#### DaFatBunny

##### Member

The following two paragraphs are the determining factors for the cost of living adjustment (COLA):

Summarizing Article 33, paragraphs 2, 3, and 4

‘COLA is based on CPI-W, published by the BLS.

COLA is calculated based on the difference between the index from May of the previous year to May of the current year.

For every 0.2 point increase IN THE INDEX above the previous index plus 3%, there is a 1 cent raise in the top scale.’

Historical CPI-W shows that May of 2020, the index was at

**249.521**.

The second to last paragraph on page 4 of the CPI news release for May, 2021 says

“The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 5.6 percent over the last 12 months to an index level of

**263.612**(1982-84=100). For the month, the index rose 0.9 percent prior to seasonal adjustment.

So in order to calculate COLA you take the previous index (CPI20), multiply it by 1.03 to get your baseline 3% increase (referred to as 3%base), find the difference between the current CPI-W (CPI21) and the adjusted 3% increase (3%base), and multiply by 5 because each 0.2 points is one cent so each 1 point is therefore 5 cents. The formula is shown below:

3%base = CPI20 x 1.03

Raise = (CPI21 - 3%base) x 5

Factoring in our numbers:

3%base = 249.521 x 1.03 = 257.007

Raise = (263.612 - 257.007) x 5 = (6.605) x 5 =

**33.025**

That means that prior to the Union taking their cut, top scale will increase 33 cents. This will probably be at least a 25 cent increase.

As a side note, this post is not making any political judgments or determinations about the causes of inflation nor is it making a stance about the cut that the Union receives; this is simply an attempt to explain the contract and make an exorbitant amount of unnecessary college math courses useful to me.

I’m not sure if this site allows edits, but if it does I will correct the post if anyone points out any mistakes I made.