The Iowa Governor's Office says Iowa is saving $94 million in a new agreement with AFSCME, Iowa's largest union, which represents state employees.
Both sides were able to agree on two of three major components in a new two-year contract.
It's the first time in bargaining history there will be no across-the-board pay increases, but to the disappointment of Governor Branstad - there will be no change to the amount union workers pay toward health insurance.
Both sides agreed on the first two elements of a new state contract:
1.0 percent across-the-board (ATB) raise for FY 14 and 0 percent ATB for FY 15
2. Annual STEP increases for FY 14 and FY 15 included
But the two sides could not agree on the subject of health insurance.
The State's final offer on health insurance was a 20 percent employee contribution for all health plans. Employees would have the opportunity to earn a credit of $90 per month towards their share of the health insurance premium by participating in a wellness program.
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