One aspect of the contract that caught our attention is a provision allowing the city to furlough officers for up to 30 days a year. Mayor Nutter called this a "key management tool."
A furlough is essentially a temporary layoff. Employees on furlough don't get paid, but keep their jobs when the furlough ends. The arbitration award says the city must give an employee a week's notice before imposing a furlough.
What will these furloughs mean in terms of dollars?
The average cop makes about $59,000 per year, not including overtime. If the city imposes the maximum number of 30 furlough days on all 6,704 union members, we figure the city could save roughly $32.9 million from the department over the course of a year, or $165 million over five years. The wage increases awarded by arbitration will cost the city $114 million over five years.
The city is unlikely to use all the furlough days allowed, but having the ability is clearly a useful resource in efforts to deal with budget gaps (unless the furloughs have the unintended consequence of driving up overtime costs -- which could happen.)
For police, the average individual salary could take a hit of up to $4,917 an officer (or 8.3 percent) if the city imposes the maximum number of furlough days.
Still, furloughs may be preferable to other options.
Furloughs are often used to avoid layoffs, and so might actually save jobs. They're also generally temporary, meaning that when the economy improves, police might see their hours restored. What's more, the city isn't required to use all 30 days. If tax revenues come in better than projected, it could forgo some of them -- officers will only lose as much of the time as the city feels is necessary.
That's a plus for the city, too. But there's a downside: Instead of paying police officers less for the same work, furloughs mean the city is paying for less work -- furloughs reduce man hours. The biggest challenge going forward for the Police Department and the city will be balancing the need to save money with keeping Philadelphians safe from crime.