After more than a year of negotiations, the University of California today offered its employees, represented by the American Federation of State, County and Municipal Employees (AFSCME) union, a comprehensive and competitive last, best and final offer (LBFO) that meets their original demand of $25 an hour and a 5% wage increase. The two parties have been negotiating a new contract since January 2024. Read the press release here.
UC’s last, best, and final offer is projected to raise AFSCME salaries to more than $3 billion by the end of the proposed five-year contract. It represents an increase of nearly $600 million in wages since the end of the last contract and is $113 million higher than UC’s initial offer made in February 2024.
Details of UC’s last best and final offer include:
• Annual across-the-board wage increases of 5% in 2025, 4% in 2026, and 3% in 2027, 2028, and 2029, with each year building upon prior increases, resulting in 19.3% total increases over the contract term.
• Eligible employees would also receive step increases of approximately 2% each year from 2026 through 2029, which, along with ATBs, result in total wage increases of 29% over the contract term.
• In conjunction with the above increases, 7,689 AFSCME-represented UC employees will see their hourly pay increase to a minimum of $25 per hour by July 2025.
• Added Juneteenth as a paid holiday, bringing the total paid holidays to 14. December 24 would be a premium-pay holiday. The proposal would provide premium pay for six of the 14 paid holidays.
• Monthly health insurance premium credits of $75-$125 to reduce costs for those who elect Kaiser HMO or UC Blue and Gold HMO. If accepted, many AFSCME-represented UC employees will have access to $0 health care premiums.
• Download the offer poster here.
| EXAMPLE: 2025 Monthly Costs for Pay Band 1 | ||||
| Plan | Self | Self + Child(ren) | Self + Adult | Family |
| Kaiser HMO (Kaiser Permanente) with $125 premium reduction | $0.00 | $0.00 | $0.00 | $24.16 |
| UC Blue & Gold HMO (Health Net) with $125 premium reduction | $0.00 | $69.38 | $180.90 | $265.91 |
What does this mean for you?
If AFSCME accepts UC’s last, best, and final offer, thousands of AFSCME-represented UC workers would start making $25 an hour on July 1, 2025. For example, the hourly rate of a UC Davis Mail Processor would increase from $21.16 to $25. In this case, gross monthly pay would rise from $3,385 to $4,000. If the same Mail Processor enrolls in Kaiser or UC Blue and Gold health plan, their monthly premiums for Self + Children are now free. As a result, this employee could gross an extra $706.15 a month to address their most pressing needs.
Significant offers despite fiscal uncertainty
Like all higher education institutions, the University of California faces financial uncertainty following the new administration’s actions and the proposed 8% cut to state budgets. Medicaid reimbursements at UC medical centers may be negatively impacted if the House Budget Resolution cuts $880 billion from the federal budget.
UC’s last, best, and final offer will increase wages, add stability, help with rising healthcare costs, and give you more control over living expenses. Our campuses and health centers thrive because of your contributions and commitment to excellence. That’s why we will continue working to put our proposed wage increases and healthcare credits into your hands as soon as possible. We hope this last, best, and final offer reinforces UC’s commitment to acknowledging your contributions.
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Visit our new Labor website for bargaining-specific information. Check
Other relevant UC News:
- From President Drake: The strength that built us will sustain us
- Federal Government Terminates UC International Student Visas: UC’s Response
- A Message from UC President Michael Drake on the University of California’s Financial Outlook
- Get the latest news on the UC federal updates page
- UC and CSU face cuts under Newsom’s proposed budget