PECO Workers Ratify Five-Year Contract With Pension Restoration and 4% Annual Raises

Roughly 1,500 utility workers at PECO Energy ratified a new five-year union contract on Saturday with 97% approval, securing annual raises of up to 4.5% and pension coverage for all employees after a three-day strike earlier this month, according to the Philadelphia Inquirer. The International Brotherhood of Electrical Workers Local 614 vote ended months of contract negotiations that resulted in the first work stoppage in the Philadelphia-area utility's history.

Strike Action Forces Management Back to Table

Workers walked off the job on July 4 after their previous five-year contract expired on March 31 without a replacement agreement. The union and PECO reached a tentative deal just before midnight on July 6, bringing the work stoppage to a close after three days. Union members voted Saturday between 7 a.m. and 5 p.m. to accept the terms negotiated during the strike that began July 4.

"Local 614 members stood together and won a great contract, and we're proud to be back at work serving the public," Larry Anastasi, president of IBEW Local 614, said in a statement when the results were announced. "They said it couldn't be done, but we brought back pensions, medical coverage, and raises for all our members."

PECO said in a statement Saturday night that the agreement "reinforces our shared commitment to maintaining a safe workplace and delivering exceptional service to the communities we serve."

Wage Increases Vary by Classification

The contract, effective immediately and running through March 31, 2031, establishes 4% annual raises for field workers in the first four years and 4.5% in the fifth year. Call center workers will receive 3% annual raises throughout the contract period. PECO had disclosed during bargaining that its customer service employees averaged $45.12 per hour, while linemen earned an average of $243,500 annually in 2025 when overtime was included.

The utility did not disclose the contract's total cost. A company statement noted that "the tentative agreement will not result in any immediate changes to customer rates."

Pension Coverage Restored for Recent Hires

The contract extends cash-balance pension plans to roughly 600 workers hired after 2021 who previously had no pension access, according to union spokesperson Melissa McCleery. All other employees had been enrolled in one of two existing pension structures.

PECO transitioned most workers from traditional monthly-benefit pensions to cash-balance plans in 2001, when roughly 80% of the workforce opted to switch, McCleery said. The union reported that cash-balance plan benefits had been reduced twice since that transition. Between 20 and 30 workers still enrolled in the original pension plan will retain that coverage under the new contract.

A cash-balance plan is employer-funded and typically does not require employee contributions, but unlike a traditional pension that pays monthly for life, it provides a stated account balance available upon retirement. "Like many employers, PECO transitioned from traditional pension plans to cash balance pension plans and, more recently, to enhanced 401(k)-based retirement programs," the company said in a Friday statement, describing the changes as "consistent with broader employer and utility industry practices."

What Happens Next

Local 614's ratification vote delivers a template for utility sector organizing at a moment when energy-sector unions face contract fights over retirement security. The pension restoration for newer hires reverses a two-tier system that had excluded one-third of the bargaining unit from retirement benefits, a structure that organizers cite as a barrier to long-term union solidarity during campaigns.

The contract runs through March 2031, meaning the next negotiation cycle will begin in late 2030. PECO has indicated that current customer rates will not change as a result of the agreement, though utility regulators will review any future rate proposals that cite labor costs. Workers return to full service under the ratified terms, ending the disruption that marked the company's first labor stoppage.