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HomeMy WebLinkAbout04-10-2012 c2 resobet slo and confidential employee grpperdjan 12012 and dec 31-2013/counci lj acenda aEpol2t Meeting Date 4/10/1 2 Item Number C 2 C I T Y O F S A N L U I S O B I S P O FROM : Monica Irons, Human Resources Directo r Prepared By :Greg Zocher, Human Resources Manage r SUBJECT : RESOLUTION BETWEEN THE CITY OF SAN LUIS OBISPO AN D CONFIDENTIAL EMPLOYEE GROUP FOR THE PERIOD OF JANUAR Y 1, 2012 THROUGH DECEMBER 31, 201 3 RECOMMENDATION 1.Adopt a resolution reducing compensation for the Unrepresented Confidential Employee s for the period of January 1, 2012 through December 31, 2013 . 2.Adopt a resolution ceasing to pay and report the value of the employer paid membe r contribution (EPMC) to California Public Employees Retirement System (Ca1PERS) fo r members of the City's Confidential Employees . DISCUSSIO N Backgroun d The City's confidential employees are not represented by a collective bargaining unit in accordanc e with the Government Code because they are privy to information that affects employee relation s and labor negotiations . Currently there are four classifications designated as confidential by th e City : Administration Executive Assistant, Legal Assistant/Paralegal, Human Resource s Administrative Assistant, and Human Resources Specialist . As unrepresented employees, they do not formally negotiate with the City in regards to their compensation and terms and conditions o f employment . Informal discussions between management and the four City confidential employee s take place similar to the process used with unrepresented management employees . The confidentia l employees' compensation and benefits are set by resolution adopted by Council and the Resolutio n expired on December 31, 2011 . The City met with this group and outlined the Council's labor relations objectives as follows : 1.Implement sustainable actions to reduce total employee compensation costs by 6 .8% or a total of $3 .1 million annually for all funds ($2 .6 million in the General Fund only) as se t forth in the 2011-13 Financial Plan ; and , 2.Achieve "significant progress" in the area of long-term systemic pension cost containmen t and reduction, including : o a shift to employees paying the full member contribution required by Ca1PER S (eight percent for Miscellaneous employees and nine percent for Safety employees); thus moving away from EPMC for current and future employees ; and , o implementation of a second tier retirement benefit, or , o other actions that meet this objective . T :\Council Agenda Reports\2012\2012-04-10\Confidential Resolution (Irons-Zocher)\E-Council Agenda Report .docx C2-1 Resolution Confidential Employee Group Page 2 The confidential group requested the following terms to achieve Council's labor relation s objectives : 1.Effective the first full payroll period in June 2012 the unrepresented confidential employee s will pay 3% of the Member contribution to Ca1PERS . 2.Effective the first full payroll period in January 2013 the unrepresented confidentia l employees will pay an additional 3% (6% total) of the Member contribution to Ca1PERS . 3.Effective the first full payroll period in June 2013 the unrepresented confidential employe e group will pay the full 8% of the Member contribution to Ca1PERS . 4.A resolution term of two years (January 1, 2012 through December 31, 2013) with no acros s the board (e .g . cost of living) salary increases and no changes to the City contribution t o health insurance . 5.The group recognizes the necessity of implementing a second tier retirement benefit . The City currently pays the Member contribution to Ca1PERS for the Confidential Employees . Several years ago, the San Luis Obispo Police Officers Association (POA), the San Luis Obisp o Police Staff Officers Association (SLOPSOA), and the Battalion Chiefs agreed to pay the membe r contribution to Ca1PERS and received equivalent salary increases . By the first full payroll period i n June 2013 the Confidential employees will be paying the full 8% of the Member contribution t o Ca1PERS but will not receive any offsetting or across the board salary increases . Further, the Cit y currently reports the value of the member contribution to Ca1PERS as additional compensation . B y adopting the two proposed resolutions, this practice will cease and the member contribution will n o longer be reported to Ca1PERS as additional compensation . During the term of this agreement, through December 31, 2013, the confidential group will no t receive a cost of living adjustment . At the end of this