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HomeMy WebLinkAboutStaff Report 332-07City of Palo Alto City Manager’s Report TO: FROM: DATE: SUBJECT: HONORABLE CITY COUNCIL CITY MANAGER AUGUST 6, 2007 DEPARTMENT: HUMAN RESOURCES CMR: 332:07 APPROVALOF RESOLUTIONS ADOP3ING A 2007-2008 COMPENSATION PLAN FOR MANAGEMENT AND PROFESSIONAL PERSONNEL AND COUNCIL APPOINTED OFFICERS AND AMENDING THE MERIT SYSTEM RULES AND REGULATIONS TO INCORPORATE THE 2007-2008 COMPENSATION PLAN RECOMMENDATION Staff recommends Council approval of the attached resolutions adopting a compensation plan for Management and Professional Personnel and Counci! Appointed Officers effective for the pay periods beginning July 1, 2007 through June 30, 2008; and amending the Merit System Rules and Regulations to incorporate the 2007-2008 compensation plan for Management and Professional personnel. BACKGROUND The Management and Professional group includes 254 active employees. Over the last five years, the City has constrained increases in personnel-related costs in the Management and Professional group. In 2003, these employees took the lead in addressing the City’s financial challenges by having no salary increase and a 1% salary decrease implemented through a mandatory furlough. Additional cost-saving measures the City implemented for management and professional employees before other employee groups, included a cap for health insurance at the PERS Choice rate from the PERS Care rate, prorated benefits for new part time management and professional employees; and a two-tier retiree health program, raising the vesting requirement for eligibility for retiree medical benefits from 5 years to 20 years for new hires. By implementing a cap on medical benefits for Management and Professional employees, the City has avoided an estimated $3.5 million in costs since 2003. In 2004, Council approved a 3% salary increase for the Management and Professional employees, offset by a mandated furlough equivalent to a 1% salary reduction. The Management and Professional group was the only unit that fully participated in this significant cost saving measure that year. In 2005, this group received a 3% control point increase effective July 1, 2005, followed by a 1% control point increase effective January 1, 2006. In 2006, the group received no salary increase between July 1, 2006 and January 5, 2007. The Management and Professional employees received a 3% control point increase between January 6, 2007 and June 30, 2007, of which one percent was awarded at the discretion of the department heads based on merit. However, at the same CMR: 332:07 Page 1 of 3 time management employees began contributing, for the first time, two percent of their salaries to the PERS employee share for the 2.7 percent @ 55 retirement benefit, effectively offsetting the 3% salary increase. DISCUSSION A committee comprised of one employee from each department provided the City Manager with feedback and concerns on behalf of the Management and Professional employees. After considering this input, the City Manager recommends: ¯A 3.5% salary control point increase. The latest Bay Area CPI, reported in June, was 3.4%. The CPI is the factor that is generally considered the benchmark for salary increases. An additional half percent to be allocated toward equity adjustments to address compaction problems, as determined by the City Manager. Other minor changes included in the compensation plan have been made in order to clarify existing benefits, policies or processes to clarify the compensation details of the pilot Management Fellow program. RESOURCE IMPACT The annual cost for the proposed Management and Professional Compensation Plan control point increase (begimaing July 1,2007) is $1,299,000 including salary and benefits, representing $630,000 in General Fund cost and $669,000 in enterprise and other fund costs. The total increase for the compensation plan is 3.12 percent based on total compensation, on an annual basis in fiscal year 2007-08. The 2007-08 Adopted Budget includes funding for this expense in the General Fund salary contingency. Staff traditionally transfers the enterprise and other funds’ portion of the salary contingency funding to those funds as part of the midyear report and budget anaendment ordinance (BAO). Accordingly, staff will propose this as part of the 2007-08 midyear report and BAO in winter 2008. POLICY IMPLICATIONS The action recommended by this report is consistent with City Council direction. ENVIRONMENTAL REVIEW This is not a project under the California Environmental Quality Act (CEQA). ATTACHMENTS Attaclmaent A: Attachment B: Attachment C: Resolution Adopting a Compensation Plan for Management and Professional Personnel Plan Resolution Amending the Merit System Rules and Regulation Redline Version of Management And Professional Compensation Plan PREPARED BY: Sandra T.R. Blanch, Risk and Benefits Manager CMR: ~9~_:u/Page 2of3 DEPARTMENT HEAD: CITY MANAGER APPROVAL: RUSS CARLSEN Director of Human Resources EMILg HARRISON Assistant City Manager CMR: 332:07 Page 3of3 NOT YET APPROVED RESOLUTION NO. RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO ADOPTING A COMPENSATION PLAN FOR MANAGEMENT AND PROFESSIONAL PERSONNEL AND COUNCIL APPOINTEES AND RESCINDING RESOLUTION NOS. 8554, 8593, 8609 and 8622 The Council of the City of Palo Alto does RESOLVE as follows: SECTION 1. Pursuant to the provisions of Section 12 of Article III of the Charter of the City of Palo Alto, the Management Compensation Plan, as set forth in Exhibit "A" attached hereto and made a part hereof by reference, is hereby adopted for Management and Professional Personnel and Council Appointees effective July 1,2007 through June 30, 2008. SECTION 2. The Compensation Plan as adopted shall be administered by the City Manager in accordance with the Merit System Rules and Regulations. SECTION 3. The. Compensation Plan shall continue in effect until amended or revoked by the Council. SECTION 4. The Director of Administrative Services hereby is authorized to implement the Compensation Plan adopted herein in his preparation of forthcoming payrolls. He is further authorized to make changes in the titles of employee classifications identified in the Table of Authorized Personnel contained in the 2006-2008 budget, if such titles have been changed in the Compensation Plan. SECTION 5. Resolution Nos. 8554, 8593, 8609 and 8622 are hereby rescinded. // // // // // 070731 ~s8260530 1 NOT YET APPROVED SECTION 6. The Council finds that this is not a project under the California Environmental Quality Act and, therefore, no environmental impact assessment is necessary. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk APPROVED AS TO FORM: Mayor APPROVED: Deputy City Attorney City Manager Director of Administrative Services Director of Human Resources 070731 ~s8260530 2 CITY OF PALO ALTO COMPENSATION PLAN Manaqement and Professional Personnel And Council Appointees Effective:Pay period including July 1, 2007 through June 30, 2008 COMPENSATION PLAN FOR THE CITY OF PALO ALTO Mana.qement and Professional Personnel As used in this Plan, the term "Management and Professional" refers to all employees, including Confidential employees, previously classified as "Management and Confidential" by the City. This group will hereafter be identified as "Management and Professional" personnel. SECTION I. COMPENSATION This section applies to all management and professional employees and does not include Council Members or Council-appointed officers. Notwithstanding this exception, the Council may authorize Variable Management Compensation for Council-appointed officers. Each Council-appointed officer shall be the responsible decision-maker under this Plan for those employees in departments under his/her control. A.MANAGEMENT and PROFESSIONAL COMPENSATION POLICY The City’s policy for management and professional compensation is to establish and maintain a general structure based on marketplace norms and internal job alignment with broad compensation grades and ranges. Structures and ranges will be reviewed annually and updated as necessary based on marketplace survey data, internal relationships, and City financial conditions. Bo Individual compensation adjustments will be considered by the Council-appointed officer based on (1) performance factors including achievement of predetermined objectives; (2) pay structure adjustments; and (3) City financial conditions. BASIC PLAN ELEMENTS 1. Structure. The compensation plan includes separate multi-grade structures for both management and professional employees. Each grade will have a control point which is used for budgetary purposes. All management and professional positions will be assigned an appropriate pay grade based on salary survey data and internal relationships. All positions are assigned to a pay grade. Actual salary within the range is determined by performance. The normal working range where most actual salaries will fall will be within + 5% of the control point. The City began a benchmarking survey in 2006 to establish an updated structure for management and professional personnel. This survey is expected to be completed in 2007. Upon the completion of the Management and Compensation study, any equity adjustments will be addressed in the future. As needed, and no less than every two years and commencing fiscal year 2005- 2006, competitive marketplace studies will be conducted by surveying a maximum of 2 12 mutually agreeable agencies similar to Palo Alto in number of employees, population and services provided. These studies will focus on general salary trends for groups of management positions such as first line supervisors, administrative, confidential, professional and top management. Periodically, and no less often than every four years, studies will include position-by-position comparisons using market agencies and internal equity data. All studies conducted pursuant to this section shall be completed by December 31 st and in no event later than March 31 in order to allow time for Committee review. Depending on the results of these studies, the entire pay grade structure may be adjusted or individual positions may be reassigned to different pay grades. Such adjustments will only affect the salary administration framework. No individual salaries will be automatically changed because of structural adjustments. An employee may request in writing a re-evaluation of his/her job based on significant changes in job content or significant discrepancies between job content and classification description, and which cannot be described as "other duties as assigned." The request must contain justification and may be made only during the period of August 10 through September 10. A statement by management that a job re-evaluation request will be submitted with the departmental budget does not relieve an employee from the responsibility of submitting his/her own request during this period. The HR Director or his designee will respond to such requests in a timely manner. If HR approves change, the request will be forwarded to ASD who will determine if there is sufficient funding to cover the cost of the change. If approved by ASD, the reclassification will be sent to the City Manager for approval. If approved, the change would be reclassified as part of the budget process and will require Council approval. Any changes approved as part of the budget process will become effective the first pay period of the following fiscal year, or, if not approved, the job will be returned to its previous status. 2. Compensation Adiustment Authorization. Each year the City Manager will propose as part of the budget process for Council approval a compensation adjustment based on recommendation received from the Management/Professional Compensation Committee. For fiscal year 2007-2008 the compensation adjustment to control point shall be a total of 3.5% This adjustment is available for those management/professional employees who have received an overall rating of "meets" or "exceeds" expectations on their 2007 annual review and who have not been on a performance improvement plan between July 1,2006 and June 30, 2007. Nothing herein shall preclude an employee’s manager from awarding a control point adjustment increase to an employee on a performance plan at a later date should employee’s performance improve. An additional half percent (.5%) will be allocated toward equity adjustments to address compaction problems as determined by the City Manager and will be retroactive to July 1, 2007. In the future, the compensation adjustment request will be based on the following factors: competitive market, changes in internal position relationships, and the City’s ability to pay. Council authorization is required prior to implementation by the Director of Human Resources. 