CITY OF PALO ALTO CONTRACT NO. C25193915
AGREEMENT FOR PROFESSIONAL SERVICES
BETWEEN THE CITY OF PALO ALTO AND MUNICIPAL RESOURCE GROUP, LLC
This Agreement for Professional Services (this “Agreement”) is entered into as of the 21st day of June 2025 (the “Effective Date”) , by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and MUNICIPAL RESOURCE GROUP, LLC, a California Limited Liability Company , located at P.O. Box 561, Wilton, CA 95693 (“CONSULTANT”).
The following recitals are a substantive portion of this Agreement and are fully incorporated herein by this reference:
RECITALS
A. CITY intends to perform the annual performance evaluations and compensation adjustment process for its four (4) Council appointed officials (the “Project”) and desires to engage a consultant to facilitate services in connection with the Project ( the “Services”, as detailed more fully in Exhibit A).
B. CONSULTANT represents that it, its employees and subconsultants, if any, possess the necessary professional expertise, qualifications, and capability, and all required licenses and/or certifications to provide the Services.
C. CITY, in reliance on these representations, desires to engage CONSULTANT to provide the Services as more fully described in Exhibit A, entitled “SCOPE OF SERVICES”.
NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this Agreement, the parties agree as follows:
SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described in Exhibit A in accordance with the terms and conditions contained in this Agreement. The performance of all Services shall be to the reasonable satisfaction of CITY.
SECTION 2. TERM.
The term of this Agreement shall be from the date of its full execution through June 20, 2028 unless terminated earlier pursuant to Section 19 (Termination) of this Agreement.
SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of Services under this Agreement. CONSULTANT shall complete the Services within the term of this Agreement and in accordance with the schedule set forth in Exhibit B, entitled “SCHEDULE Docusign Envelope ID: 6B5C7218-F9DF-46BA-A265-B3493634A7F7 Item 6
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OF PERFORMANCE”. Any Services for which times for performance are not specified in this Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and timely manner based upon the circumstances and direction communicated to the CONSULTANT.
CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT.
SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services shall be based on the compensation structure detailed in Exhibit C, entitled “COMPENSATION,” including any reimbursable expenses specified therein, and the maximum total compensation shall not exceed One Hundred Forty Four Thousand Dollars ($144,000). T he hourly schedule of rates, if applicable, is set out in Exhibit C-1, entitled “SCHEDULE OF RATES.” Any work performed or expenses incurred for which payment would result in a total exceeding the maximum compensation set forth in this Section 4 shall be at no cost to the CITY.
Optional Additional Services Provision (This provision applies only if checked and a not-to-exceed compensation amount for Additional Services is allocated below under this Section 4.)
In addition to the not-to-exceed compensation specified above, CITY has set aside the not- to-exceed compensation amount of Sixty Four Thousand Five Hundred Dollars ($64,500) for the performance of Additional Services (as defined below). The total compensation for performance of the Services, Additional Services and any reimbursable expenses specified in Exhibit C, shall not exceed Two Hundred Eight Thousand Dollars ($208,500), as detailed in Exhibit C.
“Additional Services” means any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit A . CITY may elect to, but is not required to, authorize Additional Services up to the maximum amount of compensation set forth for Additional S ervices in this Section 4. CONSULTANT shall provide Additional Services only by advanced, written authorization from CITY as detailed in this Section . Additional Services , if any, shall be authorized by CITY with a Task Order assigned and authorized by CITY’s Project Manager, as identified in Section 13 (Project Management). Each Task Order shall be in substantially the same form as Exhibit A-1, entitled “PROFESSIONAL SERVICES TASK ORDER”. Each Task Order shall contain a specific scope of services, schedule of performance and maximum compensation amount, in accordance with the provisions of this Agreement. Compensation for Additional Services shall be specified by CITY in the Task Order, based on whichever is lowest: the compensation structure set forth in Exhibit C, the hourly rates set forth in Exhibit C-1, or a negotiated lump sum.
To accept a Task Order, CONSULTANT shall sign the Task Order and return it to CITY’s Project Manager within the time specified by the Project Manager, and upon authorization by CITY (defined as counter-signature by the CITY Project Manager), the fully exec uted Task Order shall become part of this Agreement. The cumulative total compensation to CONSULTANT for all Task Orders authorized under this Agreement shall not exceed the Docusign Envelope ID: 6B5C7218-F9DF-46BA-A265-B3493634A7F7 Item 6
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amount of compensation set forth for Additional Services in this Section 4 .
CONSULTANT shall only be compensated for Additional Services performed under an authorized Task Order and only up to the maximum amount of compensation set forth for Additional Services in this Section 4 . Performance of and payment for any Additional Services are subject to all requirements and restrictions in this Agreement.
SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly invoices to the CITY describing the Services performed and the applicable charges (including, if applicable, an identification of personnel who performed the Services, hours worked, hourly rates, and reimbursable expenses), based upon Exhibit C or, as applicable, CONSULTANT’s schedule of rates set forth in Exhibit C-1. If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTANT’s invoices shall be subject to verification by CITY. CONSULTANT shall send all invoices to CITY’s Project Manager at the address specified in Section 1 3 (Project Management) below. CITY will generally process and pay invoices within thirty (30) days of receipt of an acceptable invoice.
SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All Services shall be performed by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT represents that it , its employees and subcontractors, if any, possess the professional and technical personnel necessary to perform the Services required by this Agreement and that the personnel have sufficient skill and experience to perform the Services assigned to them. CONSULTANT represents that it, its employees and subcontractors, if any, have and shall maintain during the term of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature that are legally required to perform the Services. All Services to be furnished by CONSULTANT under this Agreement shall meet the professional standard and quality that prevail among professionals in the same discipline and of similar knowledge and skill engaged in related work throughout California under the same or similar circumstances.
SECTION 7. COMPLIANCE WITH LAWS . CONSULTANT shall keep itself informed of and in compliance with all federal, state and local laws, ordinances, regulations, and orders that may affect in any manner the Project or the performance of the Services or those engaged to perform Services under this Agreement, as amended from time to time . CONSULTANT shall procure all permits and licenses, pay all charges and fees, and give all notices required by law in the performance of the Services.
SECTION 8. ERRORS/OMISSIONS. CONSULTANT is solely responsible for costs, including, but not limited to, increases in the cost of Services, arising from or caused by CONSULTANT’s errors and omissions, including, but not limited to, the costs of corrections such errors and omissions, any c hange order markup costs, or costs arising from delay caused by the errors and omissions or unreasonable delay in correcting the errors and omissions.
SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works project, CONSULTANT shall submit estimates of probable construction costs at each phase of design submittal. If the total estimated construction cost at any submittal exceeds the CITY’s stated construction budget by ten percent (10%) or more , CONSULTANT shall make recommendations to CITY for aligning the P roject design with the budget, incorporate CITY Docusign Envelope ID: 6B5C7218-F9DF-46BA-A265-B3493634A7F7 Item 6
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approved recommendations, and revise the design to meet the Project budget, at no additional cost to CITY.
SECTION 10. INDEPENDENT CONTRACTOR. CONSULTANT acknowledges and agrees that CONSULTANT and any agent or employee of CONSULTANT will act as and shall be deemed at all times to be an independent contractor and shall be wholly responsible for the manner in which CONSULTANT performs the S ervices requested by CITY under this Agreement.
CONSULTANT and any agent or employee of CONSULTANT will not have employee status with CITY, nor be entitled to participate in any plans, arrangements, or distributions by CITY pertaining to or in connection with any retirement, health or other benefits that CITY may offer its employees. CONSULTANT wi ll be responsible for all obligations and payments, whether imposed by federal, state or local law, including, but not limited to, FICA, income tax withholdings, workers’ compensation, unemployment compensation, insurance, and other similar responsibilities related to CONSULTANT’s performance of the Services, or any agent or employee of CONSULTANT providing same. Nothing in this Agreement shall be construed as creating an employment or agency relationship between CITY and CONSULTANT or any agent or employee of CONSULTANT. Any terms in this Agreement referring to direction from CITY shall be construed as providing for direction as to policy and the result of CONSULTANT ’s provision of the Services only, and not as to the means by which such a result is obtained.
SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign or transfer any interest in this Agreement nor the performance of any of CONSULTANT’s obligations hereunder wit hout the prior written approval of the City Manager. Any purported assignment made without the prior written approval of the City Manager will be void and without effect. Subject to the foregoing, the covenants, terms, conditions and provisions of this Agreement will apply to, and will bind, the heirs, succes sors, executors, administrators and assignees of the parties.
SECTION 12. SUBCONTRACTING.
CONSULTANT shall not subcontract any portion of the Services to be performed under this Agreement without the prior written authorization of the City Manager or designee. In the event CONSULTANT does subcontract any portion of the work to be performed under this Agreement, CONSULTANT shall be fully responsible for all acts and omissions of subcontractors.
SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Mary Egan , Telephone: (916) 261-7547, Email: [email protected] as the CONSULTANT’s Project Manager to have supervisory responsibility for the performance, progress, and execution of the Services and represent CONSULTANT during the day -to-day performance of the Services. If circumstances cause the substitution of the CONSULTANT’s P roject Manager or any other of CONSULTANT’s key personnel for any reason, the appointment of a substitute Project Manager and the assignment of any key new or replacement personnel will be subject to the prior written approval of the CITY’s Project Manager. CONSULTANT, at CITY’s request, shall promptly remove CONSULTANT personnel who CITY finds do not perform the Services in an acceptable manner, are uncooperative, or present a threat to the adequate or timely completion of the Services or a threat to the safety of persons or property.
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CITY’s Project Manager is Sandra Blanch, Human Resource Department, 250 Hamilton Avenue, Palo Alto, CA , 94301, Telephone: (650) 329- 2294. CITY’s Project Manager will be CONSULTANT’s point of contact with respect to performance, progress and execution of the Services. CITY may designate an alternate Project Manager from time to time.
SECTION 1 4. OWNERSHIP OF MATERIALS . All work product, including without limitation, all writings, drawings, studies, sketches, photographs, plans, reports, specifications, computations, models, recordings, data, documents, and other materials and copyright interests developed under this Agreement, in any form or media, shall be and remain the exclusive property of CITY without restriction or limitation upon their use. CONSULTANT agrees that all copyrights which arise from creation of the work product pursuant to this Agreement are vested in CITY, and CONSULTANT hereby waives and relinquishes all claims to copyright or other intellectual property rights in favor of CITY. Neither CONSULTANT nor its sub contractors, if any, shall make any of such work product available to any individual or organization without the prior written approval of the C ity Manager or designee. CONSULTANT makes no representation of the suitability of the work product for use in or application to circumstances not contemplated by the Scope of Services.
SECTION 15. AUDITS . CONSULTANT agrees to permit CITY and its authorized representatives to audit, at any reasonable time during the term of this Agreement and for four (4) years from the date of final payment, CONSULTANT’s records pertaining to matters covered by this Agreement, including without limitation records demonstrating compliance with the requirements of Section 10 (Independent Contractor). CONSULTANT further agrees to maintain and retain accurate books and records in accordance with generally accepted accounting principles for at least four (4) years after the expiration or earlier termination of this Agreement or the completion of any audit hereunder, whichever is later.
SECTION 16. INDEMNITY.
16.1. To the fullest extent permitted by law, CONSULTANT shall indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents (each an “Indemnified Party”) from and against any and all demands, claims, or liability of any nature, including death or injury to any person, property damage or any other loss, including all costs and expenses of whatever nature including attorney’s fees, experts fees, court costs and disbursements (“Claims”) resulting from, arising out of or in any manner related to performance or nonperformance by CONSULTANT, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party.
16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to require CONSULTANT to indemnify an Indemnified Party from a Claim arising from the active negligence or willful misconduct of an Indemnified Party that is not contributed to by any act of, or by any omission to perform a duty imposed by law or agreement by, CONSULTANT, its officers, employees, agents or contractors under this Agreement.
16.3. The acceptance of CONSULTANT’s Services and duties by CITY shall not Docusign Envelope ID: 6B5C7218-F9DF-46BA-A265-B3493634A7F7 Item 6
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operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive the expiration or early termination of this Agreement.
SECTION 17. WAIVERS. No waiver of a condition or nonperformance of an obligation under this Agreement is effective unless it is in writing in accordance with Section 29.4 of this Agreement. No delay or failure to require performance of any provision of this Agreement shall constitute a waiver of that provision as to that or any other instance. Any waiver granted shall apply solely to the specific instance expressly stated. No single or parti al exercise of any right or remedy will preclude any other or further exercise of any right or remedy.
SECTION 18. INSURANCE.
18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in full force and effect during the term of this Agreement, the insurance coverage described in Exhibit D, entitled “INSURANCE REQUIREMENTS”. CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or automobile policy or policies.
18.2. All insurance coverage required hereunder shall be provided through carriers with AM Best’s Key Rating Guide ratings of A -:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in full force and effect during the term of this Agreement, identical insurance coverage, naming CITY as an additional insured under such policies as required above.
18.3. Certificates evidencing such insurance shall be filed with CITY concurrently with the execution of this Agreement. The certificates will be subject to the approval of CITY’s Risk Manager and will contain an endorsement stating that the insurance is primar y coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the Purchasing Manager thirty (30) days ’ prior written notice of the cancellation or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30) days’ notice to CONSULTANT , CONSULTANT shall provide the Purchasing Manager written notice of the cancellation or modification within two (2) business days of the CONSULTANT’s receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance are provided to CITY’s Chief Procurement Officer during the entire term of this Agreement.
18.4. The procuring of such required policy or policies of insurance will not be construed to limit CONSULTANT ’s liability hereunder nor to fulfill the indemnification provisions of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as a result of the Services performed under this Agreement, including such damage, injury, or loss arising after the Agreement is terminated or the term has expired.
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SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES.
19.1. The City Manager may suspend the performance of the Services, in whole or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written notice thereof to CONSULTANT. If CONSULTANT fails to perform any of its material obligations under this Agreement, in addition to all other remedies provided under this Agreement or at law, the City Manager may terminate this Agreement sooner upon written notice of termination. Upon receipt of any notice of suspension or termination , CONSULTANT will discontinue its performance of the Services on the effective date in the notice of suspension or termination.
19.2. In event of suspension or termination, CONSULTANT will deliver to the City Manager on or before the effective date in the notice of suspension or termination, any and all work product, as detailed in Section 14 (Ownership of Materials), whether or not completed, prepared by CONSULTANT or its contractors, if any, in the performance of this Agreement. Such work product is the property of CITY, as detailed in Section 14 (Ownership of Materials).
19.3. In event of suspension or termination, CONSULTANT will be paid for the Services rendered and work products delivered to CITY in accordance with the Scope of Services up to the effective date in the notice of suspension or termination; provided, however, if this Agreement is suspended or terminated on account of a default by CONSULTANT, CITY will be obligated to compensate CONSULTANT only for that portion of CONSULTANT’s S ervices provided in material conformity with this Agreement as such determination is made by the City Manager acting in the reasonable exercise of his/her discretion . The following Sections will survive any expiration or termination of this Agreement: 14, 15, 16, 17, 19.2, 19.3, 19.4, 20, 25, 27, 28, 29 and 30.
19.4. No payment, partial payment, acceptance, or partial acceptance by CITY will operate as a waiver on the part of CITY of any of its rights under this Agreement, unless made in accordance with Section 17 (Waivers).
SECTION 20. NOTICES.
All notices hereunder will be given in writing and mailed, postage prepaid, by certified mail, addressed as follows:
To CITY: Office of the City Clerk
City of Palo Alto
Post Office Box 10250
Palo Alto, CA 94303
With a copy to the Purchasing Manager
To CONSULTANT: Attention of the P roject Manager at the address of CONSULTANT recited on the first page of this Agreement.
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CONSULTANT shall provide written notice to CITY of any change of address.
SECTION 21. CONFLICT OF INTEREST.
21.1. In executing this Agreement, CONSULTANT covenants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would conflict in any manner or degree with the performance of the Services.
21.2. CONSULTANT further covenants that, in the performance of this Agreement, it will not employ subcontractors or other persons or parties having such an interest.
CONSULTANT certifies that no person who has or will have any financial interest under this Agreement is an officer or employee of CITY; this provision will be interpreted in accordance with the applicable provisions of the Palo Alto Municipal Code and the Government Code of the State of California, as amended from time to time . CONSULTANT agrees to notify CITY if any conflict arises.
21.3. If the CONSULTANT meets the definition of a “Consultant” as defined by the Regulations of the Fair Political Practices Commission, CONSULTANT will file the appropriate financial disclosure documents required by the Palo Alto Municipal Code and the Political Reform Act of 1974, as amended from time to time.
SECTION 22. NONDISCRIMINATION; COMPLIANCE WITH ADA.
22.1. As set forth in Palo Alto Municipal Code S ection 2.30.510, as amended from time to time, CONSULTANT certifies that in the performance of this Agreement, it shall not discriminate in the employment of any person due to that person’s race, skin color, gender, gender identity, age, religion, disability, national origin, ancestry, sexual orientation, pregnancy, genetic information or condition, housing status, marital status, familial status, weight or height of such person. CONSULTANT acknowledges that it has read and understands the provisions of Section
2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510 pertaining to nondiscrimination in employment.
22.2. CONSULTANT understands and agrees that pursuant to the Americans Disabilities Act (“ADA”), programs, services and other activities provided by a public entity to the public, whether directly or through a contractor or subcontractor, are required to be accessible to the disabled public. CONSULTANT will provide the Services specified in this Agreement in a manner that complies with the ADA and any other applicable federal, state and local disability rights laws and regulations, as amended from time to time. CONSULTANT will not discriminate against persons with disabilities in the provision of services, benefits or activities provided under this Agreement.
SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS. CONSULTANT shall comply with t he CITY’s Environmentally Preferred Purchasing policies which are available at CITY ’s Purchasing Department , hereby incorporated by reference and as amended from time to time. CONSULTANT shall comply with Docusign Envelope ID: 6B5C7218-F9DF-46BA-A265-B3493634A7F7 Item 6
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waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero Waste best practices include, first, minimizing and reducing waste; second, reusing waste ; and, third, recycling or composting waste. In particular, C ONSULTANT shall comply with the following Zero Waste requirements:
(a) All printed materials provided by CONSULTANT to C ITY generated from a personal computer and printer including but not limited to, proposals, quotes, invoices, reports, and public education materials, shall be double-sided and printed on a minimum of 30% or greater post-consumer content paper, unless otherwi se approved by CITY’s Project Manager. Any submitted materials printed by a professional printing company shall be a minimum of 30% or greater post-consumer material and printed with vegetable-based inks. (b) Goods purchased by C ONSULTANT on behalf of CITY shall be purchased in accordance with CITY’s Environmental Purchasing Policy including but not limited to Extended Producer Responsibility requirements for products and packaging. A copy of this policy is on file at the Purchasing Department’s office.
(c) Reusable/returnable pallets shall be taken back by CONSULTANT , at no additional cost to CITY, for reuse or recycling. CONSULTANT shall provide documentation from the facility accepting the pallets to verify that pallets are not being disposed.
SECTION 24. COMPLIANCE WITH PALO ALTO MINIMUM WAGE ORDINANCE.
CONSULTANT shall comply with all requirements of the Palo Alto Municipal Code Chapter 4.62 (Citywide Minimum Wage), as amended from time to time. In particular, for any employee otherwise entitled to the State minimum wage, who performs at least two (2) h ours of work in a calendar week within the geographic boundaries of the City, CONSULTANT shall pay such employees no less than the minimum wage set forth in Palo Alto Municipal Code Section 4.62.030 for each hour worked within the geographic boundaries of the City of Palo Alto. In addition, CONSULTANT shall post notices regarding the Palo Alto Minimum Wage Ordinance in accordance with Palo Alto Municipal Code Section 4.62.060.
SECTION 25. NON-APPROPRIATION. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code , as amended from time to time. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Agreement are no longer available. This S ection shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement.
SECTION 2 6. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS.
26.1. This Project is not subject to prevailing wages and related requirements. CONSULTANT is not required to pay prevailing wages and meet related requirements under the California Labor Code and California Code of Regulations in the performance and implementation of the Project if the contract:
(1) is not a public works contract;
(2) is for a public works construction project of $25,000 or less, per California Labor Code Sections 1782(d)(1), 1725.5(f) and 1773.3(j); or Docusign Envelope ID: 6B5C7218-F9DF-46BA-A265-B3493634A7F7 Item 6
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(3) is for a public works alteration, demolition, repair, or maintenance project of $15,000 or less, per California Labor Code Sections 1782(d)(1), 1725.5(f) and 1773.3(j).
