FROM:
Human Resources
SUBJECT:
Title
Implementation of Classification and Compensation Study and Approval of Updated Terms of Employment for Employees of the Management/Confidential Group.
End
RECOMMENDATION:
Recommendation
Authorize the City Manager to award future one-time payments of up to $2,000 per employee for Management/Confidential and Executive employees.
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COUNCIL GOALS:
• Operate in a businesslike manner by ensuring that the public debate is based on accurate information.
• Practice sound fiscal management by producing timely and accurate financial information.
• Practice sound fiscal management by living within our means while investing in the future.
• Create and maintain a dynamic team by promoting stability and predictability by providing consistent policy direction.
• Create and maintain a dynamic team by communicating Goals and Objectives to all commissions and employees.
• Create and maintain a dynamic team by emphasizing staff development.
DISCUSSION:
On February 14, 2023, the City Council awarded an agreement to Public Sector Personnel Consultants (PSPC) to assess the competitiveness of the City’s current classification and compensation structure for all positions city-wide. A Classification and Compensation Study was conducted, and the findings were presented to the City Council during Closed Session on May 14, 2024. At that time, the City Council directed staff to develop a pathway toward competitive pay as part of their goal to address employee recruitment, retention, and stability.
Coinciding with these efforts, the Confirmation of Understanding between the City and the Management/Confidential Group (“Management/Confidential”) expired as of June 30, 2024. The City Manager has been engaged in discussions with Management/Confidential since May 2024, with the implementation plan outlined below incorporated into these discussions.
Implementation Plan
Although the study found that the City was, on average, five percent (5%) ahead of market based on total compensation, many of our current salary ranges are below the market average for similar roles in comparable cities, which directly impacts recruitment and employee retention. Specifically, PSPC identified classifications within Management/Confidential as being an average of 2.1% below market. Aligning salary ranges with the market average and wage adjustments moving forward are essential for maintaining a competitive and fair compensation structure. The implementation plan outlined below will address current pay disparities to be fair and equitable, support employee satisfaction, and enhance our ability to attract and retain top talent.
Effective February 8, 2025, salary ranges for Management/Confidential classifications identified as below market will be adjusted to the rate established in the Classification and Compensation Study, and the wage adjustment applied. On average, classifications within Management/Confidential are being adjusted by 3.6%. For the classifications identified as below market, incumbents will be moved to the next highest step within the new range, potentially unlocking future earning potential for the incumbent within their updated classification’s salary range.
Management/Confidential Deal Points
In addition to implementation of the Classification and Compensation Study, the City has concluded discussions with Management/Confidential. City staff and Management/Confidential have agreed on updated terms and conditions of employment outlined below:
• One-time, $2,000 payment for each employee as of December 10, 2024.
• On February 8, 2025, an additional 1.0% base salary increase (3.0% was applied as of July 13, 2024), resulting in a net base salary increase of 4.0% for Year 1 (FY 2024-2025).
• On July 12, 2025, a 4.0% base salary increase.
• On July 11, 2026, a 3.0% base salary increase.
• Increase to Floating Holidays, including the value of the Day after Thanksgiving and one (1) additional Floating Holiday.
The respective salary tables will be presented at the January 28, 2025, City Council Meeting.
FISCAL IMPACT:
The total estimated budgetary financial impact associated with the approval of this item is $2,026,530 for the Management Confidential group through June 30, 2027, and one-time payments of $225,219 for Management Confidential employees and $26,377 for Executives.
MOTION:
Approve staff recommendation.