salary of a replacement teacher.

The most significant contract change is in teacher health insurance offerings. There will be three different plans for teachers to choose from. For family plans, options range from one with no deductibles but a $169 monthly premium co-pay (the private-sector average is $235) to one with a $500 annual deductible but a $750 employer-paid health reimbursement account contribution and an additional annual bonus of $694 to teachers paid by the district. Full details are here.

The new contract also gradually phases out an “Early Retirement Incentive” perk that pays teachers $72,000 over a 10-year period for retiring when they turn 55. The deal was reached after 30 bargaining sessions. Read more about the new deal here.

Roscommon Area Schools

Teachers will get 2.75 percent raises this year and 2.25 percent raises next year, based on the new two-year deal with the district. These raises are in addition to regular step increases. The district also changed to a high-deductible insurance plan from Priority Health that uses a Health Savings Account. The plan includes no co-pays for prescription drugs and full coverage for 40 osteopathic and chiropractic therapy sessions. The district fully funds the cost of the deductible for employees.

The entire contract is available here

Byron Area Schools

A new two-year contract gives teachers a 1 percent across-the-board pay raise this year and a 0.5 percent pay boost next year, in addition to regular step increases. The district will still purchase health insurance through MESSA, a subsidiary of the state’s largest teachers union, but will for the first time use a plan that includes deductibles. The annual deductible for a family plan will be $200 this year and $400 next year. Teachers will not contribute anything to the cost of the premium.

Additional information is available here.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.