SECTION 27. CLAIMS PROCEDURE FOR “9204 PUBLIC WORKS PROJECTS” . For purposes of this Section 27, a “9204 Public Works Project” means the erection, construction, alteration, repair, or improvement of any public structure, building, road, or other public improvement of any kind. ( Cal. Pub. Cont. Code § 9204.) Per California Public Contract Code Section 9204, for Public Works Projects , certain claims procedures shall apply, as set forth in Exhibit F, entitled “Claims for Public Contract Code Section 9204 Public Works Projects”.
This Project is a 9204 Public Works Project and is required to comply with the claims procedures set forth in Exhibit F, entitled “Claims for Public Contract Code Section 9204 Public Works Projects”.
OR
This Project is not a 9204 Public Works Project.
SECTION 28. CONFIDENTIAL INFORMATION.
28.1. In the performance of this Agreement, CONSULTANT may have access to CITY’s Confidential Information (defined below). CONSULTANT will hold Confidential Information in strict confidence, not disclose it to any third party, and will use it only for the performance of its obligations to CITY under this Agreement and for no other purpose.
CONSULTANT will maintain reasonable and appropriate administrative, technical and physical safeguards to ensure the security, confidentiality and integrity of the Confidential Information.
Notwithstanding the foregoing, CONSULTANT may disclose Confidential Information to its employees, agents and subcontractors, if any, to the extent they have a need to know in order to perform CONSULTANT’s obligations to CITY under this Agreeme nt and for no other purpose, provided that the CONSULTANT informs them of, and requires them to follow, the confidentiality and security obligations of this Agreement.
28.2. “Confidential Information” means all data, information (including without limitation “Personal Information” about a California resident as defined in Civil Code S ection 1798 et seq., as amended from time to time) and materials, in any form or media, tangible or intangible, provided or otherwise made available to CONSULTANT by CITY, directly or indirectly, pursuant to this Agreement. Confidential Information excludes information that CONSULTANT can show by appropriate documentation: (i) was publicly known at the time it was provided or has subsequently become publicly known other than by a breach of this Agreement; (ii) was rightfully in CONSULTANT’s possession free of any obligation of confidence prior to receipt of Confidential Information; (iii) is rightfully obtained by CONSULTANT from a third party without breach of any confidentiality obligation; (iv) is independently developed by employees of CONSULTANT without any use of or access to the Confidential Information; or (v) CONSULTANT has written consent to disclose signed by an authorized representative of CITY.
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28.3. Notwithstanding the foregoing, CONSULTANT may disclose Confidential Information to the extent required by order of a court of competent jurisdiction or governmental body, provided that CONSULTANT will notify CITY in writing of such order immediately upon receipt and prior to any such disclosure (unless CONSULTANT is prohibited by law from doing so), to give CITY an opportunity to oppose or otherwise respond to such order.
28.4. CONSULTANT will notify City promptly upon learning of any breach in the security of its systems or unauthorized disclosure of, or access to, Confidential Information in its possession or control, and if such Confidential Information consists of Personal In formation, CONSULTANT will provide information to CITY sufficient to meet the notice requirements of Civil Code Section 1798 et seq., as applicable, as amended from time to time.
28.5. Prior to or upon termination or expiration of this Agreement, CONSULTANT will honor any request from the CITY to return or securely destroy all copies of Confidential Information. All Confidential Information is and will remain the property of the CITY and nothing contained in this Agreement grants or confers any rights to such Confidential Information on CONSULTANT.
28.6. If selected in Section 30 (Exhibits), this Agreement is also subject to the terms and conditions of the Information Privacy Policy and Cybersecurity Terms and Conditions.
SECTION 29. MISCELLANEOUS PROVISIONS.
29.1. This Agreement will be governed by California law, without regard to its conflict of law provisions.
29.2. In the event that an action is brought, the parties agree that trial of such action will be vested exclusively in the state courts of California in the County of Santa Clara, State of California.
29.3. The prevailing party in any action brought to enforce the provisions of this Agreement may recover its reasonable costs and attorneys’ fees expended in connection with that action. The prevailing party shall be entitled to recover an amount equal to the fair market value of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third parties.
29.4. This Agreement, including all exhibits, constitutes the entire and integrated agreement between the parties with respect to the subject matter of this Agreement, and supersedes all prior agreements, negotiations, representations, statements and undertakings, either oral or written. This Agreement may be amended only by a written instrument, which is signed by the authorized representatives of the parties and approved as required under Palo Alto Municipal Code, as amended from time to time.
29.5. If a court of competent jurisdiction finds or rules that any provision of this Agreement is void or unenforceable, the unaffected provisions of this Agreement will remain in Docusign Envelope ID: 6B5C7218-F9DF-46BA-A265-B3493634A7F7 Item 6
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full force and effect.
29.6. In the event of a conflict between the terms of this Agreement and the exhibits hereto (per Section 30 ) or CONSULTANT’s proposal (if any), the Agreement shall control. In the event of a conflict between the exhibits hereto and CONSULTANT’s proposal (if any), the exhibits shall control.
29.7. The provisions of all checked boxes in this Agreement shall apply to this Agreement; the provisions of any unchecked boxes shall not apply to this Agreement.
29.8. All section headings contained in this Agreement are for convenience and reference only and are not intended to define or limit the scope of any provision of this Agreement.
29.9. This Agreement may be signed in multiple counterparts, which, when executed by the authorized representatives of the parties, shall together constitute a single binding agreement.
SECTION 30. EXHIBITS. Each of the following exhibits, if the check box for such exhibit is selected below, is hereby attached and incorporated into this Agreement by reference as though fully set forth herein:
EXHIBIT A: SCOPE OF SERVICES
EXHIBIT A-1 PROFESSIONAL SERVICES TASK ORDER
EXHIBIT B: SCHEDULE OF PERFORMANCE
EXHIBIT C: COMPENSATION
EXHIBIT C-1: SCHEDULE OF RATES
EXHIBIT D: INSURANCE REQUIREMENTS
THIS AGREEMENT IS NOT COMPLETE UNLESS ALL SELECTED EXHIBITS ARE ATTACHED.
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CONTRACT No. C25193915 SIGNATURE PAGE
IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives executed this Agreement as of the date first above written.
CITY OF PALO ALTO
____________________________
City Manager
APPROVED AS TO FORM:
__________________________
City Attorney or Designee
MUNICIPAL RESOURCE GROUP, LLC
By:
Name:
Title:
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EXHIBIT A
SCOPE OF SERVICES
CONSULTANT will provide the Services detailed in this Exh ibit A, entitled “ SCOPE OF SERVICES”. Notwithstanding any provision herein to the contrary, CONSULTANT’s duties and services described in this Scope of Services shall not include preparing or assisting CITY with any portion of CITY’s preparation of a request for proposals, request for qualific ations, or any other solicitation regarding a subsequent or additional contract with CITY. CITY will at all times retain responsibility for public contracting, including with respect to any subsequent phase of this project.
CONSULTANT’s participation in the planning, discussions, or drawing of project plans or specifications will be limited to conceptual, preliminary, or initial plans or specifications.
CONSULTANT will cooperate with CITY to ensure that all bidders for a subsequent contract on any subsequent phase of this project have access to the same information, including all conceptual, preliminary, or initial plans or specifications prepared by CONSULTANT pursua nt to this Scope of Services.
CAO PERFORMANCE EVALUATION SERVICES
Project Introduction:
CONSULTANT to engage by consulting and working directly with City Council to facilitate the annual performance evaluation process for its four (4) Council appointed officials (CAO), City Manager, City Attorney, City Clerk and City Auditor.
Project Background:
The City Manager, City Clerk, City Attorney and City Auditor are appointed directly by the City Council and, as such, are reviewed by the City Council on an annual basis in accordance with their individual employment agreements. Such review is necessary for Council members to ensure the efficiency of the appointed offices, to provide general feedback on their performance, to set goals for the coming year, and to identify areas of improvement. It is also necessary to review compensation to ensure that the positions are paid appropriately in comparison to the market and their performances.
Performance Evaluation:
CONSULTANT will use an established approach to Performance Evaluation Processes. Based on a standard practice, CONSULTANT will incorporate Council CAO Committe e’s requests to include additional elements or minimize the process to meet expediated timelines and needs.
CONSULTANT will annually provide Performance Evaluation Processes to include but not limited to the following:
Summary to identify areas of successful and for professional development; facilitating a discussion between Council and the Appointed Officials with actionable items to enhance organizational leadership;
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A 360-degree evaluation requesting input from departmental managers will be conducted as part of this process for the City Auditor and City Clerk; AND The process ing of Appointed Officials to provide a self -assessment to summarize accomplishments and specify progress on established goals.
CONSULTANT will facilitate and prepare for CAO Performance Evaluation Processes by performing the following:
A. Preparation of Questionnaire:
While Coordinating and consulting with Council CAO Committee (four members of the City Council), CONSULTANT will prepare a questionnaire to be used for interviews. The questionnaires will be distributed to Council Members to fill out a week in advance of their scheduled interview/meeting with theCONSULTANT. The questionnaires will be designed to be a tool to summarize Council Members’ estimation of the CAO’s attainment of specific goals, as well as their performance in general areas such as communication; key relationships between the CAO and the Council, staff, public, CITY comm ittees and commissions and other government agencies; as appropriate; specific work priorities such as budget, public relations, program management and employee relations; as well as general comment on the CAO’s performance of their duties.
B. Conduct Interviews, Prepare Report, Facilitate Discussion, Prepare Summary:
CONSULTANT will interview each of the seven (7) Council Members individually, using the interview questionnaire to gather input and evaluation of CAO performance. CONSULTANT will also interview each CAO to gather their estimation of their performance, achievements, and ability to meet their established goals and performance objectives. CONSULTANT will consolidate information from all interviews and prepare a written evaluation/report, which will first be reviewed with the Council CAO Committee and then presented to the entire Council in closed session. After presentation of the evaluation/reports, CONSULTANT will facilitate Council discussion of the results of the interviews and input. CONSULTANT will then facilitate discussion of the evaluation report between each CAO and the Council.
C. Post-Evaluation Support and Compensation Advisory Process:
After facilitating the performance evaluation meetings with the Council, CONSULTANT will meet with each CAO to de -brief on Council discussion, and to discuss compensation considerations. The Council CAO Committee will make its salary adjustment recommendat ions to the full Council. The CONSULTANT will be available as a resource at the meeting with the full Council. The CONSULTANT will also be available as a resource for the Council CAO Committee in its negotiations with individual CAO’s. The CONSULTANT will prepare a complete file for each of the evaluations, including compensation recommendations and actions, for the permanent CITY record.
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D. Additional Services (Optional):
1. Executive Salary Analysis
If requested by CITY Project Manager , CONSULTANT will prepare and collect salary data for the CAO from approximately six comparable jurisdictions. The CONSULTANT will also engage in individual discussions with the Appointed Officials to uncover compensation interests.
Subsequently, in memora ndum format, the CONSULTANT will relay this information to the Council and assist in facilitating agreement on any compensation adjustments.
2. Direct Reports Feedback
If requested by CITY Project Manager , The CONSULTANT will prepare a “ Direct Reports ” feedback report for the CAO that will solicit input from each member of the s enior staff of the Appointed Officials via an online survey tool, seeking information on the CAO's performance and obtaining insight on strengths and potential development opportunities.
Deliverables:
As directed by CITY Project Manager, CONSULTANT will conduct Performance Evaluation processes detailed in Services, Section “A” through “D” per Council Appointed Official: City Manager, City Attorney, City Clerk, or City Auditor (Appointee).
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EXHIBIT A-1
PROFESSIONAL SERVICES TASK ORDER
CONSULTANT shall perform the Services detailed below in accordance with all the terms and conditions of the Agreement referenced in Item 1A below. All exhibits referenced in Item 8 are incorporated into this Task Order by this reference. CONSULTANT shall furnish the necessary facilities, professional, technical and supporting personnel required by this Task Order as described below.
CONTRACT NO.
OR PURCHASE ORDER REQUISITION NO. (AS APPLICABLE)
1A. MASTER AGREEMENT NO. (MAY BE SAME AS CONTRACT / P.O. NO. ABOVE):
1B. TASK ORDER NO.:
2. CONSULTANT NAME:
3. PERIOD OF PERFORMANCE: START: COMPLETION:
4 TOTAL TASK ORDER PRICE: $__________________
BALANCE REMAINING IN MASTER AGREEMENT/CONTRACT $_______________
5. BUDGET CODE_______________
COST CENTER________________
COST ELEMENT______________
WBS/CIP__________
PHASE__________
6. CITY PROJECT MANAGER’S NAME & DEPARTMENT:_____________________________________
7. DESCRIPTION OF SCOPE OF SERVICES (Attachment A)
MUST INCLUDE:
SERVICES AND DELIVERABLES TO BE PROVIDED
SCHEDULE OF PERFORMANCE
MAXIMUM COMPENSATION AMOUNT AND RATE SCHEDULE (as applicable) REIMBURSABLE EXPENSES, if any (with “not to exceed” amount)
8. ATTACHMENTS: A: Task Order Scope of Services B (if any): _____________________________
I hereby authorize the performance of the
work described in this Task Order.
APPROVED:
CITY OF PALO ALTO
BY:____________________________________
Name __________________________________
Title___________________________________
Date ___________________________________
I hereby acknowledge receipt and acceptance of
this Task Order and warrant that I have
authority to sign on behalf of Consultant.
APPROVED:
COMPANY NAME: ______________________
BY:____________________________________
Name __________________________________
Title___________________________________
Date ___________________________________
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EXHIBIT B
SCHEDULE OF PERFORMANCE
CONSULTANT shall perform the Services so as to complete each milestone within the number of days/weeks specified below. The time to complete each milestone may be increased or decreased by mutual written agreement of the Project Managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement. CONSULTANT shall provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the notice to proceed (“NTP”) from the CITY.
Milestones
Completion
Number of Days/Weeks (as specified below)
from NTP
1. CAO Performance Evaluation Services
per Appointee (up to 4) – Year 1 of 3
To be determine (TBD) by CITY Council
Meeting reporting date within term of
Agreement.
2. CAO Performance Evaluation Services
per Appointee (up to 4) – Year 2 of 3
TBD by CITY Council Meeting reporting date
within term of Agreement.
3. CAO Performance Evaluation Services –
Year 3 of 3 per Appointee (up to 4)
TBD by CITY Council Meeting reporting date
within term of Agreement.
Optional Schedule of Performance Provision for On-Call or Additional Services Agreements. (This provision only applies if checked and only applies to on-call agreements per Section 1 or agreements with Additional Services per Section 4.)
The schedule of p erformance shall be as provided in the approved Task Order, as detailed in Section 1 (Scope of Services) in the case of on-call Services, or as detailed in Section 4 in the case of Additional Services, provided in all cases that the schedule of performance shall fall within the term as provided in Section 2 (Term) of this Agreement.
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EXHIBIT C
COMPENSATION
CITY agrees to compensate CONSULTANT for Services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below. Compensation shall be calculated based on the rate schedule attached as E xhibit C-1 up to the not to exceed budget amount for each task set forth below.
CITY’s Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below , provided that the total compensation for the Services, including any specified reimbursable expenses, and the total compensation for Additional Services (if any, per Section 4 of the Agreement) do not exceed the amounts set forth in Section 4 of this Agreement.
CONSULTANT agrees to complete all Services, any specified reimbursable expenses, and Additional Services (if any, per Section 4) , within this/these amount(s). Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth in this Agreement shall be at no cost to the CITY.
BUDGET SCHEDULE
TASK NOT TO EXCEED
AMOUNT
Task 1
(CAO Performance Evaluation Services [up to 4 Appointee] – Year 1 of 3)
$48,000
Task 2
(CAO Performance Evaluation Services [up to 4 Appointee] – Year 2 of 3)
$48,000
Task 3
(CAO Performance Evaluation Services [up to 4 Appointee] – Year 3 of 3)
$48,000
Sub-total for Services $144,000
Reimbursable Expenses (if any) $0
Total for Services and Reimbursable Expenses $144,000
Additional Services, year 1 thru 3 (if any, per Section 4) $64,500 Maximum Total Compensation $208,500
REIMBURSABLE EXPENSES
CONSULTANT’S ordinary business expenses , such as administrative, overhead, administrative support time /overtime, information systems, software and hardware, photocopying, telecommunications (telephone, internet), in -house printing, insurance and other ordinary business expenses, are included within the scope of payment for Services and are not reimbursable expenses hereunder.
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Reimbursable expenses, if any are specified as reimbursable under this section , will be reimbursed at actual cost. The expenses (by type, e.g. travel) for which CONSULTANT will be reimbursed are: NONE up to the not-to-exceed amount of: $0.00.
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EXHIBIT C-1
SCHEDULE OF RATES
CONSULTANT’s schedule of rates is as follows:
*CONSULTANT will complete the work they identify for a fixed fee of $12,000 per appointee evaluation and related goal setting for in -person attendance at a closed session. CONSULTANT will invoice 50% of the contract at the project launch and the remaining 50% after the evaluation:
Basic Services Description: Cost:
*CAO Performance Evaluation Service per Appointee $12,000
Additional Services (Optional) Description: Cost:
Direct Reports Feedback per Appointee $3,500
Executive Salary Analysis per Appointee $2,500
Unrelated Task not detailed in Scope of Services (Hourly) $325 (per hour)
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EXHIBIT D
INSURANCE REQUIREMENTS
CONSULTANTS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE
CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA.
AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS AS SPECIFIED HEREIN.
REQUIRED TYPE OF COVERAGE REQUIREMENT
MINIMUM LIMITS
EACH
OCCURRENCE AGGREGATE
YES
YES
WORKER’S COMPENSATION
EMPLOYER’S LIABILITY
STATUTORY
STATUTORY STATUTORY STATUTORY
YES
GENERAL LIABILITY, INCLUDING
PERSONAL INJURY, BROAD FORM
PROPERTY DAMAGE BLANKET
CONTRACTUAL, AND FIRE LEGAL
LIABILITY
BODILY INJURY
PROPERTY DAMAGE
BODILY INJURY & PROPERTY
DAMAGE COMBINED.
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
YES
AUTOMOBILE LIABILITY,
INCLUDING ALL OWNED, HIRED,
NON-OWNED
BODILY INJURY
- EACH PERSON
- EACH OCCURRENCE
PROPERTY DAMAGE
BODILY INJURY AND PROPERTY
DAMAGE, COMBINED
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
YES
PROFESSIONAL LIABILITY,
INCLUDING, ERRORS AND
OMISSIONS, MALPRACTICE (WHEN
APPLICABLE), AND NEGLIGENT
PERFORMANCE
ALL DAMAGES $1,000,000
YES
THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONSULTANT, AT ITS SOLE COST
AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM
OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONSULTANT AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES.
I. INSURANCE COVERAGE MUST INCLUDE:
A. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONSULTANT’S AGREEMENT TO INDEMNIFY CITY.
II. THE CONSULTANT MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE TO THE FOLLOWING EMAIL: [email protected]
III. ENDORSEMENT PROVISIONS WITH RESPECT TO THE INSURANCE AFFORDED TO ADDITIONAL INSUREDS:
A. PRIMARY COVERAGE
WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED,
INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR Docusign Envelope ID: 6B5C7218-F9DF-46BA-A265-B3493634A7F7 Item 6
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CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS.
B. CROSS LIABILITY
THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER
THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE
INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE
INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY.
C. NOTICE OF CANCELLATION
1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON
OTHER THAN THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.
2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.
EVIDENCE OF INSURANCE AND OTHER RELATED NOTICES ARE REQUIRED TO BE FILED WITH THE CITY OF PALO ALTO TO THE FOLLOWING EMAIL:
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City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Administrative Services
Meeting Date: June 16, 2025
Report #:2505-4709
TITLE
Recommend the City Council Adopt the Fiscal Year 2026 Investment Policy as Recommended by the Finance Committee: CEQA Status – Not a Project
RECOMMENDATION
The Finance Committee and staff recommend the City Council approve the City’s Investment Policy (Policy) (Attachment A).
