FAIRFIELD — Town officials have settled a dispute with the firefighters’ union over bonus pay, leading the union to drop a labor complaint and the town to pay firefighters their full bonus amount at once.

Teamsters Local Union No. 340, which represents Fairfield’s eight full-time firefighters, signed a memorandum of understanding with the town Monday, and firefighters will receive a full bonus payment in this week’s payroll, Town Manager Michelle Flewelling said.

The Town Council originally approved using a portion of federal American Rescue Plan Act funds to give bonuses to all town employees, given in quarterly payments over the course of a year: $3,000 for full-time staff, $1,500 for part-time staff and $750 for staff who work less than 20 hours a week.

For union members, including the firefighters, police and public works, the town sent the unions memorandums of understanding for the bonus pay. The police and public works unions signed off, but the firefighters’ union did not, in part because of negotiations that were underway for a new three-year contract for firefighters.

In October an initial $750 payment was processed and given to full-time firefighters, which should not have occurred without the memorandum being signed, prompting the town to later deduct the $750 from paychecks.

In response to the deduction, the union filed a complaint with state labor officials, accusing the town of “prohibited practice,” claiming the town pursued an action that employers are prohibited from doing, such as discrimination or retaliation.

But a new memorandum now has been signed, Flewelling said. As part of the agreement, firefighters got the full bonus amount in one payment and the union dropped its labor complaint over the matter.

A representative for the union was not available to comment on the resolution.