HomeMy WebLinkAboutR-11267 amending Management Compensation for appointed officials, department heads, and management employees
R 11267
RESOLUTION NO. 11267 (2021 SERIES)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA, AMENDING MANAGEMENT COMPENSATION
FOR APPOINTED OFFICIALS, DEPARTMENT HEADS, AND
MANAGEMENT EMPLOYEES AND SUPERSEDING PREVIOUS
RESOLUTIONS IN CONFLICT
WHEREAS, the unrepresented management employees (Appointed Officials,
Department Heads, and Management Employees) of the City of San Luis Obispo have
remained committed to providing high quality service to the community; and
WHEREAS, the City Council is committed to providing competitive compensation
as provided in the City’s adopted Compensation Philosophy.
NOW, THEREFORE, BE IT RESOLVED, that the Council of the City of San Luis Obispo
hereby revises unrepresented management compensation as follows:
SECTION 1. The City agrees to increase the salaries of unrepresented
management employees with a 3% cost of living adjustment (COLA) effective the first full
pay period of July 2021.
SECTION 2. The City agrees to complete a benchmark compensation study by
February 28, 2022 which will inform competitiveness in the market and frame the next round
of conversations with the unrepresented management group.
SECTION 3. The City shall continue to provide employees certain fringe benefits
as set forth in Exhibit “A”, fully incorporated by reference.
SECTION 3. The Director of Finance shall adjust the appropriate accounts to reflect
the compensation changes.
SECTION 4. This resolution shall be in effect from July 20, 2021 through June 30,
2022.
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Resolution No. 11267 (2021 Series) Page 2
R 11267
SECTION 5. Amendments to compensation for unrepresented management
employees do not constitute a “Project” under CEQA Guidelines Sec. 15378.
Upon motion of Council Member Christianson, seconded by Council Member Pease,
and on the following vote:
AYES: Council Member Christianson, Marx, Pease, Vice Mayor Stewart, and
Mayor Harmon
NOES: None
ABSENT: None
The foregoing resolution was adopted this 20th day of July 2021.
_____________________________
Mayor Heidi Harmon
ATTEST:
__________________________
Teresa Purrington
City Clerk
APPROVED AS TO FORM:
__________________________
J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the
City of San Luis Obispo, California, on ______________________.
_____________________________
Teresa Purrington
City Clerk
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7/23/2021 | 7:49 AM PDT
EXHIBIT “A”
Table of Contents
Section A Medical, Dental, Vision ............................................................................................. 1
Section B Health Flex Allowance .............................................................................................. 2
Section C Life and Disability Insurance .................................................................................... 3
Section D Retirement .................................................................................................................. 3
Section E Supplemental Retirement ......................................................................................... 5
Section F Pay for Performance ................................................................................................. 5
Section G Vacation ...................................................................................................................... 5
Section H Administrative Leave ................................................................................................. 6
Section I Holidays ...................................................................................................................... 7
Section J Sick Leave .................................................................................................................. 8
Section K Workers’ Compensation Leave ............................................................................... 9
Section L Work Out-of-Classification ....................................................................................... 9
Section M Temporary Assignment ............................................................................................ 9
Section N Vehicle Assignment ................................................................................................. 10
Section O Uniform Allowance .................................................................................................. 10
Section P Appointed Officials .................................................................................................. 10
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EXHIBIT “A”
Page 1
Section A Medical, Dental, Vision
The City shall establish and maintain medical, dental and vision insurance plans for
appointed officials, department heads, management employees and their dependents.
The City reserves the right to choose the method of insuring and plans to be offered.
PERS Health Benefit Program
The City has elected to participate in the California Public Employees’ Retirement System
(CalPERS) Health Benefit Program. The City shall contribute an equal amount towards
the cost of medical coverage under the Public Employee’s Medical and Hospital Care Act
(PEMHCA) for both active employees and retirees. The City’s contribution toward
coverage under PEMHCA shall be the statutory minimum contribution amount
established by CalPERS on an annual basis. The City's contribution will come out of that
amount the City currently contributes to employees as part of the City’s Section 125 Plan
“Cafeteria Plan”. The cost of the City's participation in CalPERS will not require the City
to expend additional funds toward health insurance. In summary, this cost and any
increases will be borne by the employees.
Health Insurance Benefits for Domestic Partners
The City has adopted a resolution electing to provide health insurance benefits to
domestic partners (Section 22873 of the PEMHCA).
Conditional Opt Out
In order to receive the conditional opt-out incentive, employees will be required to
complete an affidavit and provide proof of other minimum essential coverage for
themselves and their qualified dependents (tax family) upon initial enrollment and
annually thereafter. Employees are required to certify that they are not enrolled in an
individual plan or in a medial plan offered under a federal marketplace or a state exchange
plan.
