SAN JOSE CAPITAL OF SILICON VALLEY

Transcription

1 CITY OF SAN JOSE CAPITAL OF SILICON VALLEY Memorandum TO: CITY COUNCIL FROM: Mayor Sam Liccardo SUBJECT: AMENDMENT TO CITY'S : June 24, 2016 PAY PLAN AND COMPENSATION ADJUSTMENTS FOR COUNCIL APPOINTEES Approved Date RECOMMENDATION 1. Accept the market salary survey results for Council Appointees. 2. Adopt a resolution to: a. Amend the City San Jose Pay Plan effective July 3, 2016 as follows: i. Create a salary range for the classification of City Attorney (2135) to the new pay range of $222,789 - $300,000 annually., ii. Create a salary range for the classification of City Auditor (1256) to the new pay range of $132,803 - $202,932. iii. Create a salary range for the classification of City Clerk (1614) to the new pay range of $132,803 - $188,268. iv. Create a salary range for the classification of Independent Police Auditor (8023) to the new pay range of $132,803 - $207,030. b. Based on annual review process, approve a one-time merit pay for the City Manager in the amount of 3% bonus of annual base salary, effective July 3, c. To restore salaries for appointees at a rate commensurate with Unit 99 since 2011, approve the following merit increases, effective July 3, 2016: i. Increase the base salary of the City Attorney by 5% to the amount of $238, annually, and reinstate the monthly car allowance to the City Attorney, as provided to other Council Appointees. ii. Increase the base salary of the City Auditor by 5% to the amount of $199, annually. OUTCOME Approval of the above recommendation will amend the City of San Jose Pay Plan to create a salary range for the City Attorney, City Auditor, Independent Police Auditor and City Clerk consistent with Council's action last year creating a salary range for the City Manager, and will ensure that

2 Honorable Mayor and City Council June 24, 2016 Subject: Amendments to the City's Pay Plan for Council Appointees and Compensation Adjustments Page 2 of 3 all of the Council Appointees have salaries restored since 2011 at a rate commensurate to employees in Unit 99. DISCUSSION Salary Ranges Unlike other city classifications, Council Appointees have not traditionally had a salary range delineated by the City of San Jose Pay Plan. In December 2015, the City Council amended the Pay Plan to create a salary range for the City Manager based on a nationwide salary survey (note: this amendment did not include an actual salary increase). To ensure the City Council was fair and consistent with all Council Appointees, the City Council also directed the City Manager to conduct market salary survey for the City Attorney, City Auditor, City Clerk, and Independent Police Auditor to ascertain San Jose's current salary comparisons. Based on the results of the salary surveys, the City's Human Resources Department recommends the above-mentioned salary ranges for the remaining Council Appointees (Attachment A). The use of a nationwide and/or statewide city comparison pool provides a recognized "best practice," because recruitment for top management positions requires a national and statewide search. Adjusting these ranges better positions the City to retain and attract executive managers, and can help avoid potential salary compaction issues. Compensation Adjustments The City Council will typically consider compensation increases for Council Appointees after it has completed its annual performance review of the Appointee and formal budgetary action. In March of this year, the City Manager's Annual Review took place. As a result of this review and of the City Manager's excellent performance, I recommend that we award the City Manager a 3% one-time, non-pensionable bonus in FY The City Manager has graciously declined to accept a pay increase. While other Appointees' annual reviews have not yet been completed, I recommend we take immediate action for the City Attorney and City Auditor. Both the City Attorney and City Auditor served in their current positions in April 2010 when they incurred 10% cuts in total compensation among the first City employees to do so to cover historic budget deficits. Both Appointees have subsequently received general wage increases awarded to all other nonsworn employees, including the three percent (3%) increase effective June 19,2016, but they have not been awarded any merit increases in the past five years. In contrast, the City resumed awarding step increases and merit increases for other City employees in FY Since that time, the average merit increase for Unit 99 employees has equaled 5.52% (see attachment B). I recommend increasing the City Attorney's and City Auditor's base salary by 5%. In addition, in 2011, the City Attorney voluntary suspended his monthly car allowance afforded to all Council Appointees. Since all of the other Council Appointees still receive a monthly car allowance, I recommend the reinstatement of this payment for the City Attorney.