resolution the Confidential Employees wil l have gone without a cost of living adjustment for three years (the last adjustment was a two percen t increase received in December 2010). FISCAL IMPAC T Effective the first full payroll in June 2012, the total compensation reductions will result in saving s of $4,700 . Effective the first full pay period in January 2013, the total compensation reductions wil l result in savings of $9,400 . Effective the first full pay period in June 2013, the total compensatio n reductions will result in an ongoing annual savings of $25,200 which is a 6 .94% total compensatio n reduction for this employee group . The 2011-13 Financial Plan included a projection for reduction s in personnel compensation costs in 2011-12 and 2012-13 . Use of one time General Fund saving s from the prior year will be required to cover the current rate of compensation until the terms of thi s contract are phased-in . One time savings of $12,000 will be utilized in 2011-12 and $10,500 i n fiscal year 2012-13 to cover employee compensation reductions budgeted in the 2011-13 Financia l Plan Combined with actions taken by the unrepresented management group in January and the Fir e Union which includes payment of the full Member contribution to Ca1PERS, this agreement help s the City achieve approximately 45% of the targeted $3 .1 million in annual personnel cost reduction s by the end of 2011-13 Financial Plan . T :\Council Agenda Reports\2012\2012-04-10\Confidential Resolution (Irons-Zocher)\E-Council Agenda Report .docx C2-2 Resolution Confidential Employee Group Page 3 ALTERNATIVE S Do not approve the resolutions and contract amendments .This alternative is not recommended, a s the resolutions and contract amendments are consistent with the Council's labor relations objective s and the City's employer-employee relations policies . ATTACHMENT S 1.Confidential Employees Resolution . Exhibit "A " 2.Resolution ceasing to pay and report the value of EPMC to Ca1PERS for the unrepresente d confidential employees . i :\agenda report templates\ecouncil agenda report.doo T :\Council Agenda Reports\2012\2012-04-10\Confidential Resolution (Irons-Zocher)\E-Council Agenda Report .docx C2-3 ATTACHMENT 1 Page 1 of 2 RESOLUTION . NO. (2011 Series ) A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISP O REGARDING COMPENSATION FOR THE UNREPRESENTED CONFIDENTIA L EMPLOYEES AND SUPERSEDING PREVIOUS RESOLUTIONS IN CONFLIC T WHEREAS,the unrepresented confidential employees (Administration Executive Assistant, Human Resources Administrative Assistant, Legal Assistant/Paralegal, and Huma n Resources Specialist) of the City of San Luis Obispo met to identify sustainable reductions in tota l compensation costs to achieve Council's labor relations objectives to reduce total compensatio n costs and implement sustainable pension cost containment and reductions ; and WHEREAS,the unrepresented confidential employees acknowledge the fiscal challenge s facing the City of San Luis Obispo and are committed to working with the City to help achiev e long-term sustainable solutions ; and WHEREAS,the unrepresented confidential employees have demonstrated sensitivity to th e fiscal challenges facing the City by agreeing to no across the board salary increases (e .g . "cost o f living" increases) since December 2010 ; an d WHEREAS,the unrepresented confidential employees have also agreed to no increases i n the City's contribution to health care for the past two calendar years, while medical premiums hav e increased in that same timeframe and will increase again in 2012 ; and WHEREAS,the unrepresented confidential employees remain committed to providin g high quality service to the citizens of San Luis Obispo in an efficient and effective manner ; NOW, THEREFORE, BE IT RESOLVED,that the Council of the City of San Luis Obisp o hereby revises unrepresented confidential employees compensation as follows : SECTION 1 .Unrepresented confidential employees will begin paying three percent of th e Member Contribution to Ca1PERS effective June 28, 2012, six percent effective January 24, 201 3 and the full eight percent effective June 27, 2013 . The City will continue to report the Membe r Contribution paid by the City as additional compensation to CaIPERS until June 27, 2013 . SECTION 2 .There will be no across the board salary increases (e .g . "cost of living " increases). SECTION 3 .There will be no increase to the City's health contribution . SECTION 4 .The City shall continue to provide employees certain fringe benefits as se t forth in Exhibit "A", fully incorporated by reference . SECTION 