ANALYSIS
The Investment Policy (Policy) requires that the Policy be reviewed annually, and that any changes be approved by the City Council during the annual budget process. The Policy (and any changes) was reviewed by the Finance Committee on June 3, 20251.
Proposed Changes Resulting from the Investment Management Audit The City Auditor issued the Investment Management Audit on December 12, 20232, which contained recommendations for the City to improve its oversight over the City’s investment portfolio, including the following recommendations:
1. Segregation of duties and oversight of investment activities a. Staff should implement a formal process for review and approval of investment activities (complete)
b. Continue efforts to adjust staffing levels of the investment function. Additional staffing resources have been hired and is currently being trained. (in process)
2. Supporting documents for investment activities
1 Finance Committee, June 3, 2025, Item #3:
https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=16128 2 City Council, January 16, 2024: https://portal.laserfiche.com/Portal/DocView.aspx?id=70175&repo=r- 704298fc&searchid=1841ef17-7090-4241-9d91-bd787b78be3c
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a. Maintain adequate supporting documentation such as cash flow and evaluation of quotations for each investment decision (complete)
b. Update Investment Policy to require broker/dealers provide documentation showing their financial condition and relevant registration (complete) As staff performed this review and further researched industry’s best practices related to #2b above, two benchmarks were used to assess brokers and dealers.
Broker and Dealer Record Free of Disclosure Events
The Financial Industry Regulatory Authority (FINRA), an independent regulator for all securities firms doing business in the United States and regulated by the Federal government, publishes the Broker Check report. The report contains the individual’s experience; current registrations and licenses; and any disclosure events, including customer disputes, disciplinary events, and/or criminal events. The proposed Policy recommends adding criteria that brokers and dealers maintain a record free of disclosure events, evidenced by the individual’s BrokerCheck report.
Net Capital Requirement
The Securities and Exchange Commission (SEC) amended financial responsibility rules for broker/dealers in 20133 where amendments to net capital, customer protection, and recordkeeping were designed to better protect broker/dealer customers and enhance the SEC’s ability to monitor and prevent unsound business practices. As a result, Rule 15c3-1 was added and requires brokers/dealers to maintain enough liquid assets for each dollar of liabilities, based on specific ratios, to ensure that there are sufficient liquid assets to pay all liabilities to customers. Firm net capital status is a required financial statement disclosure by the SEC. The Proposed policy recommends that net capital requirements, as outlined by SEC Rule 15c3-1, must be met for broker/dealers.
Other Proposed Changes
In addition to the proposed changes to further refine the Policy to address Investment Management Audit, staff propose these additional improvements to the Policy:
1. Authorized Investments
a. Clarify that the Policy is more restrictive than the Government Code and that the more restrictive parameters will take precedence; holding limits and minimum credit quality requirements apply at the time the security is purchased b. Any investments currently held at the time the policy is adopted, which does not meet new policy guidelines, can be held to maturity and will be exempt from the 3 SEC Adopts Amendments to Financial responsibility Rules for Brokers-Dealers, July 31, 2013:
https://www.sec.gov/newsroom/press-releases/2013-140
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current policy. At the time of the investment’s maturity or liquidation, such funds will be reinvested only as provided in the current policy.
2. Policy Review and Reporting on Investments
a. Outlined requirements in California Government Code Section 53646, which include a requirement that the quarterly report be reported to Council within 45 days after the end of the quarter and listing the reporting requirements per the Code.
3. Authorized Investment Personnel
This change was discussed at the June 3, 2025 Finance Committee meeting and was included in the Committee’s motion. Staff proposes updating the Authorized Investment Personnel section of the policy to include the blended approach of a specialized firm and leveraging staff. This would align with best practice of updating city policy and practices, findings in staff’s research of how other agencies manage the investment function, with city auditor observations, and anticipated higher investment earnings by partnering with an investment management firm.
In addition, on the June 17, 2025 Council Consent Agenda4, staff will be recommending that Council approve an agreement for investment management services with a specialized asset portfolio management firm, enabling a blended approach to this function. The City’s current investment management structure is supported by Administrative Services staff and in a recent survey, it was determined that two-thirds of cities within Santa Clara County enlist the expertise of professional investment portfolios managers from specialized firms.
FISCAL/RESOURCE IMPACT
Approval of the recommendation will not have a financial impact. The additional reporting can be accommodated with existing staff resources.
STAKEHOLDER ENGAGEMENT
Staff work internally and with external parties (broker/dealers and municipal advisor) to review the Policy and consider new and upcoming industry best practices.
ENVIRONMENTAL REVIEW
This activity is not a project under the California Environmental Quality Act (CEQA) as defined in CEQA Guidelines, section 15378, because adoption of the investment policy is a government funding mechanisms or fiscal activity which does not involve any commitment to any specific 4 City Council, June 17, 2025, Report #2504-4587
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project which may result in a potentially significant physical impact on the environment. CEQA Guidelines section 15378(b)(4).
ATTACHMENTS
Attachment A: Proposed FY 2026 Investment Policy
APPROVED BY:
Lauren Lai, Administrative Services Director
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ATTACHMENT A
Fiscal Year 2026 Page 1 of 24
4 2
8 9
Proposed Investment Policy
Fiscal Year 2026
INTRODUCTION
The City of Palo Alto invests its pooled idle cash according to State of California law and the charter of the City of Palo Alto. In particular, the City follows “The Prudent Investor Standard” cited in the State Government Code (Section 53600.3). Under this standard, all governing bodies of local agencies or persons authorized to make investment decisions on behalf of the City are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency.
INVESTMENT PHILOSOPHY
The basic principles underlying Palo Alto's investment philosophy is to ensure the safety of public funds, provide that sufficient money is always available to meet current expenditures, and achieve a reasonable rate of return on its investments.
The City's preferred and chief practice is to buy securities and to hold them to their date of maturity rather than to trade or sell securities prior to maturity. The City may, however, elect to sell a security prior to its maturity should there be a significant financial need. If securities are purchased and held to their maturity date, then any changes in the market value of those securities during their life will have no effect on their principal value. Under a buy and hold philosophy, the City is able to protect its invested principal. The economy, the money markets, and various financial institutions (such as the Federal Reserve System) are monitored carefully to make prudent investments and to assess the condition of the City’s portfolio.
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INVESTMENT OBJECTIVES
The primary objectives, in priority order, of investment activities shall be safety, liquidity, and yield:
1.Safety: Safety of principal is the foremost objective of the investment program.
Investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. The objective will be to mitigate credit risk and interest rate risk.
a) Credit risk is the risk that an obligation will not be paid and a loss will result.
The City will seek to minimize this risk by:
Limiting investment to the safest types of securities or minimum credit quality rating as listed in the “Authorized Investment” section Diversifying its investments among the types of securities that are authorized under this investment policy
b) Interest rate risk is the risk that changes in interest rates will adversely affect the value of an investor’s portfolio. For example, an investor with large holdings in long-term bonds has assumed significant interest rate risk because the value of the bonds will fall if interest rates rise. The City can minimize this risk by:
Buying and holding its securities until maturity
Structuring the investment portfolio so that securities mature to meet cash flow requirements
To further achieve the objective of safety, the amount that can be invested in all investment categories, excluding obligations of the U.S. Government and its agencies, is limited either as a percentage of the portfolio or by a specific dollar amount. These limits are defined under the “Authorized Investments” section.
2. Liquidity: Liquidity is the second most important objective of the investment program. The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This is accomplished by maintaining a portion of the portfolio in liquid money market mutual funds or local government investment pools. In addition, the City will maintain one month’s net cash needs in short term and/or liquid investments and at least $50 million shall be maintained in securities maturing in less than two years. Although the City’s practice is to buy and hold securities to maturity, since all possible cash demands cannot be anticipated, the portfolio will consist of securities with active secondary or resale markets should the need to sell a security prior to maturity arises.
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3. Yield: Yield on the City’s portfolio is last in priority among investment objectives.
The investment portfolio shall be designed to obtain a market rate of return that reflects the authorized investments, risk constraints, and liquidity needs outlined in the City’s investment policy. Compared to similar sized cities, the City of Palo Alto should be able to take advantage of its relatively large reserve balances to achieve higher yields through long-term investments. In addition, the City will strive to maintain the level of investment of idle funds as close to 100 percent as possible.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) RESPONSIBILITIES In addition to and subordinate to the Safety, Liquidity, and Yield investment objectives, investments that support sound environmental, social and governance (ESG) objectives are also considered. While the City’s portfolio is not classified as an ESG portfolio, investments in entities that support community well-being through practices that emphasize safe and environmentally sound objectives; fair labor practices; and equality of rights regardless of sex, race, age, disability, or sexual orientation, is encouraged. Direct investments in entities that manufacture tobacco products, firearms, and engage in direct production or drilling of fossil fuels is discouraged.
This section applies to new investments (after November 5, 2018) only and does not require divestment of existing investments. Investments in Certificates of Deposit (CDs) and Negotiable Certificates of Deposit are exempt from the ESG investing objective.
SCOPE
A. This investment policy shall apply to all financial assets of the City of Palo Alto as accounted for in the Annual Comprehensive Financial Report (ACFR), including but not limited to the following funds:
1. General Fund
2. Special Revenue Funds
3. Debt Service Funds
4. Capital Project Fund
5. Enterprise Funds
6. Internal Service Funds
7. Trust and Agency Funds
B. The policy does not cover funds held by the California Public Employees Retirement System (CalPERS), the California Employers’ Retiree Benefit Trust (CERBT), Deferred Compensation programs (e.g. ICMA, Hartford), the Authority for California Cities Excess Liability (ACCEL), and the Public Agency Retirement Services (PARS) Section 115 Irrevocable Trust.
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C. Investments of bond proceeds shall be governed by the provisions of the related bond indentures.
GENERAL INVESTMENT GUIDELINES
1. The maximum stated final maturity of individual securities in the portfolio should be ten years.
2. A maximum of 30 percent of the par value of the portfolio shall be invested in securities with maturities beyond five years.
3. The City shall maintain a minimum of one month’s net cash needs in short term and/or liquid investments.
4. At least $50 million shall be maintained in securities maturing in less than two (2) years.
5. Should the ratio of the market value of the portfolio to the book value of the portfolio fall below 95 percent, the Administrative Services Department will report this fact to the City Council within a reasonable time frame and evaluate whether there is any risk of holding any of the securities to maturity.
6. Commitments to purchase securities newly introduced on the market shall be made no more than three (3) working days before pricing.
7. Whenever possible, the City will obtain and record three or more quotations on the purchase or sale of comparable securities and take the higher yield on purchase or higher price on sale. This rule will not apply to new issues, which are purchased at market no more than three (3) working days before pricing, as well as to LAIF, City of Palo Alto bonds, money market accounts and mutual funds, all of which shall be evaluated separately.
8. Where the Investment Policy specifies a percentage limitation for a particular category of investment, that percentage is applicable only at the date of purchase.
A later increase or decrease in a percentage resulting from a change in the portfolio’s assets or values shall not constitute a violation of that restriction. As soon as possible, percentage limitations will be restored as investments mature in each category.
AUTHORIZED INVESTMENTS
The California Government Code (Sections 53600 et seq.) governs investment of City funds.
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investments to the guidelines listed below. In the event there is a difference between the Policy and the Code, the more restrictive parameters will take precedence. Percentage holding limits and minimum credit quality requirements listed in this section apply at the time the security is purchased.
Any investment currently held at the time the policy is adopted, which does not meet the new policy guidelines, can be held until maturity and shall be exempt from the current policy. At the time of the investment’s maturity or liquidation, such funds shall be reinvested only as provided in the current policy. The following investments are authorized:
1.U.S. Government Securities (e.g. Treasury notes, bonds and bills) Securities that are backed by the full faith and credit of the United States a) There is no limit on purchase of these securities.
b) Securities will not exceed 10 years maturity.
c) All purchased securities must have an explicit or a de facto backing of the full faith and credit of the U.S. Government.
2.U.S. Government Agency Securities – Obligations issued by the Federal Government agencies (e.g. Federal National Mortgage Association, etc.). a. There is no limit on purchase of these securities except for:
Callable and Multi-step-up securities provided that:
- The potential call dates are known at the time of purchase - The interest rates at which they “step-up” are known at the time of purchase
- The entire face value of the security is redeemed at the call date
- No more than 25 percent of the par value of the portfolio b. Securities will not exceed 10 years maturity.
3.California State, California Local Government Agencies, and other United States State Bonds
a) Having at time of investment a minimum Double A (AA/Aa2) rating as provided by a nationally recognized rating service (e.g. Moody’s, Fitch, and/or Standard and Poor’s).
b) May not exceed 40 percent of the par value of the portfolio.
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c) Investments include:
i)Registered state warrants or treasury notes or bonds of the State of California and bonds, notes, warrants, or other evidences of indebtedness of any local agency within California, including bonds payable solely out of the revenues from a revenue producing property owned, controlled, or operated by the state or local agency or by a department, board, agency, or authority of the state or local agency.
ii)Registered treasury notes or bond of any of the 49 United States in addition to the State of California, including bonds payable solely out of the revenues from a revenue-producing property owned, controlled, or operated by a state or by a department, board, agency or authority of any of the other 49 United States, in addition to the State of California.
4.Certificates of Deposit (CD) - A debt instrument issued by a bank for a specified period of time at a specified rate of interest. Purchase of CD’s are limited to:
a) May not exceed 20 percent of the par value of the portfolio. b) No more than 10 percent of the par value of the portfolio in collateralized CDs in any institution.
c) Purchase collateralized deposits only from federally insured large banks that are rated by a nationally recognized rating service (e.g.
Moody’s, Fitch, and/or Standard and Poor’s).
d) For non-rated banks, deposit should be limited to amounts federally insured (FDIC). – See Appendix C
e) Rollovers are not permitted without specific instruction from authorized City staff.
5.Banker's Acceptance Notes (BA) – Bills of exchange or time drafts drawn on and accepted by commercial banks. Purchase of banker’s acceptances are limited to:
a) No more than 30 percent of the par value of the portfolio. b) Not to exceed 180 days maturity.
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c) No more than $5 million with any one institution.
6.Commercial Paper - Short-term unsecured obligations issued by banks, corporations, and other borrowers. Purchases of commercial paper are limited to:
a) Having highest letter or numerical rating as provided for by a nationally recognized rating service (e.g. Moody’s, Fitch, and/or Standard and Poor’s).
b) No more than 15 percent of the par value of the portfolio. c) Not to exceed 270 days maturity.
d) No more than $3 million or 10 percent of the outstanding commercial paper of any one institution, whichever is lesser.
7.Local Agency Investment Fund (LAIF) – A State of California managed investment pool may be used up to the maximum permitted by California State Law.
8.Short-Term Repurchase Agreements (REPO) – A contractual agreement between a seller and a buyer, usually of U.S. government securities, whereby the seller agrees to repurchase the securities at an agreed upon price and, usually, at a stated time. Purchases of REPO’s must:
a) Not to exceed 1 year.
b) Market value of securities that underlay a repurchase agreement shall be valued at 102 percent or greater of the funds borrowed against those securities.
c) A Master Repurchase agreement must be signed with the bank or dealer.
9.Money Market Deposit Accounts – Liquid bank accounts which seek to maintain a net asset value of $1.00.
10.Mutual Funds which seek to maintain a net asset value of $1.00 and which are limited essentially to the above investments and further defined in note 9 of Appendix A
a) No more than 20 percent of the par value of the portfolio. b) No more than 10 percent of the par value with any one institution.
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11.Negotiable Certificates of Deposit (NCD) issued by nationally or state-chartered banks and state or federal savings institutions and further defined in note 11 of Appendix A. Purchases of negotiable certificates of deposit:
a) May not exceed 20 percent of the par value of the portfolio. b) No more than $5 million in any one institution.
12.Medium-Term Corporate Notes – Issued by corporation organized and operating within the United States or by depository institutions licensed by the United States or any state and operating with the United States.
a) Not to exceed 5 years maturity.
b) Securities eligible for investment shall have a minimum rating of AA or Aa2 from a nationally recognized rating service (e.g. Moody’s, Fitch, and/or Standard & Poor’s).
c) No more than 10 percent of the par value of the portfolio.
d) No more than $5 million of the par value may be invested in securities of any single issuer, other than the U.S. Government, its agencies and instrumentality.
e) If securities owned by the City are downgraded by Moody’s, Fitch, or Standard & Poor’s to a level below AA or Aa2, it shall be the City’s policy to review the credit situation and make a determination as to whether to sell or retain such securities in the portfolio.
13.Supranational Organizations Securities – Supranational organizations refer to International Bank for Reconstruction and Development (IBRD), International Finance Corporation (IFC) and Inter-American Development Bank (IADB). a. Securities will not exceed 5 years maturity.
b. No more than 20 percent of the par value of the portfolio. c. No more than 10 percent of the par value with any one institution. d. Securities eligible for investment shall have a minimum rating of AA or Aa2 from a nationally recognized rating service (e.g. Moody’s, Fitch, and/or Standard & Poor’s).
e. Limited to United States dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by IBRD, IFC, and IADB.
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Appendix A provides a more detailed description of each investment vehicle and its security and liquidity features. Most of the City's short-term investments will be in securities which pay principal upon maturity, while long-term investments may be in securities that periodically repay principal, as well as interest. Most of the City's investments will be at a fixed rate. However, some of the investments may be at a variable rate, so long as that rate changes on specified dates in pre-determined increments.
PROHIBITED INVESTMENTS:
Includes all investments not specified above, and in particular:
1. Reverse repurchase agreements
2. Derivatives, as defined in Appendix B
Appendix B provides a more detailed description of each investment, which is prohibited, for City investment.
AUTHORIZED INVESTMENT PERSONNEL
Idle cash management and investment transactions are the responsibility of the Administrative Services Department. The Administrative Services Department is under the control of the Director of Administrative Services (Director), as treasurer, who is subject to the direction and supervision of the City Manager.
The Assistant Directors of Administrative Services (Assistant Director), who reports to the Director, are authorized to make all investment transactions allowed by the Statement of Investment Policy. The Assistant Director may authorize the Manager of Treasury, Debt & Investments (Manager), and/or Senior Management Analyst (Manager and/or Analyst), and/or designated investment firm (Firm) to enter into investments within clearly specified parameters.
The Investment function is under the supervision of the Assistant Director. The Assistant Director is charged with the responsibility to manage the investment program (portfolio), which includes developing and monitoring the City's cash flow model and developing long-term revenue and financing strategies and forecasts.
The Manager, and/or Analyst, and/or Firm are subject to the direction and supervision of the Assistant Director. The Manager, and/or Analyst, and/or Firm assist the Assistant Director, in the purchase and sale of securities. The Manager, and/or Analyst, and/or Firm also prepare the quarterly report, and record daily all investment transactions as to the type of investment, amount, yield, and maturity. Cash flow projections are prepared as needed.
In all circumstances, approval from the Director of Administrative Services is required before Item 7
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selling securities from the City's portfolio. The Manager and/or Analyst may also transfer no more than a total of $10 million a day from the City's general account to any one financial institution, without the prior approval of the Assistant Director.
No other person has authority to make investment transactions without the written authority of the Director or Assistant Director of Administrative Services.
USE OF BROKERS AND DEALERS
The Administrative Services Department maintains a list of acceptable dealers. A dealer acts as a principal in security transactions, selling securities from and buying securities for their own position. A dealer must have:
a) At least three years’ experience operating with California municipalities; b) Maintain a record free of disclosure events, evidenced on the individual’s Financial Industry Regulatory Authority (FINRA) BrokerCheck report; b)c) Maintain an inventory of trading securities of at least $10 million; d) Meet net capital requirements as outlined in Security Exchange Commission Rule (SEC) 15c3-1 (uniform net capital rule) for brokers or dealers; c)e) Annually provide documentation showing their financial condition and relevant registration;
d)f)Annually certify in writing that they have reviewed the applicable California Government Code sections and the City’s Investment Policy; and e)g) Be approved by the Assistant Director before being added to the City's list of approved dealers; including individual traders or agents representing a dealer:
A dealer will be removed from the list if any of these criteria not be met and/or should there develop a history of problems to include: failure to deliver securities as promised, failure to honor transactions as quoted, or failure to provide accurate information.
SAFEKEEPING AND CUSTODY
All securities shall be delivered to the City's safekeeping custodian and held in the name of the City of Palo Alto, with the exception of the following investments:
a) Certificates of deposit, which may be held by the City itself.