3 Honorable Mayor and City Council June 24, 2016 Subject: Amendments to the City's Pay Plan for Council Appointees and Compensation Adjustments Page 3 of 3. Since the current City Clerk and Independent Police Auditor were not in their current positions 2011, future compensation increases will occur through the Annual Review Process. Attachment A - Human Resources Department Salary Range Memo Attachment B - City Workforce Pay Restoration Analysis from January 26, 2016

4 Attachment A CITY OF SAN JOSE CAPITAL OF SILICON VALLEY TO: Lee Wilcox - Mayor's Office Budget Director SUBJECT: Council Appointee Recommended Salary Ranges Memorandum FROM: Joe Angelo : June 22, 2016 Based on an analysis of comparative salaries from the market salary survey, staff offers the creation of the following salary ranges for Council Appointees for Council consideration: a. The market salary survey results for the City Attorney classification had a range of $149, to $300, Staff recommends using the same market salary range maximum for the City Attorney classification as this is an indicator of the maximum amount the market is willing to compensate an individual in this position. Additionally, there are compaction challenges in the CAO organization. Based on this review staff offers the following for consideration: City Attorney: new annual salary range of $222, $300, This creates a salary range for that classification and increases the range maximum approximately 32% above the current salary maximum. b. The market salary survey results for the City Auditor classification had a range of $126, to $202, Staff recommends using the same market salary range maximum for the City Auditor classification as this is an indicator of the maximum amount the market is willing to compensate an individual in this position. Based on this review staff offers the following for consideration: City Auditor: new annual salary range of $132, $202, This creates a salary range for that classification and increases the range maximum approximately 7% above the current salary maximum. c. The market salary survey results for the City Clerk classification had a range of $100, to $188, Staff recommends using the same market salary range maximum for the City Clerk classification as this is an indicator of the maximum amount the market is willing to compensate an individual in this position. Based on this review staff offers the following for consideration: City Clerk: new annual salary range of $132, $188, This creates a salary range for that classification and increases the range maximum approximately 21% above the current salary maximum. d. The market salary survey results for the Independent Police Auditor (IPA) classification had a range of $102, to $178, Staff recommends using a higher range maximum for the IPA classification as there are compaction challenges in the IPA organization. Based on this review staff offers the following for consideration: Independent Police Auditor: new annual salary range of $132, $207, This

5 creates a salary range for that classification and increases the range maximum approximately 13% above the current salary maximum. Joe Angelo Director, Human Resources

6 CITY OF 0% C: *2 SANJOSE CAPITAL OF SILICON VALLEY TO: HONORABLE MAYOR AND CITY COUNCIL SUBJECT: SEE BELOW COUNCIL AGENDA: 1/26/2016 ITEM: 3^2, Memorandum FROM: Jennifer Schembri : January 20,2016 Approved-"^ " PS<-, ( ^ l/lo/tb SUPPLEMENTAL SUBJECT: INFORMATION REQUESTED BY THE CITY COUNCIL REGARDING CITY WORKFORCE PAY INCREASES SINCE REASON FOR SUPPLEMENTAL This supplemental memorandum is intended to provide information regarding the extent of City workforce pay increases since , per the direction of the City Council as part of Item 3.3 on the December 8, 2015 San Jose City Council Agenda. BACKGROUND At the November 18, 2015, Rules Committee meeting, the City Manager was directed to provide information regarding the status of the City's efforts to restore pay and any other compensation increases given to the entire City workforce since , including general wage increases, step increases, and management pay for performance increases, prior to making any decisions to restore Council pay. This memo contains background information regarding the history of citywide compensation reductions beginning in 2010 and information regarding employee salary increases. In November 2010, the City Council in open session approved a Fiscal Year goal of reducing the total ongoing employee compensation for all City employees by ten percent (10%) and rolling back any general wage increases received in Fiscal Year This ten percent (10%) reduction in personnel costs was realized on June 26, 2011 for ten (10) of the City's eleven (11) bargaining units, as well as Executive Management (Unit 99) staff, and on September 18, 2011 for the remaining bargaining unit. In addition, on June 7, 2011, the City Council in open session approved the recommendation of the Council Salary Setting

7 HONORABLE MAYOR AND CITY COUNCIL January 20,2016 Subject: Information on Citywide Pay Increases Since Page 2 of 5 Commission Report, dated April 26, 2011, which, in part, was to reduce the salaries of the Mayor and each Councilmember by approximately ten percent (10%). The Salary Setting Commission's Report, dated April 22, 2015, recommends to the City Council a 9.6% salary increase for the Mayor, and 13.6% salary increase for the Council. The City Council has not received a salary increase since approving the Salary Setting Commission's 2011 recommendation to approve the ten percent (10%) decrease for Councilmembers. ANALYSIS Average City Workforce Pay Increases Following the pay reductions for City staff, which were fully realized by September 18, 2011, there have been various pay increases for employees represented by the City's eleven (11) bargaining units, as well as employees in Unit 99. These pay increases have come from negotiated general wage increases, salary step advancements, and performance based compensation increases as a result of the Management Performance Program (MPP). For the purpose of tracking City workforce pay increases since , all data related to employees receiving step and/or performance based compensation increases has been limited to employees who have been employed by the City from September 18, 2011 through December 15, In some cases, employees may have transferred between bargaining units during this time. In circumstances such as these, any step or performance based compensation increases as a result of the MPP have been counted toward the bargaining unit that represented the employee at the time they received the step or MPP increase. It is also important to note that data contained in this memorandum does not include salary increases due to employee promotions, or adjustments made to the City's Pay Plan in response to recruitment and retention issues, such as modifications to the Electrician class series, Building Inspector class series, and the Planner class series, among others. General Wage Increases (GWI) Following the ten percent (10%) reduction in personnel costs, the MOAs reached with the City's bargaining units, as well as the Compensation Summary for employees within Unit 99, have contained the following GWI:

