COLA and Paysteps... Two Raises Per Year!

NEMSA contracts reward seniority through a two raise system.  Seniority based pay steps allow members to make more money based on their years of service.  This is on top of overall raises in a contract... it also puts the power of compound math at work to benefit anyone covered under a NEMSA contract.

For Example:  A NEMSA Contract will have a cost of living increase (COLA) that effects everybody within a bargaining unit.  For this example, let's say the COLA is 6%.  This COLA raise happens once or more per year depending on contract terms.

However in NEMSA contracts, another raise is given on a person's anniversary date (based on date of hire).  These are "step" increases and are seniority based.  An employee steps through the pay scales gaining pay with each step.  For this example let's say that the pay scale in question has 4% increases between each step.

This gives a person 2 raises per year, for a total of 10% in one year.  But that is not all.  The power of compound math is at work here and it increases the raises as well.  We will use $10,000 for this example...

$10,000 with a 6% increase = $10,600.  $106 with a 4% increase is $11,024.  You have only gotten a 10% raise in one year but using compound math in this example, you have earned an extra $1024.  Two raises per year, your Cost Of Living Increase (COLA) and your seniority based step increase.

So now it's time for a real world example...

The NEMSA Northern California Agreement calls for a 4% COLA to be given in year one of the contract.  A person makes $50,000 per year before ratification of the contract.  In year two they receive 4.5% COLA and year 3 they receive 4% COLA.  They are on a scale with a step increase of 5%.  

Before Contract Ratification:  $50,000 per year

COLA On Contract Ratification:  $52,000 per year - $50K with 4% added

On Seniority Step Increase:  $54,600 per year - $52k with 5% added

Contract Year 2 COLA:  $57,057 - $54,600 with 4.5% added

Seniority Step Increase:  $59,909.85 - $57,057 with 5% added

Contract year 3 COLA:  $62,306.24 -  $59,909.85 with 4% added

Seniority Step Increase:  $65,421.55 - $62,306.24 with 5% added

Total Increase over 3 years:  $15,421.55 with an average 9% per year increase.  

Total Increase over 3 years without pay steps:  $6,513.60 - 50K with a 4%, 4.5%, and 4% increase.  Wow... paysteps make the difference...

So you can see the power of compound math and how paysteps work.  You earn more as a seniority bonus for every hour you work every day.  You earn more over the life of the contract.