3. Base and Variable Compensation. Compensation for management and professional employees includes bi-weekly base salary and Variable Management Compensation (VMC). Bi-weekly base salary is paid on a continuing basis. Variable Management Compensation is an annual cash performance award based upon merit. On a fiscal year basis, the sum of the bi-weekly base salary and the VMC must fall within pay grade limits of no less than 25% below the control point and no more than 20% above the control point. Funding for VMC’s shall be calculated using salary plus benefits as of July 1, 2007 for all authorized positions in the table of organization as of January 1, 2008 and excluding all frozen positions. Base salary increases are earned in accordance with administrative guidelines based upon growth within the position and performance, which must meet or exceed position standards, the salary structure and the City’s ability to pay. In addition, employees may earn Variable Management Compensation by meeting or exceeding objectives established under the annual performance planning and appraisal system. Variable Management Compensation requalification is necessary for each appraisal period. For those eligible retirees who retire during the year, any applicable VMC shall be prorated based on the number of months the employee worked during his/her fiscal year. Employees who resign from the City of Palo Alto are not eligible for prorated VMC if they leave during the eligible year. 4. Performance Plannin,q and Appraisal. Performance appraisals will be conducted at the end of each fiscal year during the months of July through September prior to determining individual employee fixed and variable compensation. This process includes both review of previous performance plan and preparation of the performance plan for the next planning period (usually the fiscal year). Performance plans are jointly prepared by the employee and supervisor with the concurrence of the department head or Council-appointed officer. The performance plans shall contain measurable objectives which place special emphasis on position description duties or specific assignments. Progress toward meeting objectives shall be monitored periodically. The performance appraisals should be implemented in a manner that will achieve the following objectives: Define the employee’s job duties and expected level of performance for the next review period to ensure that both the employee and supervisor have a clear understanding of the employee’s role and responsibilities; Evaluate and document past performance to serve as a basis for establishing and obtaining future performance standards/objectives; Co ¯Facilitate two-way communication and understanding between the employee and his or her supervisor; ¯Counsel and encourage employees to work toward a learning development plan and realize their full potential; ¯ Establish future work plan objectives to be considered for a VMC. Work plans should include job related projects or special goals related to regular job duties when applicable. At the conclusion of the fiscal year (or review period), supervisors shall make a final determination of the overall performance rating. Recommendations shall be forwarded to department heads or council-appointed officers who will then determine individual fixed and variable compensation adjustments according to the provisions of the compensation plan. This process should be completed by September 30th. MANAGEMENT and AUTHORIZATION PROFESSIONAL COMPENSATION ADJUSTMENT Council-appointed officers are authorized to pay salaries in accordance with this plan to non-Council-appointed management, and professional employees in an amount not to exceed the aggregate of approved management and professional positions budgeted at the control points in the Table of Organization for fiscal year 2007-08. In addition, for fiscal year 2007-08, Council-appointed officers are authorized up to 3% of salary plus benefits for management and professional positions, plus unused Variable Management Compensation funds from the previous fiscal year to apply toward Variable Management Compensation for individual management and professional employees who qualify under the provisions of this Management and Professional Compensation Plan. o Individual management and professional fixed and variable compensation authorized by a Council-appointed officer under the Management and Professional Compensation Plan may not be less than 25% below nor more than 20% above the control point for the individual position grades authorized in Table I of this plan. The Council-appointed officers are authorized to establish such administrative rules as are necessary to implement the Management and Professional Salary Plan subject to the limitations of the approved compensation adjustment authorization and the approved grade and control point structure. In the event a downward adjustment of a position grade assignment indicates a reduction in the established salary of an individual employee, the Council- appointed officer may, if circumstances warrant, continue the salary for such employee in an amount in excess of the revised grade limit for a reasonable period of time. Such interim salary rates shall be defined as "Y-rates." 5 SECTION I1. SPECIAL COMPENSATION This section applies to all eligible regular management and professional positions including Council Appointed Officers as applicable and including Council Members where indicated. Eligibility shall be in conformance with the Merit Rules and Regulations and Administrative Directives issued by the City Manager for the purposes of clarification and interpretation. A. OVERTIME, IN-LIEU HOLIDAY PAY AND COMPENSATORY TIME OFF 1. OVERTIME AND IN-LIEU HOLIDAY Compensation for overtime work, and scheduled work on paid holidays for certain designated non-exempt employees shall be in conformance with the Merit Rules and Regulations and Policies and Procedures. Overtime eligible employees shall be paid at the rate of time and one-half times the employees’ basic hourly salary unless called out for an emergency arising out of situations involving real or potential loss of service, property or personal danger, in which case additional pay will be at the rate of two times the employees’ basic hourly salary. Employees who work a schedule where a regular day off falls on a holiday will be paid for the hours they would have normally worked on that day. If the holiday falls on a non-workday for an exempt employee, the employee may, with supervisory approval, take another day off within the pay period or the following pay period. 2. COMPENSATORY TIME OFF Compensatory time off will be granted with department head approval for non-exempt employees at the rate of one and one-half hours for each hour of overtime worked, subject to the limitations of applicable state and federal laws. In the event compensatory time off is used as the method of compensating for overtime, the time off will be taken prior to the end of the quarter following the quarter in which the overtime has been worked. In the event the employee is denied the opportunity to take time within that quarter, he/she will either be compensated in pay for such time at the appropriate rate specified by these sections, or at the employee’s option, the earned compensatory time may be added to his or her vacation balance. B. WORKING OUT OF CLASSIFICATION PAY Where management and professional employees, on a temporary basis, are assigned to perform all significant duties of a higher classification, the City Manager may authorize payment within the range of the higher classification for the specified time frame. Working out of class pay is normally not to exceed 10% more than the employee’s current salary and shall be documented on a Personnel Action Form, with a description of the additional duties to be performed. 6 C. STAND-BY PAY Employees eligible for overtime may be entitled to stand-by pay, approved by the City Manager on a case by case basis, in extreme circumstances involving unavailability of non-management staff. Compensation is as follows: Monday through Friday Saturday, Sunday, Holidays $40 per day $58 per day D.NIGHT SHIFT PREMIUM Night shift differential shall be paid at the rate of 5% to regular full-time employees who are regularly assigned to shift work between 6:00 p.m. and 8:00 a.m., or to employees who are temporarily assigned to work a full shift between 6:00 p.m. and 8:00 a.m. E.UNIFORM PURCHASE PLAN - SWORN POLICE, FIRE PERSONNEL, and OPEN SPACE PERSONNEL Uniforms including cleaning will be provided with replacement provisions on an as- needed basis in conformance with department policy. F. WINTER CLOSURE - 2007 The winter closure will be the week of December 24-28. Not all City facilities are closed during the Winter Closure; employees must check with their supervisor to find out if the closure is applicable to their positions. During the Winter Closure, employees may elect to use paid leave balances such as management leave, vacation or holiday pay or take time off without pay. Employees who wish to work during the Winter Closure should make arrangements with their supervisors regarding work assignments. G. GROUP INSURANCE Effective Date of Coveraqe for New Employees For newly-hired regular employees coverage begins on the first day of the month following date of hire for the health plan, dental plan, vision care plan, long term disability and life insurance plans if these benefits are elected. 2.Active Employee Health Plan (a)Based on an employee’s family status, the City shall pay up to the monthly medical premium for the second most expensive plan among the existing ? array of plans available during the term of this compensation plan on behalf of eligible employees (including Council Appointed Officers and Council Members) and dependents. Eligible dependents include spouses, children under the age of 23 and never married (natural, adopted, or stepchildren), economically dependent children, and domestic partners registered with the Secretary of State. If PERS changes the plans it offers, the City will continue to provide an equivalent benefit at an equivalent cost. (b)The City agrees to offer a program to active management and professional personnel (including Council Appointed Officers and Council Members) enrolled in PERSCare prior to 1/6/07 who elected the PERSChoice health plan in which the City will reimburse the employee and/or dependents for any covered medical expense which exceeds the $2 million Lifetime Maximum Benefit. (c)Coverage for Domestic Partners: (1) Domestic Partnership Registered with the California Secretary of State: Employees may add their domestic partner as a dependent to their elected health plan coverage if the domestic partnership is registered with the Secretary of State. (2)Domestic Partnership Not Registered with the California Secretary of State: Domestic partners who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department, will be eligible for reimbursement of the actual monthly premium cost of an individual health plan, not to exceed the maximum monthly City employer contribution for one-party coverage under the CalPERS Health Benefits Program (or PORAC if a safety department employee) for an employee covered under this agreement. Evidence of premium payment will be required with request for reimbursement. (d) PERS Choice Reimbursement Plan Management and Professional personnel enrolled in the PERS Choice medical plan may submit a request for payment, as specified below, for non-covered medical expenses, incurred during the period of January 1, through December 31, of the plan year, that exceed $2,500. The maximum annual reimbursement amount provided under this program is: ¯$700for employees enrolled in the Employee-Only category; ¯$900 for employees enrolled in the Employee and One Dependent category, and ¯$1,100 for employees enrolled in the Family category. Any amounts reimbursed to an individual under this program would be included in the employee’s gross income and is not PERSable. This program shall only reimburse employees for medical expenses that are not reimbursed through any other means and meet the definition in Section 213(d) of the Internal Revenue Code. (Examples of eligible expenses include medical plan deductibles and co-payments, prescription drugs, dental care, hearing care, and vision care.) However, in order to have any expenses reimbursed under this program, the employee must have allocated 100% ($2,500.00) of their 2008 calendar Excess Benefit funds into the Medical FSA option during the election that occurred in November 2007. In addition, all such reimbursements from the Excess Benefit Program must have been solely for medical expenses, as defined by Section 213(d) of the Internal Revenue Code. If the employee has designated his/her Excess Medical funds for any other qualifying expenses (i.e. dependent care, Professional Development, Deferred Compensation contributions), the employee would not be eligible for reimbursement under this program. Employees may submit one claim for the entire plan year’s expenses during January. Any amounts remaining from the PERS Choice reimbursement plan after the claims for the plan year had been processed shall be forfeited. 3. Alternative Medical Benefit Proqram If a regular employee and/or the employee’s dependent(s) are eligible for medical insurance through another employer-sponsored or association medical plan, the employee may opt for alternative medical insurance coverage through the other employer-sponsored or association plan and waives his/her right to the City of Palo Alto’s medical insurance coverage for same individuals. Employees electing alternative coverage and no City coverage will receive cash payments of approximately half of the "average monthly premiums: for their medical insurance coverage. "Averaged monthly premiums" are the average of the Kaiser HMO, Blue Shield HMO and PERS Choice PPO premiums for the employee’s City medical coverage available through the Public Employee Retirement System (PERS). The rates for 2007 are as follows: One Party:$230.00 Two Party:$460.00 Family:$595.00 The rates for 2008 are as follows: One party:$250.00 Two parties:$500.00 Family:$645.00 4. Retiree Health Plan (a) Employees Hired Prior to January 1, 2004 Monthly City-paid premium contributions for a retiree-selected health plan through the CalPERS Health Benefits Program will be made as provided under the Public Employees" Medical and Hospital Care Act. The City’s monthly employer contribution for each employee retiring on or after 1/1/2007 shall be the amount necessary to pay for the cost of his or her enrollment in a health benefits plan up to the monthly premium for the second most expensive plan offered to management and professional personnel during the contract term (among the existing array of plans.) For the 2007 calendar year, the City’s contribution toward dependent coverage is 70% of the difference between the applicable "Employee and One Dependent" or "Family" maximum employer contribution for active management and professional personnel and the maximum employer contribution for "Employee Only" coverage. For 2008 the City’s contribution will increase to 75%. (b) Post- 1/1/04 Hires For those Management and professional employees hired after January 1, 2004, the PERS law vesting schedule set forth in Government Code section 22893 will apply. Under that law, an employee is eligible for 50% of the specified employer health premium contribution after ten years of service credit, provided at least five of those years were performed at the City of Palo Alto. After ten years of service credit, each additional service credit year increases the employer contribution percentage by 5% until, at 20 years’ service credit, the employee will be eligible upon retirement for 100% of the specified employer contribution and 90% of their dependent coverage. The City of Palo Alto’s health premium contribution for eligible post - 1/1/04 hires shall be the minimum contribution set by PERS under section 22893 based on a weighted average of available health plan premiums. 