The Government has committed to $19.4 million in back pay, ex gratia payments and pay increases for employees represented by the island’s three largest unions.

David Burt provided an update in the House of Assembly on payments to the Bermuda Industrial Union, the Bermuda Public Services Union and the Bermuda Union of Teachers.

The outlays are: $4.4 million for BIU member employees; $13.1 million for those in the BPSU; and $1.9 million for those in the BUT.

The Premier said that most agreements had expired in 2020 and included survival provisions. He said negotiations had commenced in 2022 with all partners except the Bermuda Police Association. Negotiations concluded in May with the BIU and BPSU, and in June with the BUT.

Mr Burt, who is also the finance minister, reminded the house that public employees had gone two years without pay increases but that the unions had acknowledged payroll tax reductions implemented by the Government.

He added: “The Government also accepted that successive years with no cost-of-living increase has meant government employee salaries have not kept pace with inflation.

“The Government committed to good faith bargaining and, following a fulsome review and many exchanges, the parties reached a wages and salaries agreement.

“This Government is pleased that we were able to remain at the table and reach a compromise position that was ultimately accepted by all parties void of any form of industrial action.”

The payments represent a 2.25 per cent increase in 2022-23 plus a $700 ex gratia payment and a 2.25 per cent increase in 2023-24.

Mr Burt said they would be funded by “efficiency savings that exceed budget targets”.

He said the Government had adapted its approach to negotiations, moving away from a dedicated public sector negotiating team of only private-sector representatives to a hybrid approach.

He explained: “The Government appointed private-sector chairs to represent its interests and teamed them with senior technical officers who were not members of the unions they were required to negotiate with under the direction of the chairs.

“The hybrid approach addressed the issue of conflict of interest by vesting the leadership in the government-appointed private-sector representatives and supported the position that public officers should not be charged with negotiating their own agreements,” he explained.

“This revised approach also addressed the unions’ concerns that the private-sector partners were not suitably conversant with the nuances of the service and were therefore not sufficiently empowered to make operational decisions affecting the agreements.

“It was the unions’ view that the old PSNT model frustrated the process and lengthened the time at the table.”

Mr Burt said that collective bargaining remained “a work in progress” with the BPSU for principals and the Fire Services Association.

He said: “I can report that negotiations between the Government of Bermuda and the Prison Officers Association has been referred to the Department of Labour for conciliation.”