HomeMy WebLinkAboutStaff Report 6487 Side Item 19•
CITY OF
PALO
ALTO
TO:
CITY OF PALO ALTO
MEMORANDUM
HONORABLE CITY COUNCIL
Item# 19
FROM: CITY MANAGER DEPARTMENT: HUMAN RESOURCES
AGENDA DATE: JANUARY 11, 2016
SUBJECT: Resolution Approving Terms for PAPMA
RE: PMA Side Letter Agreement .
ID#:6487
The attached agreement with PMA is being placed into the Council packet late due to the
winter holidays and the need to have the agreement reviewed by legal counsel. The attached
agreement was signed by PMA on January 4, 2016.
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Assistant City Manager
Attachment
City of Palo Alto and Palo Alto Police Managers' Association
Letter Agreement: January 11, 2016 -June 30, 2017
Section I. Introduction and Term
In 20 I 0, the City of Palo Alto (City) and the Palo Alto Police Managers' Association (Association) began
formal negotiations to complete the first Memorandum of Agreement (MOA) between the City and
Association. In 2013, although the parties have previously reached a number of tentative agreements,
both parties recognize that there remain a limited number of issues to be resolved before a complete MOA
can be prepared for approval by the City Council and ratification by the Union. While the parties
continue to work towards an MOA, they wish to memorialize and implement the following key terms
without further delay.
The term of this Letter Agreement shall commence on January 11, 2016 and shall expire on June 30,
2017. Although the parties will continue to meet and confer regarding an MOA during the term of this
Letter Agreement, neither party shall be obligated to bargain with respect to any matter specifically
addressed herein. Nothing in this Letter Agreement shall preclude the parties from mutually agreeing to
meet and confer on any subject within the scope of representation at any time. The terms of this side
letter shall be incorporated in the final MOA representing the term of January 11, 2016 to June 30, 2017.
Section II. Salary
Etlective the first full pay period after ratification by the Association and City Council approval of the
Side Letter, the base salary rates and ranges for classifications covered by this bargaining unit shall be
increased as set forth in Appendix A-I to reflect salary increases and market adjustments.
If the parties reach agreement on an MOA that is approved by the City Council and ratified by the Union
by June 30, 2016, the base salary rates and ranges for classifications covered by this bargaining unit shall
be increased on June 30, 2016 and June 30, 2017 as set forth in Appendix A-2. If an MOA is not
approved and ratified by June 30, 2016, salary increases and market adjustments shall be 0% for both
June 30, 2016 and June 30, 2017.
Section III. Retirement
A. "3%@50" Safety Retirement (Employees hired on or before December 7, 2012)
For employees hired by the City of Palo Alto on or before December 7, 2012, the California Public
Employees' Retirement System (Cal PERS) retirement formula benefit known as the "3 percent at 50
(3%@50)," per California Government Code section 21362.2, shall continue in effect with the final salary
determination for such employees of the ·'single highest one (I) year period" per California government
Code section 20042. All unit members in the 3%@ 50 safety retirement plan shall pay the full 9%
CalPERS member contribution. This contribution is pre-tax to the extent allowable by law.
City of Palo Alto and Palo Alto Police Managers' Association
Letter Agreement: January 11, 2016 -June 30, 2017
B. Second Tier "3% at 55" Safety Retirement ("Classic" Employees)
For those employees hired on or after December 8, 2012 through December 31, 2012 or are classic
members as defined by CalPERS, the Cal PERS retirement formula benefit known as the "3 percent at 55
(3%@55)," per Government Code section 21363.1, with the final salary determination for such
employees of the "three (3) highest consecutive years" based on the highest average annual compensation
earnable by the member during three (3) consecutive years of employment immediately preceding
retirement or the three-year period otherwise designated by the member per Government Code section
20037. All unit members in the second tier shall pay the full 9% CalPERS member contribution. This
contribution is pre-tax to the extent allowable by law.
C. Third Tier "2.7% at 57" Safety Retirement ("New" PEPRA Employees)
For those employees hired on or after January I, 2013, the Cal PERS retirement formula benefit known as
"2.7 percent at 57 (2.7% at 57)," with the final salary determination for such employees of the "three (3)
highest consecutive years." The initial contribution rate wi II be at least 50% of the normal cost rate at
retirement as determined by CalPERS. This contribution is pre-tax to the extent allowable by law.