5 .Unrepresented confidential employees acknowledge the City's need t o achieve long-term financial sustainability and pension cost reductions through the establishmen t T:\Council Agenda Reports\2012\2012-04-10\Confidential Resolution (Irons-Zoeher)\ATTACHMENT 1-Confidential Resolution 2012 .do c C2-4 ATTACHMENT 1 Page 2 of 2 of a second tier retirement formula for new employees . If the City amends the Ca1PER S Miscellaneous contract to provide a second tier retirement formula, confidential employees wil l participate as required by Ca1PERS . SECTION 6 .All prior resolutions relating to unrepresented confidential employee s compensation and benefits are hereby superseded to the extent inconsistent with this resolution . SECTION 7 . This resolution shall be in effect from January 1, 2012 through Decembe r 31, 2013 . SECTION 8 .The Director of Finance and Information Technology shall reduce th e appropriate accounts to reflect the compensation changes . Upon motion of , seconded by , and on the following vote : AYES : NOES : ABSENT : The foregoing resolution was adopted this 10th day of April, 2012 . Mayor Jan Marx ATTEST : Sheryll Schroeder, Interim City Cler k APPROVED AS TO FORM : /s/ Christine Dietrick_ J . Christine Dietric k City Attorney T :\Council Agenda Reports\2012\2012-04-I0\Confidential Resolution (Irons-Zocher)\ATTACHMENT 1-Confidential Resolution 2012 .do c C2-5 EXHIBIT "A " CONFIDENTIAL EMPLOYEES FRINGE BENEFITS 201 2 Section A Medical, Dental, Visio n The City shall establish and maintain medical, dental and vision insurance plans for confidentia l employees and their dependents . The City reserves the right to choose the method of insurin g and plans to be offered . The City has elected to participate in the PERS Health Benefit Program pursuant to the Publi c Employees' Medical and Hospital Care Act (PEMHCA) with the "unequal contribution option " at the PERS minimum contribution rates, $112 per month for active employees and $106 fo r retirees as of January 1, 2012 . The City's contribution toward retirees shall be increased by 5 % per year of the City's contribution for the active employees until such time as contributions fo r employees and retirees are equal . Employees with proof of medical insurance elsewhere are not required to participate in th e medical insurance plan and may receive the unused portion of the City's contribution (afte r dental and vision insurance is deducted) in cash in accordance with the City's cafeteria plan . Those employees will be assessed $16 .00 per month to be placed in the Retiree Health Insuranc e Account . This account will be used to fund the City's contribution toward retiree premiums an d the City's costs for the Public Employees' Contingency Reserve Fund and Administrative Costs . However, there is no requirement that these funds be used exclusively for this purpose, nor an y guarantee that they will be sufficient to fund retiree health costs, although they will be used fo r employee benefits . Employees will be required to participate in the City's dental and vision plans at the employee - only rate . Should they elect to cover dependents in the City's dental and vision plans, they ma y do so, even if they do not have dependent coverage for medical insurance . Employees shall participate in term life insurance of $4,000 through payroll deduction as a par t of the cafeteria plan . Section B Cafeteria Plan Contributio n The City's contribution to the Cafeteria Plan for regular, full-time employees will remain th e same as the 2010 amounts . Employee Only $469 monthl y Employee + 1 $928 monthl y Employee + Family $1255 monthl y Employees with proof of medical insurance elsewhere may elect to opt out of the City's medica l plan and receive a $200 cafeteria contribution . Employees who opted out of the City's medica l insurance coverage and were hired prior to August 31, 2008 were "grandfathered" in at the $79 0 per month contribution level, until that time when they elected to be covered under the tiere d contribution structure . An employee elects to be covered under the tiered contribution structure Resolution No . (2012 Series) EXHIBIT "A " Confidential Employees Fringe Benefits 2012 when he or she enrolls as an employee only or with dependents (employee plus one or family). At that time the employee would no longer be grandfathered in at the $790 per month contribution, but would receive the tiered contribution amount . Employees hired prior to August 31, 2008 that had employee only medical insurance coverag e were "grandfathered" in at the $790 per month contribution level, until such time when