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DULUTH – About 500 city employees must take 18 unpaid days off over the next year and a half as officials continue to reckon with a budget shortfall of up to $38 million due to the COVID-19 pandemic.

City staff belonging to the American Federation of State, County and Municipal Employees (AFSCME) Local 66 voted to approve a memorandum of understanding “to help preserve city jobs and protect the critical services Duluth-area residents deserve and demand,” a news release from the union said Wednesday.

The agreement also puts a freeze on wage and salary steps through the end of 2021. It requires the City Council’s approval to take effect.

“Our members recognize that this is in the best interest of working people and — most importantly — helps preserve the delivery of services our residents need,” Wendy Wohlwend, the unit’s bargaining chair, said in a statement.

In April and May, Duluth laid off 49 full-time staff members and 45 temporary employees. Officials said last month that they hope to rehire those workers in the coming months, when city services shut down at the pandemic’s onset resume.

A city spokesperson said officials have not yet reached agreements with Duluth’s other five bargaining units.

Before the coronavirus outbreak, the city employed more than 900 people. AFSCME is its largest labor organization, representing more than half of Duluth’s staff.

“AFSCME workers are absolutely critical to the health, safety and operations of the city,” Mayor Emily Larson said in a statement. “I understand the trust this membership has placed in the city to accept this significant shared sacrifice, and I am committed to doing all I can to continue our relationship and to stabilize our revenues, budget and services.”

An AFSCME spokesperson said its bargaining unit is in continued conversations with city officials as Duluth pushes for federal and state aid to help mitigate the financial burden of the pandemic.