The New York Philharmonic and the union representing its 106 musicians agreed Sunday to a new two-year contract that will preserve its health insurance and pension plans but raise salaries just two percent.
The agreement came after several months of difficult negotiations and just three days before the orchestra is to embark on a three-week European tour. In an echo of the recent contract negotiations at New York City Opera, a federal mediator was brought in for the final stages of the talks.
Players' minimum pay will remain unchanged this season and rise two percent in the second year. Under the last contract, which was signed in 2007, salaries rose over four percent annually. The base pay for a Philharmonic musician in 2010-11 was $134,940.
A spokesperson for Local 802 of the American Federation of Musicians called the deal on health care and pensions a "huge victory."
The agreement calls for keeping musicians' pensions under a defined benefit plan, whereas management sought to move it to a defined contribution plan. A defined benefit plan means that employees know exactly what they'll receive in retirement and it's up to the employer to provide the needed money available for retirees. A defined contribution plan is similar to a 401K, as it shifts responsibility for retirement planning and investing to workers.
In addition, the musicians may be required to pay more towards their health plans. If costs exceed the orchestra's fixed contribution in any year, they will have to contribute to premium cost of up to $40 a week.
“We are extremely pleased that an agreement has been reached that serves the needs of both musicians and management,” said Zarin Mehta, president and executive director of the Philharmonic, who led the management's negotiating team, in a statement.
The musicians said the new contract will ensure that the orchestra remains attractive to potential hires. "This will allow the Philharmonic to maintain its high quality, which is important not only to our audience but to New York City's reputation as the cultural capital of the world,” said Fiona Simon, a violinist and chairman of the orchestra’s negotiating committee.
The musicians' last contract expired on Sept. 20, but they continued to perform this season. In October, amid reports that the atmosphere in the organization had grown tense, the musicians voted to authorize their representatives to call a strike.
Earlier this month, the Philharmonic hired a new executive director, Matthew VanBesien, who starts in September. Given the brevity of the musicians' new agreement -- which takes effect retroactively starting Sept. 2011 -- he will likely be tasked with negotiating the next contract in 2013.