Agenda Report
Fullerton City Council
MEETING DATE: DECEMBER 3, 2024
TO: CITY COUNCIL / SUCCESSOR AGENCY
SUBMITTED BY: EDDIE MANFRO, DIRECTOR OF HUMAN RESOURCES PREPARED BY: LAURA GIANNETTI-MERCER, HUMAN RESOURCES MANAGER II April Thompson, Human Resources / Risk MANAGEMENT Analyst I SUBJECT: CLASSIFICATION PLAN UPDATE RELATING TO A MINIMUM WAGE INCREASE
SUMMARY
This item would update hourly rates for non-regular employees in compliance with Labor Code Section 1182.12(c) minimum wage requirements 4 and take effect on January 1, 2025. Staff presents an alternative resolution should California Proposition 32 pass for consideration.
PROPOSED MOTION
Adopt Resolution No. 2024-XXX.
RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, AMENDING RESOLUTION NO. 2024-035 APPENDIX A RELATING TO NON-REGULAR EMPLOYEE PAY Or, if Proposition 32 passes:
Adopt Alternate Resolution No. 2024-XXX.
RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, AMENDING RESOLUTION NO. 2024-035 APPENDIX A RELATING TO NON-REGULAR EMPLOYEE PAY
ALTERNATIVE OPTIONS
Approve the Proposed Motion
Other options brought by City Council.
STAFF RECOMMENDATION
Staff recommends the Proposed Motion.
CITY MANAGER REMARKS
The City Manager recommends approval of the proposed Resolution as it relates to the $16.50 minimum wage requirement by the State of California.
If Proposition 32 is approved the City Council can either approve the alternate Resolution or the City Council could defer this item until December 17th.
PRIORITY POLICY STATEMENT
This item matches the following Priority Policy Statement:
Fiscal and Organizational Stability.
FISCAL IMPACT
The estimated cost for the proposed change to the $16.50 minimum wage increase totals $14,379 for the remainder of Fiscal Year (FY) 2024-25. This amount includes wage adjustments and applicable benefits contributions. The following lists projected impacts by department:
Parks and Recreation $11,961
Library $ 1,258
Public Works $ 448
Police $ 386
Fire $ 326
Total $14,379
Staff expects expenditures to remain within the FY 2024-25 Adopted Budget for the affected departments and does not request a budget adjustment.
Should California Proposition 32 pass, the estimated cost for the proposed change to an $18.00 minimum wage increase totals $58,493 for the remainder of FY 2024-25. This amount includes wage adjustments and applicable benefits contributions. The following lists the projected impacts by department:
Parks and Recreation $48,064
Library $ 5,033
Police $ 1,956
Fire $ 1,956
Public Works $ 1,484
Total $58,493
Staff expects expenditures to remain within the FY 2024-25 Adopted Budget for the affected departments and does not request a budget adjustment.
BACKGROUND AND DISCUSSION
Current Minimum Wage Law
Senate Bill 3 revised Labor Code Section 1182.12 on April 4, 2016 to incrementally increase the California minimum wage each January through January 1, 2022, at which time it reached $15.00 per hour.
Following the minimum wage increase to $15.00 per hour, Labor Code Section 1182.12(c) requires that on or before August 1 of each year, the Director of Finance calculate the adjusted minimum wage to the lesser of 3.5% or the rate of change, as specified, for the United States Bureau of Labor Statistics non-seasonally adjusted United States Consumer Price Index for Urban Wage Earners and Clerical Workers (U.S. CPI-W). The increase effective January 1, 2024 raised the minimum wage to $16.00 per hour.
The Director of Finance found this year that the U.S. CPI-W for the 12-month period from July 1, 2023 to June 30, 2024 increased by 3.18% (Attachment 1). The minimum wage will increase by 3.18% to $16.50 per hour effective January 1, 2025.
Staff recommends the following increases to address the mandated increase and maintain an appropriate differential between specified classifications in the group:
Group A: CalPERS Exempt
Group B: CalPERS
Classification
Current
Proposed
Classification
Current
Proposed
CS Leader I
$16.00
$16.50
Fire Utility Worker I
$16.50
$16.75
CS Leader II
$16.25
$16.75
Fire Utility Worker II
$17.50
$17.75
CS Leader-Sr.
