PROVIDENCE — A labor arbitrator has awarded firefighters a 2.5 percent pay raise and spared them from sharing in the cost of their health insurance premiums.

In a near-complete victory for the labor union that represents firefighters, arbitrator Michael C. Ryan also continued cost-of-living pension increases for firefighters in excess of the COLAs now provided by municipal ordinance and limited the city’s power to force disabled firefighters to retire.

The arbitration award, which was made public yesterday by the firefighters union, settles employment terms for the period July 1, 2004 through June 30, 2005. The long-running and bitter confrontation between Mayor David N. Cicilline and the International Association of Fire Fighters, Local 799, now moves to arbitration of terms for 2005-2006.

Rank-and-file union members are “very excited” by the award, declared Firefighter 1st Class Paul A. Doughty, union president. “They think it’s really vindicated our position and exposed the mayor as the unreasonable one” in the acrimonious collective-bargaining relationship.

John C. Simmons, director of administration for Cicilline, and Fire Chief George Farrell replied that Cicilline and his subordinates have tried repeatedly to negotiate a full labor contract and lesser matters with Local 799 but that the union has been unresponsive.

Arbitration for firefighters, under state law, is a process handled by a three-member committee consisting of a neutral arbitrator and appointees representing the mayor and the union. They vote on each point in dispute, giving the neutral arbitrator — in this case, Ryan — the ultimate power in the process.

Cicilline’s exasperation with the outcome was voiced by his appointee, lawyer Vincent F. Ragosta Jr., who complained in a written dissent that the award shows “a patent laxity” in its rationale and often fails to state a factual basis for its decisions.

“…Insulating Providence firefighters from co-sharing a relatively small fraction of the city’s onerous health insurance costs is nothing less than an affront to the city’s hard-working citizenry, many of whom are uninsured, and many of whom pay as much as 50 percent of the cost of their health insurance benefits,” Ragosta wrote.

Cicilline unsuccessfully asked Ryan to require the firefighters to pay 10 percent of the cost of their health insurance premiums and to allow his administration the freedom to change the company that administers health insurance to save money.

Even as firefighters avoided having to pitch in on their health insurance premiums, most other school and nonschool employees were obliged to begin that major cost-sharing in 2004-2005.

Teachers and members of Laborers International Union of North America, Local 1033, which represents many municipal employees, bowed to that requirement when they negotiated labor contracts for that year. And the Cicilline administration imposed it on nonunion employees. Like the firefighters, however, members of the police union do not contribute to the cost of their health insurance premiums.

“It’s our expectation that if we didn’t get it this year, then we will get it next year,” Simmons said of the premium cost-sharing. “It’s the city’s expectation — not if, but when.”

Firefighters also fared well on their salaries for 2004-2005, relative to most other school and nonschool employees for that year. The award of 2.5 percent outstrips the 1.9 percent garnered by teachers and Local 1033 members. The police, though, landed a 3 percent pay raise in an arbitration award for 2004-2005.

Where the firefighters fall short on salary, however, is retroactivity. The arbitrator made the salary award retroactive for only six months of the contested contract year.

By resorting to arbitration rather than reaching a deal with the mayor, firefighters for years have gone without pay raises for prolonged periods of time and have not been able to recover all of those deferrals.

“One could argue,” Simmons said, “that they have had to pay a price that they wouldn’t have had to pay” if they negotiated contracts.

The across-the-board pay raise for 2004-2005 boosts the weekly salary of a firefighter 1st class by $22.74, from $909.74 to $932.48. About 75 percent of the union membership holds this rank.

A lieutenant enjoys a pay boost of $25.05, from $1,001.91 to $1,026.96.

A captain is boosted by $27.33, from $1,093.04 to $1,120.37.

Firefighters also receive recurring annual percentage bonuses for longevity, beginning with five years’ service.

Doughty estimated that the award will cost the city about $4 million, largely due to the salary provision, but Simmons put the figure at about $2 million. Regardless of the actual sum, the city’s 2007-2008 operating budget contains no money to pay this or other arbitration awards. Simmons said the money will come from reserves.

In making the award, Ryan noted that the city’s ability to pay has improved because the state of its finances is stronger.

Simmons called that “being punished for having improved our financial position.”

Cicilline also tried to make headway in arbitration on pension COLAs, which he has said are contributing to the massive unfunded liability in the municipal retirement system, but got nowhere.

As it is, firefighters enjoy a 3 percent compounded-interest COLA, calculated on a retiree’s entire annual benefit but only payable after the third year of retirement. The mayor sought to have that reduced to a much less costly 3 percent COLA with simple interest.

“We haven’t given up on it,” Simmons said. “It’s a fundamental issue.”

The arbitration award supersedes the municipal retirement ordinance, which provides retirees a 3 percent simple-interest COLA calculated on $12,000 of a retiree’s annual benefit and payable after the third year of retirement. That works out to $360, according to Doughty.

In other provisions, the arbitrator:

•Boosted co-payments for emergency room visits, from $25 to $100, unless the patient is admitted to the hospital; for doctor’s office visits, from $10 to $15; for visits to specialists, from $15 to $20; and for prescription drugs, from zero to $5 for generics and from $3 to $15 for brand names.

•Required for the first time that if a firefighter is out of work on injured-on-duty status — that is full pay, non-taxable — the firefighter must follow whatever noninvasive course of treatment his or her personal physician recommends. If the firefighter fails to do so, that person must begin using his or her sick leave.

•Enhanced the city’s ability to put injured firefighters on light duty. The number of firefighters that it can assign to light duty was increased from 10 to 20. Light duty generally consists of clerical work such as filing and preparing work schedules, according to Farrell. Doughty said there has never been more than 12 firefighters eligible for light duty at a given time.

•Limited the city’s ability to force the retirement of firefighters who have been injured on duty and carried on the payroll for a long time. This curtailment apparently will allow firefighters to stay out indefinitely, frustrating the administration’s effort to fully staff the Fire Department and relieve a payroll burden. It applies only to firefighters who were injured on duty on or after June 30, 2005.

In the past few years, according to Doughty, the administration has applied to the city Retirement Board to have firefighters on long-term injured-on-duty status given either accidental-disability or ordinary-disability pensions regardless of whether the firefighter hoped to return to work.

“This is a huge victory,” Doughty said.

gsmith@projo.com