DATE: August 20, 2024
TO: Mayor and City Council
FROM: Director of Human Resources
SUBJECT: Adopt a Resolution Approving the Memorandum of Understanding between the City of Hayward and the Service Employees International Union (SEIU), Local 1021, Maintenance and Operations Unit, and Authorizing Staff to Execute the Agreement
RECOMMENDATION
That Council adopts the attached resolution (Attachment II) approving the Memorandum of Understanding (“MOU”) between the City of Hayward (“City”) and the Service Employees International Union, Local 1021, Maintenance and Operations Unit (“SEIU”) bargaining unit from July 1, 2024, through June 30, 2027.
SUMMARY
The current SEIU MOU expired on June 30, 2024. The attached resolution will allow staff to execute a successor agreement with SEIU, from July 1, 2024, through June 30, 2027. The new agreement will grant cost of living (COLA) salary adjustments totaling thirteen percent (13%) over the three-year contract term, as well as equity salary adjustments for all SEIU Maintenance members who are three (3%) or more under the market median based on a total compensation study completed on December 31, 2023, enhancement of continuous service pay (CSP), an increase to meal allowance, the addition of Juneteenth holiday, an increase to alternate benefits by one hundred dollars ($100.00) per tier, an increase to the Health and Wellness allowance to seven hundred and twenty dollars ($720.00), an increase to Night Shift Differential, increased shoe allowance for eligible classifications per calendar year at two-hundred and fifty dollars ($250.00), and maximum reimbursement of three hundred dollars ($300.00) if purchased with a vendor within the City of Hayward, create vacation hard cap and enhance employee maximum vacation accrual cap to twice the annual rate plus forty (40) hours, add vacation cash out option up to forty (40) hours . The new contract also includes operational, administrative, and legal language updates.
BACKGROUND AND DISCUSSION
During the term of its prior contract with SEIU, the City worked hard to achieve and maintain fiscal sustainability. Though the City continues to face the challenges of growing pension and retiree health liabilities, the City also recognizes the need to provide competitive salary increases as part of any successor contract in order to maintain the ability to recruit and retain employees. To do so, and to help mitigate growing costs, the City sought to maintain its cost-sharing structure for major employee benefits, including health and retirement. As detailed below, the City was able to achieve both goals in the proposed contract.
As part of the previous contract, the City and SEIU, conducted a total compensation study for benchmark classifications during the last contract term. The parties recognized that to improve the City’s position in the labor market it would be beneficial to implement equity adjustments based on the total compensation study. As outlined below the parties agreed that:
Positions that are three percent (3%) or more under the market median for total compensation shall receive an equity adjustment that brings them to the total compensation median.
In addition to these equity adjustments, the City and SEIU also agreed to the following COLA salary adjustments during the contract term.
Six percent (6%) salary adjustment effective July 29, 2024.
Four percent (4%) salary adjustment effective July 1, 2025.
Three percent (3%) salary adjustment effective July 1, 2026.
This structure provides the City with a period of fiscal stability as it continues to navigate the impacts of the COVID-19 pandemic. It also provides employees with significant, competitive salary increases over the full contract term. The City agreed to complete a total compensation survey in advance of the next round of contract negotiations.
Additionally, the proposed contract maintains existing employee contributions toward the Employer’s share of retirement costs, medical benefits, dental and vision plans.
The parties also agreed to several operational, administrative, and legal updates to the contract. Of note, is the City addition of (i) Reproductive Loss Leave as mandated by State law, (ii) an increase in bereavement leave benefit to five (5) paid days, (iii) an increase to forty hours (40) of sick leave to care for an eligible family member as mandated by State law, (iv) align the Groundskeeper, classification job series equivalent to the Maintenance Worker classification, and (v) Add, “No Strike,” provision.
The table below summarizes the key proposed changes in the new MOU:
Table 1: Key Proposed Changes
MOU Section
Updated Language
Effective Date
MOU Clean-up Language
MOU Clean-up language throughout.
July 1, 2024
5.01 Meal Allowance
Increase Meal Allowance from $15.00 to $17.00
July 29, 2024
5.07 Night Shift Differential
Clarify Night Shift Differential shifts and Increase Nightshift Differential by one dollar ($1.00) per tier as follows:
Employees assigned to shifts that include five (5) or more hours scheduled between the hours of 3:00 P.M. and 11:00 P.M. shall be paid an additional three dollars ($3.00) per hour for all hours worked during that window.
Employees assigned to shifts that include five (5) or more hours scheduled between 11:00P.M. and 7:00A.M. shall receive an additional four dollars ($4.00) per hour for all hours worked during that window.
July 29, 2024
5.08 Heavy Equipment Vehicle Operation Differential
Update language to include the following classifications are not eligible to receive heavy equipment vehicle operation differential:
Equipment Operator (M400)
Sweeper Equipment (M700)
Operator
Lead Sweeper Equipment Operator (M702)
Add street sweeper to the list of eligible equipment.