The monthly conditional opt-out incentives are:
Opt Out $200
“Legacy” Opt Out $790 (hired before September 1, 2008)
The conditional opt-out incentive shall be paid in cash (taxable income) to the employee.
The employee must notify the City within 30 days of the loss of other minimum essential
coverage. The conditional opt-out payment shall no longer be payable if the employee
and family members cease to be enrolled in other minimum essential cov erage.
Employees receiving the conditional opt-out amount will also be assessed $16.00 per
month to be placed in the Retiree Health Insurance Account. This account will be used
to fund the City's contribution toward retiree premiums and the City's costs for the Public
Employee's Contingency Reserve Fund and the Administrative Costs. However, there is
no requirement that these funds be used exclusively for this purpose nor any guarantee
that they will be sufficient to fund retiree health costs, although they will be used for
negotiated employee benefits.
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EXHIBIT “A”
Page 2
Dental and Vision Insurance/Dependent Coverage
Employee participation in the City's dental and vision plans is optional. Employees who
elect coverage shall pay the dental and/or eye premium by payroll deductions on a pre-
tax basis through the City’s Cafeteria Plan.
Section B Health Flex Allowance
Employees electing medical coverage in the City’s plans shall receive a health flex
allowance, as defined by the Affordable Care Act (ACA) and shall purchase such
coverage through the City’s Cafeteria Plan. If the health flex allowance is less than the
cost of the medical plan, the employee shall have the opportunity to pay the difference
between the health flex allowance and the premium cost on a pre -tax basis through the
City’s Cafeteria Plan. If the premium cost for medical coverage is less than the health
flex allowance, the employee shall not receive any unused health flex in the form of cash
or purchase additional benefits under the Cafeteria Plan.
The current monthly health flex allowance amount for regular, full -time employees is
outlined below:
Level of Coverage
2021 Monthly
Health Flex
Allowance Rates
Employee Only $593
Employee Only “Legacy” $790
Employee Plus One $1,173
Family $1,588
Employees hired prior to September 1, 2008 that elect employee only medical coverage
will receive the health flex allowance listed above for employee only “legacy” coverage.
As of January 1, 2015, if an employee that is receiving Employee Only or Opt Out “legacy”
coverage changes their level of coverage, they will be eligible to return to the “legacy”
coverage in a future year. If the premium cost for medical coverage is less than the health
flex allowance, the employee shall no longer receive any unused health flex in the form
of cash.
Effective in January 2022, the City’s total health flex allowance for group medical coverage
shall be modified by an amount equal to one-half of the average percentage increase for
family coverage in the PERS health plans available in San Luis Obispo County. For
example: if three plans were available and the year-to-year changes were +10%, +20%,
and -6% respectively, the City’s contribution would be increased by 4% (10% + 20% + -
6% ÷ 3 = 8% x 1/2).
Less than full-time employees shall receive a prorated share of the City’s contribution.
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EXHIBIT “A”
Page 3
The City agrees to continue its contribution to the health flex allowance for two (2) pay
periods in the event that an employee has exhausted all paid time off and leave approved
under the federal Family and Medical Leave Act (FMLA) and the California Family Rights
Act (CFRA) due to an employee's catastrophic illness. That is, the employee shall receive
regular City health flex allowance for the first two (2) pay periods following the pay period in
which the employee’s accrued leave balances reach zero (0) and FMLA/CFRA benefits
have been exhausted.
Section C Life and Disability Insurance
The City shall provide the following special insurance benefits in recognition of
management responsibilities:
1. Long-term disability insurance providing 66 2/3% of gross salary (maximum
benefit $11,250 per month) to age 65 for any sickness or accident, subject to
the exclusions in the long-term disability policy, after a 30-day waiting period.
2. In addition to $4,000 term life insurance purchased by the employee, the City
provides a $100,000 term life insurance including accidental death and
dismemberment through the City’s Cafeteria Plan.
Section D Retirement
A. PERS Contracts
1. “Classic Members First Tier” non-sworn and sworn employees hired before
December 6, 2012.
The City agrees to provide the Public Employees' Retirement System’s (PERS)
2.7% at age 55 plan to all non -sworn employees and the 3% at 50 plan to all
sworn employees. The 2.7% at 55 plan includes the following amendments:
1959 Survivor’s Benefit – Level Four, conversion of unused sick leave to
additional retirement credit, one-year final compensation, Military Service
Credit, and Pre-Retirement Optional Settlement 2 Death Benefit. The 3% at
age 50 plan includes the following amendments: Post-Retirement Survivor
Allowance, conversion of unused sick leave credit to additional retirement
credit, 1959 Survivor’s Benefit- Level Four, one-year final compensation,
Military Service Credit, and Pre-Retirement Optional Settlement 2 Death
Benefit.
