1. The current salary schedules in effect through the end of Fiscal Year 2000 shall be modified as described below:

2. Fiscal Year 2001:

A. Effective the first day of the first full pay period beginning on or after October 1, 2000, the salary schedules of employees who are actively employed in Compensation Units 1 and 2 as of the date of the approval of this agreement shall be adjusted by four percent (4%), in accordance with past methods of increasing base salary schedules.

B. In addition, all permanent full-time employees in Compensation Units 1 and 2 covered by this Agreement who are actively working for the District of Columbia and on the active payroll as of the date of ratification of this Agreement shall receive a one-time, non annualizing lump sum payment of five hundred dollars ($500). The payment of the aforesaid lump sum shall not be added to the employees base pay during the year. Any employee who is not actively working a regularly scheduled tour of duty, including but not limited to “when actually employed” (WAE) employees, shall not be eligible to receive the lump sum payment. Actively working part-time employees shall receive one-half of the total lump sum payment.

3. Fiscal Year 2002

A. Effective the first full pay period beginning on or after January 1, 2002, the salary schedules then in effect shall be adjusted by four percent (4%), in accordance with past methods of increasing base salary schedules. Such adjustment shall be made in conjunction with the consolidation of current salary schedules as described in Section 3B, below.

B. Also effective the first day of the first full pay period beginning on or after January 1, 2002, in conjunction with the wage adjustment described in Section 3A above, the District shall implement a consolidation of current salary schedules to significantly reduce the total number of such schedules in effect. This initiative is intended as a first step toward simplifying the administration of compensation and classification systems within the District Government. The aggregate fiscal impact of the resulting individual pay adjustments is anticipated to cost the District an amount approximately equivalent to one percent (1%) of total payroll as of December 31, 2001, for Compensation Units 1 and 2, in addition to the adjustment described in Section 3A above.

C. The joint labor management committee provided for in the MOU between the parties signed on January 30, 2001, shall meet and discuss the structure and design of the consolidated salary schedules described in Section 3B, above, and to provide input into the final schedules to be implemented effective the first day of the first full pay period beginning on or after January 1, 2002.

No employee covered by this Agreement will realize any loss in base pay as a result of this reform. It is projected that most employees will receive an increase in base pay of at least, approximately, one percent (1%). Each full-time employee covered by this Agreement shall be guaranteed a minimum one-half percent (1/2%) wage payment equal to the combination of an undetermined increase to base wages plus a one-time non-annualizing lump sum bonus. The sum of both shall equal at least one-half percent (1/2%) based upon the employee’s rate of pay on December 31, 2001.

4. Fiscal Year 2003:

A. Effective the first day of the first full pay period beginning on or after April 1, 2003, the salary schedules then in effect shall be increased by four percent (4%) in accordance with past methods of increasing base salary schedules.

B. During Fiscal Year 2003, the District will also invest the equivalent of a minimum 1 percent increase in the aggregate salaries for the bargaining unit toward further classification and compensation reform. The joint labor-management committee shall continue to meet and shall work jointly toward the development of further classification and compensation reforms intended to strengthen the District’s market competitiveness as an employer and to improve administrative efficiency. The Committee will authorize a survey of wages paid for comparable work by the Federal Government in the District area and by private area employers with the goal of matching the competition.