$16.50
$17.00
Sr. P&R Specialist I
Library Page I
$16.00
$16.50
Step 1
$18.50
$18.75
Library Page II
$16.50
$17.00
Step 2
$19.00
$19.25
Laborer
$16.00
$16.50
Step 3
$19.50
$19.75
CS Specialist I
$17.00
$17.50
Sr. P&R Specialist II
CS Specialist II
$17.50
$18.00
Step 1
$20.00
$20.25
CS Specialist III
$18.00
$18.50
Step 2
$20.50
$20.75
Police Cadet
$16.50
$16.75
Step 3
$21.00
$21.25
Sr. Police Cadet
$17.75
$18.00
Parking Control Aide
$18.00
$18.25
Intern I
$16.50
$16.75
Police Comm Aide
$19.50
$19.75
Intern II
$18.00
$18.25
Intern III
$19.50
$19.75
The estimated fiscal impact for the remainder of FY 2024-25 totals $14,379 based on current staffing. Changes related to this proposed resolution become effective December 21, 2024, the beginning of the pay period that covers January 1.
Proposition 32 (Prop 32)
The state has not yet certified the election results for California Proposition 32 (Attachment 2), also referred to as the Living Wage Act. The Proposition would require a minimum wage increase to $17.00 per hour upon certification of the 2024 election results with another increase to $18.00 per hour effective January 1, 2025. It does not appear that Proposition 32 will pass, however, staff believes it prudent for the City to have a plan in place should the measure pass at time of certification.
The California Secretary of State will release certified election results by December 13, 2024. If Proposition 32 passes, the minimum wage will increase to $17.00 per hour for the remainder of calendar year 2024. The expected effective date falls in the middle of the pay period beginning December 7, 2024. Any January 1 change must become effective on the pay period beginning December 21, 2024. Staff suggests bypassing immediate enactment of the $17.00 per hour increase and put the $18.00 per hour minimum wage rate in place on December 7, 2024. This would ease implementation tasks for staff at a time when other year-end fiscal activities occur.
This increase has significant impact, especially in the differential between positions. Only four positions fall below the $16.50 minimum wage. This number would increase to 13 positions falling below the $18.00 minimum wage. Staff recommends the following increases to maintain equity and economic mindfulness:
Group A: CalPERS Exempt
Group B: CalPERS
Classification
Current
Proposed
Classification
Current
Proposed
CS Leader I
$16.00
$18.00
Fire Utility Worker I
$16.50
$18.00
CS Leader II
$16.25
$18.25
Fire Utility Worker II
$17.50
$18.75
CS Leader-Sr.
$16.50
$18.50
Sr. P&R Specialist I
Library Page I
$16.00
$18.00
Step 1
$18.50
$19.75
Library Page II
$16.50
$18.50
Step 2
$19.00
$20.25
Laborer
$16.00
$18.00
Step 3
$19.50
$20.75
CS Specialist I
$17.00
$19.00
Sr. P&R Specialist II
CS Specialist II
$17.50
$19.25
Step 1
$20.00
$21.00
CS Specialist III
$18.00
$19.50
Step 2
$20.50
$21.50
Police Cadet
$16.50
$18.00
Step 3
$21.00
$22.00
Sr. Police Cadet
$17.75
$18.75
Parking Control Aide
$18.00
$19.00
Intern I
$16.50
$18.50
Police Comm Aide
$19.50
$20.00
Intern II
$18.00
$19.00
Intern III
$19.50
$20.00
The estimated fiscal impact for the remainder of FY 2024-25 totals $58,493 based on current staffing. Changes related to this proposed resolution would become effective December 7, 2024, the pay period that covers the December 13, 2024 certification date.
Attachments:
Attachment 1 – Director of Finance Determination and Certification dated August 1, 2024 Attachment 2 – Summary of Proposition 32
Attachment 3 – Draft Resolution 2024-XXX with $16.50 per hour minimum wage update Attachment 4 – Draft Resolution 2024-XXX with $18.00 per hour minimum wage update cc: City Manager, Eric J. Levitt
Classification Plan Update – Minimum Wage
December 3, 2024 - Page 5