July 1, 2024
5.14 Thermoplastic Differential
Remove sunset language
July 1, 2024
7.04 Alternate Benefits
Increase Alternate Benefits by one hundred dollars ($100.00) per tier as follows:
Employee only $310.00 per month
Employee plus one (1) dependent $480.00 per month
Employee and two plus (2+) dependents $600.00 per month July 29, 2024
9.01 Salaries
FY 2024 – six percent (6%) COLA
July 29, 2024
FY 2025 – four percent (4%) COLA
July 1, 2025
FY 2026 – three percent (3%) COLA
July 1, 2026
9.03 Longevity Pay
Update Continuous Service Pay to longevity pay and tier as follows:
15 years – 2.5%
20 years – 2.5%
25 years – 2.5%
Maximum premium of 7.5%
July 29, 2024
11.01 Holidays Observed by the City
Add Juneteenth to the list of existing City observed holidays.
July 1, 2024
12.00 Vacations
Update language to include all requests for vacation leave shall be approved or denied in writing and in advance.
July1, 2024
Update language for full-time employees' maximum vacation accrual cap shall be twice the annual rate to include plus forty (40) hours and remove the soft cap.
Update language for part-time
employees' maximum vacation accrual cap shall be twice the annual rate to include plus twenty (20) hours and remove the soft cap.
January 1, 2025
Section 12.02 Vacation Leave Allowance for Full-Time Employees For Full-Time Employees add a vacation cash-out option for up to forty (40) hours maximum per calendar year.
For Part-Time Employees add a vacation cash-out option for up to twenty (20) hours maximum per calendar year.
July 1, 2024
13.00 Sick Leave
Update language to include a maximum use of forty (40) hours to care for an eligible family member.
July 1, 2024
14.01 Bereavement and Reproductive Loss Leave
Increase bereavement leave from 3 paid days to 5 paid days.
Add Reproductive Loss Leave. Reproductive loss events include failed adoption, failed surrogacy, miscarriage, stillbirth, or unsuccessful assisted reproduction.
July 1, 2024
14.04 Industrial Injury Leave
Change the section title to “Worker’s Compensation Leave.” July 1, 2024
15.00 Grievances
Add clarifying language:
Increase City response time to 14 days at all steps. Increase Union response time to 14 business days at Step 2, and compensation grievance is not subject to further review after Step 2.
July 1, 2024
16.01 Safety Shoes
Maintain reimbursement amount at two hundred and fifty dollars ($250.00). If safety shoes are purchased from a vendor with the City of Hayward the maximum reimbursement shall be three hundred dollars ($300.00) per calendar year.
July 1, 2024
16.22 Health and Wellness
Increase and enhance Health and Wellness Benefits as follows:
For full-time employees an increase in health and wellness from six hundred dollars ($600.00) to seven hundred and twenty dollars ($720.00). This reimbursement may be made in a lump sum or may be used for recurring monthly expenses.
Part-time employees who work less than forty (40) hours per week shall be eligible to receive a maximum of thirty ($30.00) per month for expenses associated with health and wellness programs.
July 29, 2024
NEW 18.00 NO STRIKE
Add NO STRIKE language consistent with other miscellaneous bargaining units.
July 1, 2024
19.00 Duration of MOU
3-year term:
July 1, 2024 – June 30, 2027
July 1, 2024
NEW Groundskeeper Salary Setting
The city agrees to set the Groundskeeper classification series equivalent to the Maintenance Worker series as follows:
Groundskeeper I – equivalent to – Maintenance Worker
Groundskeeper II – equivalent to – Maintenance Leader
Groundskeeper III – equivalent to – Sr. Maintenance Leader July 29, 2024
APPENDIX A
Salary Survey
Equity Adjustments
Positions that are three percent (3%) or more under the market median (based on total compensation) shall receive an equity adjustment that brings them to the total compensation median.
July 29, 2024
APPENDIX B
Salary Survey
Equity Study
The City agrees to perform an equity study on total compensation that includes all benchmark positions for SEIU, by December 31, 2026.
The City shall provide the results of the survey to SEIU, no later than March 31, 2027.
Begin the bidding and selection process by February 1, 2026, and complete by December 31, 2026.
FISCAL IMPACT
The total proposed changes will result in an estimated fiscal impact of $4,890,637 across all funds, over the three-year contract period (FY 2025-FY 2027). Of this amount, the fiscal impact to the General Fund is approximately $622,840 over the contract period when compared to projections in the City's General Fund budget model for the same three-year period (FY 2025-FY 2027). FY 2025 budget adjustments will be reflected in the mid-year review.
STRATEGIC ROADMAP
This agenda item is a routine operational item and does not relate to one of the Council’s Strategic Roadmap.
NEXT STEPS
If adopted, Human Resources staff will finalize the agreement, the City Manager will execute the agreement, and the Finance Department will implement the above changes in coordination with Human Resources.
Prepared by: Marisa Guerrero, Human Resources Manager
Recommended by: Brittney Frye, Director of Human Resources Approved:
Dustin Claussen, Interim City Manager