8 HONORABLE MAYOR AND CITY COUNCIL January 20,2016 Subject: Information on Citywide Pay Increases Since Page 3 of 5 Employee Unit Ongoing GWI FYE FYE 2016 Effective June 19, Effective First Pay Period FY OE#3 8.00% 3.00% 3.00% IAFF 8.00% 3.00% 3.00% ABMEI 8.00% 3.00% 3.00% IBEW 8.00% 3 00% AvANMVSIIA AMSP 8.00%. 3.00% 3.00% 8.00% 3.00% 3.00% CAMP 8.00% 3.00% 3.00% POA 10.66% MEF 8.00% 3.00% 3.00% 8.00% 3.00% _4 Unit % 3.00% 3.00% 8.00% 3 00% _5. Average 8.22% 3.00% A comprehensive, listing of all GWI from Fiscal Year through all current MO As can be found in Attachment A. Step Increases Employees in classifications represented by the POA, IAFF, ABMEI, MEF, OE#3, IBEW, and CEO are non-management employees. Per their MOAs and City Policy Manual, Section 3.3.3, Non-Management Performance Program, classifications represented by these bargaining units have specific salary steps within their pay ranges that employees advance through based on the amount of time they have spent in their current classification and step. With the exception of transitioning from Step 1 to Step 2 for some bargaining units, an automatic step increase is granted to employees upon completion of one full year (2,080 hours worked) in each step. Prior to June 26, 2011, there had been a difference of approximately five percent (5%) between steps within a single classification. Effective June 26, 2011 for ABMEI, MEF, OE#3, IBEW, and effective September 18, 2011 for CEO, for classifications in these bargaining units the difference in pay between each salary step changed from approximately five percent (5%) to approximately two and one half percent (2.5%), which resulted in an increase in the number of 1 The IBEW MOA expires on June 30, This figure does not include a 4.00% ongoing, non-pensionable retention bonus premium pay that was agreed to as part of the January 1, December 31,2016 MOA between the City and the POA. 3 The POA MOA expires on December 31, The CEO MOA expires on June 30, The ALP MOA expires on June 30,2017.

9 HONORABLE MAYOR AND CITY COUNCIL January 20,2016 Subject: Information on Citywide Pay Increases Since Page 4 of 5 steps in the pay ranges for these classifications. POA and IAFF continue to have a five percent (5%) difference between steps. Bargaining Unit Number of Employees Percentage of Employees at Top Step in 2011 Percentage of Employees at Top Step in 2015 Average Total Increase from Step Increases Per Employee POA % 94.45% 4.72% IAFF 67.88% 88.40% 6.91% ABMEI % 87.50% 3.90% MEF 1, % 46.80% OE# % 65.70% 3.71% IBEW 89.36% 81.40% CEO % 65.79% 2.56% Please note that this data represents the average total salary increase per applicable employee due to step increases over a time period of over approximately four years, from September 18, 2011 through December 15,2015. Please also note that this data includes employees who were at the top step of their classification on September 18, 2011 and who still occupied that same classification and step on December 15, As such, while these employees were part of the City workforce data set, they did not receive any additional salary increase(s) from one or more step increases, but were included when calculating the average increases from step increases per employee since Management Performance Program (MPP) Increases Employees in classifications represented by AEA, AMSP, CAMP, and ALP, as well as employees in Unit 99 are management employees. Per their MOAs, Compensation Summaries, and City Policy Manual, Section 3.3.2, Management Performance Program, classifications represented by these bargaining units, or contained within Unit 99, have open ranges in between their minimum and maximum salaries, instead of designated steps. Additionally, there are no automatic increases in pay as a result of the length of time an employee has spent within their classification. Instead, advancement in an MPP classification is achieved solely based on the employee's rating on their annual performance appraisal. During the fall of each year, the City Manager provides guidelines for salary increases based on performance ratings. Following the ten percent (10%) total compensation reduction, the MPP program was frozen until the beginning of FY Once it resumed, the guidelines provided for up to a two and one half percent (2.5%) merit increase based on performance. Per these guidelines, employees at the top of their salary range are eligible for up to a two and one half percent (2.5%) one-time lump sum bonus based on their performance. The data below reflects the ongoing merit increases received.

