University of Washington regents agreed Thursday to give faculty a pay raise and turn over $17.5 million in back pay, interest and attorney fees to settle a lawsuit.

The settlement came four months after a Superior Court judge ruled that the university had violated its own policy when it refused to give 3,200 faculty members a 2 percent raise during the 2002-03 school year.

The university had agreed in 1999 to grant the merit raises to keep salaries competitive and address pay disparities that favored newcomers and professors threatening to leave.

The university argued it didn’t offer a raise in 2002-03 because the Legislature did not fund one, but the judge ruled the raise was part of the faculty contract.