Chicago Teachers Union members voted last week to give their leadership the authority to scrap the union's contract with the Chicago Board of Education and call a strike because teachers have not received a promised salary increased this year.
The specter of a possible strike over the salary issue was one of the issues cited by Standard & Poor's Corp. on Oct. 6 when it assigned a negative outlook to the board's BBB rating on $75 million of outstanding general obligation debt.
Union members are angry that the board froze teacher salaries in its $2.3 billion fiscal 1992 budget, instead of funding a 7% pay raise called for in the union's contract, explained Jackie Gallagher, a union spokeswoman.
The board exercised a contingency clause in the teachers union contract that allows it to reopen negotiations on salary increases if there is not enough money to fund them, according to Linda Matsumoto, a board spokeswoman. Facing an estimated $315 million shortfall when it began drafting its fiscal 1992 budget in May, the board eliminated $78 million of that deficit by freezing all employee salaries at fiscal 1991 levels. Other cuts eliminated the remaining shortfall and balanced the budget.
The two sides have been negotiating on the issue since the fiscal 1992 budget took effect Sept. 1, but no progress has been made, Ms. Gallagher said. If the 7% raise is not funded, the union on Nov. 13 will void the remaining two years of the three-year contract and go on strike as early as Nov. 18, she said.
Under the contract, the union is allowed to terminate the agreement if the board does not live up to its terms, Ms. Gallagher maintained.
The lack of a contract with the teachers union would put a hole in the board's budget for this fiscal year. Ms. Matsumoto said $50 million of teachers union pension funds that are scheduled to be transferred into the board's operating fund are contingent on the existing contract being in place.
