A panel of arbitrators has awarded raises of more than 2 percent for each of the next two years to Hawaii firefighters in a binding decision that could be the bellwether of contract negotiations for all state and county public worker unions.

Hawaii Fire Fighters Association President Robert “Bobby” Lee said the decision Monday also continues step movement salary increases every three years for firefighters based on their employment anniversaries. That means about two-thirds of the union’s 2,000 members will also get an extra step movement pay increase worth roughly 1 percent during the new two-year contract.

“I think our members will be happy,” Lee said of the new agreement. “We feel it’s a fair award, and we respect the bargaining process.”

He said the decision is “more than affordable” for the state and counties, and said he believes the employers are satisfied with the decision as well.

“Firefighters not only put their lives on the line every day they come to work, but they also deal with hazards that have both short- and long-term health effects, including heart and lung diseases, and (they) are subjected to a much higher rate of cancer than the general public,” Lee said. “They deserve everything they get and more.”

Most firefighters are employed by the city and counties, which means most of the cost of the raises and fringe benefit increases will be borne by the Honolulu, Hawaii, Maui and Kauai county governments.

However, the initial contract settlement in each round of collective bargaining often sets a pattern for the awards and settlements that follow for state and county workers. The firefighters decision is the first settlement for this year. Thirteen other public worker bargaining units are also seeking new contracts.

Six units of the Hawaii Government Employees Association have made their cases to arbitrators. Binding decisions on those contract negotiations are expected later this month. Some units of the United Public Workers are also reported to be close to settlements or decisions.

Senate Ways and Means Chairwoman Jill Tokuda said her committee has taken a conservative approach to budgeting this year, cognizant that pay raises for all unionized government workers in state and county government were on the table. She noted the firefighters settlement makes up just a small percentage of government workers.

Tokuda declined to say if and where cuts may be made as additional contracts are finalized.

House finance Committee Chairwoman Sylvia Luke said the firefighters arbitration award is within the general range of what lawmakers expected, but the overall cost of all of the public worker agreements still isn’t known.

Lawmakers will have to strike a balance between those costs and other significant spending proposals the Legislature has been considering, such as expanding the renter’s tax credit, a state earned income tax credit or income tax relief for low-income residents, she said.

“We’ve just got to see how these large cost items will fit in, and what are our priorities,” said Luke (D, Punchbowl-Pauoa-Nuuanu).

The firefighter arbitration decision awards across-the-board raises of 2 percent to the firefighters on July 1 and 2.25 percent on July 1, 2018, but also affects retirement and other fringe benefit costs that are tied to wages.

The new agreement will affect 1,048 Honolulu firefighters and 141 firefighters on Kauai, city and county officials said.

A spokesman for Maui County said the decision by the three-member arbitration panel will cost that county an extra $3.2 million in additional wages and fringe benefits over the next two years. Maui has 285 firefighters on its payroll.

The new contract follows a six-year agreement between the state and counties and the firefighters unions that was widely regarded as generous. The first two years of the old contract had no raises, but in the following three years the firefighters received 2 percent pay increases every six months. In this final year of the contract, the firefighters received a 5 percent raise.

The firefighters’ representatives were dissatisfied with early offers made by negotiators on behalf of the state this year, which led to a declaration of a bargaining impasse. The dispute was then submitted for binding arbitration, a process put in place to settle contract disputes because firefighters are not allowed to strike.

“I think the process was a lot tougher than it needed to be because of how the employers operated throughout the whole bargaining process, but we feel the process is fair, and we can only control our side on how we operated during the bargaining process,” Lee said.

Star-Advertiser reporter Sophie Cocke contributed to this report.