The nearly seven-year retroactive deal with the Council of School Supervisors and Administrators also provides every principal the chance to earn a $25,000 bonus based on their students' progress and sharply curtails seniority rights for assistant principals.
The pact concludes a stalemate that loomed over the Bloomberg administration's efforts to reform the school system, in part by broadening the authority of principals this fall in exchange for greater scrutiny.
In a rare show of public unity at City Hall, both sides cast the agreement as good for education. Labor officials claimed it included "common-sense reforms," while city officials noted it introduced the sort of financial incentives to the school system that they had long sought.
By offering principals with proven track records an extra $25,000 a year to lead tough schools, the deal builds on a previous teachers-contract provision that offers veteran instructors $10,000 more a year to mentor younger colleagues in high-needs schools.
To get the additional pay, principals must agree to lead the school for three years.
If approved by its 5,600 members, the pact would finally bump the salaries of most principals and assistant principals beyond those of their teachers - whose union has negotiated two pay hikes totaling 22 percent since the CSA contract expired in June 2003.
The top salary for principals would jump to nearly $154,000 from $125,000, while that of assistant principals would increase to $131,000 from $107,000.