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Newcastle council approves one‑time 2.6% pay increase for most city employees
Summary
Council discussed cost‑of‑living and retention before approving a one‑time across‑the‑board pay increase of 2.6% for general government employees (excludes police, fire and the city manager); staff will implement the increase and process back pay for the current pay period.
Council members and staff debated a short‑term pay adjustment intended to help retain employees and address recent inflation. Finance staff outlined options of 1.5–2.5% and presented the additional cost including retirement and payroll taxes; the Bureau of Labor Statistics CPI figure for 2025 (about 2.69%) was referenced in the discussion.
A council member moved to provide a 2.6% increase for general government employees (excluding police, fire and the city manager). The motion was seconded; council agreed to implement the adjustment for the current pay period and staff said they would process any necessary back pay. City staff described the change as an 11–12‑pay‑period implementation to accommodate payroll systems and noted new hires after July 1 would not receive the step increase until the next budget year.
Council discussion emphasized employee retention, competitiveness with neighboring cities and the relatively modest budgetary impact given stronger tax receipts in recent months. The council approved the motion during the meeting and directed staff to implement the pay change and prepare documentation of the fiscal impact.
Staff committed to tracking revenue impacts and recommended presenting a Q1 comparison of water and other revenue streams in three months in other agenda items.