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b) City shares in pooled investment funds, under contract. c) Mutual funds
d) Local Agency Investment Fund (LAIF)
POLICY REVIEW AND REPORTING ON INVESTMENTS
Monthly, the Administrative Services Department will review performance in relation to Council adopted Policy. Per California Government Code Section 53646, quarterly, the Department will report to Council (within 45 days after the end of the quarter) investment activity, including: the portfolio’s performance in comparison to policy, explain any variances from policy, provide any recommendations for policy changes, and discuss overall compliance with the City’s Investment Policy. In addition, the Department will provide Council with:
a) An asset listing showing par value, cost and independent third-party fair market value of each security as of the date of the report, the source of the valuation, type of investment, issuer, maturity date and interest rate.
b) A description of the funds, investments and programs (including lending programs) managed by contracted parties (i.e. LAIF; LGIPS, outside money managers and securities lending agents)
c) A statement of compliance with investment policy, including a schedule of any transactions or holdings which do not comply with this policy or with the California Government Code, including a justification for their presence in the portfolio and a timetable for resolution, A detailed list of all securities, investments and monies held by the City, and
a)d) Report on the City’s ability to meet expenditure requirements over the next six months.
Per California Government Code Section 53607, the Department shall provide a monthly report of transactions (investments, reinvestment, sold, and exchanged securities) made during the month to the Council. This reporting requirement is separate and distinct from the quarterly investment report submitted under Code Section 53646.
Annually, the Administrative Services Department will present a Proposed Statement of Investment Policy, to include the delegation of investment authority, to the City Council for review during the annual budget process. All proposed changes in policy must be approved by the Council prior to implementation.
Adopted by City Council October 22, 1984 Amended by City Council June 17, 2003 Item 7
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Monthly reporting effective January 1985 Amended by City Council June 28, 2004 Amended and Adopted by City Council June 24,
1985
Amended by City Council June 20, 2005
Amended by City Council December 2, 1985 Amended by City Council June 12, 2006 Amended by City Council June 23, 1986 Amended by City Council June 11, 2007 Amended by City Council June 22, 1987 Amended by City Council June 09, 2008 Amended by City Council August 8, 1988 Amended by City Council June 15, 2009 Amended by City Council November 28, 1988 Amended by City Council June 28, 2010 Amended by City Council June 26, 1989 Amended by City Council June 20, 2011 Amended by City Council May 14, 1990 Amended by City Council June 18, 2012 Amended by City Council June 24, 1991 Amended by City Council June 03, 2013 Amended by City Council June 22, 1992 Amended by City Council June 16, 2014 Amended by City Council June 23, 1993 Amended by City Council June 15, 2015 Amended by City Council June 20, 1994 Amended by City Council June 13, 2016 Amended by City Council June 19, 1995 Amended by City Council June 27, 2017 Amended by City Council June 24, 1996 Amended by City Council November 5, 2018 Amended by City Council June 23, 1997 Amended by City Council June 24, 2019 Amended by City Council January 26, 1998 Adopted by City Council June 22, 2020 Amended by City Council June 22, 1998 Amended by City Council June 21, 2021 Amended by City Council June 28, 1999 Adopted by City Council June 20, 2022 Amended by City Council June 19, 2000 Adopted by City Council June 19, 2023 Amended by City Council June 11, 2001 Amended by City Council June 17, 2024 Amended by City Council June 17, 2002
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APPENDIX A
EXPLANATION OF PERMITTED INVESTMENTS
1.U.S. Government Securities: United States Treasury notes, bonds, bills, or certificates of indebtedness or those for which the faith and credit of the United States are pledged for the payment of principal and interest.
2.U.S. Government Agency Securities: U.S. Government Agency Obligations include the securities of the Federal National Mortgage Association (FNMA), Federal Land Banks (FLB), Federal Intermediate Credit Banks (FICB), banks for cooperatives, Federal Home Loan Banks (FHLB), Government National Mortgage Association (GNMA), Federal Home Loan Mortgage Corporation (FHLMC), Student Loan Marketing Association (SLMA), Small Business Administration (SBA), Federal Farm Credit (FFC), and Federal Agricultural Mortgage Corporation (FAMC or FMAC). Federal Agency securities are debt obligations that essentially result from lending programs of the Government. Federal agency securities differ from other types of securities, as well as among themselves. Their characteristics depend on the issuing agency. It is possible to distinguish three types of issues: (A) participation certificates (pooled securities), (B) Certificates of interest (pooled loans), (C) notes, bonds, and debentures. The securities of a few agencies are explicitly backed by the full faith and credit of the U.S. Government. All other issues purchased by the City have the de facto backing from the federal government, and it is highly unlikely that the government would let any agency default on its obligations.
3.Certificates of Deposit: A certificate of deposit (CDs) is a receipt for funds deposited in a bank, savings bank, or savings and loan association for a specified period of time at a specified rate of interest. Denominations are $250,000 and up. The first $250,000 of a certificate of deposit is guaranteed by the Federal Deposit Insurance Corporation (FDIC), if the deposit is with a bank or savings bank, or the Savings Association Insurance Fund (SAIF), if the deposit is with a savings and loan. CDs with a face value in excess of $250,000 can be collateralized by U.S. Government Agency and Treasury Department securities or first mortgage loans. Government securities must be at least 110 percent of the face value of the CD collateralized in excess of the first $250,000. The value of first mortgages must be at least 150 percent of the face value of the CD balance insured in excess of the first $250,000. Generally, CDs are issued for more than 30 days and the maturity can be selected by the purchaser.
4.Bankers' Acceptance: A Banker's Acceptance (BA) is a negotiable time draft or bill of exchange drawn on and accepted by a commercial bank. Acceptance of the draft irrevocably obligates the bank to pay the bearer the face amount of the draft at maturity.
BAs are usually created to finance the import and export of goods, the shipment of goods within the United States and storage of readily marketable staple commodities. In over 70 years of usage in the United States, there has been no known instance of principal loss to Item 7
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any investor in BAs. In addition to the guarantee by the accepting bank, the transaction is identified with a specific commodity. Warehouse receipts verify that the pledged commodities exist, and, by definition, these commodities are readily marketable. The sale of the underlying goods generates the necessary funds to liquidate the indebtedness.
BAs enjoy marketability since the Federal Reserve Bank is authorized to buy and sell prime BAs with maturities of up to nine months. The Federal Reserve Bank enters into repurchase agreements in the normal course of open market operations with BA dealers.
As are sold at a discount from par. An acceptance is tied to a specific loan transaction; therefore, the amount and maturity of the acceptance is fixed.
5.Commercial Paper: Commercial paper notes are unsecured promissory notes of industrial corporations, utilities, and bank holding companies. Interest is discounted from par and calculated using actual number of days on a 360-day year. The notes are in bearer form, with maturities up to 270 days selected by the purchaser, and denominations generally start at $100,000. There is a small secondary market for commercial paper notes and an investor may sell a note prior to maturity.
Commercial paper notes are backed by unused lines of credit from major banks. Some issuer's notes are insured, while some are backed by irrevocable letters of credit from major banks. State law limits a City to investments in United States corporations having assets in excess of five hundred million dollars with an "A" or higher rating by a nationally recognized rating service for the issuer's debentures. Cities may not invest more than 25 percent of idle cash in commercial paper.
6.Local Agency Investment Fund Demand Deposit: The Local Agency Investment Fund LAIF) was established by the State to enable treasurers to place funds in a pool for investments.
The City is limited to an investment of the amount allowed by LAIF (currently $75 million).
LAIF has been particularly beneficial to those jurisdictions with small portfolios. Palo Alto uses this fund for short-term investment, liquidity, and yield.
7.Repurchase Agreements: A Repurchase Agreement (REPOS) is not a security, but a contractual arrangement between a financial institution or dealer and an investor. The agreement normally can run for one or more days. The investor puts up funds for a certain number of days at a stated yield. In return, the investor takes title to a given block of securities as collateral. At maturity, the securities are repurchased and the funds repaid, plus interest. Usually, amounts are $500,000 or more, but some REPOS can be smaller.
8.Money Market Deposit Accounts: Money Market Deposit Accounts are market-sensitive bank accounts, which are available to depositors at any time, without penalty. The interest rate is generally comparable to rates on money market mutual funds, though any individual bank's rate may be higher or lower. These accounts are insured by the Federal Deposit Item 7
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Insurance Corporation or the Savings Association Insurance Fund.
9.Mutual Funds: Mutual funds are shares of beneficial interest issued by diversified management companies, as defined by Section 23701 M of the Revenue and Taxation Code.
To be eligible for investment, these funds must:
a) Attain the highest ranking in the highest letter and numerical rating provided by not less than two of the three largest nationally recognized rating services; or
b) Have an investment advisor registered with the Securities and Exchange Commission with not less than five years’ experience investing in the securities and obligations, as authorized by subdivisions (a) to (n), inclusive, of Section 53601 of the California Government Code, and with assets under management in excess of five hundred million dollars; and
c) Invest solely in those securities and obligations authorized by Sections 53601 and 53635 of the California Government Code. Where the Investment Policy of the City of Palo Alto may be more restrictive than the State Code, the Policy authorizes investments in mutual funds that shall have minimal investment in securities otherwise restricted by the City's Policy. Minimal investment is defined as less than 5 percent of the mutual fund portfolio; and d) The purchase price of shares of beneficial interest purchased shall not include any commission that these companies may charge.
e) Have a net asset value of $1.00.
10.Callable Securities and Multi-Step-ups: Callable securities are defined as fixed interest rate government agency securities that give the issuing agency the option of returning the invested funds at a specific point in time to the purchaser. Multi-step-ups are government agency securities in which the interest rate increases ("steps-up") at preset intervals, and which also have a callable option that allows the issuing agency to return the invested funds at a preset interval. Callable and multi-step-ups are permitted, provided that:
the potential call dates are known at the time of purchase; the interest rates at which they “step-up” are known at the time of purchase; and
the entire face value of the security is redeemed at the call date.
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11.Negotiable Certificates of Deposit (NCD): NCDs are large-dollar-amount, short-term certificate of deposit. Such certificates are issued by large banks and bought mainly by corporations and institutional investors. They are payable either to the bearer or to the order of the depositor, and, being negotiable, they enjoy an active secondary market, where they trade in round lots of $5 million. Although they can be issued in any denomination from $100,000 up, the typical amount is $1 million also called a Jumbo Certificate of Deposit.
State law prohibits the investment of local agency funds in negotiable certificates of deposit issued by a state or federal credit union if a member of the legislative body of the local agency, or any person with investment decision making authority in the administrative, manager’s, budget, auditor-controller’s, or treasurer’s offices of the local agency also serves on the board of directors, other credit committee or the supervisory committee of the state or federal credit union issuing the negotiable certificate of deposit.
12.Medium-Term Corporate Notes: All corporate and depository institution debt securities with a maximum remaining maturity of five years or less, issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States. According to California Government Code Section 53601, “Notes eligible for investment under this subdivision shall be rated in a rating category of “A” or its equivalent or better by a nationally recognized rating service. Purchase of medium-term notes shall include other instruments authorized by this section and shall not exceed 30 percent of the agency’s moneys that may be invested pursuant to this section.”
13.Supranational Securities: California Government Code Section53601 defines allowable supranational securities as United States dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, the International Finance Corporation, and Inter- American Development Bank. Supranationals are well capitalized and in most cases have strong credit support from contingent capital calls from their member countries. Section 53601 was amended effective January 1, 2015 to allow local agencies to invest in the senior debt obligations of these three supranational issuers which are eligible for purchase and resale within the United States. These entities were established with the purpose of ending poverty and raising the standard of living around the world through sustainable economic growth.
a) The supranationals are international organization owned by member countries. These are:
International Bank for Reconstruction and Development (IBRD or World Bank), a member of the World Bank Group, provides direct loans and guarantees to sovereigns and government-backed projects International Finance Corporation (IFC), a member of the World Bank Item 7
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Group, supports the creation and growth of private companies through direct lending and equity investment, attracting third party capital, and providing advisory services
Inter-American Development Bank (IADB), a member of the Inter-American Development Bank Group, provides loans, grants, and guarantees to sovereigns in Latin America and the Caribbean b) Additional characteristics shared by the IBRD, IFC, and IADB include:
Headquartered in Washington, D.C. with the United States as the largest shareholder of each organization
Rated AAA/Aaa by S&P and Moody’s
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APPENDIX B
EXPLANATION OF PROHIBITED INVESTMENTS
1.Reverse Repurchase Agreements: A Reverse Repurchase Agreement (Reverse REPO) is a contractual agreement by the investor (e.g. local agency) to post a security it owns as collateral, and a bank or dealer temporarily exchanges cash for this collateral, for a specific period of time, at an agreed-upon interest rate. During the period of the agreement, the local agency may use this cash for any purpose. At maturity, the securities are repurchased from the bank or dealer, plus interest.
California law contains a number of restrictions on the use of Reverse REPOS by local agencies.
2.Derivatives: A derivative is a financial instrument created from, or whose value depends on (is derived from), the value of one or more underlying assets or indices. The term "derivative" refers to instruments or features, such as collateralized mortgage obligations, forwards, futures, currency and interest rate swaps, options, caps and floors. Except for those callable and multi-step-up securities as described under Permitted Investments, derivatives are prohibited.
Certain derivative products have characteristics which could include high price volatility, liquid markets, products that are not market-tested, products that are highly leveraged, products requiring a high degree of sophistication to manage, and products that are difficult to value.
According to California law, a local agency shall not invest any funds in inverse floaters, range notes, or interest-only strips that are derived from a pool of mortgages.
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APPENDIX C
GLOSSARY OF INVESTMENT TERMS
AGENCIES: Federal agency and instrumentality securities.
ASKED: The price at which securities are offered.
BID: The price offered by a buyer of securities (when one sells securities, one asks for a bid).
See “Offer”.
BROKER: A person or institution that conducts investment transactions on behalf of the buyer and seller of the investment and earns a commission on the transaction.
COLLATERAL: Securities, evidence of deposit, or other property, which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies.
ANNUAL COMPREHENSIVE FINANCIAL REPORT (ACFR): The official annual report for the City of Palo Alto. It includes combined financial statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles and pronouncements set forth by the Governmental Accounting Standards Board (GASB). The ACFR also includes supporting schedules that are necessary to demonstrate compliance with finance- related legal and contractual provisions, extensive introductory material, and a detailed statistical section.
COUPON: The annual rate of interest that a bond’s issuer promises to pay the bondholder on the bond’s face value or the certificate attached to a bond evidencing interest due on a payment date.
DEALER: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his own account.
DEBENTURE: A bond secured only by the general credit of the issuer.
DELIVERY VERSUS PAYMENT: There are two methods of delivery of securities: (1) delivery versus payment (DVP); and (2) delivery versus receipt (DVR). DVP is delivery of securities with an exchange of money for the securities. DVR is delivery of securities with an exchange of a signed receipt for the securities.
DISCOUNT: The difference between the acquisition cost of a security and its value at maturity when quoted at lower than face value. A security that sells below original offering price shortly after sale, is also is considered to be at a discount.
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DISCOUNT SECURITIES: Non-interest-bearing money market instruments that are issued a discount and that are redeemed at maturity for full face value (e.g., U.S. Treasury Bills).
DIVERSIFICATION: Dividing investment funds among a variety of securities that offer independent returns.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION (“FAMC” or “FMAC”): A federal agency established in 1988 to provide a secondary market for farm mortgage loans. Informally called Farmer Mac.
FEDERAL CREDIT AGENCIES: Agencies of the Federal Government that were established to supply credit to various classes of institutions and individuals (e.g., S&Ls, small business firms, students, farmers, farm cooperatives, and exporters).
FEDERAL DEPOSIT INSURANCE CORPORATION (“FDIC”): A federal agency that insures all types of deposits received at an insured bank, including deposits in a checking account, negotiable order of withdrawal (NOW) account, savings account, money market deposit account (MMDA) or time deposit such as a certificate of deposit (CD). FDIC insurance covers depositors' accounts at each insured bank, dollar-for-dollar, including principal and any accrued interest through the date of the insured bank's closing, up to the insurance limit.
The FDIC does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities or municipal securities, even if these investments are purchased at an insured bank.
The FDIC does not insure U.S. Treasury bills, bonds or notes, but these investments are backed by the full faith and credit of the United States government.
The standard maximum deposit insurance amount is described as the “SMDIA” in FDIC regulations. The SMDIA is $250,000 per depositor, per insured bank.
FEDERAL FUNDS RATE: The rate of interest at which Fed funds are traded. This rate is currently pegged by the Federal Reserve through open-market operations.
FEDERAL HOME LOAN BANKS (“FHLB”): Government-sponsored wholesale banks (currently 12 regional banks) which lend funds and provide correspondent banking services to member commercial banks, thrift institutions, credit unions, and insurance companies. The mission of the FHLBs is to liquefy the housing-related assets of its members, who must purchase stock in their District Bank.
FEDERAL NATIONAL MORTGAGE ASSOCIATION (“FNMA”): FNMA, like GNMA, was chartered under the Federal National Mortgage Association Act in 1938. FNMA is a federal corporation working under the auspices of the Department of Housing and Urban Development (HUD). It is the largest single provider of residential mortgage funds in the United States. Fannie Mae, as the Item 7
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corporation is called, is a private stockholder-owned corporation. The corporation’s purchases include a variety of adjustable mortgages and second loans, in addition to fixed-rate mortgages.
FNMA’s securities are also highly liquid and are widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest.
FEDERAL OPEN MARKET COMMITTEE (“FOMC”): The FOMC consists of seven members of the Federal Reserve Board and five of the 12 Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member, while the other Presidents serve on a rotating basis. The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of government securities in the open market, as a means of influencing the volume of bank credit and money.
FEDERAL RESERVE SYSTEM: The central bank of the United States created by Congress and consisting of a seven-member Board of Governors in Washington, D.C., 12 regional banks, and about 5,700 commercial banks that are members of the system.
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (“GNMA” or “Ginnie Mae”): Securities that influence the volume of bank credit that is guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations, and other institutions. A security holder is protected by the full faith and credit of the U.S. Government. Ginnie Mae securities are backed by the FHA, VA, or FMHM mortgages. The term “pass-throughs” is often used to describe Ginnie Maes.
LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash without a substantial loss of value. In the money market, a security is said to be liquid if the spread between bid and asked prices is narrow, and reasonable amount can be done at those quotes.
LOCAL GOVERNMENT AGENCY: A local government agency is any city, county, city and county, district, or other local governmental body or corporation, including the California State Universities (CSU) and University of California (UC) systems, K-12 schools and community colleges empowered to expend public funds.
LOCAL GOVERNMENT INVESTMENT FUND (“LAIF”): Monies from local governmental units may be remitted to the California State Treasurer for deposit in this special fund for the purpose of investment.
MARKET VALUE: The price at which a security is trading and could presumably be purchased or sold.
MASTER REPURCHASE AGREEMENT: A written contract covering all future transactions between the parties to repurchase-reverse repurchase agreements that establish each party’s rights in the transactions. A master agreement will often specify, among other things, the right of the buyer (lender) to liquidate the underlying securities in the event of default by the seller (borrower).
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MATURITY: The date upon which the principal or stated value of an investment becomes due and payable.
MONEY MARKET: The market in which short-term debt instruments (e.g., bills, commercial paper, and bankers’ acceptances) are issued and traded.
OFFER: The price asked by a seller of securities (when one buys securities, one asks for an offer).
See “Asked” and “Bid”.
OPEN MARKET OPERATIONS: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank, as directed by the FOMC in order to influence the volume of money and credit in the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit; sales have the opposite effect. Open market operations are the Federal Reserve’s most important and most flexible monetary policy tool.
PORTFOLIO: A collection of securities that an investor holds.
PRIMARY DEALER: A group of government securities dealers that submit daily reports of market activity and positions, and monthly financial statements to the Federal Reserve Bank of New York, and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC) -- registered securities broker-dealers, banks, and a few unregulated firms.
PRUDENT INVESTOR RULE: An investment standard cited in the California Government Code Section 53600 et seq. Under this standard, all governing bodies of local agencies or persons authorized to make investment decisions on behalf of the City are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency.
QUALIFIED PUBLIC DEPOSITORIES: A financial institution that: (1) does not claim exemption from the payment of any sales, compensating use, or ad valorem taxes under the laws of this state; (2) has segregated for the benefit of the commission eligible collateral having a value of not less than its maximum liability; and (3) has been approved by the Public Deposit Protection Commission to hold public deposits.
