PHILADELPHIA (CBS) — Most of the roughly 1,500 who received layoff notices earlier this month will lose their jobs next week. However, nearly 350 teachers entangled in a legal dispute between the School District and teachers union will remain on the payroll until their status is sorted out through the arbitration process.

The arbitrator will determine which teachers still have to be laid off. 174 instructors at overhauled schools known as Promise Academies were targeted. But the school districted declared them exempt and pink slipped 174 other non-Promise Academy teachers instead.

READ MORE: 21-Year-Old Killed In Road Rage Shooting On Roosevelt Boulevard, Police Say

Union attorney Ralph Teti says the two sides have agreed to settle their dispute through an expadited arbitration process.

“We’re very, very confident that when the arbitrator hears our issues he will support the contention that the exemption of the teachers, not on the basis of seniority, is frankly outside the authority of the district under the collective bargaining agreement.”

The school district has issued a statement outlining terms of Thursaday’s agreement but declined to comment beyond that.

READ MORE: Family, Friends Hold Candlelight Vigil For Slain Temple University Student Samuel Collington

The statement reads in part:

“In the spirit of cooperation, the School District of Philadelphia and the Philadelphia Federation of Teachers (PFT) today reached an agreement which allows the District to proceed with its reduction in teachers. 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.”

Reported by Paul Kurtz, KYW Newsradio

MORE NEWS: Jolly Trolley And Main Street Light Spectacular Bring Joy To Manayunk Following Ida Flooding, Pandemic