Local government employers have welcomed an agreement with trade unions on the terms of reference for the arbitration process that will resolve the 2008-09 pay dispute.
The bitter pay battle, which saw hundreds of thousands of local authority workers strike this summer, has been referred to conciliation service Acas.
The terms of reference for the arbitration board stipulate that it will “take into account levels of affordability for all local authorities” as well as the economic circumstances.
Brian Baldwin, chairman of the Employers’ Side of the National Joint Council, said: “It is encouraging that the unions have accepted that this arbitration is viewed in the context of the unprecedented economic challenges local government is now facing as we have unquestionably reached the limit of what the council tax payer can afford.”
Councils’ final offer of 2.45% was rejected, with up to 600,000 council workers staging a 48-hour walkout in July.
A spokeswoman for trade union Unison said: “Unison is pleased that terms of reference have finally been agreed, which will put an end to this dispute. We will be providing Acas with strong evidence to support our claim for a better deal.
“These may be difficult times for councils, but our members are also struggling to pay their bills this Christmas.”