2. “Classic Members Second Tier” non-sworn and sworn employees hired on or
after December 6, 2012.
The City agrees to provide the PERS 2% at 60 plan for non-sworn employees
using the highest three-year average as final compensation. The second-tier
formula for non-sworn employees will include the following amendments: 1959
Survivor’s Benefit – Level Four, conversion of unused sick leave to additional
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EXHIBIT “A”
Page 4
retirement credit, Military Service Credit, and Pre-Retirement Optional
Settlement 2 Death Benefit. Employees hired under t his plan will pay the full
member contribution required under the plan, presently seven percent (7%).
For sworn “Classic Members” hired on or after December 6, 2012, the City will
provide the PERS 3% at 55 plan for sworn Fire employees and 2% at 50 plan
for sworn Police employees using the highest three -year average as final
compensation. The second-tier formula for sworn employees will include the
following amendments: Post Retirement Survivor Allowance, conversion of
unused sick leave to additional retirement credit, the 1959 Survivor’s Benefit –
Level Four, Military Service Credit, and Pre-Retirement Optional Settlement 2
Death Benefit.
3. “New Members Third Tier” non-sworn and sworn employees hired after
January 1, 2013. PERS determines who are “New Members” within the
meaning of the California Public Employees’ Pension Reform Act (PEPRA).
The City will provide the PERS 2% at 62 plan for non -sworn employees and
2.7% at 57 plan for sworn employees, using the highest three-year average as
final compensation.
B. Member Contributions
1. “Classic Members First and Second Tier”
Effective the first pay period in January 2012, employees began paying the full
member contribution required under the plan for first and second tier sworn
(9%) and non-sworn (8% and 7% respectively) employees and the City
discontinued their payment of the member contribution. For purposes of this
Section, employee contributions are based on salary and special compensation
as defined by PERS.
Effective the first full pay period in July 2019, all non-sworn and sworn
employees shall contribute 1.5% in addition to the employee contribution
defined in the paragraph above. Effective the first full pay period in July 2020,
all non-sworn and sworn employees’ additional contribution shall increase to
3%, in addition to the employee contribution defined in the paragraph above.
These additional contributions are in accordance to the provisions of AB 340,
§7522.30 and §20516.
All of the employee contributions are made on a pre-tax basis as allowed under
Internal Revenue Service Code Section 414 (h) (2).
2. “New Members Third Tier”
Effective on their date of hire, new members will pay 50% of the normal cost,
as determined by PERS.
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EXHIBIT “A”
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Effective the first full pay period in July 2019, all non -sworn and sworn new
members shall contribute 1.5% in addition to the employee paying 50% of the
normal cost. Effective the first full pay period in July 2020, all non-sworn and
sworn new members contribution shall increase to 3%, in addition to the
employee paying 50% of the normal cost. These additional contributions are
in accordance to the provisions of AB 340, §7522.30 and §20516.
All of the employee contributions are made on a pre-tax basis as allowed under
Internal Revenue Service Code Section 414 (h) (2).
Section E Supplemental Retirement
The City shall contribute 1% of salary for department heads to a defined contribution
supplemental retirement plan established in accordance with sections 401 (a) and 501
(a) of the Internal Revenue Code of 1986 and California Government Code sections
53215-53224.
Section F Pay for Performance
In 1996 the City Council established the Management Pay for Performance System for
department heads and management employees. The system is designed to recognize and
reward excellent performance by department heads and managers and to provide an
incentive for continuous improvement and sustained high performance. Instead of step
increases, the department heads and management employees move through their salary
range solely according to accomplishment of objectives and job-related behavior. Further
information about the Management Pay for Performance System is found in the
Management Pay for Performance System Guide.
Section G Vacation
Vacation leave is governed by Section 2.36.440 of the Municipal Code, except that it may
be taken after the completion of the sixth calendar month of service from the benefit date
or earlier with department head or designee authorization. Each employee shall accrue
vacation leave with the pay at the following rates:
Management Employees
Years of
Service
Annual
Vacation
Accrual Days*
Annual
Vacation
Accrual Hours
0 to 5 years 12 days 96 hours
5 to 10 years 15 days 120 hours
10 to 20 years 18 days 144 hours
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EXHIBIT “A”
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20+ years 20 days 160 hours
Appointed Officials & Department Heads
Years of
Service
Annual
Vacation
Accrual Days*
Annual
Vacation
Accrual Hours
0 to 10 years 15 days 120 hours
10 to 20 years 18 days 144 hours
20+ years 20 days 160 hours
*One day is equivalent to eight (8) hours for a 40 -hour per week line-item position.
