HomeMy WebLinkAboutX-E-02 Compensation Study Implementation
City Council Memorandum
To: Mayor Fasbender & City Councilmembers
From: City Administrator Dan Wietecha
Date: September 6, 2022
Item: Implementation of Compensation Study
Council Actions Requested:
1. Adopt the Step & Grade Scale (2022 final).
2. Approve wage adjustments for non-represented (non-union) employees, retroactive to July 4,
2022, as outlined in this memo.
Background Information:
At the July 18 City Council meeting, Abdo Solutions presented the Position Classification &
Compensation Study Report. Subsequently, the Administration Committee of City Council met July 27
and August 5 to discuss the Study and how to implement it. The City Council held workshop on the
subject August 15.
I believe the recommendation fairly balances several priorities: making sure that the City is paying wages
competitive with neighboring communities, providing a formalized structure for internal consistency and
legal compliance, and maintaining a payroll that is affordable for the City’s budget. This positions the
City to retain high-performing employees, while also being able to recruit top talent to meet future needs.
Please note that the recommendation outlined here is subject to revision and approval by the City Council.
My recommendation is based on the two Administration Committee meetings and is also included in my
recommendations for the 2023 Budget. Here’s the step-by-step version of it:
Step G Step F Step E Step D Step C Step B Step A
$31.20 $32.52 $33.81 $35.12 $36.50 $37.72 $39.01
Step 1 Step 2 Step 3 Step 4 Step 5 Step 6 Step 7 Step 8
$34.53 $35.65 $36.81 $38.01 $39.25 $40.53 $41.85 $43.21
1. Ensure all positions are in the competitive market range. Please see the illustration above,
noting that each union, each position, and each individual employee will be different.
• The current pay range of this position goes from Step G ($31.20) to Step A ($39.01), and
this hypothetical employee is at Step B ($37.72).
• The competitive pay range is based on the survey of neighboring cities. It goes from Step
1 ($34.53) to Step 8 ($43.21).
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• The two pay ranges are lined up so no one would have a pay cut when converting from
the current range to the market range. Please note that some positions line up further
below the market than shown here, and some closer to or even above the market range.
• Several positions are currently above the new market range. They are recommended to
keep their current pay rate (no one has a cut in pay).
2. No cut in pay.
• No employee has a cut in pay when converting from the current range to the market
range.
• Depending on the position and the market, most positions would have an increase
somewhere between $0.20 and $1.56. There is one considerably below market currently,
which is recommended for $3.84 to get into the market range. There are also several
positions already above the market range, which would remain at their current wage as
discussed below.
• In the case of this hypothetical employee, converting from Step B to Step 4 results in a
modest raise of $0.29.
• Exception: In order to avoid misperception of my recommendation being self-serving, the
recommendation is that my wage as City Administrator not receive an incremental
increase when converted into the new range effective July 2022 and also not receive a
step increase in January 2023.
3. Retroactive to July 2022.
• The new pay rate is recommended effective July 4, 2022. This is approximately when the
Compensation Study was completed, and it keeps the math easy with the beginning of a
pay period.
4. Opportunities for steps going forward.
• In the example, the hypothetical employee had 1 step until reaching the top of the current
range, and would result in 4 steps until the top of the new range.
i. This gives opportunities for additional raises going forward.
ii. The recommendation includes step increases in January 2023.
iii. Advancing steps each January should be based on satisfactory job performance
throughout the preceding year.
• A different example might be a long-term employee at the top of the range Step A, then
converting to Step 5 in the new range.
i. It might be nice if we could keep this hypothetical employee at the top of the
range, but that got really cost prohibitive when running the calculations across all
employees. The recommendation is to phase in future steps to keep the budget
impact reasonable.
ii. This is also partly due to adding a step, since the current system has 7 steps;
while, the new system has 8 steps.
iii. Please note this still meets the goal of making sure employees are in the
competitive range and not having a cut in pay.
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iv. A long-time employee who might convert from Step A to Step 5 (for example)
would not lose longevity, which is calculated separately from the steps.
5. Adjustments for highly competitive positions.
• Accountants and Building Inspectors are in short supply in the market.
i. In order to make sure we are extra competitive with these positions, the
recommendation is that none of these positions (and their supervisors) be below
Step 6 in the new range.
ii. Any that place in the upper Steps 6 through 8 when converted into the new range,
would be at that step.
iii. Any that might convert to a lower step, would be raised to Step 6.
