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The Chicago Transit Authority (CTA) and its 17 labor unions recently resolved pension and health care issues, and settled on a five-year contract that will impact 10,200 employees, or 88 percent of the authority’s workforce.

Retroactive to Jan. 1, 2007, and running through Dec. 31, 2011, the contract is contingent on approval from the state legislature to issue pension obligation bonds to support the new health care trust fund and pension plan.

The contract calls for wage increases of 3 percent for 2007, 2008 and 2009, and 3.5 percent wage increases in 2010 and 2011. In addition, the authority will reform its retiree health care plan by creating an independent health-care trust to manage the retiree benefits. The trust will be self-sustaining through investments and contributions from active employees, retirees and their dependents. Currently, active employees do not contribute to the fund and retirees pay only for their dependents.

CTA also will reform its pension program and increase employee contributions from 3 percent to 6 percent. Employees hired after Jan. 1, 2008, will received reduced pension at 55 years of age and 10 years of service, and full pension at 64 years of age and 25 years of service.