Detroit reaches labor deal with city unions

A file photo of downtown Detroit
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Detroit and a coalition of 14 city employee unions have reached a tentative deal on five-year collective bargaining agreements, federal court-appointed mediators said on Monday.

The agreement in principle covers the major aspects of labor contracts with the city's largest union, the American Federation of State, County and Municipal Employees (AFSCME), and 13 other bargaining units, said the mediators, who were appointed by the U.S. Bankruptcy Court judge overseeing Detroit's historic municipal bankruptcy.

Once the pacts are finalized and ratified by union members, the terms will be included in the city's plan of adjustment, which must be approved by the bankruptcy court, the mediators said in a written statement. Terms of the deal, which covers 3,500 workers, were not released and will be made public once the contracts are ratified.

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Edward McNeil, chief spokesman for the union coalition, said the unions will work with Mayor Mike Duggan on improving operations with existing workers not private contractors.

"We know operationally what needs to be done to save money and improve services," McNeil said in a statement. "This agreement in principle offers an opportunity for the unions to provide regular input and guidance to city management."

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Detroit's latest version of its plan to adjust $18 billion of debt and exit the biggest municipal bankruptcy in U.S. history is the subject of a hearing on Monday before Judge Steven Rhodes.

The city late on Friday filed the revision with the court after reaching an agreement in principle on pensions and healthcare with a court-appointed committee representing retired city workers.

That followed deals with Detroit's two retirement systems, three bond insurers and other key creditors.

By Reuters