A five-year stalemate between Philadelphia Mayor Michael Nutter and the city's largest municipal worker union has finally come to an end.

Nutter announced Friday that he has clinched a tentative deal with the blue-collar AFSCME District Council 33, which represents about 10,000 streets, sanitation and other workers. The labor union has been working without a labor contract or raises since 2009. 

"This process often has been long and difficult for all parties involved," said Nutter. "But as we know, change, significant change, is often never easily achieved."

The agreement, which goes through the end of June 2016, will allow both Nutter and the union to claim victories.

The workers will receive a $2,800 signing bonus, as well as a 3.5 percent raise next month and a 2.5 percent raise in July 2015, as was previously reported by NewsWorks. District Council 33 also successfully fought off Nutter's attempt to secure the right to furlough workers. 

The deal, which still must be ratified by the rank-and-file workers, will add $127 million in costs to Philadelphia's five-year budget plan. If it is approved, Nutter has agreed to withdraw a controversial lawsuit seeking to impose contract terms on District Council 33. Critics say the litigation could have negative ramifications on labor unions across the state.

“It’s a good agreement. I’m happy with it,” said Pete Matthews, president of District Council 33. “It was very significant to get them to drop that lawsuit.”

Nutter, for his part, achieved modest pension reform. Current workers will have to choose between enrolling in a new hybrid pension plan, which includes aspects similar to a 401(k), or contributing an extra 1 percent of their pay starting in 2016 to keep their traditional pension plans. 

New workers will have to pay an additional 2 percent to register in a traditional plan.

"Pension costs are one of the most critically important cost drivers in our city budget, one that we have been committed to putting on a new, more affordable course for our taxpayers, while at the same time offering a high-quality benefit to our city employees," Nutter said. "We have achieved that goal in this contract."

Nutter also won changes in calculating overtime that could help reduce costs, as well as a modification that he said would let the city more easily lay off workers on a temporary basis during economic downturns.

Matthews, the union president, was not at Nutter's news conference announcing the deal. Nutter, who was in Atlanta for a Democratic National Committee meeting Thursday night when the agreement was reached, cautioned the media to not make a big deal of this.

“I would hope that at least for the next 24 hours we could at least look at this as a positive circumstance here in the city,” said Nutter. “It doesn’t mean anything else other than the fact that the union was together last night and wanted to sign, and I wasn’t here last night.”

Matthews said he had not been aware of the news conference.

Matthews has been a vocal critic of Nutter for several years. He has repeatedly likened him to Scott Walker, the Republican governor of Wisconsin who has restricted collective bargaining rights in that state.

During Nutter's budget address in 2013, hundreds of protesting blue- and white-collar workers shouted over the mayor so loudly that he was forced to retreat and make his speech in another room closed to the public.

Nutter reached a deal with the white-collar union District Council 47 in February.

The city's agreement with District Council 33 comes as the Democratic National Committee considers holding its party's 2016 presidential convention in Philadelphia. While visiting the city last week, organizers reportedly made it clear that there could be no labor conflicts during the convention.

Asked if the city’s bid for the convention played a part in the deal, Matthews said, “If it helped, I'm very appreciative. I can say that. Because just like everybody else, I want the convention to come here."

Both Matthews and the Nutter administration said a state mediator, who recently proposed a compromise contract, was instrumental in securing a bargain.

“That set the framework for the parties to talk using his proposal,” said Shannon Farmer, the city’s chief labor negotiator. “I think that made a significant difference.”

Contract talks have been going on since early in Nutter's first term. With this deal expiring in the summer of 2016, the city's next mayor elected next year will not have long before needing to try to strike a new bargain.

View the contract and summary of terms below.