RATE OF RETURN: The yield obtainable on a security based on its purchase price or its current market price.
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SAFEKEEPING: A service to customers rendered by banks for a fee whereby securities and valuables of all types and descriptions are held in the bank’s vaults for protection.
SECONDARY MARKET: A market made for the purchase and sale of outstanding issues following the initial distribution.
SECURITIES AND EXCHANGE COMMISSION: An agency created by Congress to administer securities legislation for the purpose of protecting investors in securities transactions.
STRUCTURED NOTES: Notes issued by instrumentalities (e.g., FHLB, FNMA, SLMA) and by corporations, that have imbedded options (e.g., call features, step-up coupons, floating rate coupons, derivative-based returns) in their debt structure. The market performance of structured notes is affected by fluctuating interest rates; the volatility of imbedded options; and shifts in the yield curve.
SUPRANATIONALS: International institutions that provide development financing, advisory services and/or financial services to their member countries to achieve the overall goal of improving living standards through sustainable economic growth. The California Government Code Section 53601 allows local agencies to purchase the United States dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development (IBRD), International Finance Corporation (IFC), or Inter-American Development Bank (IADB).
TIME CERTIFICATE OF DEPOSIT: A non-negotiable certificate of deposit, which cannot be sold prior to maturity.
TREASURY BILLS: A non-interest-bearing discount security that is issued by the U.S. Treasury to finance the national debt. Most T-bills are issued to mature in three months, six months, or one year.
TREASURY BONDS: Long-term, coupon-bearing U.S. Treasury securities that are issued as direct obligations of the U.S. Government, and having initial maturities of more than 10 years.
TREASURY NOTES: Medium-term, coupon-bearing U.S. Treasury securities that are issued as direct obligations of the U.S. Government, and having initial maturities of two to 10 years.
YIELD: The rate of annual income return on an investment, expressed as a percentage.
YIELD-TO-CALL (YTC): The rate of return an investor earns from a bond assuming the bond is redeemed (called) prior to its nominal maturity date.
YIELD-TO-MATURITY: The current income yield minus any premium above par or plus any Item 7
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discount from par in purchase price, with the adjustment spread over the period from the date of purchase to the date of maturity.
ZERO-COUPON SECURITIES: Security that is issued at a discount and makes no periodic interest payments. The rate of return consists of a gradual accretion of the principal of the security and is payable at par upon maturity.
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City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Human Resources
Meeting Date: June 16, 2025
Report #:2505-4737
TITLE
Adoption of Memoranda of Agreement with International Association of Fire Fighters (IAFF) Local 1319, Fire Chiefs Association (FCA), and Utilities Managers and Professionals Association of Palo Alto (UMPAPA) for Terms Ending June 30, 2028, and Adoption of the Updated Management and Professional Compensation Plan and Corresponding Salary Schedules; CEQA Status – Not a Project
RECOMMENDATION
Staff recommend that the City Council:
1) Adopt the Memoranda of Agreement (MOAs), and all associated salary schedules, between the City of Palo Alto and the:
a. International Association of Fire Fighters (IAFF) Local 1319; b. Fire Chiefs Association (FCA);
c. Utilities Managers and Professionals Association of Palo Alto (UMPAPA); and 2) Adopt the updated Management and Professional Compensation Plan covering unrepresented employees and the associated salary schedules, effective the first full pay period following Council adoption through June 30, 2028
BACKGROUND
As a public agency under California law, the City of Palo Alto must meet and confer in good faith with recognized employee organizations on matters relating to wages, hours, and terms and conditions of employment. Following thoughtful and thorough negotiations, City representatives reached tentative agreement with IAFF, FCA, and UMPAPA. IAFF, FCA, and UMPAPA have ratified the tentative agreement. An updated compensation plan has been developed for the City’s unrepresented management and professional employees.
These agreements align with the City's labor strategy to emphasize recruitment and maintaining competitive salaries to attract top talent; to continue improving employee retention and reduce turnover, and to foster a positive work environment to continue being an Employer of Choice. Each agreement builds upon key themes of equity, competitiveness, and Item 8
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operational sustainability as well as focusing on fiscal responsibility. The current agreements expire on June 30, 2025.
ANALYSIS
These agreements reflect a coordinated effort to standardize core elements across bargaining groups and the City’s unrepresented workforce, supporting long-term financial planning and operational consistency. General wage increases and health care contribution adjustments are applied uniformly; each agreement also includes tailored adjustments—such as market-based or certification-related compensation—that address the distinct needs of each group. These targeted adjustments are intended to strengthen the City's ability to attract and retain talent in competitive labor markets and will be detailed in the subsequent sections. Additionally, language updates across the agreements improve clarity, align with current practices, and support operational efficiency.
Common Elements Across All Agreements and Compensation Plan:
• Term: July 1, 2025 – June 30, 2028 (3-year term)
• Cost of Living Adjustments (COLA):
ο FY 2026: 3%
ο FY 2027: 3%
ο FY 2028: 3%
• Medical Contributions:
ο July 2025: alignment with SEIU (all units will be on one flat rate) ο Jan 2026: None
ο Jan 2027: 4% increase in flat-rate contributions
ο Jan 2028: 4% increase in flat-rate contributions
• Market-Based or Certification-Based Enhancements (Unit Specific)
IAFF – International Association of Fire Fighters, Local 1319 Unit Description: The International Association of Fire Fighters represents front-line fire personnel including Firefighters, Apparatus Operators, Fire Captains, and Inspection. This unit is comprised of 96 full time equivalent “FTE” and is responsible for daily fire suppression and prevention activities.
This agreement supports continuity of emergency response services and sustainable staffing enhancements creating a pathway for future Council direction around use of single role classifications and promotes long-term retention of trained public safety professionals through introduction of an education-based incentive program.
Summary of Specifics:
• Market-based Adjustments
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ο FY 2026: None
ο FY 2027: 0.75%
ο FY 2028: 0.75%
• Education Incentive
ο FY 2026: None
ο FY 2027: Tier 1: 2.5%
ο FY 2028: Tier 2: 5%
FCA – Fire Chiefs’ Association
Unit Description: The Fire Chiefs’ Association represents Fire Battalion Chiefs “BC” who oversee, manage, and supervise day to day operations of the fire department. This unit is comprised of four FTE: three shift BCs and one training BC. The City has at least one Battalion Chief on duty at all times.
This agreement ensures equity and alignment between our BC classifications and the line staff who they supervise. Considering fiscal constraints in the FY 2026 budget process, FCA and City representatives collaborated to develop cost-savings through deferred compensation without roll-up and to move the majority of market-based adjustments to later years of the agreement.
Summary of Specifics:
• Market-based Adjustments
ο FY 2026: 1.5%
ο FY 2027: None
ο FY 2028: 2%
• Deferred Compensation
ο FY 2026: Increase to $300/month (previously $220/month) ο FY 2027: Increase to $600/month
ο FY 2028: Remain at $600/month
UMPAPA – Utilities Managers and Professionals Association of Palo Alto Unit Description: Represents managers, engineers, and professionals across Utilities Operations, including Electric, Water, Gas, Wastewater, and Fiber. The unit is comprised of 54 FTE.
The agreement provides targeted adjustments for positions key to completing large-scale projects, such as grid modernization, in an effort to promote, attract, and retain staff in hard- to-fill technical and regulatory roles.
Summary of Specifics:
• 6% strategic market adjustment for Electrical Engineering positions (Principal, Manager) • 4% strategic market adjustment for WGW Engineering positions (Principal, Manager) Item 8
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• Market adjustment of 0.7% for the Administrative job family
Management and Professional Compensation Plan (Unrepresented) Group Description: The Management and Professional Compensation Plan covers managers and professionals not represented by a labor union. The group is comprised of 247.75 FTE. These employees span department directors, division managers, supervisors and analysts from all city departments.
This compensation reinforces internal equity and consistency with represented counterparts and ensures a minimum salary differential between managerial/supervisory classifications and the represented classifications they supervise.
Summary of Specifics:
• Targeted compaction-based increases to the salary range to ensure differential from supervised classifications for: Senior Technologist, Chief Transportation Official, Public Safety Communications Manager, and Manager Solid Waste. Adjustments to the range do not necessarily result in a corresponding salary increase to the incumbents in the position unless to address a current compaction issue. Any individual adjustments will be done at the discretion of the City Manager in alignment with the Management and Professional Compensation Plan.
• $500 increase in Management excess benefit (from $2,500/year to $3,000/year) • Creation of the Principal Transportation Engineer Classification to improve the management oversight of the transportation engineering work. The salary of this new position will be 7% above the Senior Engineer. The Table of Organization will be amended to add a 1.00 FTE Principal Transportation Engineer position and eliminate a
1.00 Senior Engineer position as part of the FY 2026 Budget Adoption (Staff Report # 2503-4250) also scheduled for the June 16, 2025 City Council meeting.
FISCAL/RESOURCE IMPACT
Adoption of the MOAs for IAFF, FCA, and UMPAPA and the updated Management and Professionals compensation plan will result in estimated cost increases of $14.5 million in the General Fund and $22.4 million across all funds over the three-year term, ending June 30, 2028.
The first-year contract costs are incorporated into the FY 2026 budget, scheduled for adoption on June 16, 2025 (Staff Report # 2503-4250). Costs for years two and three of the contracts were included in the General Fund long-range financial forecast and financial forecasts for the City‘s various utilities; however, final estimates may vary based on actual staffing levels, classification changes, and health plan enrollment.
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STAKEHOLDER ENGAGEMENT
All MOAs and compensation plans were ratified by the respective bargaining units and reviewed by internal stakeholders. Following Council adoption, documents will be publicly posted.
ENVIRONMENTAL REVIEW
The proposed Council action is not a project under the California Environmental Quality Act (CEQA), as it involves organizational and administrative activities. (CEQA Guidelines, Section 15378(b)(2))
ATTACHMENTS
Attachment A: MOA – IAFF Local 1319
Attachment B: MOA – FCA
Attachment C: MOA – UMPAPA
Attachment D: Management & Professional Compensation Plan Attachment E: IAFF Local 1319 Salary Schedule
Attachment F: FCA Salary Schedule
Attachment G: UMPAPA Salary Schedule
Attachment H: Management and Professional Salary Schedule
APPROVED BY:
Sandra Blanch, Human Resources Director
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1 MEMORANDUM OF AGREEMENT
Between
CITY OF PALO ALTO and
I.A.F.F. LOCAL 1319
January 30, 2023 uly 1, 2025 – June 30, 20285
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2 PREAMBLE __________________________________________________________ 7 ARTICLE I - RECOGNITION _____________________________________________ 7 Section 1. Recognition. ______________________________________________________ 7 ARTICLE II - NO DISCRIMINATION _______________________________________ 7 Section 1. No Discrimination. __________________________________________________ 7 Section 2. Free Choice. ______________________________________________________ 7 Section 3. Human Relations Committee. _________________________________________ 7 ARTICLE III - PAYROLL DEDUCTIONS ____________________________________ 7 Section 1. Payroll Deductions and Written Authorization. ____________________________ 8 Section 2. Certification of Union Membership _____________________________________ 8 Section 3. Indemnification ____________________________________________________ 8 ARTICLE IV - UNION ACTIVITIES ________________________________________ 8 Section 1. On-Duty Time. _____________________________________________________ 8 Section 2. Interoffice Mail, Bulletin Boards, and E-Mail. ______________________________ 8 Section 3. Use of Meeting Places. ______________________________________________ 9 ARTICLE V - NO STRIKES ______________________________________________ 9 Section 1. No Strikes. ________________________________________________________ 9 ARTICLE VI - PROBATIONARY PERIOD __________________________________ 9 Section 2. Part of Testing Process. _____________________________________________ 9 Section 3. Suspension or Termination. __________________________________________ 9 ARTICLE VII - SALARY PROVISIONS ____________________________________ 10 Section 1. Base Wage Rates. ________________________________________________ 10 Section 2. Out-of-Class Compensation. _________________________________________ 11 Section 3. Salary Steps _____________________________________________________ 11 Section 4. Pay for Court Appearance. __________________________________________ 12 Section 4. Classifications ____________________________________________________ 13 ARTICLE VIII - PAY DIFFERENTIALS ____________________________________ 13 f. Paramedic Differential. _________________________________________________ 14 Section 2. Emergency Medical Technician Certification. _________________________ 14 Section 3. Bilingual Pay _____________________________________________________ 14 Section 4. Special Operations Assignment (Haz Mat) _____________________________ 15 Section 5. Fire Investigator Differential. ________________________________________ 15 Section 6. Education Incentive _____________________________________________ 15 ARTICLE IX - HOLIDAYS ______________________________________________ 16 Section 1. Named Holidays. __________________________________________________ 16 Section 2. Conditions. ______________________________________________________ 17 Item 8
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3 ARTICLE X - OVERTIME COMPENSATION _______________________________ 18 Section 1. Compensation. ___________________________________________________ 18 ARTICLE XI - APPARATUS STAFFING ___________________________________ 18 ARTICLE XII - WORK ASSIGNMENTS AND TRANSFERS ____________________ 18 Section 1. Shipouts. _______________________________________________________ 19 Section 2. Vacation Relief Positions. ___________________________________________ 19 Section 3. Transfer Requests. ________________________________________________ 19 Section 4. Special Assignments. ______________________________________________ 20 Section 5. Continuous Hourly Service. __________________________________________ 20 ARTICLE XIII - TRAINING COORDINATION _______________________________ 20 Section 1.Coordination ______________________________________________________ 20 ARTICLE XIV - PROMOTION ___________________________________________ 21 Section 1. Promotion Step Level. ______________________________________________ 21 Section 2. Promotion Process Information. ______________________________________ 21 ARTICLE XV - REDUCTION IN FORCE ___________________________________ 21 Section 1. Order of Reduction. ________________________________________________ 21 ARTICLE XVI - SELECTIVE CALL BACK WITH REGARD TO RESIDENCY ______ 21 Section 1. In Case of Emergency ______________________________________________ 21 ARTICLE XVII - HEALTH BENEFITS _____________________________________ 22 Section 1. Maintenance of Levels _____________________________________________ 22 Section 2. Vision Care ______________________________________________________ 22 Section 3. PEMHCA Health Plan. _____________________________________________ 22 ARTICLE XVIII - DENTAL BENEFITS _____________________________________ 25 Section 1. Level of Benefits. __________________________________________________ 25 Section 2. Premiums. _______________________________________________________ 25 ARTICLE XIX - LIFE INSURANCE _______________________________________ 25 ARTICLE XX - RETIREMENT BENEFITS __________________________________ 26 Section 1. PERS Retirement Formula. __________________________________________ 26 Section 2. PERS Member Contribution. ________________________________________ 27 Section 3. Additional Employee PERS contributions _______________________________ 27 Section 4. Option 2 Death Benefit. _____________________________________________ 27 Section 5. Military Service Credit. _____________________________________________ 28 Section 6. 1959 Survivor Benefit. _____________________________________________ 28 Section 7. Employer Contributions to 457 Plan ___________________________________ 28 ARTICLE XXI - RETIREMENT MEDICAL PLAN_____________________________ 28 Section 1. Retiree medical coverage for Unit employees hired before January 1, 2004: ____ 28 Item 8
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4 Section 2. 20-Year Vesting for Retiree Medical Coverage for Unit Employees Hired On Or After January 1, 2004: ____________________________________________________ 28 ARTICLE XXII - DEPENDENT CARE ASSISTANCE PROGRAM (DCAP) ________ 29 Section 1. DCAP. __________________________________________________________ 29 ARTICLE XXIII - VACATION ACCRUAL __________________________________ 29 Section 1. Accrual Rate. _____________________________________________________ 29 Section 2. Unused At Termination. _____________________________________________ 30 Section 3. Limits. __________________________________________________________ 30 ARTICLE XXIV - USE OF VACATION ____________________________________ 30 Section 1. Maximum Number of Slots __________________________________________ 30 Section 2. Approvals. _______________________________________________________ 30 Section 3. Vacation Pay. ____________________________________________________ 30 Section 4. Illness on Vacation. ________________________________________________ 30 Section 5. When to be Taken. ________________________________________________ 30 Section 6. Limitation on Use. _________________________________________________ 31 Section 7. Waiting Period. ___________________________________________________ 31 Section 8. Double Compensation Prohibited. _____________________________________ 31 Section 9. Cash out Option. __________________________________________________ 31 ARTICLE XXV - SICK LEAVE ___________________________________________ 31 Section 1. Statement of Policy. _______________________________________________ 31 Section 2. Eligibility ________________________________________________________ 31 Section 3. Accrual. _________________________________________________________ 31 Section 4. Accumulation. ____________________________________________________ 31 Section 5. Use. ____________________________________________________________ 31 Section 6. Depletion of Sick Leave Benefits. _____________________________________ 32 Section 7. Forfeiture Upon Termination. ________________________________________ 32 Section 8. Payment for Accumulated Sick Leave. _________________________________ 32 Section 9. Personal Business Leave Chargeable to Sick Leave. ______________________ 32 Section 10. Return to Work or Continue Work With Limited Duty. _____________________ 33 ARTICLE XXVI - SUBPOENAS __________________________________________ 33 ARTICLE XXVII - WORKERS' COMPENSATION ____________________________ 33 Section 1. Status Reporting While on Disability. __________________________________ 33 ARTICLE XXVIII - PHYSICAL FITNESS MEDICAL EXAMINATIONS ____________ 33 ARTICLE XXIX- LEAVES OF ABSENCE WITHOUT PAY _____________________ 33 Section 1. Disability. ________________________________________________________ 33 Section 2. Other Leaves. ____________________________________________________ 34 Item 8
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5 Section 3. Accrued Vacation Credits. ___________________________________________ 34 Section 4. Approval of Department Head ________________________________________ 34 Section 5. Approval by City Manager. __________________________________________ 34 Section 6. Absence Without Leave. ____________________________________________ 34 Section 7. Leave of Absence; Death Outside the Immediate Family. __________________ 34 Section 8. Military Leave of Absence ___________________________________________ 34 Section 9. Use of paid accruals while on leave. ___________________________________ 34 ARTICLE XXX - LEAVES OF ABSENCE WITH PAY _________________________ 34 Section 1. City Manager Granted Leaves. _______________________________________ 34 Section 2. Council Granted Leave. _____________________________________________ 34 Section 3. Employee's Time Off to Vote. ________________________________________ 35 Section 4. Leaves of Absence; Death in Immediate Family. _________________________ 35 Section 5. Jury Duty; Leave of Absence. ________________________________________ 35 ARTICLE XXXI – VOLUNTEER LEAVE PROGRAM _________________________ 35 ARTICLE XXXII- TUITION REIMBURSEMENT _____________________________ 37 Section 1. Options. _________________________________________________________ 37 ARTICLE XXXIII - PER DIEM TRAVEL EXPENSES__________________________ 37 Section 1. City Business. ____________________________________________________ 37 ARTICLE XXXIV - HOUSE FUND ITEMS __________________________________ 37 Section 1. Station House Fund. _______________________________________________ 37 Section 2. Non-Food House Items _____________________________________________ 37 ARTICLE XXXV- PARKING ____________________________________________ 37 Section 1. Entitlements. _____________________________________________________ 37 ARTICLE XXXVI- GRIEVANCES ________________________________________ 37 Step II ___________________________________________________________________ 38 Step III __________________________________________________________________ 38 Step IV __________________________________________________________________ 39 ARTICLE XXXVII- SAFETY COMMITTEE _________________________________ 40 Section 1. Committee _______________________________________________________ 40 ARTICLE XXXVIII – MISCELLANEOUS ___________________________________ 40 Section 1. Section 1. Uniforms. _______________________________________________ 40 Section 2. Removal of Disciplinary Actions. ______________________________________ 40 ARTICLE XXXIX - FULL UNDERSTANDING _______________________________ 40 Section 1. Full and Entire Understanding ________________________________________ 40 Section 2. Fair Labor Standards Act. ___________________________________________ 41 Section 3. Severability. ______________________________________________________ 41 Item 8
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6 Section 4. Good Faith. ______________________________________________________ 41 Section 5. Merit System Rules and Regulations. __________________________________ 41 Section 6. Station Consolidation or Relocation ___________________________________ 41 Section 7. Meet and Confer. __________________________________________________ 41 ARTICLE XL – 48/96 Work Schedule ____________________________________ 41 ARTICLE XLI – FUTURE SERVICE DELIVERY MODELS _____________________ 41 ARTICLE XLII - DURATION ____________________________________________ 41
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7 MEMORANDUM OF AGREEMENT
CITY OF PAL0 ALTO and I.A.F.F. LOCAL 1319
January 30, 2023 - June 30, 2025
PREAMBLE
This Memorandum of Agreement between the City of Palo Alto, hereinafter referred to as the "City", and Local 1319, International Association of Fire Fighters, hereinafter referred as the "Union", has been prepared and entered into in accordance with Title I, Division 4, Chap ter 10, Sections 3500- 3510 of the California Government Code and Chapter 12 of the City of Palo Alto Merit System Rules and Regulations.
