The city administration and its chief employees union reached a one-year agreement on a wage settlement that provides a 4.3% raise.
The increase, which came after several months of negotiations, raises the city's annual payroll to about $12.2 million from $11.7 million, according to Elaine Winer, city personnel manager.
The new wage structure, which took effect Sunday, affects about 400 workers represented by Torrance Municipal Employees Local 1117 of the American Federation of State, County and Municipal Employees.
Left unresolved is a union request to make Martin Luther King Jr.'s birthday an official holiday.
Winer said the city wants to negotiate that issue with all employees and would be willing to consider a switch with another holiday or a cash trade-off. She said a committee is examining ways to implement the holiday in 1987.