At issue is whether the district can skip over dismissing teachers at its Promise Academies, overhauled schools with extra resources. The district says it can, based on special powers given to the School Reform Commission by the state takeover law. The union disagrees.
Until the matter is ironed out in arbitration, on hold are the potential layoffs of 174 Promise Academy teachers with low seniority and 174 non-Promise Academy teachers who received layoff notices but who would be safe if the Promise Academy teachers were dismissed.
PFT president Jerry Jordan said he was "very happy" about Fox's ruling.
"If you're going to lay off people, they have to be laid off correctly," Jordan said.
Ralph Teti, an attorney for the PFT, said he hoped the arbitration case would move forward in the next few weeks.
"As far as we're concerned, we're satisfied. I'm very confident of our case," Teti said.
District spokeswoman Elizabeth Childs said in a statement that "this agreement allows the district to move forward with the teacher assignment and transfer process to prepare for the successful opening of schools next year."
But there was no relief Friday for the teachers left in limbo.
After a year of commuting to University City High School from North Jersey, Stephanie Silver just signed a lease on an apartment in the city. Silver had received assurances her job at University City High, a Promise Academy, was secure, so she did not apply to charter schools or other districts.
"The district never should have told us that we were safe," Silver, 24, said.
Tensions had already existed between Promise Academy teachers - who are paid more but required to work longer days, Saturdays, and a month every summer - and non-Promise Academy teachers. Now they are worse.
"But we should band together. Everyone should be pointing the finger at the higher-ups, saying, 'How could you let this happen?' " Silver said.
Silver said she understood the PFT's attempts to protect seniority but hoped the arbitrator would rule in the district's favor.
"I feel like I'm taking someone's spot, but at the end of the day, how many people are really going to want my spot?" she said.
Some non-Promise Academy teachers acknowledge that the district's attempt to exempt some educators had made them resent the Promise Academies.
Two years ago, Megan Marchino left her job teaching at a Catholic school for the Philadelphia district and a bigger paycheck.
Marchino taught at Carnell Elementary, a non-Promise Academy school in the Northeast, until last week, but she received a pink slip in early June. With two years' seniority, she is number 31 on the list and thus likely to be among the 174 whose layoffs are rescinded at least temporarily.
She will have a job in September only if the 174 Promise Academy teachers are laid off.
"I feel like my life is on hold," said Marchino, 29. "I have two small kids to support, and I don't know what's going on, and this has been dragging on for weeks already."
She said that Promise Academy teachers should never have been exempted and that she was "beyond frustrated" with the district and with City Council, which just voted to raise residents' taxes to put together $53 million in new money for the school system.
"They raise my taxes twice," Marchino said, "and then they lay me off."
Contact staff writer Kristen Graham at 215-854-5146, email@example.com or on Twitter @newskag. Read her blog, "Philly School Files," at www.philly.com/schoolfiles.