ARTICLE I - RECOGNITION
Section 1. Recognition. The City recognizes the Union as the exclusive representative of an employee group consisting solely of the classifications of Fire Apparatus Operator, Fire Fighter, Fire Captain, Fire Captain (forty -hour assignment), Fire Inspector Sworn and Non- Sworn, Hazardous Materials Specialist , and Hazmat Inspector, who are regularly employed by the City and others as amended into the representation unit from time to time under existing law and the Merit System Rules and Regulations.
ARTICLE II - NO DISCRIMINATION
Section 1. No Discrimination. The Union and the City hereby agree that there shall be no discrimination because of race, color, age, disability, sex, national origin, sexual orientation, political or religious affiliation under this Agreement. There shall be no discrimination in emplo yment conditions or treatment of employees on the basis of membership or non-membership in the Union, or participation in the lawful activities of the Union.
Section 2. Free Choice. The Union and the City hereby agree to protect the rights of all employees to exercise their free choice to join the Union and to abide by the express provisions of applicable State and local laws.
Section 3. Human Relations Committee. A Human Relations Committee will include up to five members appointed by the Union executive board and at least two members of management with representation from the Fire and Human Resources Departments.
The committee may make recommendations to management regarding recruitment outreach, equal employment opportunity and career development programs.
ARTICLE III - PAYROLL DEDUCTIONS
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8 Section 1. Payroll Deductions and Written Authorization. The City shall deduct Union membership dues assessments and insurances authorized by the Union. This will be accomplished by payroll deduction from the bi -weekly pay of member employees.
The dues deduction must be authorized in writing by the employee on a Union authorization card.
The Union will be the custodian of records for individual employee membership and dues deduction forms. The Union will maintain authorizations for dues deduction, signed by the individual from whose salary or wages the deduction or reduction is to be made. The City will direct employee requests to cancel or change deductions to the Union.
The City shall remit the deducted dues to the Union as soon as possible after deduction.
Section 2. Certification of Union Membership. The Union agrees to provide the City an initial certified list of members and statement that the Union has and will maintain written authorizations signed by the individuals from whose w ages the Union dues deductions are to be made. From that point forward the Union will update the list whenever there are changes.
Section 3. Indemnification. The Union shall indemnify and hold the City harmless against any liability arising from any claims, demands, or other action relating to this article. The Union shall comply with all statutory and legal requirements with respect to this article.
ARTICLE IV - UNION ACTIVITIES
Section 1. On-Duty Time. Local 1319 officers may use a reasonable amount of on- duty time to attend to Union business specifically related to representation of employees so long as:
a. Staffing is available
b. Operations are not interrupted
c. Advance approval is obtained from the Battalion Chief or Operations Chief
Section 2. Interoffice Mail, Bulletin Boards, and E-Mail. The Union shall have access to interoffice mail and existing bulletin boards in unit employee work areas for the purpose of posting, transmitting, or distributing notice or announcements including notices of social events, recreational events, Union membership meetings, result of elections and reports of minutes of Union meetings. Any other material must have prior approval of the Operations Chief or Fire Chief. Action on approval will be taken within 24 hours of submission.
The Union may send e- mail messages only for the purposes set forth above. The I.T.
Division will maintain the IAFF list. The Union access to e-mail is based on the following conditions:
a. E-Mails to the IAFF list will be copied to the Fire Chief or Operations Chief at distribution.
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9 b. E-Mails to the IAFF list will only be sent by the Executive Board Members.
Section 3. Use of Meeting Places. The Union shall have the right to reserve City meeting and conference rooms for use during non- working hours or as subject to Battalion Chief approval. Such meeting places will be made available in conformity with City regulations and subject to the limitations of prior commitment.
ARTICLE V - NO STRIKES
Section 1. No Strikes. The Union, its representatives, or members, shall not engage in or cause, instigate, encourage, sanction, or condone a strike, withholding of services, leave of absence abuse, work stoppage or work slowdown of any kind against the City of Palo Alto or its citizens by employees covered under this Agreement. No employee shall refuse to cross any picket line in the conduct of Fire Department business, nor shall the Union, its representatives or members discriminate in any way toward any one who refuses to participate in a strike, or any of the job actions cited above.
ARTICLE VI - PROBATIONARY PERIOD
Section 1. Tentative and Subject to Probationary Period. All original appointments to regular or part -time municipal service positions shall be tentative and subject to a probationary period. TWith the exception of the Fir e Inspector (Non-Sworn) classification, this probationary period shall include the fire training academ ies and an additional fourteen (14) to sixteen ( 16) months after completion of the academ ies (including in-house academy), excluding time off for extended leaves of absence. The probationary period will end at the sooner of 16 months or the completion of all probationary testing, inclusive of driver II certification.
All original appointments to Fire Inspector ( Sworn or Non -Sworn) classifications shall serve a twelve (12) month probationary period, commencing with the first day of employment in the classification. Promotion from a non-sworn to a sworn position will be subject to the applicable Probationary Period.
Section 2. Part of Testing Process. The probationary period shall be regarded as part of the testing process and shall be utilized for closely observing all aspects of the employee's qualifications, for ensuring the effective adjustment of a new employee to the position and for rejecting any probationary employee who, in the opinion of management, is not suitable to attain permanent status.
Section 3. Suspension or Termination. During the probationary period a new employee may be suspended or terminated at any time by the appointing authority without cause and without right of appeal or to submit a grievance. Said employee shall not have the right to proceed to arbitration on the issue of arbitrability or on the issue of its constitutional or discovery rights, nor those of any employee by reason of the Item 8
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10 foregoing. The Union shall not be a party to any lawsuit relating to the termination of a probationary employee.
ARTICLE VII - SALARY PROVISIONS
Section 1. Base Wage Rates.
a. The base wage rates of bargaining unit classifications will be as set forth in Appendix A of this MOA.
b. General Salary Increase
Effective the first full pay period following July 1, 2025, the salary ranges of all represented classifications will be increased by three percent (3%).
Effective the first full pay period following July 1, 2026, the salary ranges of all represented classifications will be increased by three half percent (3%)
Effective the first full pay period following July 1, 2027, the salary ranges of all represented classifications will be increased by three percent (3%).
c. Market Increase:
Effective the first full pay period following July 1, 2026, the salary ranges of all represented classifications will be increased by three-fourths of one percent (0.75%).
Effective the first full pay period following July 1, 2027, the salary ranges of all represented classifications will be increased by three -fourths of one percent (0.75%).
Market Increase: Effective the first full pay period including the adoption of the MOA, the salary ranges of all represented classifications will receive a market adjustment of five percent (5.0%).Addition of Salary Step: Effective the first full pay period including adoption of this MOA by City Council, the City will implement a new step 6 (5% above Step 5) following the same percentage difference as steps 1-5. Any employee who is already at Step 5 on the date the City Council adopts the MOA will move to Step 6 effective the first full pay period following City Council adoption of the MOA. Any employee in the Firefighter classification who is already at Step 4 on the date the City Council adopts the MOA whichever is later will move to Step 5 effective the first full pay period following City Council adoption of the MOA. The employees moved to Step 5 pursuant to this paragraph will move to Step 6 upon one year of service at Step 5 so long as they receive a satisfactory Item 8
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11 performance evaluation.
General Salary Increase: Effective the first full pay period following July 1, 2023, the salary ranges of all represented classifications will be increased by four percent (4.0%).General Salary Increase: Effective the first full pay period following July 1, 2024, the salary ranges of all represented classifications will be increased by four percent (4.0%).Market Adjustment Part 2: Effective the first full pay period following January 1, 2025, the salary ranges of all represented classifications will receive a market adjustment of two percent (2.0%).
Total Compensation and Survey Database
Management and the Union have agreed to a compensation survey database structure. Survey Cities include: Alameda, Berkeley, Fremont, Hayward, Menlo Park Fire District, Milpitas, Mountain View, Redwood City, Pleasanton, San Jose, San Mateo, San Ramon Fire District, Santa Clara, Santa Clara County and South San Francisco. Compensation Criteria includes: top step salary, maximum longevity, maximum education, uniform allowance, EMT differential, Hazmat differential, deferred compensation, employee pick up of employer pension costs (Negative EPMC), and maximum City paid benefits (medical, dental, vision, life insurance, LTD, and EAP).
The database is intended to provide one source of information concerning how the compensation paid to employees in bargaining unit job classifications compares to that paid by other employers.
Section 2. Out -of-Class Compensation. All represented employees who are assigned work in a higher classification for longer than four (4) continuous hours will be compensated at a higher pay rate for all hours worked during the out -of-class assignment. This provision applies as follows:
Fire Fighter, Apparatus Operator, Captain or Inspector working in a higher classification: Step to step. Representation unit classification working as a Battalion Chief, 10% above 6th-Step Captain, but not to exceed 93% ofof the salary range of the Battalion Chief control point . Representation unit classification working in any other management position, within the range of the management position.
In accordance with Government Code 20480, an employee assigned to work in an “out- of-class appointment” may not exceed 960 hours worked in the appointment within a fiscal year if the employee is appointed to an upgraded position or higher classification that is vacant during recruitment for a permanent appointment. This limitation does not apply to a position that is temporarily available due to a leave of absence.
Section 3. Salary Steps
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12 Employees in the Firefighter Rank initially appointed to the first step of the salary range of their classification shall be entitled to a merit increase to step two in the pay range upon successful completion of six (6) months of service, so long as they receive a satisfactory performance evaluation. The date of such increase shall be the first full pay period following the evaluation date.
Employees may be appointed to any step in the salary schedule for their classification as recommended by the Fire Chief and approved by the City Manager.
Employees appointed to the second step and above are eligible to receive a merit increase the first full pay period following successful completion of twelve (12) months of actual service, so long as they receive a satisfactory performance evaluation.
Employees in the Fire Inspector (Non-Sworn) classification shall be entitled to a step increase in the pay range upon successful completion of twelve (12) months of service, so long as they receive a satisfactory performance evaluation. The date of such increase shall be the first full pay period following the evaluation date.
Each twelve (12) months of actual service after the evaluation date, each employee receiving a satisfactory performance evaluation shall receive a merit step increase to the next higher step (effective the first full pay period following the evaluation date) until the top step of the pay range for the job class has been reached. An employee shall not receive a merit increase beyond the maximum steps established for the job classification.
Section 4. Pay for Court Appearance. Sworn Fire personnel appearing in court for the People shall be compensated as follows:
Period Rate Minimum
a. Appearance on scheduled day
off
Time and one-half at
40-hour rate
4 hours
b. Any or all court time
during scheduled shift
Straight time during
shift at 56-hour rate
None
c. Appearance on scheduled Time and one-half at 2 hours work day but not during
scheduled shift
40-hour rate (2 hour minimum, may
not run into shift time)
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13 days from the termination of his/her services. Compensation for mileage or subsistence allowance shall not be considered as a fee and shall be retained by the employee.
Section 4. Classifications. The sworn Haz Mat Inspector and positionsworn Fire Inspector classification will be paid at the same level as the Fire Inspector (603Fourt - hour Fire Captain).
One Fire Captain position will be assigned to a Fire Captain (Forty -hour Assignment) with the pay set at 5% above the Fire Captain.
ARTICLE VIII - PAY DIFFERENTIALS
Sworn Unit employees are eligible for the following pay differentials. Notwithstanding any provision of this agreement, eligible employees can receive up to two differentials in addition to the EMT and Paramedic Certification pay. total differential pay shall not exceed seventeen and a half percent (17.5%). Non-Sworn Fire Inspectors will not be eligible for the listed pay differentials.
Section 1. Paramedic Assignment
a. Section 1. Limit of Eligibility. The City reserves the right to limit eligibility for the Paramedic Program to the Fire Fighter classification. The City may, at its discretion, add other classifications within the represented bargaining unit to meet the need of program changes. Differen tials for other classifications will be as provided in Article VIII, Section 1this Article.
b. Section 2. Additional Candidate Training. As the Program progresses, Management will assess the need for training additional Paramedic candidates.
It is Management's intention to provide for such additional training as necessary for Program continuity.
c. Section 3. Incentives. Paramedics will receive a one-time cash payment of $500 for each biennial recertification. This provision applies only to active incumbents of authorized paramedic positions who remain in the paramedic assignment for at least one additional year after rec ertification. The one year requirement after recertification does not apply to those paramedics who may leave the program Item 8
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14 because of work- related injury or illness, or promotion, nor does it apply when a paramedic is asked by management to recertify in order to voluntarily extend their paramedic service to meet special departmental needs for a period of less than one year.
d. Section 4. Proctoring. Paramedic proctoring assignments will be made by the Chief from among qualified volunteers. Payment of $600 will be made to the primary proctoring paramedic at the conclusion of each proctoring assignment.
The Chief or his or hertheir designee will maintain a list of qualified proctors from among volunteers. Personnel will be selected by the Fire Chief or his or her designee from the list to serve as paramedic proctors. If a conflict arises between the City and the Union regarding the Proctor Program, either side may suspend the program at the annual renewal period and shall remain suspended until a resolution or agreement is reached.
e. Section 5. Field Training Stipend. Employees assigned to provide field training for new paramedic accreditation will receive a $300 stipend to train a new paramedic or EMT to successful completion of paramedic accreditation. This assignment is at the discretion of the Chief or their designee.
e.f. Paramedic Differential.
Paramedics who have completed the required training and have been accredited in accordance with the program and possess their paramedic license, will receive a 14% differential in addition to their base salary effective beginning with the date of assignment to rotational Paramedic duty. The Paramedic salary differential will terminate with the cessation of assignment to rotational Paramedic duty. The base salary for Captain classification (including Hazmat Inspector and Fire Inspector) base salary will be increased 1% in alignment with this differential increase..
Section 24. Emergency Medical Technician DifferentialCertification.
The former 3% EMT differential pay was rolled into base pay constituting the City’s incentive payment for EMT skills. All employees hired into sworn positions must maintain a current EMT certification as a condition of employment. Employees, including Paramedics, shall receive a three percent (3%) differential in addition to their base salary for the EMT certification. The EMT differential will be provided the first pay period following graduation from an entry level academy or on date of hire where an academy is not required. In the event an employee’s EMT certification expires, the employee will be taken off the line and placed in an unpaid status until the employee can submit proof of EMT recertification.
Section 3. Bilingual Pay
Employees who have successfully demonstrated proficiency in any of the approved Item 8
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15 languages shall receive a 5% premium in addition to their base salary.
a. Approved Languages:
Spanish, Chinese (Mandarin and Cantonese), Japanese, Tagalog, Korean, Vietnamese, Russian, American Sign Language, and such other languages as determined by management.
b. Proficiency Requirements
The City shall develop and provide a method of testing for proficiency in the above listed languages. The City will pay for the first test in any approved language however subsequent testing will be at the employee’s own expense. An employee must pass the proficiency test to maintain the bilingual pay. The Fire Chief shall have the authority to require employees receiving bilingual pay to re-certify with the Human Resources Department as necessary and reasonable.
c. Arbitratability
The City’s substantive evaluation of an employee’s knowledge of and skills in a designated second language shall not be subject to the grievance procedure or review by an arbitrator.
Section 4. Special Operations Differential Assignment (formerly Haz Mat) A maximum of eighteen positions who are both members of the Special Operations group and assigned the Special Operations , inclusive of Technical Rescue and Hazardous Materials certified personnel, team will receive a 5% differential in addition to their base salary. The differential does not apply to minimum staffing replacements.
Section 5. Fire Investigator Differential.
A maximum of five six (65) Fire inspector personnel including Haz Mat Inspectors who have been trained as Fire investigators and who are regularly assigned to fire investigation duties by the Chief will receive a 5% differential in addition to their base salary. The Chief reserves the right to determine who is regularly assigned to such duties.
Section 6. Education Incentive
Employees who have successfully achieved the education and training required for the Career Development program will receive either:
Tier 1: 2.5% differential in addition to base salary
OR
Tier 2: 5% differential in addition to base salary
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16 a. Tier 1: An employee shall be eligible for Tier 1 incentive upon completion of 300 hours of Fire Chief approved job-related coursework.
1. Tier 1 will begin the first full pay period including July 1, 2026.
2. Employees must successfully pass probation in order to become eligible. b. Tier 2: An employee shall be eligible for tier 2 incentive upon completion of 600 hours of Fire Chief approved job-related coursework.
1. Tier 2 will begin the first full pay period including July 1, 2027.
2. Employees must successfully obtain step 4 of the salary schedule in order to become eligible.
c. Conditions of Job-related coursework
1. An Associate’s degree from an accredited college or university in public safety field shall count toward 150 hours of job related coursework. A Bachelor’s degree or higher accredited college or university shall count toward 300 hours of job related coursework.
2. Job related coursework completed to hold EMT or Paramedic licensure in this Article will not be eligible to count toward Tier 1 or Tier 2 required job- related coursework.
3. On duty City provided job-related classes will not be eligible.
4. Under no circumstances may duplicative coursework be submitted. d. All education and training completed under this Program must be actively utilized in the course of the employee’s assigned duties.
e. A minimum of 32 hours of Fire Chief approved job-related coursework is required every other calendar year in order to maintain the education incentive. f. The employee is responsible for submitting appropriate official transcripts, certificates, and proof of course completion demonstrating completion of all qualifying components. No incentive shall be granted without verified documentation.
g. Incentive pay shall begin the first full pay period after approval by the Fire Chief or designee of require documentation.
h. The Fire Chief or designee, shall make final determinations regarding course approval, applicability of training, and eligibility for incentive payment. A joint labor-management committee shall meet as needed to discuss the program.
ARTICLE IX - HOLIDAYS
Section 1. Named Holidays.
Holiday pay is compensation for employees who are normally required to work on an approved holiday because they work in positions that require scheduling staff without regard to holidays. The following holidays are recognized as municipal holidays for pay purposes, and regular, employees shall have these days off with pay, except as otherwise provided in these rules:
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17 January 1 Veterans’ Day, November 11
Third Monday in January Thanksgiving Day
Third Monday in February Day after Thanksgiving Day
Last Monday in May December 25
July 4th Either December 24, or December 31 as provided below First Monday in September
Second Monday in October
Floating Holiday: In addition to the paid holidays listed above, employees shall be excused with pay for one full work shift as a day of reflection (floating holiday) per calendar year. Eligible employees may use the floating holiday on any day mutually agreed by the employee and their supervisor for a Day of Reflection, including:
Juneteenth Freedom Day (June 19) or Cesar Chavez/Dolores Huerta Day (March 31).
Day of Reflection not used by the end of the fiscal year will be deemed forfeited and have no cash value.
161.5 hours are paid annually to an employee at a rate of 6.21 hours each pay period. Shift personnel shall receive pay in lieu of taking paid leave for accrued holidays. Such paid hours are in addition to the normal biweekly base pay. Shift personnel will be paid 6.21 hours of in lieu of holiday pay each pay period. Hours are prorated and accrued based on hours actually worked.
Accrued Holiday balances will be automatically paid off in the months of June and December.
Section 2. Conditions.
a. Personnel assigned to a 40- hour work schedule will receive paid holidays in accordance with Sections 517 and 518 of the Merit System Rules and Regulations.
b. Personnel assigned to a 40-hour work schedule will receive floating days off with pay in each of the following months: August, September, March, April, and June.
The following conditions will hold:
(1) Management will designate the schedule of the paid day off under this section at least thirty days in advance.
(2) If, in conformance with this section, Management is unable to schedule a day off in the month indicated for reasons of shift operations, work scheduling or any other reason, the day will be added to the employee's Item 8
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18 vacation accrual.
(3) If an employee fails to take a day off as scheduled by Management under this section, the day off so scheduled will be forfeited.