5.Dental Plan a)The City shall pay covered plan charges on behalf of all eligible employees and dependents. (Domestic partners who are either registered with the Secretary of State or who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department are considered dependents under the plan.) Benefits for regular part-time employees will be prorated as follows: Employees who will work less than full time, will receive prorated premium costs for dental benefits in accordance with his/her 10 percentage of a full-time work schedule. Part time employees currently receiving full benefits will not be impacted. b) The City’s Dental Plan provides the following: Maximum Benefits per Calendar Year- $2,000 per person Lifetime Maximum for Orthodontics- The City will pay up to $2,000.00 for orthodontia coverage (not included in annual dental maximum) ¯Major Dental Services ¯Orthodontics ¯Basic Benefits (All other covered services) First Calendar Year of Eligibility Subsequent Calendar Years *Usual, Customary, and Reasonable 50% UCR* 50% UCR* 70% UCR* 70%-100% Effective 1/1/07 the City added composite (tooth covered) fillings for posterior teeth to the dental plan. For each dental plan member, the percentage of coverage for basic benefits will begin at 70% for the first calendar year of coverage and increase by 10% (up to a maximum of 100%) effective the first day of the next calendar year as long as the member utilizes the plan at least once during the current year. Per the Delta Dental contract effective October 1,2005, if the member does not utilize the plan during the current year, the percentage of coverage for the next calendar year shall remain unchanged from the current year. If a dental plan member ever loses coverage under the plan, the applicable percentage of coverage for basic benefits provided during any future period of coverage will commence at 70% as if the dental plan member was a new enrollee. Examples of when a member might lose coverage under the plan would include: Employee goes on an unpaid leave of absence and elects not to pay the required dental premiums for his/her family’s coverage during the leave. Employee elects to drop one or more covered dependents from the plan during an open enrollment period so that they might be covered on a spouse’s non-City of Palo Alto dental plan. 6.Basic Life Insurance The City shall provide a basic group term life insurance with Accidental Death and Dismemberment (AD&D) coverage, in an amount equal to the employee’s annual basic pay (rounded to the next highest $1,000) at no-cost to the employee. AD&D pays an additional amount equal to the employee’s annual basic pay (rounded to the next highest $1,000). 7.Supplemental Life And AD&D Insurance An employee may, at his/her cost, purchase additional life insurance and additional AD&D coverage equal to his or her annual salary. The maximum amount of life insurance available to the employee is up to $325,000 and the maximum amount of AD&D coverage available is up to $325,000. 8. Lon,q Term Disability Insurance a) The City shall provide long term disability (LTD) insurance with a benefit of 2/3 monthly salary, up to a maximum benefit of $10,000 per month. The City shall pay the premium for the first $6,000 of base monthly salary. For employees whose base monthly salary exceeds $6,000, the employee shall pay the cost of the required premium based upon their monthly salary between $6,000 and $15,000. b)For employees whose base monthly salary exceeds $6,000 and who have no eligible dependents covered under the City’s medical, dental or vision plans, the City will pay up to $17.50 per month towards the employee’s cost for LTD coverage. 9.Vision Care a)The City shall provide vision care coverage for employee and dependents. Coverage is administered by Vision Service Plan (VSP). The plan provides an exam every 12 months; lenses every 24 months; frames every 24 months, all subject to a $20 co-payment as defined in the Vision Services Benefits Plan A schedule. Benefits for regular part-time employees will be prorated as follows: Employees hired after January 1, 2004, who will work less than full time, will receive prorated premium costs for vision benefits in accordance with his/her percentage of a full-time work schedule. Part time employees currently receiving full benefits will not be impacted. b) Effective July 1, 1996, dependents include eligible domestic partners who are either registered with the Secretary of State or who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department. H.EMPLOYEE ASSISTANCE PLAN 12 The Employee Assistance Plan (EAP) provides employees with confidential personal counseling, work and family related issues, eldercare, substance abuse, etc. In addition, EAP programs provide a valuable tool for supervisors to refer troubled employees to professional outside help. This service staffed by experienced clinicians is available to employees and their dependents by calling a toll-free phone line 24 hours a day, seven days a week. Guidance is also available online. SAFETY DIFFERENTIALS 1. Police Department- Personnel Development Proqram Pursuant to administrative rules governing eligibility and qualification, the following may be granted to sworn police personnel: P.O.S.T. Intermediate Certificate: P.O.S.T. Advanced Certificate: 2. Fire Department- EMT Differential 5% above base salary 7 1/2% above base salary Pursuant to administrative rules governing eligibility and qualification, the following may be granted to sworn Fire personnel: EMT Differential:2.5% above base salary MANAGEMENT and PROFESSIONAL BENEFIT PROGRAM Management and professional employees are eligible for Sections 1, 2, 3, and 4 of the Management Benefit Program. City Council Members are eligible for Section 3 only. 1.Professional Development- Reimbursement Reimbursement for authorized self-improvement activities may be granted each management and professional employee up to a maximum of $1,500 per fiscal year. The following items are eligible for reimbursement: a.Civic and professional association memberships b.Conference participation and travel expenses c.Educational programs/tuition reimbursement. The education must maintain or improve the employee’s skills in performing his or her job, or be necessary to meet the express requirements of the City or the requirements of applicable law. The education to which the reimbursement relates must not be part of a program qualifying the employees for another trade or business; or be necessary to meet the minimum educational 13 requirements for qualification for employment. Permissible educational expenses are refresher courses, courses dealing with current developments, academic or vocational courses, as well as the travel expenses associated with the courses. d. Professional and trade journal subscriptions not to exceed 12 months. e.Gym/health club memberships. Reimbursement of these expenses is taxable to the employee. Purchase of job related computer software, hardware, internet access, telecommunication equipment and home office equipment/furniture. Reimbursement of any of these expenses is taxable to the employee. Amounts under this professional development program will not be prorated, with the following exception: The maximum amount for Professional Development reimbursement for employees who move into a position covered by this compensation plan from a position under another City of Palo Alto bargaining group will be the lesser of: (1) $1,500 less any amounts they have received in the fiscal year of their position change through any other City of Palo Alto Tuition Reimbursement or Professional Development program; or (2) An amount obtained by subtracting any amounts the employee may have received in the fiscal year of their position change through any other City of Palo Alto Tuition Reimbursement or Professional Development program from the sum of: (i) the number of months of the current fiscal year that the employee served in previous bargaining unit and multiplying it by one-twelfth of that unit’s Tuition Reimbursement or Professional Development annual maximum benefit; and, (ii) the number of months of the current fiscal year that the employee will serve in the position covered by this compensation plan multiplied by $125. 2.Professional Development Leave Authorized paid leaves of absence for up to one year will be granted in accordance with the following requirements: a. Eligibility is subject to a minimum City service requirement of five years. b.Compensation during the Professional Development Leave shall not exceed 50% salary and full benefits. Co When granted, a Professional Development Leave shall require an employee commitment of at least two-years’ service following return from the Leave. To the extent the full two-year commitment is not fulfilled, the employee shall re-pay the City a pro rata amount of the salary paid during the Leave based on the percentage of the two-year commitment not fulfilled. d.The Professional Development Leave program shall relate to the employee’s job assignment. e.An employee’s job assignment activity shall be adequately covered during his/her absence with emphasis on the development of subordinates. The leave of absence period shall be adequately coordinated with departmental priorities and workload. go Professional Development Leaves shall be based on internship exchanges, and/or loaned executive arrangements; scholastic and/or authorship programs; or educational travel-study plans. Leave of absence schedules will be apportioned among all levels of management and professional employees and will be based on an evaluation of each employee’s performance record. Each paid sabbatical leave will be limited to a maximum of one year and not more than two employees being on leave simultaneously. Sabbatical leaves must be cleared in advance and approved by a Council-appointed officer for his/her subordinates. Professional Development Leaves granted in excess of 30 days shall be noticed to the Council. 3.Physical Examinations All management and professional employees are eligible to receive an annual physical examination as follows: Use the periodic health exam benefit as provided under the PERS Health Plan option you have selected. Each of the PERS Health Plans provides for a periodic physical examination. The examination must be performed by your primary care physicianmunless he/she refers you to another physician. The types of tests and the frequency of the tests cannot exceed AMA guidelines. The guidelines are a suggested minimum based on research studies concerning preventative care. The judgment of your physician is the final determinant for your care. 15 Any additional necessary asymptomatic tests that are required by your physician that are not covered by your health plan, will be reimbursed by the City. Any symptomatic tests will be covered under your PERS Health Plan. The Reimbursement for Periodic Physical Exam Form is available on the Human Resources Intranet site. This benefit will not be pro-rated. 4.Excess Benefit This benefit is designed to meet the requirements of Section 125 of the Internal Revenue Code. Every calendar year, each employee will be provided with $2,500 that they can designate among the following options: Medical Flexible Spendin.q Account (Medical FSA). Provides reimbursement for excess medical/dental/vision, or expenses that are incurred by employees and their dependents which are not covered or reimbursed by any other source, including existing City-sponsored plans. This includes prescribed medications and copayments as well as over-the- counter drugs, including: antacids, allergy medicines, pain relievers and cold medicines. However, nonprescription dietary supplements (e.g. vitamins, etc.) toiletries (e.g. toothpaste), cosmetics (e.g. face cream), and items used for cosmetic purposes (e.g. Rogaine) are not acceptable. bo Dependent Care Flexible Spending Account (Dependent Care FSA). Provides reimbursement for qualified dependent care expenses under the City’s Dependent Care Assistance Program (DCAP), subject to the following limits: Dependent care expenses will be reimbursed only to the extent that the amount of such expenses reimbursed under this Management Benefit Program, when added to the amount (if any) of annual dependent care expenses that the participant has elected under the City’s Flexible Benefits Plan, do not exceed the maximum permitted under the DCAP. 1)The annual amount submitted for reimbursement cannot exceed the income of the lower-paid spouse. 2)The expenses must be employment-related expenses for the care of one or more dependents who are under 13 years of age and entitled to a dependent deduction under Internal Revenue Code section 151(e) or a dependent who is physically or mentally incapable of caring for himself or herself. 3)The payments cannot be made to a child under 19 years of age or to a person claimed as a dependent. 16 4)If the services are provided by a dependent care center, the center must comply with all state and local laws and must provide care for more than six individuals (other than a resident of the facility). 5)Dependent care expenses not submitted under this section are eligible under the City Dependent Care Assistance Plan (DCAP). However, the maximum amount reimbursed under DCAP will be reduced by any amount reimbursed under the Excess Benefit Plan. Non-taxable Professional Development Spending Account. Provides reimbursement for Non-Taxable professional development expenses (e.g.,job-related training and education, seminars, training manuals, etc.) to the extent they are not paid or reimbursed under any other plan of the City. Deferred Compensation. Provides a one-time contribution to the employee’s City-sponsored 457 Deferred Compensation plan with either ICMA-RE or the Hartford. Amounts designated by employees to either the Medical FSA, Dependent Care FSA, or Professional Development options are done so on a "use -it-or-lose-it" basis. This means that any amounts designated and not used by the end of the calendar year (or end of the extended grace period for the medical FSA) will be forfeited by the employee and returned to the plan. Specified amounts under this benefit will be applied on a pro-rata basis for employees who are part-time or who are in a management or professional pay status for less than the full fiscal year. Such benefits will be pro-rated in the first year of employment (based on hire date) but will not be pro-rated upon separation of employment. K. LEAVES 1.Sick Leave a)Sick leave shall be accrued bi-weekly provided the employee has been in a pay status for 50 percent or more of a bi-weekly pay period. Sick leave shall be accrued at the rate of 3.7 hours per bi-weekly pay period for those employees working a forty-hour duty schedule. Those assigned work schedules, which are greater or lesser than forty hours will accrue sick leave at the ratio of their work schedule to forty hours. b)Employees may use up to twenty hours of sick leave per calendar year for personal business. The scheduling of such leave is subject to the approval of the appropriate level of Management. 