they added dependents or opted out . At that time the employee would no longer be grandfathered i n at the $790 per month contribution, but would receive the tiered contribution amount . Less than full-time employees shall receive a prorated share of the City's contribution . The City agrees to continue its contribution to the cafeteria plan for two (2) pay periods in th e event that an employee has exhausted all paid time off due to an employee's catastrophic illness . Section C Life and Disability Insuranc e The City shall provide the following special insurance benefits : 1. Long-term disability insurance providing 66 2/3% of gross salary (maximum benefi t $5, 000 per month) to age 65 for any sickness or accident, subject to the exclusions i n the long-term disability policy, after a 30-day waiting period . 2. In addition to $4,000 term life insurance purchased by the employee through th e cafeteria plan $25,000 term life insurance, including accidental death an d dismemberment . Section D Retiremen t The City shall provide the California Public Employees' Retirement System's (CaIPERS) 2 .7 % at 55 plan to all eligible employees including the amendments permitting conversion of unuse d sick leave to additional retirement credit, the 1959 survivor's benefit (Level Four), one year fina l compensation, and pre-retirement Option 2 death benefit . The City shall no longer report as salary all Employer-Paid Member Contributions (EPMC) to Ca1PERS for the purposes of retirement credit in accordance with Government Code Sectio n 20636 (c) (4) effective June 27, 2013 . Section E Vacatio n Vacation leave is governed by section 2 .36 .440 of the Municipal Code, except that it may b e taken after the completion of the sixth calendar month of service since the benefit date . Vacatio n leave shall be accrued as earned each payroll period provided that not more than twice the annua l rate may be carried over to a new calendar year . T :\Council Agenda Reports\2012\2012-04-10\Confidential Resolution (Irons-Zocher)\Exhibit A .doc C2-7 Resolution No . (2012 Series) EXHIBIT "A " Confidential Employees Fringe Benefits 2012 Vacation schedules for confidential employees shall be based upon the needs of the City an d then, insofar as possible, upon the wishes of the employee . A department head may not deny a confidential employee's vacation request if such denial will result in the loss of vacation accrua l by the employee, except that, a department head may approve a two-month extension o f maximum vacation accrual . However, in no event shall more than one such extension be grante d in any calendar year . Confidential employees are eligible, once annually in December, to request payment for up to 4 0 hours of unused vacation provided that an employee's overall performance and attendanc e practices are satisfactory . Section F Administrative Leav e Confidential employees shall be granted 12 hours of administrative leave per calendar year . Section G Holiday s Confidential employees shall receive 11 fixed plus 2 floating holidays per year . The floatin g holidays shall be accrued on a semi-monthly basis and added to the vacation accrual . Section H Sick Leav e Sick leave is governed by section 2 .36 .420 of the Municipal Code . An employee may take up t o 16 hours per year of sick leave if required to be away from the job to personally care for a member of his/her immediate family as defined in Section 2 .36 .420 . This may be extended to 4 0 hours per year if the family member is part of the employee's household and to 56 hours if a household family member is hospitalized and the employee submits written verification of suc h hospitalization . If the family member is a child, parent or spouse, an employee may use up to 4 8 hours annually to attend to the illness of the child, parent or spouse, instead of the lesse r maximums above, in accordance with Labor Code Section 233 . In conjunction with existing leave benefits, confidential employees with one year of City servic e who have worked at least 1,250 hours in the previous year may be eligible for up to 12 weeks o f Family/Medical Leave in accordance with the federal Family and Medical Leave Act and th e California Family Rights Act . Sick leave may be used to be absent from duty due to the death of a member of the employee's immediate family as defined in Section 2 .36 .420, provided such leave shall not exceed fort y working hours for each incident . The employee may be required to submit proof of relative's death before being granted sick leave pay . False information concerning the death o r relationship shall be cause