ARTICLE X - OVERTIME COMPENSATION
Section 1. Compensation. Shift personnel assigned to overtime relief duty in addition to their regular 56-hour shift schedule shall receive overtime compensation at a rate of one and one -half times the employee's basic 56- hour rate, or out -of-class rate if such applies, for all hours of the relief duty shift. Required off-duty training, excluding remedial training, will be compensated at the rate of one and one- half times the basic 40- hour rate or as otherwise agreed. If an opportunity was provided to allow for the required training to be on duty, but the employee was unable to attend, the training scheduled for off duty will not be eligible for the 40-hour rate. Emergency callback will be compensated at a rate of one and one- half times the basic 40-hour rate to a maximum of 8 hours, and at a rate of one and one-half times the basic 56-hour rate for those hours in excess of 8 hours.
Overtime duty assignments will first be made from the voluntary overtime list. If such assignments cannot be filled from the voluntary overtime list, the vacant position will be filled by moving up on- shift personnel through out -of class assignment. Any re maining vacancy will then be filled by overtime duty assignment made in reverse order of hire date seniority according to specialty and qualifications required to be assigned. The overtime duty assignment seniority list will be adjusted annually on October 31.
ARTICLE XI - APPARATUS STAFFING
Engine, truck and combination rescue companies shall be deployed for emergency services purposes at the level of one Fire Captain, one Fire Apparatus Operator and one Fire Fighter. Truck companies have the option of deploying at the level of two Fire Apparatus Operators instead of one Fire Apparatus Operator and one Firefighter. This option shall be determined by seniority. Paramedic ambulance staffing shall be two personnel; the City will dispatch personnel on Emergency Medical Service calls such that a mi nimum of 1 licensed paramedic responds. The Foothill Fire Station #8, when activated by the Fire Chief, shall be staffed with a minimum of one Fire Apparatus Operator and one Fire Fighter. City may dispatch a two-person apparatus (ex: squad or quick response vehicle) with a minimum of 1 paramedic.
ARTICLE XII - WORK ASSIGNMENTS AND TRANSFERS
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19 Department will maintain a constant state of readiness to defend against fire and other disasters. It is therefore imperative that all Fire Department divisions assign personnel in the best manner to respond to the needs of the City and the Department. It is also acknowledged that the Fire Chief is responsible to make and/or approve the work assignments or transfers of Fire Department personnel.
The Fire Chief or designee will maintain a three year station and shift assignment, seniority-based bid system covering the following classifications within Fire Operations on a rotational basis: Fire Captain, Apparatus Operator and Fire Fighter.
The Fire Chief, or his designee, shall initiate personnel assignments and transfers to balance platoon or division strength, fill permanent or temporary vacancies and provide required training to individual personnel. Such assignments will be based on seni ority, except where career development, training, special assignments, skills and documented performance issues are specifically identified in writing, management may make assignments based on such issues. For purposes of this article, seniority shall be computed from the date of entry into the current classification.
Section 1. Shipouts. When possible, least senior Fire Fighters will be given short term or shipout relief duty. In order to maintain training continuity, shipouts of probationary personnel will be subject to the approval of the Fire Chief or their designee.
Section 2. Vacation Relief Positions. In order that platoon strengths can be balanced more quickly and to reduce the need for excess overtime, two positions will be designated for vacation relief. These positions will be the lowest two on the Department seniority list who have completed their probationary period.
a. The vacation relief persons will be assigned to one station when not on relief assignment.
b. Relief assignment can be made to any Station or shift where a shortage of personnel will cause unnecessary overtime.
c. Shortages may be caused by vacation, sick leave, disability or any leave of absence that causes a shift to be short of personnel while another has a surplus.
d. Shift transfers will be made so as not to cause the relief person to work more than the prescribed number of hours in the prescribed period.
e. Relief assignments will be made and hours will be coordinated by the Battalion Chief's office.
Section 3. Transfer Requests. Non-probationary fire personnel may submit transfer requests to their immediate supervisor to be forwarded to the appropriate chief officer.
Providing that Departmental needs are satisfied, such transfers will be administered using first a mutually agreeable exchange, secondly seniority.
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20 The transfer requests shall remain on file during the year and may be granted when a vacancy occurs, providing the requesting employee possesses the experience and performance ability required to fill the vacancy.
Section 4. Special Assignments. Management reserves the right to assign personnel to career development opportunities, special projects, seminars, programs and selected educational and/or training courses, based on Fire Department needs and the performance of the employee.
Section 5. Continuous Hourly Service. Continuous hours of service in excess of 96 hours are subject to approval by the Fire Chief or designee. Approval may be granted up to 120 hours when an employee has not been engaged in a greater than usual level of activity or is not fatigued.
ARTICLE XIII - TRAINING COORDINATION
Section 1.Coordination. Three shift employees per platoon may be assigned to assist the Training Officer in the coordination, preparation and scheduling of the training program. It is agreed that volunteers will first be sought for such assignment, and further agreed that the details of this section shall be established by mutual agreement between the Fire Chief and the Union.
ARTICLE XIV - PARAMEDIC ASSIGNMENT
Section 1. Limit of Eligibility. The City reserves the right to limit eligibility for the Paramedic Program to the Fire Fighter classification. The City may, at its discretion, add other classifications within the represented bargaining unit to meet the need of program changes. Differentials for other classifications will be as provided in Article VIII, Section
1. Section 2. Additional Candidate Training. As the Program progresses, Management will assess the need for training additional Paramedic candidates. It is Management's intention to provide for such additional training as necessary for Program continuity.
Section 3. Incentives. Paramedics will receive a one- time cash payment of $500 for each biennial recertification. This provision applies only to active incumbents of authorized paramedic positions who remain in the paramedic assignment for at least one additional year after recertification. The one year requirement after recertification does not apply to those paramedics who may leave the program because of work - related injury or illness , or promotion, nor does it apply when a paramedic is asked by management to recertify in order to voluntarily extend their paramedic service to meet Item 8
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21 special departmental needs for a period of less than one year.
Section 4. Proctoring. Paramedic proctoring assignments will be made by the Chief from among qualified volunteers. Payment of $600 will be made to the primary proctoring paramedic at the conclusion of each proctoring assignment.
The Chief or his or her designee will maintain a list of qualified proctors from among volunteers. Personnel will be selected by the Fire Chief or his or her designee from the list to serve as paramedic proctors. If a conflict arises between the City and t he Union regarding the Proctor Program, either side may suspend the program at the annual renewal period and shall remain suspended until a resolution or agreement is reached.
Section 5. Field Training Stipend. Employees assigned to provide field training for new paramedic accreditation will receive a $300 stipend to train a new paramedic or EMT to successful completion of paramedic accreditation. This assignment is at the discretion of the Chief or their designee.
ARTICLE XIV - PROMOTION
Section 1. Promotion Step Level. All regular promotions from classifications within the representation unit to the classification of Fire Captain will be made at the sixth step on the salary range.
Section 2. Promotion Process Information. For promotions to positions within the representation unit, promotion process information will be available in the Human Resources Department office at the time of posting. Information will include applications, minimum qualifications, study material reference information, if appropriate, and information on passing scores. Any changes in an established testing process must be submitted in writing to the Union for review and input no fewer than 60 days prior to the beginning of the process.
ARTICLE XVI - REDUCTION IN FORCE
Section 1. Order of Reduction. If the work force is reduced (reduction in force) within a represented classification, unit employees having the shortest length of service with the Fire Department will be laid off first so long as employees retained are fully qualified, trained and capable of performing remaining work.
ARTICLE XVII - SELECTIVE CALL BACK WITH REGARD TO RESIDENCY
Section 1. In Case of Emergency Management may use selective call back with regard to residency in cases of emergency.
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22 ARTICLE XVIII - HEALTH BENEFITS
Section 1. Maintenance of Levels Except as otherwise set forth herein, the City will maintain the present level of benefits on all City-sponsored medical programs.
Section 2. Vision Care
a) Level of Benefits: The City offers vision care coverage for employees and dependents.The City provides a base vision plan for all eligible employees and dependents. Additionally, eligible employees will have the option to enroll in a vision “buy-up” plan. Coverage is equivalent to $20 Deductible Plan A under the Vision Service Plan, with monthly premiums paid by the employer. Dependents include domestic partners, as defined under Article XX Section 3(b). a)b) Premiums: The City shall pay all premium payments on behalf of employees and dependents who are eligible and enrolled in coverage under the base vision plan. Employees will be responsible for premium payments required to enroll in the “buy up” vision plan.
Section 3. PEMHCA Health Plan.
a. ACTIVE EMPLOYEES: During the term of this contract, 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:
Effective July 1, 2025, the City will increase its maximum contribution to the following:
Medical Category Premium Total Maximum City Contribution (inclusive of PEMHCA contribution*)
effective July 1, 2025
Employee Only
Employee plus one
Employee Family
$943.00
$1,885.00
$2,444.00
Effective January 1, 2027, the City will increase its maximum contribution to medical premiums by the following percentages:
• Employee only: 2%
• Employee plus one: 3%
• Employee family: 5%
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23 Medical Category Premium Total Maximum City Contribution (inclusive of PEMHCA contribution*)
effective January 1, 2027
Employee Only
Employee plus one
Employee Family
$962.00
$1,942.00
$2,566.00
Effective January 1, 2028, the City will increase its maximum contribution to medical premiums by four percent (4%).
Medical Category Premium Total Maximum City Contribution (inclusive of PEMHCA contribution*)
effective January 1, 2028
Employee Only
Employee plus one
Employee Family
$1,000.00
$2,020.00
$2,669.00
The City’s total maximum contribution towards medical premiums for eligible part time employees shall be prorated based on the number of hours per week the part-time employee is assigned to work.
* Any increases to the PEMHCA minimum during the term of this contract will result in a corresponding decrease to the amount of the additional City contribution, so that the total maximum City contribution never exceeds the Total Maximum City Contribution described above.
If the State of California or federal government requires the City to participate and contribute toward coverage under any medical plan outside of PEMHCA including but not limited to the Affordable Care Act, the City’s total liability for enrolled employees and retirees and their eligible family members shall not exceed what the City would have paid toward PEMHCA coverage in the absence of such state or federal plan. The parties will meet and confer over the impact of such change on matters within the scope of representation before implementing any change.
b. Flexible Compensation:
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24 2023, in lieu of additional increases to the City’s medical premiums, hourly wages for all bargaining unit classifications will werebe increased by $100 per month ($1200 per year). Employees can utilize this cash payment for any purpose, including to cover health insurance premiums or contribute to flexible spending accounts/457 deferred compensation plans. Effective the first full pay period of January 2024, hourly wages for all bargaining unit classifications will were be increased by an additional $100 per month.
c. Active employee domestic partners whose domestic partnership is registered with the State of California may add their domestic partner as a dependent to their elected health plan coverage if the domestic partner is registered with the Secretary of State.
Active employee domestic partners whose domestic partnership is not registered with the State but who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department, will be eligible for reimbursement of the actual monthly premium cost of an individual health plan, not to exceed 90% of the average monthly premium cost of individual coverage under the PEMHCA health plans in 2016. Effective with the first pay period including Januar y 1, 2017, a stipend of two hundred eighty four ($284) per month toward the cost of an individual health plan will be provided. Evidence of premium payment will be required with request for reimbursement.
d. Alternate Medical Benefit Program.
If a regular employee and/or the employee’s dependent(s) are eligible for and elect to receive medical insurance through any non- City of Palo Alto sponsored or association medical plan, the employee may choose to waive his/her right to the City of Palo Alto’s medical insurance coverage and receive cash payments in the amount of two hundred and eighty four dollars ($284) for each month City coverage is waived.
Examples of waivers eligible for this payment are:
• Employee waives all applicable City medical coverage; or • Employee is eligible to enroll his or her spouse or domestic partner and waives medical coverage for the spouse or domestic partner; or • Employee has additional eligible dependents and waives family-level medical coverage.
Participation must result in a health insurance cost savings to the City and payments per employee shall not exceed a total of two hundred eighty four dollars ($284) per month. To participate in the program the employee and dependents must be eligible for coverage under PEMHCA medical plans, complete a waiver of medical coverage form, and provide proof of eligible alternative medical coverage.
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25 Payments will be made in the employee’s paycheck beginning the first month following the employee’s completion of the waiver form. Payments are subject to state and federal taxes and are not considered earnings under PERS law.
Employees are responsible for notifying the City of any change in status affecting eligibility for this program (for example, life changes affecting dependent’s eligibility for medical coverage through the employee) and will be responsible for repayment of amounts paid by the City contrary to the terms of this program due to the employee’s failure to notify the City of a change in status.
e. Dual Coverage.
When a City employee is married to another City employee each shall be covered only once (as an individual or as a spouse of the other City employee, but not both) and dependent children, if any, shall be covered only by one spouse.
ARTICLE XVIIIIX - DENTAL BENEFITS
Section 1. Level of Benefits. The City will maintain the present level of benefits on the City- sponsored dental program. The City provides a base dental plan for all eligible employees and dependents. Additionally, eligible employees will have the option to enroll in a dental “buy-up” plan.
Maximum benefits per calendar year shall be $2,000.
Section 2. Premiums. The City shall pay all premium payments or equivalent self - insured program charges on behalf of employees and dependents who are eligible and enrolled for coverage under the existing base dental plan. Dependents will include domestic partners, as defined under Article XX, Section 3(b). Employees will be responsible for premium payments required to enroll in the “buy up” dental plan.
Section 3. Orthodontia Benefit Maximum. The City will provide a 50% of reasonable charges, $2,000 lifetime maximum orthodontic benefit for representation unit employees and their dependents.
ARTICLE XIX - LIFE INSURANCE
Section 1. Premiums. The City currently pays the following amounts of premium on behalf of Fire personnel:
Per Pay Period Per Month (Approx.)
Basic Life Insurance and
Basic ADD $.085 $ .185
(per $1,000 of coverage)
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26 The City will provide employees with Basic and Supplemental life insurance plans.
The basic life insurance provided by the City shall equalThe City shall pay the premium for basic life insurance coverage equal to one times the employee’s base monthly salary multiplied by twelve.annual salary. Employees will have the option of enrolling in supplemental life insurance by paying the premiums required to enroll in the plan.
ARTICLE XXI - RETIREMENT BENEFITS
Section 1. PERS Retirement Formula.
Safety Pension Group A: 3%@50 Safety Retirement
The City will continue the present benefits under the Public Employees' Retirement System (PERS) "3 percent at 50 (3%@50)" formula for employees hired before the effective date of the “3 percent at 55” (3%@55) formula for new hires as described herein. The final year compensation for employees hired under the 3% at 50 formula will continue to be “Single highest year” or the highest average annual compensation earnable by the member during one (1) year of employment immediately preceding retirement or the one -year period otherwise designated by the member (Government Code section 20042).
Safety Pension Group B: 3%@55 Safety Retirement
Effective December 7, 2012, the City amended its contract with CalPERS to provide employees hired on or after that date who are not “new members” of CalPERS, as defined in the Public Employees’ Pension Reform Act (ofte n referred to as “classic” CalPERS members) with the CalPERS retirement formula three percent of final salary at age 55 (“3%@55”), with the final salary determination for such employees of “3 highest consecutive years” based on the highest average annual compensation earnable by the member du ring three (3) consecutive years of employment immediately preceding retirement or the three -year period otherwise designated by the member (Government Code section 20037).
Safety Pension Group C: 2.7% at Age 57 Safety Retirement Employees hired on or after January 1, 2013 meeting the definition of “new member” under the Public Employees’ Pension Reform Act (Gov’t. Code s. 7522 et seq.) shall be subject to all of the provisions of that law, including but not limited to the two point seven percent at age 57 (2.7%@57) retirement formula with a three year final compensation period.
Miscellaneous Pension Formulas:
a. Miscellaneous Pension Group A: 2.7% at 55. The City provides retirement benefits under the California Public Employees Retirement System at the level of
2.7% at age 55 for employees hired before July 17, 2010, with a one year final compensation period.
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27 on or after July 17, 2010, and before January 1, 2013, and employees hired on or after January 1, 2013 who are not “new members” of CalPERS as defined in the Public Employees’ Pension Reform Act (often referred to as “Classic” CalPERS members)the City offers the CalPERS retirement formula two percent (2.0%) of final salary at age sixty (60), with a one (1) year final compensation period.
a.c. Miscellaneous Pension Group C: 2% at 62. Employees hired on or after January 1, 2013 meeting the definition of “new member” under the Public Employees’ Pension Reform Act (Gov’t. Code s. 7522 et seq.) shall be subject to all of the provisions of that law, including but not limited to the two percent at age 62 (2%@62) retirement formula with a three (3) year final compensation period.
Section 2. PERS Member Contribution.
a. Employees in all represented classes in Pension Groups A and B described above will make the 9% PERS member contributions by payroll deduction.
b. Employees in all represented classes in Pension Group C described above shall pay the employee contribution required by the Public Employees’ Pension Reform Act, currently calculated at fifty percent (50%) of the normal cost.
c. When employees pay their PERS Member Contribution pursuant to section 3a and 3b above, the City will provide for member contributions to be made as allowed under provisions of IRS Code Section 414(h)(2).
Section 3. Additional Employee PERS contributions
In addition to the PERS member contribution as required under section 2. a, b and c above, all employees in pension groups a, b and c shall contribute the additional following contributions:
a. In addition to the Member Contribution required per CalPERS 20516 contract amendment all employees regardless of pension formula in this unit shall pay 3% towards the Employer share of Pension.
b. Effective the first full pay period following July 1, 2020, all employees regardless of pension formula in this unit shall, in addition to the Member Contribution required, pay an additional 1% towards the employer share of Pension for a total of 4%.
Section 4. Option 2 Death Benefit. The City provides the Pre -Retirement Option Settlement 2 Death Benefit. The Pre- Retirement Optional Settlement 2 Death Benefit provides the spouse of a deceased member, who was eligible to retire for service at the time of death, with an alternate option to the lump sum Basic Death Benefit whereby the Item 8
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28 surviving spouse can elect a monthly allowance equal to the amount the member would receive if he/she had retired from service on the date of death and elected Optional Settlement 2 (the highest monthly allowance a member can leave a spouse).
Section 5. Military Service Credit. The City will provide the Public Employees’ Retirement System benefit known as “Section 20930.3, Military Service Credit as Public Service.”
Section 6. 1959 Survivor Benefit.
The City will continue to provide the basic level of 1959 PERS Survivor Benefit to eligible employees in accordance with Government Code section 21571.
Section 7. Employer Contributions to 457 Plan
Effective the first full pay period following July 1, 2020, the City will contribute the equivalent of 1% of the employee’s pensionable salary into the 457 plan.
Eligibility:
a. Employees must be enrolled in an eligible City sponsored 457 plan b. Employees who reach the maximum as defined by the IRS will not receive additional contributions
c. Employee must be making PERS contributions
ARTICLE XXII - RETIREMENT MEDICAL PLAN
Section 1. 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 that retire on or before December 31, 2006. Effective January 1, 2007 for an employee retiring on or after that date the City will pay up to the monthly medical premium for the 2
nd most expensive plan offered to IAFF employees among the existing array of plans. However, the City contribution for an employee hired before January 1, 2004 who retires on or after December 1, 2011 shall be the same contribution amount it makes for active City employees.
Effective upon ratification and adoption of this AgreementStarting June 1, 2016 through August 31, 2016, the City shall provided active unit employees who were hired before January 1, 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 adopti on of this Agreement.
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29 Hired On Or After January 1, 2004:
The retiree health benefit provided in California Government Code section 22893 shall apply to all employees hired on or after January 1, 2004. Under this law, an employee is eligible to receive Fifty (50) percent of benefit after ten (10) years; each additional service credit year after Ten (10) years will increase employer credit by Five (5%) percent until Twenty (20) years is reached at which time employee is eligible for One Hundred (100%) percent of annuitant-only coverage and Ninety (90%) percent of the additional premium for dependents.
ARTICLE XXIIV - DEPENDENT CARE ASSISTANCE PROGRAM (DCAP) Section 1. DCAP. The City will provide a dependent care assistance program for employees subject to the provisions of applicable law. The program will remain in effect subject to a reasonable minimum participation level and availability of third party administrative services at a reasonable cost. Disputes regarding the administration of the plan shall be subject to the dispute resolution procedure provided by the plan document.
Section 2. HCFSA. The City will provide healthcare flexible spending program for employees subject to the provision of applicable law. Disputes regarding the administration of the plan shall be subject to the dispute resolution procedure provided by the plan document.