17 c)Employees leaving the municipal service shall forfeit all accumulated sick leave, except as otherwise provided by law and by Section 609 of the Merit Rules and Regulations. In the event that notice of resignation is given, sick leave may be used only through the day which was designated as the final day of work by such notice. d)Employees that were hired before December 1, 1983 and who leave the municipal service in good standing, or who die while employed in good standing by the city, and who have fifteen or more years of continuous service shall receive compensation for unused sick leave hours in a sum equal to two and one-half percent of their unused sick leave hours multiplied by their years of continuous service and their basic hourly rate of pay at termination. Full sick leave accrual will be paid in the event of termination due to disability. See Merit System Rules and Regulations, Chapter 6, Section 609. e)Up to nine days of sick leave per calendar year may be used for illness in the immediate family, including a registered domestic partner. f) Management and Professional employees eligible, as specified above if hired before December 1, 1983, to be compensated for sick leave may annually convert sick leave hours in excess of 600 to cash or deferred compensation, according to the formula set forth above, up to a maximum of $2,000 per fiscal year. 2.Manaqement Annual Leave At the beginning of each fiscal year regular management and professional employees will be credited with 80 hours of annual leave. This leave is granted in recognition of the extra hours Management and Professional employees work over their regular schedule. This leave may be taken as paid time off, added to vacation accrual (subject to vacation accrual limitations), taken as cash or taken as deferred compensation. When time off is taken under this provision, 10-hour shift workers will receive one shift off for each 8 hours charged; 24-hour shift workers will receive one-half shift off for each 8 hours charged. Entitlement under this provision will be reduced on a prorated basis for part-time status, or according to the number of months in paid status during the fiscal year. Unused balances as of the end of the fiscal year will be paid in cash unless a different option as indicated above is elected by the employee. 3.Professional Development Leave Authorized paid leaves of absence for up to one year will be granted in accordance with the following requirements: a. Eligibility is subject to a minimum City service requirement of five years. 18 b. Compensation during the Professional Development Leave shall not exceed 50% salary and full benefits. c. When granted, a Professional Development Leave shall require an employee commitment of at least two-years’ service following return from the Leave. To the extent the full two-year commitment is not fulfilled, the employee shall re-pay the City a pro rata amount of the salary paid during the Leave based on the percentage of the two-year commitment not fulfilled. d. The Professional Development Leave program shall relate to the employee’s job assignment. e. An employee’s job assignment activity shall be adequately covered during his/her absence with emphasis on the development of subordinates. f. The leave of absence period shall be adequately coordinated with departmental priorities and workload. g. Professional Development Leaves shall be based on internship exchanges, andlor loaned executive arrangements; scholastic and/or authorship programs; or educational travel-study plans. Leave of absence schedules will be apportioned among all levels of management and professional employees and will be based on an evaluation of each employee’s performance record. Each paid sabbatical leave will be limited to a maximum of one year and not more than two employees being on leave simultaneously. Sabbatical leaves must be cleared in advance and approved by a Council-appointed officer for his/her subordinates. Professional Development Leaves granted in excess of 30 days shall be noticed to the Council. 4. Vacation Vacation will be accrued when an employee is in pay status and will be credited on a bi-weekly basis. Total vacation accrual at any one time may not exceed three times the annual rate of accrual. Each eligible employee shall accrue vacation at the following rate for continuous service performed in pay status: (a)Less than nine years. For employees completing less than nine years continuous service: 120 hours vacation leave per year; provided that: (i)The City Manager is authorized to adjust department head annual vacation accrual to provide for a maximum of 160 hours for those hired between July 1, 1996 and June 30, 2001; and 19 (ii)The City manager is authorized to adjust the annual vacation accrual of employees hired on or after July 1, 2001, to provide up to 40 additional hours (i.e., to a maximum annual accrual of 160 hours) for service with a prior employer. (b)Nine, but less than fourteen years. For employees completing nine, but not more than fourteen years continuous service; 160 hours vacation per year. (c)Fourteen, but less than nineteen years. For employees completing fourteen, but not more than nineteen years continuous service; 180 hours vacation leave per year. (d) Nineteen or more years. For employees completing nineteen or more years continuous service; 200 hours vacation leave per year. (e) Once each calendar year an employee may cash out vacation accrual balances in excess of 80 hours. An employee may cash out a minimum of 8 hours to a maximum of 120 hours of accrued vacation provided the employee has taken 80 vacation hours in the previous 12 months. 5. Bereavement Leave of absence with pay of three days may be granted an employee by the head of his/her department in the event of death in the employee’s immediate family, which is defined for purposes of this section as wife, husband, son, son-in-law, step-son, daughter, daughter-in-law, step-daughter, mother, mother-in-law, father, father-in-law, brother, brother-in-law, sister, sister-in-law, grandmother, grandmother-in-law, grandfather, grandfather-in-law, grandchild, aunt, uncle, niece, nephew, registered domestic partner, or a close relative residing in the household of employee. Such leave shall be at full pay and shall not be charged against the employee’s accrued vacation or sick leave. Requests for leave in excess of three days shall be subject to the approval of a Council-Appointed Officer for employees under his/her control. L. RETIREMENT PENSION Effective pay period inclusive of 1/6/07, the City’s Public Employees’ Retirement System (PERS) benefits changed to the 2.7% at 55 formula for non-safety members (from 2% at 55). Employee Share. Effective May 1, 1984, the City agreed to pay the 7% employee contribution to PERS. Effective pay period inclusive of 1/6/07, the employee share of the PERS contribution increased to 8% from 7%. The City pays 6% and the employee pays 2% of the 8% PERS employee share for the 2.7 at 55 retirement benefit formula. This provision applies to Council-appointed 2O officers and all regular management and professional employees, except that for sworn police and fire management employees the City shall continue to pay the mandatory nine percent (9%) of the employee’s PERS contribution. Notwithstanding subsection 2 above, effective the pay period inclusive of 1/6/07, upon filing a notice of retirement, the 6% City-paid PERS contribution (9% for sworn police and fire management personnel) will be converted to a salary adjustment of equal amount on a one-time irrevocable basis for the final compensation period which is defined as the highest average compensation earnable (salary) during the year immediately preceding retirement or any other designated consecutive year. Employee PERS contributions shall be made on a tax deferred basis, in accordance with Section 414(h)(2) of the Internal Revenue Code. All provisions of this subsection are subject to and conditioned upon compliance with IRS regulations. As of October 20, 2001 and March 9, 2002, the City provides the Public Employees’ Retirement System (PERS) Benefit, "3% at 50" full formula (Section 21362.2) for safety members. M.AUTOMOBILE EXPENSE ALLOWANCE No For those employees whose duties require use of a City automobile, the City Manager (or in the case of Council-appointed officers, the City Council) may authorize payment of up to $325 per month in lieu thereof. COMMUTE INCENTIVES and PARKING Employees who qualify may voluntarily elect one of the following commute incentives: 1. Civic Center Parking. Employees assigned to Civic Center and adjacent work locations. The City will provide a Civic Center Garage parking permit. Employees hired after June 30, 1994 may initially receive a parking permit for another downtown lot, subject to the availability of space at the Civic Center Garage. 2. Public Transit. The City will provide monthly Commuter Checks worth the value of: $40 for employees traveling two or more zones on Caltrain; $40 for employees using the Dumbarton Express, BART, the ACE train or a commuter highway vehicle; $35 for employees traveling within one zone on Caltrain; $35 for employees using VTA, and other buses. These vouchers may be used toward the purchase of a transit pass. 21 3. Carpool. The City will provide $30 per month to each eligible employee in a carpool with two or more licensed drivers. 4. Vanpool Pilot Program. The City will provide Commuter Checks worth the value up to $60 to each employee voluntarily participating in the Vanpool Pilot Program. These may be used toward payment of the monthly cost of the vanpool. Employees must fulfill the basic requirements of the Employee Commute Alternatives Program to qualify. 5. Bicycle. The City will provide employees with $20 per month to eligible employees who ride a bicycle to work. 6. Walk. The City will provide employees with $20 per month to eligible employees who walk to work. O.AT-WILL STATUS Department heads hired after July 1,2004 will be "At-Will" employees whose terms of employment are specified by an employment contract. Any current department head or the Assistant City Manager may elect to remain covered by the Merit Rules or to become At-Will employees with an employment contract that shall include a severance package. All current executive managers shall maintain all the benefits they presently have or would have as a new executive manager. P.ADDITIONAL COMPENSATION FOR MAYOR AND VICE MAYOR The Mayor shall receive $150 monthly, and the Vice Mayor $100 monthly to defray additional expenses of these offices. Q.REIMBURSEMENT FOR RELOCATION EXPENSE Policy Statement The City of Palo Alto, in rare instances, may provide a Basic Relocation Benefits Package for new management and professional employees, upon the approval of the City Manager or designated subordinate. In addition, the provision of "Optional Benefits" or portions thereof, may be extended for exceptional circumstances and only the approval of the City Manager or designee, or for Council-appointed officers, the City Council. The details of the Relocation Expense program are specified in the City’s Relocation Expense policy. R. MEAL ALLOWANCE 22 Management and professional employees assigned to attend night meetings are eligible to receive reimbursement for up to $20.00 per dinner. This provision covers only receipted meals actually taken and submitted for reimbursement. So REDUCTION IN WORKFORCE: The City will make every effort to follow the 2005 transition plan if a reduction in workforce is necessary in 2007 or 2008. The Management/Professional Compensation Committee shall be involved in development of changes to the transition plan. To GRIEVANCES REGARDING COUNCIL APPOINTED OFFICERS: Notwithstanding the grievance procedures provided in Chapter 11 of the City of Palo Alto’s Merit System Rules and Regulations, any Management and Professional employee who is supervised by a Council Appointed Officer and has a grievance against that Council Appointed Officer or regarding the conduct of that Council Appointed Officer shall, following an attempt to resolve the grievance pursuant to Step One (informal discussion), summarize the grievance regarding the Council Appointed Officer in writing and submit it to the Director of Human Resources for review and resolution using the methods he/she considers appropriate. MERIT RULES: The City will include members of the Management/Professional Compensation Committee in discussions regarding revision of the Merit Rules and Regulations. SECTION III. MANAGEMENT FELLOW PROGRAM The City has created a pilot program for Management Fellows. This pilot program will be tested over a two year period. The program’s purpose is to create limited duration entry level positions for graduate students. A management fellow will be an "at will" employee whose term of employment shall be no more than one year. A Management Fellow shall be PERS exempt, but will receive limited vacation, limited sick leave, limited health care benefits and other limited benefits, as determined by the City Manager. Sections I and II of this Plan shall not apply to Management Fellows, except as specified by the City Manager. 