10 HONORABLE MAYOR AND CITY COUNCIL January 20,2016 Subject: Information on Citywide Pay Increases Since Page 5 of 5 Bargaining Unit And Executive Management Number of Employees Percentage of Employees at Top of Salary Range in 2011 Percentage of Employees at Top of Salary Range Average Total Increase from Ongoing MPP increases Per Employee AEA % 39.68% 5.45% AMSP Killiiiiii 15.00% 35.71% 4.54% CAMP % 45.24% 3.94% IPiiiSilf % 16.67% 5.36% Unit # % 31.28% 5.52% Please note that this data represents the average total salary increase per applicable employee due to performance based compensation increases as a result of the MPP over a time period of over approximately four years, from September 18, 2011 through December 15, Please also note that this data includes employees who were at the top of the pay scale for their classification on September 18, 2011 and who still occupied that classification and remained at the top of the pay scale for their classification on December 15, As such, while these employees were part of the City workforce data set, they did not receive any additional salary increase(s) from performance based compensation increases as a result of the MPP, but were included when calculating the average increases from ongoing MPP increases per employee since As each bargaining unit may have different amounts for salary step increases and MPP increases, it is difficult to provide an overall average of all City workforce pay increases received since per Council direction. A conservative method of accounting for City workforce pay increases from through December 15, 2015 would be to assume at least an eight percent (8%) increase as a result of GWIs, and either (1) a 2.23% pay increase due to salary step increases, or (2) a 3.94% pay increase due to performance based compensation increases as a result of the MPP.. JENNIFER SCHEMBRI Director of Employee Relations Attachment: List of all GWI from through all current MO As For questions please contact Jennifer Schembri, Director of Employee Relations, at (408)

11 Attachment A List of All General Wage Increases Through Current MOAs EMPLOYEE UNIT INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE OE#3 0.00% N/A 2.00% 4/27/ % 6/22/ % 6/21/ % 6/19/ % First PP 2017 IAFF 0.00% N/A 0.00% N/A 5.00% 6/22/ % 6/21/ % 6/19/ % First PP 2017 ABMEI 0.00% N/A 2.00% 11/24/ % 6/22/ % 6/21/ % 6/19/ % First PP 2017 IBEW 0.00% N/A 2.00% 10/27/ % 6/22/ % 6/21/ % 6/19/2016 TBD TBD AMSP 0.00% N/A 2.00% 6/23/ % 6/22/ % 6/21/ % 6/19/ % First PP 2017 AEA 0.00% N/A 2.00% 10/13/ % 6/22/ % 6/21/ % 6/19/ % First PP 2017 CAMP 0.00% N/A 2.00% 6/23/ % 6/22/ % 6/21/ % 6/19/ % First PP 2017 POA 0.00% N/A 4.00% 12/22/ %.6/22/ % 6/21/ % 6/19/2016 TBD TBD MEF 0.00% N/A 2.00% 6/23/ % 6/22/ % 6/21/ % 6/19/ % First PP 2017 CEO 0.00% N/A 2.00% 6/23/ % 6/22/ % 6/21/ % 6/19/2016 TBD TBD UNIT % N/A 2.00% 6/23/ % 6/22/ % 6/21/ % 6/19/ % First PP 2017 ALP % N/A 2.00% 6/23/ % 6/22/ % 6/21/ % 6/19/2016 TBD TBD Average 0.00% 2.00% _ 3.19% ;.3.03%.3.08% 3.00% EMPLOYEE UNIT TOTAL ONGOING TOTAL ONGOING OE#3 8.00% 14.00% IAFF 8.00% 14.00% ABMEI 8.00% 14.00% IBEW 8.00% 11.00% AMSP 8.00% 14.00% AEA 8.00% 14.00% CAMP 8.00% 14.00% POA 10.66% 14.66% MEF 8.00% 14.00% CEO 8.00% 11.00% UNIT % 14.00% ALP % 11.00% Average 8.22% 13.31% Additional Notes: 1 This wage increase was negotiated as part of FY 13/14 negotiations. 2 Prior to 2010 employees represented by ALP were in Unit POA contract expires on December 31,2016. IBEW, CEO, and ALP contracts expire on June 30, January 13, 2016 City of San Jose