There are several additional factors important to considering the City’s compensation system. They are
not directly part of the recommendation for City Council action tonight, but they are presented here for
transparency and to keep the entire system in context.
6. COLA.
• The budget recommendation includes a 3% COLA in January 2023, including for several
positions currently above the new market range.
• Please note that this amount is consistent with our 3 union contracts that cover 2023 (the
other 2 contracts need to be negotiated beyond 2022), as well as in line with what
neighboring cities are planning.
7. Union negotiations.
• We have a number of employees represented by unions. 2 of the 5 union contracts expire
at the end of 2022. The other 3 expire at the end of 2023.
• These contracts would need to be negotiated and approved separately.
i. I expect these negotiations to be similar and consistent with this overall
implementation plan.
ii. We have had positive negotiations with the 2 unions with whom we’ve met this
past week.
• We have committed to re-open these contracts after completion of the Comp Study.
8. Round tables and correcting potential mistakes.
• We have scheduled opportunities to discuss and explain the study and its implementation
with employees on September 7 and 13. Additional meetings will be schedule if needed.
• If there might be technical mistakes (for example a required license missed when
updating job descriptions, or a data entry error), we would certainly investigate and
correct as appropriate.
Financial Impact:
2022 (6 m) 2023
Non Union 49,840 159,709
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49ers Union 20,930 55,689
Police Unions 65,000 193,835
Fire Unions 22,789 85,036
enterprise funds -11,390 -29,504
SubTotal (wages) $147,169 $464,765
est PERA/FICA 20% 29,434 92,953
est COLA 3% 4,415 13,943
TOTAL (general fund) $181,018 $571,661
Please note this chart shows the budget impact on the General Fund by subtracting out wage increases
which would be attributed to the Enterprise Funds (Water, Sewer, and Stormwater).
The City budgeted $200K for implementation in 2022. My 2023 Budget recommendations include this
implementation plan.
Committee Discussion:
• Administration Committee (Lund*, Fox, and Leifeld) met July 27 and August 5.
• City Council workshop August 15
Attachment:
• Step & Grade Scale (2022 final)
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Step and Grade Scale – 2022 Final
Grade 1 2 3 4 5 6 7 8
0 65 1 17.50$ 18.07$ 18.66$ 19.27$ 19.90$ 20.55$ 21.22$ 21.91$
66 76 2 18.87 19.48 20.11 20.76 21.43 22.13 22.85 23.59
77 88 3 20.35 21.01 21.69 22.39 23.12 23.87 24.65 25.45
89 98 4 21.95 22.66 23.40 24.16 24.95 25.76 26.60 27.46
99 102 5 23.67 24.44 25.23 26.05 26.90 27.77 28.67 29.60
103 110 6 25.53 26.36 27.22 28.10 29.01 29.95 30.92 31.92
111 150 7 27.53 28.42 29.34 30.29 31.27 32.29 33.34 34.42
151 187 8 29.69 30.65 31.65 32.68 33.74 34.84 35.97 37.14
188 195 9 32.02 33.06 34.13 35.24 36.39 37.57 38.79 40.05
196 250 10 34.53 35.65 36.81 38.01 39.25 40.53 41.85 43.21
251 299 11 37.24 38.45 39.70 40.99 42.32 43.70 45.12 46.59
300 309 12 40.16 41.47 42.82 44.21 45.65 47.13 48.66 50.24
310 329 13 43.31 44.72 46.17 47.67 49.22 50.82 52.47 54.18
330 369 14 46.71 48.23 49.80 51.42 53.09 54.82 56.60 58.44
370 413 15 50.38 52.02 53.71 55.46 57.26 59.12 61.04 63.02
414 464 16 54.33 56.10 57.92 59.80 61.74 63.75 65.82 67.96
465 534 17 58.59 60.49 62.46 64.49 66.59 68.75 70.98 73.29
535 616 18 63.19 65.24 67.36 69.55 71.81 74.14 76.55 79.04
617 691 19 68.15 70.36 72.65 75.01 77.45 79.97 82.57 85.25
692 775 20 73.50 75.89 78.36 80.91 83.54 86.26 89.06 91.95
Points
Standard Steps
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