23 Salary Rates/Classifications Effective 07/01/2007 Class No./Job Code 157 5O 171 98 76 126 115 108 109 107 170 2001 1001 143 1003 119 1002 6 65 73 168 102 132 30 91 118 128 7 82 40 96 89 153 41 186 195 136 29 19 61 9 20 71 52 75 191 MANAGEMENT COMPENSATION 2007 Title ADM HUMAN RES ADM PLN & COMM ENVRN ADM PUBLIC WORKS ADM SPEC EVENTS ADMIN ASSISTANT ARTS & CULTURE DIV MGR ASST BUILD OFFICIAL ASST CITY ATTY ASST CITY CLERK ASST CITY MANAGER ASST DIR UT/ADM SVCS ASST DIR LIBRARY SVS ASST DIR PLA COMM ENV ASST DIR PUBLIC WRKS ASST DIR UT ENG ASST DIR UT/ENG/OPN ASST DIR UT/CUST SUPPORT SVS ASST DIR UT/OPN ASST DIR UT/RES MGMT ASST DIRECTOR ADM SV ASST FLEET MGR ASST MGR WQCP ASST POLICE CHIEF ASST TO THE CITY MGR BUSINESS ANALYST CHIEF BLD OFFICIAL CHIEF INFORMATION OFF CHIEF PLG & TRANS OFF CHIEF TRANSP OFF CITY TRAFFIC ENGR CLAIMS INVESTIGATOR CONTRACTS ADMINISTRATOR COORD CHILD CARE COORD ENVIRON PROTEC COORD LIB CIRC COORD POL TECH SVCS COORD PUB WKS PROJ COORD TRANS SYS MGMT COORD UTIL SAF & SEC COORD UTILITY PROJ DEP CITY ATTORNEY DEP FIRE CHIEF-EMT DEP CITY CLERK DEP DIR ADM SVCS DEP DIR PW OPRNS DEP FIRE CHIEF/FIRE MARSHALL Grade Code 40 40 40 40 70 29 33 26 44 14 23 29 20 23 19 19 23 21 19 25 41 33 19 32 37 26 26 25 27 31 46 39 42 27 48 28 46 44 41 43 36 21 51 27 25 22 Control Point 7,652 7 652 7,652 7,652 6,111 10,108 9,136 10,906 6,915 16,057 11,767 10,108 12,683 11,767 13,012 13,012 11,767 12,377 13,012 11,192 7,463 9,136 13,012 9,368 8,252 10.906 10,906 11,192 10 640 9,614 6,569 7,848 7,286 10 640 6,247 10,381 6,569 6,915 7,463 7,094 8,472 12 377 5,793 10,640 11 192 12,077 Approx. Annual 91,822 91,822 91,822 91,822 73,328 121,291 109,627 130,870 82,974 192,682 141,203 121,291 152,193 141,203 156,148 156,148 141,203 148,520 156,148 134,307 89,560 109,627 156,144 112,421 99,028 130 870 130,870 134,307 127,677 115,370 78,828 94,172 87,431 127,677 74,970 124,573 78,828 82,974 89,560 85 125 101,667 148,520 69,515 127,677 134,307 144,928 Approx Biwkly 3,532 3,532 3,532 3,532 2,820 4,665 4,216 5,033 3,191 7,411 5,431 4,665 5,854 5,431 6,006 6,006 5,431 5,712 6,006. 5,166 3,445 4,216 6,006 4,324 3,809 5,033 5,033 5,166 4,911 4,437 3,032 3,622 3,363 4,911 2,883 4,791 3,032 3,191 3,445 3,274 3,910 5,712 2,674 4,911 5,166 5,574 Approx Hourly 44.15 44.15 44.15 44.15 35.25 58.31 52.71 62.92 39.89 92.64 67.89 58.31 73.17 67.89 75.07 75.07 67.89 71.40 75.07 64.57 43.06 52.71 75.07 54.05 47.61 62.92 62.92 64.57 61.38 55.47 37.90 45.28 42.03 61.38 36.04 59.89 37.90 39.89 43.06 40.93 48.88 71.40 33.42 61.38 64.57 69.68 1 7/31/2007 60 81 72 133 131 134 135 ~21 2002 123 194 172 1006 137 27 129 120 138 1005 139 127 101 90 69 80 86 79 141 49 84 63 185 45 21 93 39 105 179 151 32 158 175 92 51 95 103 198 160 150 156 48 68 DEP FIRE CHIEF/OPS/SUPPORT DIR ADM SVCS DIR COMM SVCS DIR HUMAN RESOURCES DIR LIBRARIES DIR PLAN/COMM ENVlR DIR PW/CITY ENGR DIR UTILITIES DIV HEAD LIBRARY SVS DIV MGR CUB CTR & HU SCV DIV MGR GOLF & PARKS DIV MGR OPEN SPACE DIV MGR REC & GOLF DIV MGR REC & YOUTH SVS ELECTRIC PROJECT ENG ENGR MGR -ELECTRIC ENGR MGR - WGW EXECUTIVE ASSISTANT EXECUTIVE ASST TO CM FIRE CHIEF FLEET MANAGER HUMAN RESOURCES REP LANDSCAPE ARCH/PK PLANNER LEGAL ADMINISTRATOR MANAGEMENT ASSISTANT MANAGING ARBORIST MGR ACCOUNTING MGR ARTS MGR BUDGET MGR COMMUNICATIONS MGR ECONOMIC RES MGR ELECTRIC OPRNS MGR EMPLOYEE RELATIONS MGR ENERGY RISK MGR ENV CONTROL PROG MGR ENVRN COMPLIANCE MGR FAC MAINT & PROJ MGR FLD & CUST SVC MGR HUMAN RES & DEV MGR INFO TECH MGR LAB SERVICES MGR MAIN LIB SVCS MGR MAINT OPER MGR PLANNING MGR PUR & CNTR ADMIN MGR REAL PROPERTY MGR RISK & BENEFITS MGR SOLID WASTE MGR UTIL MKT SVCS MGR UTIL OPRNS WGW MGR UTIL TELECOMM MGR UTILITY RATES 22 15 16 18 21 18 16 9 37 28 25 33 26 26 34 23 23 43 43 16 34 49 37 40 51 40 32 41 31 38 28 27 31 22 36 23 32 30 35 30 33 34 35 31 32 31 31 31 30 29 25 30 12,077 15,671 14,027 13,336 12,377 13,336 14,027 16,673 8,252 10,381 11,192 9,136 10,906 10,906 8,912 11,767 11,767 7,094 7,094 14,027 8,912 6,092 8,252 7,652 5,793 7,652 9,368 7 463 9,614 8,045 10.381 10,640 9,614 12,077 8,472 11,767 9,368 9,869 8,685 9,869 9,136 8,912 8,685 9,335 9,368 9,614 9,614 9,614 9,869 10,108 11 192 9,869 144,928 188,051 168,322 160,029 148,520 160,029 168,322 200,074 99,028 124,573 134,307 109,62~ 130,869 130,870 106,944 141,203 141,203 85,125 85,125 168,322 106,944 73,107 99,028 91,822 69,515 91,822 112,421 89,560 115,370 96,545 124,573 127,677 115,370 144,928 101,667 141,203 112,421 118,430 104,217 118,430 109,627 106,944 104217 112,016 112,421 115370 115 370 115,370 118,430 121 291 134,307 118,430 5,574 7,233 6,474 6,155 5,712 6,155 6,474 7,695 3,809 4,791 5,166 4,216 5,033 5,033 4,113 5,431 5,431 3,274 3,274 6,474 4,113 2,812 3,809 3,532 2,674 3,532 4,324 3,445 4,437 3,713 4,791 4,911 4,437 5,574 3,910 5,431 4,324 4,555 4,008 4,555 4,216 4,113 4,008 4,308 4,324 4,437 4,437 4,437 4,555 4,665 5,166 4,555 2 7/31/2007 69.68 90.41 80.92 76.94 71.40 76.94 80.92 96.19 47.61 59.89 64.57 52.71 62.92 62.92 51.42 67.89 67.89 40.93 40.93 80.92 51.42 35.15 47.61 44.15 33.42 44.15 54.05 43.06 55.47 46.42 59.89 61.38 55.47 69.68 48.88 67.89 54.05 56.94 50.10 56.94 52.71 51.42 50.10 53.85 54.05 55.47 55.47 55.47 56.94 58.31 64.57 56.94 178 163 196 147 148 149 28 77 38 74 117 14 152 130 13 11 188 187 199 34 26 53 25 64 33 190 155 183 173 t65 43 85 162 47 114 161 113 169 78 22 154 166 174 58 124 42 94 182 180 181 56 8 MGR WQC PLANT PARKING EXAMINER PAYROLL ANALYST POLICE CAPTAIN-ADV POLICE CHIEF-ADV POLICE LIEUT-ADV PROJECT ENGINEER PROJECT MGR PUBLIC COMMUN MGR SAFETY OFFICER SR ACCOUNTANT SR ADMINISTRATOR SR ASST CITY ATTY SR AUDITOR SR BUSINESS ANALYST SR DEPUTY CITY ATTNY SR ELECTRIC PROJECT ENG SR ENGINEER SR FINANCIAL ANALYST SR MKT ANALYST SR PROJECT ENGINEER SR PROJECT MANAGER SR RESOURCE ORIGINAT SR RESOURCE PLANNER SR TECHNOLOGIST STAFF ACCOUNTANT SUPT ANIMAL SERVICES SUPT GOLF COURSE SUPT PARKS SUPT PW OPNS SUPV ANIMAL SVCS SUPV BLDG INSPECTION SUPV BLDG SERVICES SUPV ELECT OPNS PROG SUPV ELECT SYSTEMS SUPV FACIL MGT SUPV INSP/SURV PW SUPV JR MUSEUM SUPV LIBRARIAN SUPV OPEN SPACE SUPV PARKS SUPV POLICE SERVICE SUPV PUBLIC WORKS SUPV REC PROG SUPV REPRO & MAIL SUPV UTIL MTR RD&FLD SUPV UTL CONSTR-INSP SUPV WATER TRANS SUPV WGW SUPV WQC OPER TECHNOLOGIST TRANSPORTATION MGR 23 43 72 23 15 29 36 41 35 43 39 35 20 39 34 32 29 31 39 37 31 29 27 29 34 47 40 34 34 31 47 39 49 39 33 40 40 43 43 42 40 41 40 42 51 37 41 37 37 39 37 31 11,767 7,094 5,556 11,767 14,378 10,108 8,472 7,463 8,685 7,094 7,848 8,685 12,683 7,848 8,912 9,368 10,108 9,614 7,848 8,252 9,614 10,108 10,640 10.108 8,912 6,412 7,652 8,912 8,912 9,614 6,412 7 848 6,092 7,848 9,136 7 652 7,652 7,094 7,094 7,286 7,652 7,463 7,652 7,286 5,793 8,252 7,463 8,252 8,252 7,848 8,252 9,614 141,203 85,125 66,671 141,203 172,535 121,291 101,667 89,560 104,217 85,125 94,172 104,217 152,201 94,172 106,944 112,421 121,291 115,370 94,172 99,028 115,370 121,291 127,677 121,291 106,944 76,943 91,822 106,944 106,944 115,370 76,943 94,172 73,107 94,172 109,627 91,822 91,822 85,125 85,125 87 431 91,822 89 560 91,822 87,431 69,515 99,028 89 560 99,028 99,028 94 172 99.028 115,370 5,431 3,274 2,564 5,431 6,636 4,665 3,910 3,445 4,008 3,274 3,622 4,008 5,854 3,622 4,113 4,324 4,665 4,437 3,622 3,809 4,437 4,665 4,911 4,665 4,113 2,959 3,532 4,113 4,113 4,437 2,959 3,622 2,812 3,622 4,216 3,532 3,532 3,274 3,274 3,363 3,532 3,445 3,532 3,363 2,674 3,809 3,445 3,809 3,809 3,622 3,809 4,437 3 7/31/2007 67.89 40.93 32.05 67.89 82.95 58.31 48.88 43.06 50.10 40.93 45.28 50.10 73.17 45.28 51.42 54.05 58.31 55.47 45.28 47.61 55.47 58.31 61.38 58.31 51.42 36.99 44.15 51.42 51.42 55.47 36.99 45.28 35.15 45.28 52.71 44.15 44.15 4O.93 40.93 42.03 44.15 43.06 44.15 42.03 33.42 47.61 43.06 47.61 47.61 45.28 47.61 55.47 23 36 37 184 146 TRANSPORTATION PROJ MGR UTIL KEY ACCT REP UTIL MKT ANALYST VETERINARIAN WAREHOUSE SUPV 36 40 44 33 47 8,472 7,652 6,915 9,136 6,412 101,667 91,822 82,974 109,627 76,942 3,910 3,532 ¯ 3,191 4,216 2,959 48.88 44.15 39.89 52.71 36.99 Confidential Classifications Class No./Job Grade Control Approx.Approx Approx Code Title Code Point Annual Biwkly Hourly 905 HUMAN RSRCE ASST CNF 82 5,386 64,634 2,486 31.07 1004 SR. LEGAL SECRETARY-CONF 85 6,111 73,328 2,820 35.25 903 LEGAL SEC-CONF 80 5,556 66,677 2,564 32.06 67 SEC TO CITY ATTY 67 6,745 80,941 3,113 38.91 I Budget Changes eff 7/1/07 (no inc incl) 4 7/31/2007 NOT YET APPROVED RESOLUTION NO. RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO AMENDING SECTION 1701 OF THE MERIT SYSTEM RULES AND REGULATIONS TO INCORPORATE THE 200%2008 COMPENSATION PLAN FOR MANAGEMENT AND PROFESSIONAL PERSONNEL AND COUNCIL APPOINTEES The Council of the City of Palo Alto does RESOLVE as follows: follows: SECTION 1.Section 1701 of the Merit System Rules and Regulations to read as "1701. Compensation Plan for Management and Professional Personnel and Council Appointees incorporated by reference. That certain Compensation Plan entitled "City of Palo Alto Compensation Plan--Management and Professional Personnel and Council Appointees," effective the pay period including July 1, 2007 through June 30, 2008, is hereby incorporated into these Merit System Rules and Regulations by reference as though fully set forth herein. Said Compensation Plan shall apply to all Management and Professional employees and Council Appointees, except where specifically provided otherwise herein. In the case of conflict with this chapter and any other provisions of the Merit System Rules and Regulations, this chapter will prevail over such other provisions as to employees in classifications covered by said Compensation Plan." SECTION 2. The changes to the Merit System Rules and Regulations provided for in this resolution shall not affect any right established or accrued, or any offense or act committed, or any penalty of forfeiture incurred, or any prosecution, suit, or proceeding pending or any judgment rendered prior to the effective date of this resolution. // // // // 070731 ~s 8260531 NOT YET APPROVED SECTION 3. The Council finds that this is not a project under the California Environmental Quality Act and, therefore, no environmental impact assessment is necessary. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk APPROVED AS TO FORM: Mayor APPROVED: Deputy City Attorney City Manager Director of Human Resources Director of Administrative Services 070731 ~s 8260531 2 ATTACHMENT C CITY OF PALO ALTO COMPENSATION PLAN Management and Professional Personnel And Council Appointees Effective:Pay period including July 1, 20076 through June 30, 20087- COMPENSATION PLAN FOR THE CITY OF PALO ALTO Mana.qement and Professional Personnel As used in this Plan, the term "Management and Professional" refers to all employees, including Confidential employees, previously classified as "Management and Confidential" by the City. This group will hereafter be identified as "Management and Professional" personnel. SECTION I.COMPENSATION This section applies to all management and professional employees and does not include Council Members or Council-appointed officers. Notwithstanding this exception, the Council may authorize Variable Management Compensation for Council-appointed officers. Each Council-appointed officer shall be the responsible decision-maker under this Plan for those employees in departments under his/her control. A.MANAGEMENT and PROFESSIONAL COMPENSATION POLICY The City’s policy for management and professional compensation is to establish and maintain a general structure based on marketplace norms and internal job alignment with broad compensation grades and ranges. Structures and ranges will be reviewed annually and updated as necessary based on marketplace survey data, internal relationships, and City financial conditions. Individual compensation adjustments will be considered by the Council-appointed officer based on (1) performance factors including achievement of predetermined objectives; (2) pay structure adjustments; and (3) City financial conditions. B.BASIC PLAN ELEMENTS 1. Structure. The compensation plan includes separate multi-grade structures for both management and professional employees. Each grade will have a control point which is used for budgetary purposes. All management and professional positions will be assigned an appropriate pay grade based on salary survey data and internal relationships. All positions are assigned to a pay grade. Actual salary within the range is determined by performance. The normal working range where most actual salaries will fall will be within + 5% of the control point. The City began a benchmarking survey in 2006 to establish an updated structure for management and professional personnel. This survey is expected to be completed in 2007. Upon the completion of the Manaqement and Compensation study, any equity adiustments will be addressed in the future. As needed, and no less than every two years and commencing fiscal year 2005- 2006, competitive marketplace studies will be conducted by surveying a maximum of 2 12 mutually agreeable agencies similar to Palo Alto in number of employees, population and services provided. These studies will focus on general salary trends for groups of management positions such as first line supervisors, administrative, confidential, professional and top management. Periodically, and no less often than every four years, studies will include position-by-position comparisons using market agencies and internal equity data. All studies conducted pursuant to this section shall be completed by December 31 st and in no event later than March 31 in order to allow time for Committee review. Depending on the results of these studies, the entire pay grade structure may be adjusted or individual positions may be reassigned to different pay grades. Such adjustments will only affect the salary administration framework. No individual salaries will be automatically changed because of structural adjustments. An employee may request in writing a re-evaluation of his/her job based on significant changes in job content or significant discrepancies between job content and classification description, and which cannot be described as "other duties as assigned." The request must contain justification and may be made only during the period of August 10 through September 10. A statement by management that a job re-evaluation request will be submitted with the departmental budget does not relieve an employee from the responsibility of submitting his/her own request during this period. The HR Director or his designee will respond to such requests in a timely manner. If HR approves change, the request will be forwarded to ASD who will determine if there is sufficient funding to cover the cost of the change. If approved by ASD, the reclassification will be sent to the City Manager for approval. If approved, the change would be reclassified as part of the budget process and will require Council approval. Any changes approved as part of the budget process will become effective the first pay period of the following fiscal year, or, if not approved, the job will be returned to its previous status. 2. Compensation Adjustment Authorization. Each year the City Manager will propose as part of the budget process for Council approval a compensation adjustment based on recommendation received from the Management!Professional Compensation Committee. For fiscal year 20076-2008_7 the compensation adjustment to control point shall be a total of 3.5%~ This adiustment is available A44 r’-I~eelfin~÷innc- eh-’~ll rar",alx~a ~÷ la~c,÷ ~ Oo/_ ~4h~e÷man÷ ÷r~ {’hair o-’~i,mn~ haalnnlnn ,~.