Vacation leave shall be accrued as earned biweekly provided that not more than twice
the annual rate (not including floating holiday leave) may be carried over to a new
calendar year. Management employees vacation time shall not exceed twice the annual
rate. If an employee reaches the cap at any time throughout the year, the employee will
stop accruing vacation leave.
Vacation schedules for management employees shall be based upon the needs of the
City and then, insofar as possible, upon the wishes of the employee.
Appointed officials, department Heads and management employees are eligible, once
annually in December, to request payment for up to 40 hours of unused vacation leave .
If an employee reaches the annual accrual cap before December, the employee will be able
to request vacation payment one additional time during the calendar year, in addition to the
December cash out. However, no more than 40 hours of unused vacation leave will be paid
out in any calendar year. Payment for unused vacation leave is subject to the availability
of budgeted funds.
To recognize the unprecedented year due to the COVID-19 pandemic, department heads
and management employees will be able to request payment for an additional 40 hours
of unused vacation, for a total of 80 hours in the 2021 calendar year. If an employee
reaches the annual accrual cap before December 2021, the employee will be able to
request vacation payment of one additional time during the calendar year, in addition to
the December cash out. However, no more than 80 hours of unused vacation leave will
be paid out in the 2021 calendar year.
Section H Administrative Leave
Appointed officials and department heads shall be granted 80 hours of administrative
leave the pay period that January 1st falls into.
Management employees shall be granted 48 hours of administrative leave the pay period
that January 1st falls into.
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EXHIBIT “A”
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Administrative leave hours shall be pro-rated on a pay period basis when a department
head or management employee is appointed or leaves employment during the calendar
year. The employee’s final check will be adjusted to reflect the pro-rated hours, however
there is no provision to receive cash payment for unused ad ministrative hours. Unused
administration leave will not be carried over year to year but can be taken through
December 31st of each year.
Appointed officials, department heads and management employees are considered
exempt from the overtime provisions of the Fair Labor Standards Act (FLSA) and not
eligible for overtime payment. In general, management employees are expected to work
the hours necessary to successfully carry out their duties and frequently must return to
work or attend meetings and events outside their normal working hours. However, in the
event a state of emergency is called for the City of San Luis Obispo by the City Council,
County of San Luis Obispo, State of California, or Federal Government, employees can
be paid at the rate of time and one-half for the hours worked in excess of forty (40) hours
per week on activities related to disaster management and recovery that are reimbursable
by state or federal funding. Approved employees can be similarly compensated when
rendering aid to other agencies in an emergency declaration situation where overtime is
reimbursable by the requesting agency upon approval by their Department Head or
designee.
Section I Holidays
Appointed officials, department heads, and management employees shall receive eleven
(11) fixed plus two (2) floating holidays per year. The following days of each year are
designated as paid holidays:
• January 1 – New Year’s Day
• Third Monday in January – Martin Luther King Jr. Birthday
• Third Monday in February – Presidents’ Day
• Last Monday in May – Memorial Day
• July 4 – Independence Day
• First Monday in September – Labor Day
• November 11 – Veteran’s Day
• Fourth Thursday in November – Thanksgiving Day
• Friday after Thanksgiving
• December 25 – Christmas
• One half day before Christmas
• One half day before New Year’s Day
When a holiday falls on a Saturday, the preceding Friday shall be observed. When a
holiday falls on a Sunday, the following Monday shall be observed. A holiday shall be
defined as eight (8) hours of paid time off for regular full-time employees.
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When Christmas or New Year’s Holiday falls on a Tuesday or Thursday, the City reserves
the right to close non-essential City services and offices on Monday or Friday (the day
adjacent to the observed holiday). Essential City services are determined at the
discretion of the department head. Employees scheduled to work in non-essential
functions on the days adjacent to the paid holidays would be required to use appropriate
personal leave. The City would notify employees of closure of non-essential City services
and offices no later than October 31st of the same year in order to provide employees with
ample time to plan accordingly.
The two floating holidays (16 hours) will be provided in a floating holiday leave bank the
pay period that January 1st falls within and will be prorated on a pay period basis if an
employee starts later in the year. Employees will have the ability to use floating holiday
leave hours at any point during the calendar year. Unused floating holiday leave will not
be carried over year to year but can be taken through December 31 st of each year.
