Two-year award will provide annual three percent wage increases, civilianization, plus a $3,000 cash bonus 

PHILADELPHIA —  Mayor Cherelle L. Parker today, alongside Philadelphia Police Chief Kevin J. Bethel, Police Department leaders and other City officials, officially announced the outcome of a 2025 Interest Arbitration Award between the Fraternal Order of Police (FOP) Lodge 5 and the City of Philadelphia. The announcement follows a comprehensive hearing process conducted by a panel of arbitrators.

The arbitration panel has issued an award based on considerations outlined in the Pennsylvania Intergovernmental Cooperation Authority (PICA) Act. The PICA Act emphasizes the importance of maintaining balanced budgets and ensuring that city expenditures align with revenues.

“The conclusion of this interest arbitration marks a significant step in our commitment to ensuring fair compensation for our police officers, while also maintaining the City’s fiscal footing in order to meet its responsibilities to Philadelphia residents,” said Mayor Cherelle L. Parker. “To every member of Lodge 5 and every Philadelphia police officer, your City values you and the work you do every day, protecting our residents and their families from harm’s way.”

Key provisions of the interest arbitration award include:

  • Wage Increases: Three percent wage increases in Fiscal 2026 and Fiscal 2027.
  • Signing Bonus: A one-time $3,000 cash bonus for Lodge 5 members, payable within 30 days.
  • Civilianization Process: Economic adjustments for Lodge 5 members based on a civilianization process designed to transition positions performing non-law enforcement duties to non-law enforcement staff, including increases in a longevity pay scale for members, with a goal of encouraging police officer retention.
  • Wellness Day: One Wellness Day per year added for all members.
  • Sick Leave Policy: The Police Department will conduct a pilot program allowing Lodge 5 members to use up to five (5) days of their accrued sick leave to care for these family members: spouse or domestic partner, child (including stepchildren residing with the member), biological or adoptive parent.

Mayor Parker said during the press conference that the cost of the interest arbitration award over the City’s current Five-Year Plan would be $343 million.

Key findings from the interest arbitration award include:

  • The City is legally obligated to maintain a balanced budget and to submit updated five-year financial plans for approval to PICA.
  • The panel’s decisions and findings reflect a commitment to ensuring that financial considerations are balanced with the needs of police officers and city services.
  • Throughout the hearings, both the FOP and the City presented ample evidence and arguments regarding the financial capabilities of the City to meet the outcomes of the arbitration while adhering to the five-year financial plan mandated by the PICA Act.

“I’m incredibly proud of the men and women of the Philadelphia Police Department, whose dedication and professionalism make this City safer every single day,” said Philadelphia Police Commissioner Kevin J. Bethel. “It’s clear that Mayor Parker, who has been a steadfast supporter of our department, values their hard work and commitment. This contract reflects that appreciation, not only through competitive pay and benefits, but also by prioritizing officer wellness and supporting their families. It also underscores our shared commitment to recruiting and retaining the best officers possible, while enhancing our ability to civilianize certain functions. That flexibility will allow us to place more sworn officers where they are needed most – out in the field, engaging directly with our communities and fighting crime.”

The City of Philadelphia remains committed to transparent governance and responsible fiscal management as we work towards improving and maintaining services for all citizens. The findings from this arbitration will guide our continued discussions on compensation and benefits for our public safety officers moving forward.

For more information regarding the arbitration outcomes and the City’s financial plans, click here.

 

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