~,r"s ~, -°007’ to, all for those managemengprofessional employees who have received an overall rating of "meets" or "exceeds" expectations on their 2007~ annual review and who have not been on a pe#ormance improvement plan be~een July 1, 2006~ and June 30, 2007£D£cember 3!, 200Z~. Nothing herein shall preclude an employee’s manager from awarding a control point adjustment increase to an employee on a pe~ormance plan at a later date should employee’s pe#ormance improve. An additional half percent (.5%) will be allocated toward equity adjustments to address compaction problems as determined bv the City ManaQer 3 and will be retroactive to July 1,2007. In the future, the compensation adjustment request will be based on the following factors: competitive market, changes in internal position relationships, and the City’s ability to pay. Council authorization is required prior to implementation by the Director of Human Resources. 3. Base and Variable Compensation. Compensation for management and professional employees includes bi-weekly base salary and Variable Management Compensation (VMC). Bi-weekly base salary is paid on a continuing basis. Variable Management Compensation is an annual cash performance award based upon merit. On a fiscal year basis, the sum of the bi-weekly base salary and the VMC must fall within pay grade limits of no less than 25% below the control point and no more than 20% above the control point. Funding for VMC’s shall be calculated using salary plus benefits as of July 1, anua~’ 7, 2007 for all authorized positions in the table of organization as of January 1, 20087 and excluding all frozen positions. Base salary increases are earned in accordance with administrative guidelines based upon growth within the position and performance, which must meet or exceed position standards, the salary structure and the City’s ability to pay. In addition, employees may earn Variable Management Compensation by meeting or exceeding objectives established under the annual performance planning and appraisal system. -Variable Management Compensation requalification is necessary for each appraisal period. For those eligible retirees who retire during the year, any applicable VMC shall be prorated based on the number of months the employee worked during his/her fiscal year. Employees who resign from the City of Palo Alto are not eligible for prorated VMC if they leave during the eligible year. 4. Performance Planninq and Appraisal. Performance appraisals will be conducted at the end of each fiscal year during the months of July through September prior to determining individual employee fixed and variable compensation. This process includes both review of previous performance plan and preparation of the performance plan for the next planning period (usually the fiscal year). Performance plans are jointly prepared by the employee and supervisor with the concurrence of the department head or Council-appointed officer. The performance plans shall contain measurable objectives which place special emphasis on position description duties or specific assignments. Progress toward meeting objectives shall be monitored periodically. The performance appraisals should be implemented in a manner that will achieve the following objectives: ¯Define the employee’s job duties and expected level of performance for the next review period to ensure that both the employee and supervisor have a clear understanding of the employee’s role and responsibilities; ¯Evaluate and document past performance to serve as a basis for establishing and obtaining future performance standards/objectives; ¯Facilitate two-way communication and understanding between the employee and his or her supervisor; ¯Counsel and encourage employees to work toward a learning development plan and realize their full potential; ¯Establish future work plan objectives to be considered for a VMC. Work plans should include job related projects or special goals related to regular job duties when applicable. At the conclusion of the fiscal year (or review period), supervisors shall make a final determination of the overall performance rating. Recommendations shall be forwarded to department heads or council-appointed officers who will then determine individual fixed and variable compensation adjustments according to the provisions of the compensation plan. This process should be completed by September 30th. MANAGEMENT and AUTHORIZATION PROFESSIONAL COMPENSATION ADJUSTMENT Council-appointed officers are authorized to pay salaries in accordance with this plan to non-Council-appointed management, and professional employees in an amount not to exceed the aggregate of approved management and professional positions budgeted at the control points in the Table of Organization for fiscal year 200Z6-0_87. In addition, for fiscal year 20076-078, Council-appointed officers are authorized up to 3% of salary plus benefits for management and professional positions, plus unused Variable Management Compensation funds from the previous fiscal year to apply toward Variable Management Compensation for individual management and professional employees who qualify under the provisions of this Management and Professional Compensation Plan. Individual management and professional fixed and variable compensation authorized by a Council-appointed officer under the Management and Professional Compensation Plan may not be less than 25% below nor more than 20% above the control point for the individual position grades authorized in Table I of this plan. o The Council-appointed officers are authorized to establish such administrative rules as are necessary to implement the Management and Professional Salary Plan subject to the limitations of the approved compensation adjustment authorization and the approved grade and control point structure. In the event a downward adjustment of a position grade assignment indicates a reduction in the established salary of an individual employee, the Council- appointed officer may, if circumstances warrant, continue the salary for such employee in an amount in excess of the revised grade limit for a reasonable period of time. Such interim salary rates shall be defined as "Y-rates." SECTION II.SPECIAL COMPENSATION This section applies to all eligible regular management and professional positions including Council Appointed Officers as applicable and including Council Members where indicated. Eligibility shall be in conformance with the Merit Rules and Regulations and Administrative Directives issued by the City Manager for the purposes of clarification and interpretation. A. OVERTIME, IN-LIEU HOLIDAY PAY AND COMPENSATORY TIME OFF OVERTIME AND IN-LIEU HOLIDAY Compensation for overtime work, and scheduled work on paid holidays for certain designated non-exempt employees shall be in conformance with the Merit Rules and Regulations and Policies and Procedures. Overtime eligible employees shall be paid at the rate of time and one-half times the employees’ basic hourly salary unless called out for an emergency arising out of situations involving real or potential loss of service, property or personal danger, in which case additional pay will be at the rate of two times the employees’ basic hourly salary. Employees who work a schedule where a regular day off falls on a holiday will be paid for the hours they would have normally worked on that day. If the holiday falls on a non-workday for an exempt employee, the employee may, with supervisory approval, take another day off within the pay period or the following pay period. 2. COMPENSATORY TIME OFF Compensatory time off will be granted with department head approval for non-exempt employees at the rate of one and one-half hours for each hour of overtime worked, subject to the limitations of applicable state and federal laws. In the event compensatory time off is used as the method of compensating for overtime, the time off will be taken prior to the end of the quarter followinq the quarter in which the overtime has been worked. In the event the employee is denied the opportunity to take time within that quarter, he/she will either be compensated in pay for such time at the appropriate rate specified by these sections, or at the employee’s option, the earned compensatory time may be added to his or her vacation balance. B.WORKING OUT OF CLASSIFICATION PAY Where management and professional employees, on a temporary basis, are assigned to perform all significant duties of a higher classification, the City Manager may authorize payment within the range of the higher classification for the specified time frame. Working out of class pay is normally not to exceed 8-- 10% more than the employee’s current salary and shall be documented on a Personnel Action Form, with a description of the additional duties to be performed~ 6 C.STAND-BY PAY Employees eligible for overtime may be entitled to stand-by pay, approved by the City Manager on a case by case basis, in extreme circumstances involving unavailability of non-management staff. Compensation is as follows: Monday through Friday Saturday, Sunday, Holidays $40 perday $58 perday D. NIGHT SHIFT PREMIUM Night shift differential shall be paid at the rate of 5% to regular full-time employees who are regularly assigned to shift work between 6:00 p.m. and 8:00 a.m., or to employees who are temporarily assigned to work a full shift between 6:00 p.m. and 8:00 a.m. E.UNIFORM PURCHASE PLAN - SWORN POLICE, FIRE PERSONNEL, and OPEN SPACE PERSONNEL Uniforms including cleaning will be provided with replacement provisions on an as- needed basis in conformance with department policy. F. WINTER CLOSURE -20076 The winter closure will be the week of December 24-5-289. Not all City facilities are closed during the Winter Closure; employees must check with their supervisor to find out if the closure is applicable to their positions. During the Winter Closure, employees may elect to use paid leave balances such as management leave, vacation or holiday pay or take time off without pay. Employees who wish to work during the Winter Closure should make arrangements with their supervisors regarding work assignments. G.GROUP INSURANCE Effective Date of Coveraqe for New Employees For newly-hired regular employees coverage begins on the first day of the month following date of hire for the health plan, dental plan, vision care plan, long term disability and life insurance plans if these benefits are elected. Active Employee Health Plan (a) Based on an employee’s family status, the City shall pay up to the monthly medical premium for the second most expensive plan among the existing array of plans available during the term of this compensation plan on behalf of eligible employees (including Council Appointed Officers and Council Members) and dependents. Eligible dependents include spouses, children under the age of 23 and never married (natural, adopted, or stepchildren), economically dependent children, and domestic partners registered with the Secretary of State. If PERS changes the plans it offers, the City will continue to provide an equivalent benefit at an equivalent cost. (b)The City agrees to offer a program to active management and professional personnel (including Council Appointed Officers and Council Members) enrolled in PERSCare prior to 1/6/07 who elected the PERSChoice health plan in which the City will reimburse the employee and/or dependents for any covered medical expense which exceeds the $2 million Lifetime Maximum Benefit. (c)Coverage for Domestic Partners: (1) Domestic Partnership Registered with the California Secretary of State: Employees may add their domestic partner as a dependent to their elected health plan coverage if the domestic partnership is registered with the Secretary of State. (2)Domestic Partnership Not Registered with the California Secretary of State: Domestic partners who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department, will be eligible for reimbursement of the actual monthly premium cost of an individual health plan, not to exceed the maximum monthly City employer contribution for one-party coverage under the CalPERS Health Benefits Program (or PORAC if a safety department employee) for an employee covered under this agreement. Evidence of premium payment will be required with request for reimbursement. (d) PERS Choice Reimbursement Plan Management and Professional personnel enrolled in the PERS Choice medical plan may submit a request for payment, as specified below, for non-covered medical expenses, incurred during the period of January 1, 2-~_ through December 31,2~_ of the plan year, that exceed $2,500. -The maximum annual reimbursement amount provided under this program is: ¯$700 for employees enrolled in the Employee-Only category; ¯$900 for employees enrolled in the Employee and One Dependent category, and ¯$1,100 for employees enrolled in the Family category. Any amounts reimbursed to an individual under this program would be included in the employee’s gross income and is not PERSabie. This program shall only reimburse employees for medical expenses that are not reimbursed through any other means and meet the definition in Section 213(d) of the Internal Revenue Code. (Examples of eligible expenses include medical plan deductibles and co-payments, prescription drugs, dental care, hearing care, and vision care.) However, in order to have any expenses reimbursed under this program, an employee the employee must have allocated 100% ($2,500.00) of their 200_87 calendar Excess Benefit funds into the Medical FSA option during the election that occurred in November 20076. In addition, all such reimbursements from the Excess Benefit Program must have been solely for medical expenses, as defined by Section 213(d) of the Internal Revenue Code. If the employee has designated his/her Excess Medical funds for any other qualifying expenses (i.e. dependent care, Professional Development, Deferred Compensation contributions), the employee would not be eligible for reimbursement under this program. Employees may submit one claim for the entire plan year’s expenses during January. Any amounts remaining from the PERS Choice reimbursement plan after the claims for the plan year had been processed shall be forfeited. 