If an employee terminates for any reason, the employee’s final check will be adjusted to
reflect the prorated hours calculated on a pay period basis; however, there is no provision
to receive cash payment for unused floating holiday hours. Unused floating holiday leave
will not be carried over year to year but can be taken through December 31st of each year.
Section J Sick Leave
Sick leave is governed by Section 2.36.420 of the Municipal Code. An employee shall
accrue sick leave with pay at the rate of twelve (12) days or the prorated shift equivalent
per year of continuous service since the benefit date. An employee may take up to 48
hours per calendar year of sick leave if required to be away from the job to personally
care for a member of their immediate family as defined in Section 2.36.420, Labor Code
233 and/or Assembly Bill 1522. This may be extended to 56 hours if a household family
member is hospitalized, and the employee submits written verification of such
hospitalization.
In conjunction with existing leave benefits, appointed officials, department heads, and
management employees with one year of City service who have worked at least 1,250
hours in the previous year may be eligible for up to 12 weeks of Family/Medical Leave in
accordance with the federal Family and Medical Leave Act (FMLA) and the California
Family Rights Act (CFRA). In the event an employee is caring for a family member and
is covered under FMLA/CFRA, they will be able to use all accrued sick leave to care for
a family member.
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 forty working hours for each incident. The employee may be requir ed to
submit proof of relative’s death before being granted sick leave pay. False information
concerning the death or relationship shall be cause for discharge.
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EXHIBIT “A”
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Upon retirement the employee may choose: 1) a payout of the employee’s accumulated
sick leave balance based on years of service according to the following schedule, 2) to
convert a portion or all of the employee’s sick leave balance to service credit in
accordance with CalPERS regulations, or, 3) a combination of these two options.
(A) Death – 25%
(B) Retirement and actual commencement of PERS benefits:
(1) After ten years of continuous employment – 10%
(2) After twenty years of continuous employment – 15%
Section K Workers’ Compensation Leave
An employee who is absent from duty because of on -the-job injury in accordance with
State workers’ compensation law and is not eligible for disability payments under Labor
Code Section 4850 shall be paid the difference between their base salary and the amount
provided by workers’ compensation law during the first ninety (90) business days of such
temporary disability absence. Eligibility for workers’ compensation leave requires an
open workers’ compensation claim.
If an employee is eligible for Total Temporary Disability benefits after exhausting 4850 or
salary continuation as defined in the paragraph above, the employee will receive such
payment directly from the City’s workers’ compensation administrator and will only be
able to supplement pay with accrued sick leave. If an employee is paid for less than half
of their regularly scheduled hours during a pay period, and are not on a protected leave,
the employee will not be eligible for the City’s health flex allowance or conditional opt out
incentive.
Section L Work Out-of-Classification
An out-of-class assignment is the full-time performance of all the significant duties of an
available, funded position in one classification by an individual in a position of another
classification. An employee assigned in writing by management to work out-of-class in a
position that is assigned a higher pay range which is vacant pending an examination or
is vacant due to an extended sick or disability leave, shall receive no less than five percent
(5%), but in no case more than the top salary of the higher range, in addition to their
regular base rate commencing on the eleventh consecutive workday of the out -of-class
assignment.
Section M Temporary Assignment
An appointing authority or designee may temporarily assign an employee to a different
position for a specific period not to exceed ninety (90) days, after which the employee
returns to their regular duties and position from which they were regularly assigned. The
temporary assignment may be extended past ninety (90) days if agreed to by the
employee in writing. Such action shall have the prior approval of the Human Resources
Director or designee. An appointing authority may assign an employee to a different
position for a period not to exceed ninety (90) days, provided the employee has received
twenty-four (24) hours written notice which includes reasons for the assignment.
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Employees who are subject to temporary assignment shall be compensated in
accordance with Section L.
Section N Vehicle Assignment
The Fire Chief and Police Chief will be provided a City vehicle for emergency response
during off-duty time. All other department heads shall receive a car allowance of $236
per month, paid semi-monthly.
The use of a personal automobile for City business will be eligible for mileage
reimbursement in accordance with standard City policy.
Section O Uniform Allowance
Employees required to wear a uniform, including the Fire Chief, Deputy Fire Chief, Fire
Marshal and Police Chief, shall receive the same uniform allowance as those they directly
supervise. For “Classic Members” as defined by PERS, uniform allowance sha ll be
reported to PERS as special compensation. Uniform allowance will not be pro-rated upon
separation from employment.
Section P Appointed Officials
The benefits outlined in this exhibit for department heads apply to appointed officials,
except where they have been modified by council resolution.
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