for discharge . Upon termination of employment by death or retirement, a percentage of the dollar value of th e employee's accumulated sick leave will be paid to the employee, or the designated beneficiary o r beneficiaries according to the following schedule : T :\Council Agenda Reports\ 2012\ 2012-04-10\Confidential Resolution (Irons-Zocher)\Exhibit A .doc C2-8 Resolution No . (2012 Series) EXHIBIT "A " Confidential Employees Fringe Benefits 2012 (A)Death — 25 % (B)Retirement and actual commencement of Ca1PERS benefits : (1)After ten years of continuous employment — 10% (2)After twenty years of continuous employment — 15 % (3)After twenty-five years of continuous employment — 20 % (4)After thirty years of continuous employment — 25 % Section I Workers' Compensation Leav e An employee who is absent from duty because of an on-the-job injury in accordance with Stat e workers' compensation law and is not eligible for disability payments under Labor Code Sectio n 4850 shall be paid the difference between his/her base salary and the amount provided by workers' compensation law during the first ninety (90) business days of such temporar y disability absence . Eligibility for workers' compensation leave requires an open workers ' compensation claim . T :\Council Agenda Reports\2012\2012-04-10\Confidential Resolution (Irons-Zoeher)\Exhibit A .doc C2-9 ATTACHMENT 2 Page 1 of 2 RESOLUTION NO . (2012 Series ) A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO CEASIN G TO PAY AND REPORT THE VALUE OF EMPLOYER PAID MEMBE R CONTRIBUTIONS FOR UNREPRESENTED CONFIDENTIAL EMPLOYEES AN D SUPERSEDING PREVIOUS RESOLUTIONS IN CONFLIC T WHEREAS,the Council of the City of San Luis Obispo has the authority to implemen t Government Code Section 20636(c) (4) pursuant to Section 20691 ; an d WHEREAS,the Council of the City of San Luis Obispo has a resolution which reduces th e Employer Paid Member Contribution (EPMC) 3% effective June 28, 2012, 6% January 24, 201 3 and which no longer provides for the normal member contributions to be paid by the employer an d reported as additional compensation effective June 27, 2013 ; an d WHEREAS,one of the steps in the procedures to implement Section 20691 is the adoptio n by the Council of the City of San Luis Obispo of a Resolution to no longer pay and report the valu e of said Employer Paid Member Contributions (EPMC); and WHEREAS,the governing body of the City of San Luis Obispo has identified th e following conditions for the purpose of its election to no longer pay EPMC ; •Effective June 28, 2012, six percent of the normal contributions will be paid a s EPMC, and the same six percent (value) of compensation earnable {excludin g Government Code Section 20636(c)(4)} will be reported as additional compensatio n for the Unrepresented Confidential Employees . •Effective January 24, 2013, three percent of the normal contributions will be paid a s EPMC, and the same three percent (value) of compensation earnable {excludin g Government Code Section 20636(c)(4)} will be reported as additional compensatio n for the Unrepresented Confidential Employees . •Effective June 27, 2013 this benefit shall no longer apply to all employees of th e Unrepresented Confidential Employees . •Effective June 27, 2013, zero percent of the normal contributions will be paid a s EPMC, and the same zero percent (value) of compensation earnable {excludin g Government Code Section 20636(c)(4)} will be reported as additiona l compensation . NOW, THEREFORE, BE IT RESOLVED,that the Council of the City of San Lui s Obispo hereby : SECTION 1 .Effective beginning June 28, 2012 elects to reduce the EPMC as set fort h above and effective June 27, 2013 elects to no longer pay the member contribution and therefore n o longer report EPMC as additional compensation . SECTION 2 . Directs that prior resolutions relating to the Unrepresented Confidentia l T :\Council Agenda Reports\2012\2012-04-10\Confidential Resolution (Irons-Zocher)\ATTACHMENT 2-Confidential Resolution 201 2 EPMC .doe C2-10 ATTACHMENT 2 Page 2 of 2 Employees compensation and benefits are hereby superseded to the extent inconsistent with thi s resolution . Upon motion of , seconded b y , and on the following vote : AYES : NOES : ABSENT : The foregoing resolution was adopted this 10th day of April . Mayor Jan Marx ATTEST : Sheryll Schroeder, Interim City Cler k APPROVED AS TO FORM : /s/ Christine Dietrick_ J . Christine Dietric k City Attorney T :\Council Agenda Reports\2012\2012-04-I0\Confidential Resolution (Irons-Zocher)\ATTACHMENT 2-Confidential Resolution 201 2 EPMC .doe C2-11 Page intentionally lef t blank .