Fremont City Council Meeting: 07/07/26 07:00 PM
3300 Capitol Avenue Div/Dept: Human Resources
Fremont, CA 94538 Category: Labor Relations
SCHEDULED
Sponsors:
COUNCIL STAFF REPORT (ID # 5784) DOC ID: 5784 A
Updated: 7/1/2026 5:29 PM by Alberto Quintanilla A Page 1 Operating Engineers, Local Union No. 3 MOU - Consideration of a Resolution Approving a Successor Memorandum of Understanding with the Operating Engineers, Local Union No. 3 (OE3)
Contact Persons:
Name: Tina Gallegos Brian Stott
Title: Human Resources Director Assistant City Manager
Div/Dept: Human Resources City Manager's Office
Phone: 510-494-4652 510-494-4660
E-Mail: [email protected] [email protected]
Executive Summary: In June 2026, the City of Fremont (City) reached a tentative agreement with the Operating Engineers, Local Union No. 3 (OE3) for a three-year successor Memorandum of Understanding (MOU). The bargaining unit is made up of 111 members. The proposed MOU incorporates compensation increases, health-benefit allowance increases, and market equity adjustments for positions identified to be out-of-market. All other substantive provisions of the MOU remain unchanged.
Background: The City’s current MOU with OE3 expires on June 30, 2026.
The City’s negotiating team met and conferred with OE3 representatives and reached a Tentative Agreement on June 25, 2026. The City received notice that OE3 members ratified the Tentative Agreement on June 29, 2026. The effective date of the successor MOU will be July 1, 2026, and will expire on June 30, 2029. California Government Code Section 3505.1 requires the City Council to vote on the proposed successor MOU at a duly noticed public meeting.
Discussion/Analysis: Significant changes to provisions of the MOU include:
1. Employee Compensation:
General Salary Increases (GSI):
a) The salaries for the classifications listed in Appendix A of this MOU shall be increased by 3% effective the start of the first full pay period in July 2026.
Council Staff Report (ID # 5784) Meeting of July 7, 2026 Updated: 7/1/2026 5:29 PM by Alberto Quintanilla A Page 2 b) The salaries for the classifications listed in Appendix A of this MOU shall be increased by 3% effective the start of the first full pay period in July 2027.
c) The salaries for the classifications listed in Appendix A of this MOU shall be increased by 3% effective the start of the first full pay period in July 2028.
Market Equity Increases:
Based on the City’s market survey, the salary assigned to Building Maintenance Coordinator shall be increased by the following amounts:
a) 3.0% effective the first full pay period in July 2026. b) 3.0% effective the first full pay period in July 2027. c) 3.0% effective the first full pay period in July 2028.
2. Health Benefit Allowance:
a) Effective January 1, 2027, the unit’s health benefit allowance will be increased by an additional $200 per month (new health benefit allowance totals will be: $2,071 per month for employee- only coverage, $2,895 per month for two-party coverage, and $3,407 per month for family coverage).
b) Effective January 1, 2028, the unit’s health benefit allowance will be increased by an additional $200 per month (new health benefit allowance totals will be: $2,271 per month for employee- only coverage, $3,095 per month for two-party coverage, and $3,607 per month for family coverage).
c) Effective January 1, 2029, the unit’s health benefit allowance will be increased by an additional $200 per month (new health benefit allowance totals will be: $2,471 per month for employee- only coverage, $3,295 per month for two-party coverage, and $3,807 per month for family coverage).
Fiscal Impact:
1. Compensation Increases:
Council Staff Report (ID # 5784) Meeting of July 7, 2026 Updated: 7/1/2026 5:29 PM by Alberto Quintanilla A Page 3 a) Fiscal Year 2026/27 Anticipated Fiscal Impact: $392,385 b) Fiscal Year 2027/28 Anticipated Fiscal Impact: $796,542 c) Fiscal Year 2028/29 Anticipated Fiscal Impact: $1,212,823
2. Health Benefit Allowance Increases:
a) Fiscal Year 2026/27 Anticipated Fiscal Impact: $55,101 b) Fiscal Year 2027/28 Anticipated Fiscal Impact: $123,489 c) Fiscal Year 2028/29 Anticipated Fiscal Impact: $149,190
3. Market Equity Increases:
a) Fiscal Year 2026/27 Anticipated Fiscal Impact: $4,048 b) Fiscal Year 2027/28 Anticipated Fiscal Impact: $8,463 c) Fiscal Year 2028/29 Anticipated Fiscal Impact: $13,272
Environmental Review: The proposed approval of a successor MOU is exempt from and not subject to review under the California Environmental Quality Act (CEQA) because, without limitation, it is not a “project” as defined in CEQA Guidelines Section 15378(b)(2) and/or 15378(b)(5), and it has no possibility of having a significant effect on the environment, as specified in CEQA Guidelines Section 15061(b)(3), each as a separate and independent basis for CEQA compliance.
Links: None.
ATTACHMENTS:
• OE3 Resolution 2026
Recommendation: Adopt a resolution approving the tentative agreement reached with the Operating Engineers, Local Union No. 3 (OE3) for a successor MOU and authorizing the City Manager to execute an MOU for the period of July 1, 2026, through June 30, 2029; and direct staff to adjust appropriations in the FY 2026/27 adopted operating budget as necessary to implement the terms of the MOU.