Bath Iron Works and its largest union on Sunday announced they reached an agreement on a new contract, avoiding a repeat of a strike in 2020 during the last contract talks.

Machinists Union Local S6 represents about 4,250 of the shipyard’s 6,500 workers. It said 72% of its members approved the three-year contract, which includes the biggest pay raises in the union’s 68-year history.

“This agreement represents our desire to continue working together to deliver the Navy’s ships on time to protect our nation and our families,” BIW said in a statement Sunday. “We appreciate our employees’ participation in the process.”

“Thank you all,” Local S6 said in a message to members. “See you on the deck plates.”

The pay raises range from 4%-9.5% the first year of the contract, 5% the second year and 4% the third year. The previous contract included annual 3% pay raises.

The deal includes an increase in 401(k) contributions from General Dynamics, which owns the shipyard. The company agreed to 401(k) matching contributions from 35 cents a dollar up to 5% to 40 cents in 2025 and 45 cents in 2026. It also agreed to offer a Roth 401(k) starting in 2024.

The contract also includes higher health insurance premiums and the elimination of an unpaid week off in late December, which drew criticism from some members. Other members wanted higher raises due to factors like inflation.

The union’s negotiating committee said it was “the best proposal they could bring back.” BIW called the wage and benefits package “substantial … (and) a clear indication that our company believes in its current workforce and wants to continue to attract new talent to sustain our work into the future.” The shipyard emphasized “building on the momentum” at the shipyard, which earlier this month was awarded a Navy contract to build three more Flight III Arleigh Burke-class destroyers. Twelve destroyers are now in the works at the shipyard.

During the last contract negotiations in 2020, the union held a two-month strike over disagreements about BIW’s use of subcontractors and planned changes to seniority. The two sides quickly agreed to the subcontracting provision this time around. The 2020 strike, combined with the coronavirus pandemic, put BIW months behind schedule building destroyers, the only vessel it builds. BIW President Chuck Krugh said production has increased in recent months.

The contract includes annual health insurance premium increases of about 4% for the three plans offered. Deductibles would also be raised for some plans. Though the December week off was eliminated, the company has said it will offer union members four unpaid, excused days off during that time.