CITY COUNCIL STAFF REPORT
Meeting: November 7, 2023
Subject
Approve and update the salary and benefits for the Unrepresented (Management and Confidential) Employees and Appointed Employees.
Recommended Action
Adopt Resolution No. 23-XXX revising the Compensation Program and salary schedules for the Unrepresented (Management and Confidential) Employees effective July 1, 2023; Adopt Resolution No. 23-XXX revising the Compensation Program for the Appointed Employees effective July 1, 2023; and Approve salary realignment for the classification of Environmental Program Manager to Transportation Manager and Capital Improvement Programs Manager Reasons for Recommendation
Historically, the City Council has aligned the compensation plans for the Unrepresented and Appointed employee groups with the terms and conditions of employment for the Cupertino City Employees’ Association (CEA)/IFPTE Local 21. The following summarizes the two programs:
The Unrepresented Employees’ Compensation Program includes employees in management or confidential positions as adopted by the City Council and may be amended or otherwise modified from time to time.
The Appointed Compensation Program includes the City Manager and City Attorney who are evaluated by the City Council on an annual basis. Compensation for these employees is considered on the basis of equity of pay for duties and responsibilities assigned, meritorious service, comparability with similar work in other public employment in the same labor market, and terms of their employment contracts. The employment contract for the City Manager includes salary adjustments in line with those that employees receive.
On August 16, 2022, the City Council approved a three-year compensation plan for the Unrepresented and Appointed employee groups. This plan included a 5% cost of living adjustment (COLA) and $3,800 in a one-time lump sum payment, consistent with the contract approved by CEA/IFPTE Local 21. That agreement included a side letter that allowed for wage and health reopener. CEA contacted the City in February 2023 to reopen contract negotiations.
The City has since reached a tentative agreement with both bargaining units that represent City staff. Staff is requesting that Council adopt conforming changes to the Unrepresented Employees’ Compensation Program and the Appointed Employees’ Compensation Program, consistent with the Tentative Agreement with CEA/IFPTE Local 21 and as guided by the Appointed Employees’ Compensation Program, Policy No. 1 and the City Manager’s employment contract. Key provisions of the tentative agreements are summarized below:
Cost of Living adjustments (COLAs): CEA/IFPTE Local 21 agreed to reopen negotiations concerning COLAs for FY23-24 and FY24-25. The results from these reopened negotiations will be, if approved by the Council, applied to the Unrepresented (Management and Confidential) Employees and the City Manager and approved by the Council as follows:
3.5% for year 2 and no additional COLA’s for year 3 of the MOU (omitting the City Attorney).
Health Premiums: Effective January 1, 2024, the City shall contribute up to the Kaiser Family health premium cost per month applied to both Unrepresented and Appointed employees. Required contribution amounts exceeding this premium contribution of the City are the responsibility of the employee.
For any change in the monthly medical plan premium charged by CalPERS in the plan year 2025 compared to the plan year 2024, the City’s maximum contributions shall be capped at no more than 6% for Unrepresented and Appointed Employees. Any required contribution amounts exceeding the premium contribution of the City are the responsibility of the employee.
Adding Lunar New Year and Cesar Chavez Day as paid holidays starting in 2024 for Unrepresented and Appointed Employees. For Calendar Year 2023, Unrepresented and Appointed employees will receive one (1) floating holiday in lieu of Lunar New Year holiday.
To maintain fair labor practices, job classifications and salary ranges within the organization are periodically reviewed to ensure employees are working within the job duties and responsibilities of their designated job classification and for pay equity. As a result, staff recommends council consider approving a salary realignment for the classification of Environmental Program Manager to Capital Improvement Programs Manager and Transportation Manager.
Additional minor modifications to the Appointed Employee Compensation Programs adjusts the process for approval of expenses.
Title 2 of the California Code of Regulations, section 570.5, requires that the pay schedule of every CalPERS agency be approved and adopted by the agency's governing body pursuant to public meeting law. The City's Salary Schedule for Unrepresented (Management and Confidential) Employees is attached for the Council's review and approval, effective July 1, 2023.
Sustainability Impact
There is no sustainability impact resulting from the recommended action in this report.
Fiscal Impact
The City incurred an estimated cost of $1,152,236 for unrepresented employees and $27,227 for appointed employees in the first year (FY2022-23) of the compensation plan. Estimated costs for the second year (FY2023-24) are $720,850 for unrepresented and $14,702 for appointed employee, for a total cost of $1,873,086 and $41,929. At the time of the adopted budget, costs related to the labor contracts were unknown, but estimates were included in the adopted budget. Budget estimates are sufficient to cover the additional estimated cost and no budget adjustment is needed.
California Environmental Quality Act (CEQA)
Not applicable.
Prepared by: Vanessa Guerra, Human Resources Manager
Reviewed by: Kristina Alfaro, Director of Administrative Services Matt Morley, Assistant City Manager
Approved for Submission by: Pamela Wu, City Manager
Attachments:
A – Unrepresented Comp Program - Clean
B – Unrepresented Comp Program - Redline
C – Appointed Comp Program- Clean
D – Appointed Comp Program- Redline
E – Draft Resolution amending the Appointed and Unrepresented Employees' Compensation Programs