3. Alternative Medical Benefit Program If a regular employee and/or the employee’s dependent(s) are eligible for medical insurance through another employer-sponsored or association medical plan, the employee may opt for alternative medical insurance coverage through the other employer-sponsored or association plan and waives his/her right to the City of Palo Alto’s medical insurance coverage for same individuals. Employees electing alternative coverage and no City coverage will receive cash payments of approximately half of the "average monthly premiums: for their medical insurance coverage. "Averaged monthly premiums" are the average of the Kaiser HMO, Blue Shield HMO and PERS Choice PPO premiums for the employee’s City medical coverage available through the Public Employee Retirement System (PERS). The rates for 2007 are as follows: One Party: $230.00 9 Two Party:$460.00 Family:$595.00 The rates for 2008 are as follows: One party:$250.00 Two parties:$500.00 Family:$645.00 4. Retiree Health Plan (a) Employees Hired Prior to January 1,2004 Monthly City-paid premium contributions for a retiree-selected health plan through the CalPERS Health Benefits Program will be made as provided under the Public Employees" Medical and Hospital Care Act. The City’s monthly employer contribution for each employee retiring on or after 1/1/2007 shall be the amount necessary to pay for the cost of his or her enrollment in a health benefits plan up to the monthly premium for the second most expensive plan offered to management and professional personnel during the contract term (among the existing array of plans.) For the 2007_6 calendar year, the City’s contribution toward dependent coverage is 7__~_068% of the difference between the applicable "Employee and One Dependent" or "Family" maximum employer contribution for active management and professional personnel and the maximum employer contribution for "Employee Only" coverage. For 2008_7 the City’s contribution will increase to 750%. (b) Post- 1/1/04 Hires For those Management and professional employees hired after January 1, 2004, the PERS law vesting schedule set forth in Government Code section 22893 will apply. Under that law, an employee is eligible for 50% of the specified employer health premium contribution after ten years of service credit, provided at least five of those years were performed at the City of Palo Alto. After ten years of service credit, each additional service credit year increases the employer contribution percentage by 5% until, at 20 years’ service credit, the employee will be eligible upon retirement for 100% of the specified employer contribution and 90% of their dependent coverage. The City of Palo Alto’s health premium contribution for eligible post - 1/1/04 hires shall be the minimum contribution set by PERS under section 22893 based on a weighted average of available health plan premiums. Dental Plan 10 a)The City shall pay covered plan charges on behalf of all eligible employees and dependents. (Domestic partners who are either registered with the Secretary of State or who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department are considered dependents under the plan.) Benefits for regular part-time employees will be prorated as follows: Employees who will work less than full time, will receive prorated premium costs for dental benefits in accordance with his/her percentage of a full-time work schedule. Part time employees currently receiving full benefits will not be impacted. b)The City’s Dental Plan provides the following: Maximum Benefits per Calendar Year- $2,000 per person Lifetime Maximum for Orthodontics- Effectiv~ !/!/07 tThe City will pay up to $2,000.00 for orthodontia coverage (not included in annual dental maximum) ¯Major Dental Services ¯Orthodontics ¯Basic Benefits (All other covered services) First Calendar Year of Eligibility Subsequent Calendar Years *Usual, Customary, and Reasonable 50% UCRI* 50% UCR* 70% UCR* 70%-100% Effective 1/1/07 the City wi44-added composite (tooth covered) fillings for posterior teeth to the dental plan. For each dental plan member, the percentage of coverage for basic benefits will begin at 70% for the first calendar year of coverage and increase by 10% (up to a maximum of 100%) effective the first day of the next calendar year as long as the member utilizes the plan at least once during the current year. Per the Delta Dental contract effective October 1,2005, if the member does not utilize the plan during the current year, the percentage of coverage for the next calendar year shall remain unchanged from the current year. If a dental plan member ever loses coverage under the plan, the applicable percentage of coverage for basic benefits provided during any future period of coverage will commence at 70% as if the dental plan member was a new enrollee. Examples of when a member might lose coverage under the plan would include: ¯Employee goes on an unpaid leave of absence and elects not to pay the required dental premiums for his/her family’s coverage during the leave. Employee elects to drop one or more covered dependents from the plan during an open enrollment period so that they might be covered on a spouse’s non-City of Palo Alto dental plan. Basic Life Insurance The City shall provide a basic group term life insurance with Accidental Death and Dismemberment (AD&D) coverage, in an amount equal to the employee’s annual basic pay (rounded to the next highest $1,000) at no-cost to the employee. AD&D pays an additional amount equal to the employee’s annual basic pay (rounded to the next highest $1,000). Supplemental Life And AD&D Insurance An employee may, at his/her cost, purchase additional life insurance and additional AD&D coverage equal to his or her annual salary. The maximum amount of life insurance available to the employee is up to $325,000 and the maximum amount of AD&D coverage available is up to $325,000. Long Term Disability Insurance a)The City shall provide long term disability (LTD) insurance with a benefit of 2/3 monthly salary, up to a maximum benefit of $10,000 per month. The City shall pay the premium for the first $6,000 of base monthly salary. For employees whose base monthly salary exceeds $6,000, the employee shall pay the cost of the required premium based upon their monthly salary between $6,000 and $15,000. b)For employees whose base monthly salary exceeds $6,000 and who have no eligible dependents covered under the City’s medical, dental or vision plans, the City will pay up to $17.50 per month towards the employee’s cost for LTD coverage. Vision Care a)The City shall provide vision care coverage for employee and dependents. Coverage is administered by Vision Service Plan (VSP). The plan provides an exam every 12 months; lenses every 24 months; frames every 24 months, all subject to a $20 co-payment as defined in the Vision Services Benefits Plan A schedule. Benefits for regular part-time employees will be prorated as follows: Employees hired after January 1,2004, who will work less than full time, will receive prorated premium costs for vision benefits in accordance with his/her percentage of a full-time work schedule. 12 Part time employees currently receiving full benefits will not be impacted. b)Effective July 1, 1996, dependents include eligible domestic partners who are either registered with the Secretary of State or who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department. H.EMPLOYEE ASSISTANCE PLAN The Employee Assistance Plan (EAP) provides employees with confidential personal counseling, work and family related issues, eldercare, substance abuse, etc. In addition, EAP programs provide a valuable tool for supervisors to refer troubled employees to professional outside help. This service staffed by experienced clinicians is available to employees and their dependents by calling a toll-free phone line 24 hours a day, seven days a week. Guidance is also available online. I.SAFETY DIFFERENTIALS 1. Police Department - Personnel Development Pro.qram Pursuant to administrative rules governing eligibility and qualification, the following may be granted to sworn police personnel: P.O.S.T. Intermediate Certificate: P.O.S.T. Advanced Certificate: 5% above base salary 7 1/2% above base salary 2. Fire Department - EMT Differential Pursuant to administrative rules governing eligibility and qualification, the following may be granted to sworn Fire personnel: EMT Differential:2.5% above base salary J.MANAGEMENT and PROFESSIONAL BENEFIT PROGRAM Management and professional employees are eligible for Sections 1,2, 3, and 4 of the Management Benefit Program. City Council Members are eligible for Section 3 only. 1.Professional Development- Reimbursement Reimbursement for authorized self-improvement activities may be granted each management and professional employee up to a maximum of $1,500 per fiscal year. The following items are eligible for reimbursement: 13 a.Civic and professional association memberships b.Conference participation and travel expenses Educational programs/tuition reimbursement. The education must maintain or improve the employee’s skills in performing his or her job, or be necessary to meet the express requirements of the City or the requirements of applicable law. The education to which the reimbursement relates must not be part of a program qualifying the employees for another trade or business; or be necessary to meet the minimum educational requirements for qualification for employment. Permissible educational expenses are refresher courses, courses dealing with current developments, academic or vocational courses, as well as the travel expenses associated with the courses. d.Professional and trade journal subscriptions not to exceed 12 months. e.Gym/health club memberships. Reimbursement of these expenses is taxable to the employee. Purchase of job related computer software, hardware, internet access, telecommunication equipment and home office equipment/furniture. Reimbursement of any of these expenses is taxable to the employee. Amounts under this professional development program will not be prorated, with the following exception: The maximum amount for Professional Development reimbursement for employees who move into a position covered by this compensation plan from a position under another City of Palo Alto bargaining group will be the lesser of: (1) $1,500 less any amounts they have received in the fiscal year of their position change through any other City of Palo Alto Tuition Reimbursement or Professional Development program; or (2) An amount obtained by subtracting any amounts the employee may have received in the fiscal year of their position change through any other City of Palo Alto Tuition Reimbursement or Professional Development program from the sum of: (i) the number of months of the current fiscal year that the employee served in previous bargaining unit and multiplying it by one-twelfth of that unit’s Tuition Reimbursement or Professional Development annual maximum benefit; and, (ii) the number of months of the current fiscal year that the employee will serve in the position covered by this compensation plan multiplied by $125. Professional Development Leave Authorized paid leaves of absence for up to one year will be granted in accordance with the following requirements: a.Eligibility is subject to a minimum City service requirement of five years. b.Compensation during the Professional Development Leave shall not exceed 50% salary and full benefits. When granted, a Professional Development Leave shall require an employee commitment of at least two-years’ service following return from the Leave. To the extent the full two-year commitment is not fulfilled, the employee shall re-pay the City a pro rata amount of the salary paid during the Leave based on the percentage of the two-year commitment not fulfilled. d.The Professional Development Leave program shall relate to the employee’s job assignment. e.An employee’s job assignment activity shall be adequately covered during his/her absence with emphasis on the development of subordinates. f.The leave of absence period shall be adequately coordinated with departmental priorities and workload. go Professional Development Leaves shall be based on internship exchanges, and/or loaned executive arrangements; scholastic and/or authorship programs; or educational travel-study plans. Leave of absence schedules will be apportioned among all levels of management and professional employees and will be based on an evaluation of each employee’s performance record. Each paid sabbatical leave will be limited to a maximum of one year and not more than two employees being on leave simultaneously. Sabbatical leaves must be cleared in advance and approved by a Council-appointed officer for his/her subordinates. Professional Development Leaves granted in excess of 30 days shall be noticed to the Council. 3.Physical Examinations All management and professional employees are eligible to receive an annual physical examination as follows: Use the periodic health exam benefit as provided under the PERS Health Plan option you have selected. Each of the PERS Health Plans provides for a periodic physical examination. The examination must be 15 performed by your primary care physician--unless he/she refers you to another physician. bo The types of tests and the frequency of the tests cannot exceed AMA guidelines. The guidelines are a suggested minimum based on research studies concerning preventative care. The judgment of your physician is the final determinant for your care. Any additional necessary asymptomatic tests that are required by your physician that are not covered by your health plan, will be reimbursed by the City. Any symptomatic tests will be covered under your PERS Health Plan. The Reimbursement for Periodic Physical Exam Form is available on the Human Resources Intranet site. This benefit will not be pro-rated. 