D. Additional Employee PERS Contributions
Effective as soon as administratively possible all employees regardless of pension formula in this unit
shall, in addition to the Member Contribution required per CalPERS 20516 contract amendment, pay an
additional 1 % towards the Employer share of Pension. Effective the pay period that includes June 30,
2016, all employees regardless of pension formula in this unit shall, in addition lo the Member
Contribution required, pay an additional I% towards the Employer share of Pension for a total of 2%.
Effective the pay period that includes June 30, 2017, all employees regardless of pension formula in this
unit shall, in addition to the Member Contribution required, pay an additional I% towards the Employer
share of Pension for a total of 3%. Such contributions under CalPERS 20516 will be provided on a pre
tax basis to the extent allowable by law.
E. 1959 Survivor Benefit
The City will continue to provide the basic level (Level I) of the 1959 Survivor Benefit to eligible
employees per Government Code section 21571.
F. Military Service Credit
The City will continue to contract with CalPERS to provide Military Service Credit as Public Service.
City of Palo Alto and Palo Alto Police Managers' Association
Letter Agreement: January 11, 2016 -June 30, 2017
Section IV. Active Health Plans
The maximum City contribution towards medical premiums for eligible full time employees per
employee category shall be up to a maximum of the following for any plan:
Medical PEMHCA Additional Ci!Y Total maximum City Total maximum City
Premium contribution* Contribution contribution* contribution*
Category 2016 (effective pay period (effective pay period
including January I I, including January I,
2016) 2017)
Employee $125.00 $618.00 $743 $773
only
Employee+ $125.00 $1,360.00 $1,485 $1,544
I
Employee+ $125.00 $1,806.00 $1,931 $2,008
2 or more
*Total City contribution includes both PEMHCA minimum contributions pursuant to Government Code
section 22892 and an additional City contribution necessary to pay the cost of medical premiums up to the
amount listed in the "Total maximum City contribution" columns above. This contribution amount is
based on half of the eight percent historical trend.
Section V. Retirement Medical Plan
A. Retiree Medical Coverage for Unit Employees Hired Before January 1, 2004:
Monthly City-paid premium contributions for a retiree-selected PEMHCA optional plan will be made in
accordance with the Public Employees' Medical and Hospital Care Act Resolution for employees hired
before January I, 2004 as outlined below.
For employees who retire before June I, 2012, the City will pay up to the monthly medical premium for
the 2nd most expensive plan offered to PMA employees among the existing array of plans.
For employees who retire on or after June 1, 2012, The City contribution towards retiree medical shall be
the same contribution amount it makes for active City employees.
Effective upon ratification and adoption of this Agreement (Scheduled for January 11, 2016), the City
shall provide active unit employees who were hired before January I, 2004 with a one-time opportunity to
opt-in to retiree health benefits provided under California Government Code section 22893. Eligible
employees who wish to exercise this option shall inform the People, Strategy, and Operations department
of their election in writing no later than 90 days following the ratification and adoption of this Agreement.
B. 20-Year Vesting Schedule for Retiree Medical Coverage for Unit Emplovees Hired on or
After January l, 2004 and employees who chose to opt-in to retiree health benefits provided
under California Government Code section 22893 as outlined above:
City of Palo Alto and Palo Alto Police Managers' Association
Letter Agreement: January 11, 2016 -June 30, 2017
The retiree health benefit provided in California Government Code section 22893 shall apply to all
employees hired on or after January l, 2004 and employees who opt-in as outlined above. Under this
law, an employee is eligible to receive Fifty (50) percent of benefit after ten (I 0) years; each additional
service credit year after Ten (I 0) years will increase employer credit by Five (5%) percent until Twenty
(20) years is reached at which time employee is eligible for One Hundred ( l 00%) percent of annuitant
only coverage and Ninety (90%) percent of the additional premium for dependents.
Palo Alto Police Managers' Association City of Palo Alto
Date Dania Torres Wong Date
Date Natalie Korthamar Date
Sandra Blanch Date
Molly Stump Date
Jim Keene Date