4.Excess Benefit This benefit is designed to meet the requirements of Section 125 of the Internal Revenue Code. Every calendar year, each employee will be provided with $2,500 that they can designate among the following options: ao Medical Flexible Spending Account (Medical FSA). Provides reimbursement for excess medical/dental/vision, or expenses that are incurred by employees and their dependents which are not covered or reimbursed by any other source, including existing City-sponsored plans. This includes prescribed medications and copayments as well as over-the- counter drugs, including: antacids, allergy medicines, pain relievers and cold medicines. However, nonprescription dietary supplements (e.g. vitamins, etc.) toiletries (e.g. toothpaste), cosmetics (e.g. face cream), and items used for cosmetic purposes (e.g. Rogaine) are not acceptable. Dependent Care Flexible Spending Account (Dependent Care FSA). Provides reimbursement for qualified dependent care expenses under the City’s Dependent Care Assistance Program (DCAP), subject to the following limits: Dependent care expenses will be reimbursed only to the extent that the amount of such expenses reimbursed under this Management Benefit Program, when added to the amount (if any) of annual dependent care expenses that the participant has elected under the City’s Flexible Benefits Plan, do not exceed the maximum permitted under the DCAP. 1)The annual amount submitted for reimbursement cannot exceed the income of the lower-paid spouse. shall be accrued at the rate of 3.7 hours per bi-weekly pay period for those employees working a forty-hour duty schedule. Those assigned work schedules, which are greater or lesser than forty hours will accrue sick leave at the ratio of their work schedule to forty hours. b)Employees may use up to twenty hours of sick leave per calendar year for personal business. The scheduling of such leave is subject to the approval of the appropriate level of Management. c)Employees leaving the municipal service shall forfeit all accumulated sick leave, except as otherwise provided by law and by Section 609 of the Merit Rules and Regulations. In the event that notice of resignation is given, sick leave may be used only through the day which was designated as the final day of work by such notice. d)Employees that were hired before December 1, 1983 and who leave the municipal service in good standing, or who die while employed in good standing by the city, and who have fifteen or more years of continuous service shall receive compensation for unused sick leave hours in a sum equal to two and one-half percent of their unused sick leave hours multiplied by their years of continuous service and their basic hourly rate of pay at termination. Full sick leave accrual will be paid in the event of termination due to disability. See Merit System Rules and Regulations, Chapter 6, Section 609. e)Up to nine days of sick leave per calendar year may be used for illness in the immediate family, including a registered domestic partner. f) Management and Professional employees eligible, as specified above if hired before December 1,1983, to be compensated for sick leave may annually convert sick leave hours in excess of 600 to cash or deferred compensation, according to the formula set forth above, up to a maximum of $2,000 per fiscal year. Mana.qement Annual Leave 18 At the beginning of each fiscal year regular management and professional employees will be credited with 80 hours of annual leave. This leave is granted in recognition of the extra hours Management and Professional employees work over their regular schedule. This leave may be taken as paid time off, added to vacation accrual (subject to vacation accrual limitations), taken as cash or taken as deferred compensation. When time off is taken under this provision, 10-hour shift workers will receive one shift off for each 8 hours charged; 24-hour shift workers will receive one-half shift off for each 8 hours charged. Entitlement under this provision will be reduced on a prorated basis for part-time status, or according to the number of months in paid status during the fiscal year. Unused balances as of the end of the fiscal year will be paid in cash unless a different option as indicated above is elected by the employee. Professional Development Leave Authorized paid leaves of absence for up to one year will be granted in accordance with the following requirements: a. Eligibility is subject to a minimum City service requirement of five years. b. Compensation during the Professional Development Leave shall not exceed 50% salary and full benefits. c. When granted, a Professional Development Leave shall require an employee commitment of at least two-years’ service following return from the Leave. To the extent the full two-year commitment is not fulfilled, the employee shall re-pay the City a pro rata amount of the salary paid during the Leave based on the percentage of the two-year commitment not fulfilled. d. The Professional Development Leave program shall relate to the employee’s job assignment. e. An employee’s job assignment activity shall be adequately covered during his/her absence with emphasis on the development of subordinates. f. The leave of absence period shall be adequately coordinated with departmental priorities and workload. g. Professional Development Leaves shall be based on internship exchanges, and/or loaned executive arrangements; scholastic and/or authorship programs; or educational travel-study plans. Leave of absence schedules will be apportioned among all levels of management and professional employees and will be based on an evaluation of each employee’s performance record. Each paid sabbatical 19 leave will be limited to a maximum of one year and not more than two employees being on leave simultaneously. Sabbatical leaves must be cleared in advance and approved by a Council-appointed officer for his/her subordinates. Professional Development Leaves granted in excess of 30 days shall be noticed to the Council. 4. Vacation Vacation will be accrued when an employee is in pay status and will be credited on a bi-weekly basis. Total vacation accrual at any one time may not exceed three times the annual rate of accrual. Each eligible employee shall accrue vacation at the following rate for continuous service performed in pay status: (a)Less than nine years. For employees completing less than nine years continuous service: 120 hours vacation leave per year; provided that: (i)The City Manager is authorized to adjust department head annual vacation accrual to provide for a maximum of 160 hours for those hired between July 1, 1996 and June 30, 2001 ; and The City manager is authorized to adjust the annual vacation accrual of employees hired on or after July 1, 2001, to provide up to 40 additional hours (i.e., to a maximum annual accrual of 160 hours) for service with a prior employer. (b) Nine, but less than fourteen years. For employees completing nine, but not more than fourteen years continuous service; 160 hours vacation per year. (c)Fourteen, but less than nineteen years. For employees completing fourteen, but not more than nineteen years continuous service; 180 hours vacation leave per year. (d) Nineteen or more years. For employees completing nineteen or more years continuous service; 200 hours vacation leave per year. (e) Once each calendar year an employee may cash out vacation accrual balances in excess of 80 hours. An employee may cash out a minimum of 8 hours to a maximum of 120 hours of accrued vacation provided the employee has taken 80 vacation hours in the previous 12 months. 5. Bereavement 20 Leave of absence with pay of three days may be granted an employee by the head of his/her department in the event of death in the employee’s immediate family, which is defined for purposes of this section as wife, husband, son, son-in-law, step-son, daughter, daughter-in-law, step-daughter, mother, mother-in-law, father, father-in-law, brother, brother-in-law, sister, sister-in-law, grandmother, grandmother-in-law, grandfather, grandfather-in-law, grandchild, aunt, uncle, niece, nephew, registered domestic partner, or a close relative residing in the household of employee. Such leave shall be at full pay and shall not be charged against the employee’s accrued vacation or sick leave. Requests for leave in excess of three days shall be subject to the approval of a Council-Appointed Officer for employees under his/her control. L. RETIREMENT PENSION Effective pay period inclusive of 1/6/07, the City’s Public Employees’ Retirement System (PERS) benefits sha44-changed to the 2.7% at 55 formula for non-safety members (from 2% at 55). Employee Share. Effective May 1, 1984, the City agreed to pay the 7% employee contribution to PERS. Effective pay period inclusive of 1/6/07, the employee share of the PERS contribution w~14-increased to 8% from 7%. ,~;r~rqr~r~ ~^,i÷l~ t,lq~ I-"-%~ i~ ...................__B,.~ ........~ ......" ......~"’~ ~’"~’ ’°~ ....f ~/6/0.7, tThe City £hal,Lpays 6% and the employee ~qa-l~-pays 2% of the 8% PERS employee share for the 2.7 at 55 ....... ~.,~apphes to Council-retirement benefit formula. This provision o~’o" o~’~’~" " appointed officers and all regular management and professional employees, except that for sworn police and fire management employees the City shall continue to pay the mandatory nine percent (9%) of the employee’s PERS contribution. o Notwithstanding subsection 2 above, effective the pay period inclusive of 1/6/07, upon filing a notice of retirement, the 6% City-paid PERS contribution (9% for~sworn police and fire management personnel) will be converted to a salary adjustment of equal amount on a one-time irrevocable basis for the final compensation period which is defined as the highest average compensation earnable (salary) during the year immediately preceding retirement or any other designated consecutive year. Employee PERS contributions shall be made on a tax deferred basis, in accordance with Section 414(h)(2) of the Internal Revenue Code. All provisions of this subsection are subject to and conditioned upon compliance with IRS regulations. As of October 20, 2001 and March 9, 2002, the City provides the Public Employees’ Retirement System (PERS) Benefit, "3% at 50" full formula (Section 21362.2) for safety members. M.AUTOMOBILE EXPENSE ALLOWANCE 21 For those employees whose duties require use of a City automobile, the City Manager (or in the case of Council-appointed officers, the City Council) may authorize payment of up to $325 per month in lieu thereof. N.COMMUTE INCENTIVES and PARKING Employees who qualify may voluntarily elect one of the following commute incentives: 1. Civic Center Parking. Employees assigned to Civic Center and adjacent work locations. The City will provide a Civic Center Garage parking permit. Employees hired after June 30, 1994 may initially receive a parking permit for another downtown lot, subject to the availability of space at the Civic Center Garage. 2. Public Transit. The City will provide monthly Commuter Checks worth the value of: $40 for employees traveling two or more zones on Caltrain; $40 for employees using the Dumbarton Express, BART, the ACE train or a commuter highway vehicle; $35 for employees traveling within one zone on Caltrain; $35 for employees using VTA, and other buses. These vouchers may be used toward the purchase of a transit pass. 3. Carpool. The City will provide $30 per month to each eligible employee in a carpool with two or more licensed drivers. 4. Vanpool Pilot Program. The City will provide Commuter Checks worth the value up to $60 to each employee voluntarily participating in the Vanpool Pilot Program. These may be used toward payment of the monthly cost of the vanpool. Employees must fulfill the basic requirements of the Employee Commute Alternatives Program to qualify. 5. Bicycle. The City will provide employees with $20 per month to eligible employees who ride a bicycle to work. 6. Walk. The City will provide employees with $20 per month to eligible employees who walk to work. 22 O.AT-WILL STATUS Department heads hired after July 1,2004 will be "At-Will" employees whose terms of employment are specified by an employment contract. Any current department head or the Assistant City Manager may elect to remain covered by the Merit Rules or to become At-Will employees with an employment contract that shall include a severance package. All current executive managers shall maintain all the benefits they presently have or would have as a new executive manager. ¯ EXPENSE ALLOWANCEADDITIONAL COMPENSATION FOR MAYOR AND VICE MAYOR The Mayor shall receive $150 monthly, and the Vice Mayor $100 monthly to defray additional expenses of these offices. ~A .....$92.31 $200.00 Vice Mayor $23.08 $50.00 Q.REIMBURSEMENT FOR RELOCATION EXPENSE Policy Statement The City of Palo Alto, in rare instances, may provide a Basic Relocation Benefits Package for new management and professional employees, upon the approval of the City Manager or designated subordinate. In addition, the provision of "Optional Benefits" or portions thereof, may be extended for exceptional circumstances and only the approval of the City Manager or designee, or for Council-appointed officers, the City Council. The details of the Relocation Expense program are specified in the City’s Relocation Expense policy. R. MEAL ALLOWANCE Management and professional employees assigned to attend night meetings are eligible to receive reimbursement for up to $20.00 per dinner. This provision covers only receipted meals actually taken and submitted for reimbursement. So REDUCTION IN WORKFORCE: The City will make every effort to follow the 2005 transition plan if a reduction in workforce is necessary in 2006Z or 20078. The Management/Professional Compensation Committee shall be involved in development of changes to the transition plan. 23 GR!EV,^,NCE PROCEDURE: T. GRIEVANCES REGARDING COUNCIL APPOINTED OFFICERS: Notwithstandinq the grievance procedures provided in Chapter i 1 of the City of Palo Alto’s Merit System Rules and Requlations, any Management and Professional employee who is supervised by a Council Appointed Officer and has a grievance aqainst that Council Appointed Officer or reqarding the conduct of that Council Appointed Officer shall, following an attempt to resolve the grievance pursuant to Step One (informal discussion), summarize the grievance regarding the Council Appointed Officer in writing and submit it to the Director of Human Resources for review and resolution usinq the methods he/she considers appropriate. T Th0 1413 F/ir~r,÷r~r ~nr4 hie kb.U__:.MERIT RULES: The City will include members of the Management/Professional Compensation Committee in discussions regarding revision of the Merit Rules and Regulations. SECTION III.MANAGEMENT FELLOW PROGRAM The City has created a pilot program for Manaqement Fellows. This pilot program will be tested over a two year period. The program’s purpose is to create limited duration entry level positions for graduate students. A manaqement fellow will be an "at will" employee whose term of employment shall be no more than one year. A Manaqement Fellow shall be PERS exempt, but will receive vacation, sick leave, limited health care benefits and other limited benefits, as determined by the City Manager. Sections I and II of this Plan shall not apply to Manaqement Fellows, except as specified by the City Manaqer.