The HCFSA program will be available to employees effective January l, 2026, and remain in effect subject to a reasonable minimum participation level and availability of third-party administrative services at a reasonable cost.
ARTICLE XXIIIV - VACATION ACCRUAL
Section 1. Accrual Rate. All eligible fire suppression persons shall accrue vacation at the following rate for continuous service performed in a pay status. Non- shift representation unit employees shall accrue the 40- hour equivalent --one shift equals sixteen hours.
a. For employees completing less than four years continuous service, the accrual rate shall be five duty shifts per year.
b. For employees completing four but not more than nine years continuous service, the accrual rate shall be eight duty shifts per year.
c. For employees completing nine but not more than 14 years continuous service, the accrual rate shall be 10 duty shifts per year.
d. For employees completing 14 but less than 19 years continuous service, the accrual rate shall be 11 duty shifts per year.
e. For employees completing 19 or more years continuous service, the accrual rate shall be 12 duty shifts per year.
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30 At the time of initial appointment to the City, the City may credit an employee for prior years of public service in a city, county, special district, state or federal government agency, up to a maximum of four (4) years of service. The City Manager or designee shall identify the number of years for which the employee will receive credit (up to the four (4) year maximum).
Section 2. Unused At Termination. Represented employees who fail to use all vacation as accrued may continue the accrual balance and be entitled to all accrued but unused vacation upon termination, except as limited below.
Section 3. Limits. Vacation accrual balances shall be limited to three times the annual accrual rate. Accrual credit beyond this limit shall not be recognized or compensated, except that for employees of record as of January 1, 1984 who have vacation excess on a one-time basis shall be set aside (banked) to be subsequently used as vacation or paid at termination. No additions may be made to the bank. The bank is established only to facilitate changeover from unlimited to three times annual accrual rate lim itation on vacation accrual as herein provided.
ARTICLE XXIV - USE OF VACATION
Section 1. Maximum Number of Slots. The maximum number of vacation scheduling slots for representation unit suppression employees is four (4) per platoon on a year- round basis. During the term of the contract, parties agree to meet to discuss the impact of the number of vacation slots per day on daily staffing.
Section 2. Approvals. Vacation scheduling must be approved by the Battalion Chief or Fire Chief. The minimum is twelve (12) hours or more for suppression employees.
Advance vacation schedules for suppression shall begin either at 8:00 a.m. or 8:00 p.m.
Section 3. Vacation Pay. Vacation pay shall be made available in advance of regular pay day provided that employee requests such advance in writing to the Finance Department at least two weeks prior to his/her vacation date. The employee's supervisor must verify vacation date on the request.
Section 4. Illness on Vacation. When an employee becomes ill while on vacation and such illness can be supported by a statement from an accredited physician or the employee is hospitalized for any period, the employee shall have the period of illness charged against sick leave and not against vacation leave.
Section 5. When to be Taken. The time at which an employee may use accrued vacation leave and the amount to be taken at any one time shall be determined by the Chief with particular regard for the needs of the City, but insofar as possible, considering Item 8
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31 the wishes of the employee.
Section 6. Limitation on Use. Employees may not use more than three times their annual rate of accrual in any calendar year period provided, however, that the Chief may grant exceptions to this limitation.
Section 7. Waiting Period. Employees shall complete six months continuous service before using accrued vacation leave.
Section 8. Double Compensation Prohibited. Employees shall not work for the City during their vacation.
Section 9. Cash out Option.
Once each calendar year an employee may cash out eight (8) or more hours of vacation accrual in excess of eighty (80) hours to a maximum of one hundred twenty (120) hours; PROVIDED, that the employee has taken eighty (80) hours of vacation off with pay in the previous twelve (12) months.
ARTICLE XXVI - SICK LEAVE
Section 1. Statement of Policy. Sick leave shall be allowed and used only in case of actual personal sickness or disability, medical or dental treatment, or as authorized in Section 9. Up to six (6) days (72 shift hours for suppression personnel) S sick leave per year may be used for illness in the immediate family (wife, husband, child, parent, parent- in-law, brother, sister, registered domestic partner, or close relative residing in the household of the employee.)
Section 2. Eligibility. Regular employees shall be eligible to accrue and use sick leave.
Section 3. Accrual. Sick leave shall be accrued bi-weekly, provided the employee has been in a pay status for 50 percent or more of a bi -weekly pay period. Sick leave shall be accrued at the rate of six shifts per year.
Section 4. Accumulation. Accumulated sick leave may be accrued without limit, except as provided in Section 8 below.
Section 5. Use. Sick leave may be used as needed and approved, to the point of depletion, at which time the employee will no longer receive pay for sick leave. A new employee may, if necessary, use up to forty -eight (48) hours or shift equivalent of sick leave at any time during the first six months of employment. Any negative balances generated by such utilization will be charged against future accrual or deducted from final paycheck in the event of termination.
An employee who has been disabled for 60 consecutive days and who is otherwise eligible both for payment under the long- term disability group insurance coverage and accrued sick leave benefits may, at his/her option, choose either to receive the long- Item 8
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32 term disability benefits or to utilize the remainder of his/her accrued sick leave prior to applying for long-term disability benefits.
Sick leave will not be granted for illness occurring during any leave of absence other than sick leave, unless the employee can demonstrate that it was necessary to come under the care of a doctor while on such other leave of absence.
When an employee finds it necessary to be absent for any reason, he/she should cause the facts to be reported to the department within 60 minutes prior to his/her regular starting time on the first working day of absence, and shall regularly report on, or account in advance for each work day thereafter unless hospitalized or otherwise indisposed. Such reports may be subject to written documentation. Sick leave shall not be granted unless such report or advance accounting has been made, provided, however, that the department head may grant exception to this policy where the circumstances warrant.
Section 6. Depletion of Sick Leave Benefits. Upon depletion of sick leave or the beginning of the period to be covered by payments under long- term disability group insurance coverage, whichever comes first, an employee may be granted a medical leave of absence without pay for a period not exceeding s ixty days. If the employee is unable to return to work at the end of this period, he/she must request further medical leave which will be subject to the approval of the City Manager. If further leave is granted, the employee must notify the City of intent to return to work every thirty days. If further leave is not granted, the employee's service with the City shall be considered terminated.
Section 7. Forfeiture Upon Termination. Employees leaving the municipal service shall forfeit all accumulated sick leave, except as otherwise provided by law and Section
8. In the event that notice of resignation is given, sick leave may be used only through the day which was designated as the final day of work by such notice.
Section 8. Payment for Accumulated Sick Leave. Eligible employees (those hired before December 31, 1983) who leave the municipal service in good standing, or who die while employed in good standing by the City, and who have fifteen or more years of continuous service, shall receive compensation for unused sick leave hours in a sum equal to two and one- half percent of their unused sick leave hours multiplied by their years of continuous service and their basic hourly rate of pay at termination. Full sick leave accrual will be paid in the event of termination due to disability.
For new employees hired after December 31, 1983, sick leave accrual accumulation will be limited to 1,000 hours with no payoff provisions for unused balance at termination for any reason.
Section 9. Personal Business Leave Chargeable to Sick Leave. It is agreed between the parties that all shift personnel represented by the Union shall have the right to charge up to forty-eight (48) hours personal business leave per year to sick leave, and that all non-shift personnel shall have the right to charge up to twenty (20) hours personal Item 8
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33 business leave per year to sick leave. Such personal business leave shall be allowed only on a staffing available basis and where the provisions of the minimum staffing agreement are not affected. "Staffing available" means at or above minimum staffing levels as defined in Article XII.
Section 10. Return to Work or Continue Work With Limited Duty. In cases of non- work-related injury, illness or pregnancy an employee, upon approval of the Fire Chief and the City Safety Officer, may return to work or continue work with doctor -approved limited duty. Approval for such limited duty shall be based upon department ability to provide work consistent with medical limitations and the length of time of the limitations.
Shift employees must be willing to accept any non- shift limited duty schedule work location and may be subject to the reasonable availability of limited duty assignments.
The City doctor may be consulted in determining work limitations.
ARTICLE XXVII - SUBPOENAS
Employees required to answer subpoenas as a witness for the City of Palo Alto or for a plaintiff where the City of Palo Alto is a defendant shall not lose pay or benefits for work time lost to answer depositions or to appear in court.
ARTICLE XXVIII - WORKERS' COMPENSATION
Section 1. Status Reporting While on Disability. Persons on disability will be required to appear or otherwise report at regular two-week intervals to the Fire Chief or designate to discuss his/her status of medical treatment therapy and physical condition. This section is not meant to unreasonably rest rict employee's activities so long as such activities are cleared by the treating physician, treating program or alternative treatment program is maintained and employee is available for full or restricted duty as soon as medical clearance can be received.
ARTICLE XXVIIIX - PHYSICAL FITNESS MEDICAL EXAMINATIONS
Physical fitness medical examinations for all represented employees may include chest x-rays every three years unless otherwise directed by a physician, eye examination and hearing examination.
ARTICLE XXIX- LEAVES OF ABSENCE WITHOUT PAY
Section 1. Disability. Leaves of absence without pay may be granted in cases of disability not covered by sick leave. Pregnancy will be considered as any other disability.
Leaves of absence for disability are subject to physician's verification including diagnosis and medical work restriction.
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34 Section 2. Other Leaves. Leaves of absence without pay may be granted in cases of personal emergency or when such absences would not be contrary to the best interest of the City. Non- disability prenatal and/or postpartum leave is available under this provision, but such leave shall not begin more than six months prenatal nor extend more than six months postpartum.
Section 3. Accrued Vacation Credits. During unpaid leaves of absence for disability or other reasons, the employee may elect to use accrued vacation credits. Requests for leaves without pay shall not be unreasonably denied. In order to avoid misunderstandings, all leaves without pay must be in writing to be effective.
Section 4. Approval of Department Head. Leave of absence without pay for one week or less may be granted by the department head, depending on the merit of the individual case.
Section 5. Approval by City Manager. Leave of absence without pay in excess of one week's duration may be granted by the City Manager on the merit of the case, but such leave shall not exceed twelve months' duration.
Section 6. Absence Without Leave. Unauthorized leave of absence shall be considered to be without pay, and reductions in the employee's pay shall be made accordingly. Unauthorized leave of absence may result in termination of employment.
Section 7. Leave of Absence; Death Outside the Immediate Family. Leave without pay may be granted a regular employee by his/her department head in the event of death to family members other than one of the immediate family, such leave to be granted in accordance with Section 2 and Section 4.
Section 8. Military Leave of Absence. State law shall govern the granting of military leaves of absence and the rights of employees returning from such absence.
Section 9. Use of paid accruals while on leave. During unpaid leaves of absence for disability or other reasons, the employee may elect and the City may require the employee to use accrued vacation paid leave credits in a manner consistent with state and federal law. Requests for leaves without pay shall not be unreasonably denied. In order to avoid misunderstandings, all leaves without pay must be in writing to be effective.
ARTICLE XXXI - LEAVES OF ABSENCE WITH PAY
Section 1. City Manager Granted Leaves. The City Manager may grant a regular employee under his control a leave of absence with pay for a period not exceeding thirty calendar days for reasons he deems adequate and in the best interest of the City.
Section 2. Council Granted Leave. The City Council may grant a regular employee a leave of absence with pay for a period not to exceed one year for reasons the Council Item 8
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Section 3. Employee's Time Off to Vote. Time off with pay to vote at any general or direct primary election shall be granted as provided in the State of California Elections Code, and notice that an employee desires such time off shall be given in accordance with the provisions of said Code.
Section 4. Leaves of Absence; Death in Immediate Family. Leave of absence with pay of one shift with provision for approval of one additional shift for travel outside the area may be granted an employee by the Chief in the event of death in the employee's immediate family, which is defined for purposes of this s ection as wife, husband, son, son-in-law, daughter, daughter -in-law, father, mother, brother, brother -in-law, sister, sister-in-law, mother-in-law, father-in-law, grandfather, grandfather-in-law, grandmother, grandmother-in-law, uncle, aunt, registered domestic partner, or a close relative residing in the household of the employee. Such leave shall be at full pay and shall not be charged against the employee's accrued vacation or sick leave. Requests for leave in excess of two shifts shall be subject to the approval of the City Manager.
Section 5. Jury Duty; Leave of Absence. Employees required to report for jury duty shall be granted a leave of absence with pay from their assigned duties until released by the court, provided the employee remits to the City all fees received for such duties other than mileage or subsistence al lowances within thirty days from the termination of his or her jury service.
ARTICLE XXXII – VOLUNTEER LEAVE PROGRAM
The City of Palo Alto has established a Firefighter Voluntary Leave Program to provide members of Local 1319 International Association of Fire Fighters (IAFF) employees the opportunity to donate their accrued vacation time to assist fellow members of IAFF either due to: (a) an employee’s own verifiable non- industrial catastrophic illness or injury (as defined herein) or (b) in order to care for a member of the employee’s immediate family (spouse, child, parent or registered domestic partner suffering from a verifiable catastrophic illness or injury) and have exhausted or will presently exhaust all of their paid leave.
In order to be eligible to receive donated leave, an employee must have a catastrophic illness or injury or an employee’s immediate family member must have a catastrophic illness or injury that requires the employee to provide full -time care for this family member. Care will be taken to emphasize the voluntary nature of the plan and to insure confidentiality of employee participants and medical conditions (where applicable).
A Firefighter Voluntary Leave Sharing Program has been established to accept donations of vacation in accordance with the Program’s guidelines. All donations shall be:
1. Voluntary
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3. Confidential, unless disclosure is required by law
4. In whole hour increments of at least four (4) hours, with the hours donated being converted to donee hours based on the donee’s salary rate (so that there will be no cost to the City due to salary differential).
5. The employee shall be required to exhaust all other types of leave to request donated leave
6. It is understood that employees seeking or receiving leave under this program will apply for long-term disability benefits for which they may be eligible
7. Where any of the period during which an employee receives donated leave is designated as family leave under the California Family Rights Act (CFRA/Family Medical Leave Act (FMLA), the employee will be eligible for continuation of medical and other available benefits during that the family leave period (for up to 12 weeks), in accordance with the requirements of those laws. If the employee receiving donated leave is not eligible for CFRA/FMLA benefit continuation, or after the employee has exhausted the avai lable CFRA/FMLA leave period, the employee will need to pay the premiums for continued medical and other available benefits if the employee chooses to continue such coverages through the City
8. If the donation request is based on the need for an employee to care for an immediate family member, as defined above, the family member must require full- time care by the employee. Certification of this requirement by a health care professional is required
9. The maximum donated time a donee may receive is 12 months (if available).
10. Applications to donate leave or receive leave under this Program are made to the Human Resources Department
11. This is a pilot program and is subject to cancellation by either party
IAFF members interested in donating leave or in applying to receive donated leave shall complete forms provided by the Human Resources Department. If an applicant for leave is found to meet the criteria set forth herein, Human Resources will determine th e availability of and (as applicable) allocation of donated paid leave. Payroll will be notified in writing of the number of hours to be deducted from each donating employee’s vacation balance and transferred to the donee employee(s).
The City reserves the right to modify or terminate this program at any time.
Catastrophic Illness or Injury (also referred to as “medical emergency” in Revenue Ruling 90-29 and Sections 801(c) and 812 of the Merit Rules and Regulations): A non- occupational medical condition of an employee that will require the prolonged absence of the employee from duty and which will result in a substantial loss of income to the employee because the employee will have exhausted all paid leave available apart from the Voluntary Employee Leave sharing Program. Non- disability postpartum leave as referenced in Merit Rule 801(b) shall not be considered a catastrophic illness or injury under this Policy.
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37 ARTICLE XXXIII- TUITION REIMBURSEMENT
Section 1. Options.
Effective July 1, 2004 the tuition reimbursement program was amended to provide each employee the option of receiving the $1,000 as taxable cash or as a contribution to deferred compensation. The tuition reimbursement program will be eliminated effective July 1, 2012 with no further payouts starting in FY 12-13 and on-going.
ARTICLE XXXIIIV - PER DIEM TRAVEL EXPENSES
Section 1. City Business. Unless other mutually agreeable arrangements are made, representation unit employees who are required to travel away from the City on City business will receive travel expenses, according to City policies which are currently in effect.
ARTICLE XXXIV - HOUSE FUND ITEMS
Section 1. Station House Fund. The station house fund per year, per shift employee shall be $100.00.
Section 2. Non-Food House Items. The City agrees to furnish and maintain each fire station with non- food house fund items: TV purchase and repair. Kitchen cooking utensils, small kitchen appliances and other specific items to be determined by mutual agreement of the parties will be purc hased from the station house fund. The Fire Fighters agree to maintain the voter registration program.
ARTICLE XXXVI - PARKING
Section 1. Entitlements. Employees in represented classes assigned to Civic Center or adjacent work locations shall be entitled to free parking in the Civic Center Garage, or a commute incentive which will be subject to meet and confer. Employees hired after July 1, 1994, may initially receive a parking permit for another downtown lot, subject to availability of space at the Civic Center Garage. Light duty employees assigned to the Civic Center will receive Civic Center parking temporary permits for the duration of the light duty assignment.
ARTICLE XXXVII- GRIEVANCES
The City and the Union agree to establish a grievance procedure as follows:
1. Definition: A grievance is any complaint or dispute regarding the application of interpretation of this Memorandum of Understanding, Department rules, Item 8
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2. Any non-probationary employee represented by the Union may file and process a grievance. Such aggrieved employees may be represented by the Union or may represent themselves in preparing and presenting their grievance at any level of review. The Union may file a grievance when a Union right not directly related to an individual employee becomes subject to dispute.
3. Any retroactivity on monetary grievances shall be limited to the date of occurrence, except in no case will retroactivity be granted prior to three months before the grievance was filed in writing.
4. Written grievances shall be submitted on forms provided by the City or on forms which are mutually agreeable to the City and the Union. The Union shall deliver a copy of a written grievance to the Human Resources Department Director on the same date that i t is first filed with another City representative under the provisions of the below grievance procedure.
5. The time limits specified in this section may be extended by mutual agreement in writing of the aggrieved employee or Union and the reviewer concerned. Should a decision not be rendered within a stipulated time limit, the aggrieved employee may immediately appeal to the next step. The grievance will be considered settled if the decision of any step is not appealed within the specified time limit.
6. If a grievance is related to a promotional process to positions within the representation unit, Step I shall be directed to the Deputy Fire Chief (or Fire Marshal for FPB positions).
7. Step I. The aggrieved employee will first attempt to resolve the grievance through informal discussions with the immediate supervisor by the end of the tenth business day following the discovery of the incident upon which the grievance is based. Every attempt will be made to settle the issue at this level.
Step II. If the grievance is not resolved through informal discussion, it may be submitted in writing to the Battalion Chief (Deputy Fire Chief for Captain grievances) within ten business days of the informal discussion. The Battalion Chief/Assistant Fire Chief will have ten business days from receipt of the grievance to review the matter and prepare a written response. If the grievance is denied, the response shall contain the reasons therefore.
Step III. If the grievance is not resolved in Step II, it may be submitted in writing to the Fire Chief within ten business days of receipt of the Battalion Chief's/ Deputy Fire Chief's written response. The Fire Chief will have ten business days from receipt of the grievance to review the matter and prepare a written response.
If the grievance is denied, the response shall contain the reasons therefore.
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39 Step IV. If the grievance is not resolved in Step III, the aggrieved employee may submit the grievance to the City Manager for final determination or to binding grievance arbitration. All Step IV appeals must be filed in writing at the Human Resources Department Office within ten business days of receipt of the Fire Chief's response under Step III. All hearings before the City Manager shall be pursuant to the rules and regulations set forth in the City of Palo Alto Merit Rules and Regulations. Hearings before an arbitrator will be as set forth below.
In the event the aggrieved employee decides to proceed to arbitration, he/she shall select jointly with the Director of Human Resources an arbitrator. If the parties are unable to agree on an arbitrator, they shall jointly request a panel of five qualified and experienced arbitrators from the State Conciliation Service.
Upon receipt of the list of arbitrators, the names shall be alternately struck until one name remains who shall serve as arbitrator. The arbitrator shall be jointly contacted by the parties.
The arbitrator shall have jurisdiction and authority only to interpret, apply, or determine compliance with the provisions of the Memorandum of Agreement and such Merit System rules, regulations, policies, procedures, City ordinances or regulations relating to terms or conditions of employment, wages or fringe benefits, as may hereafter be in effect in the City insofar as may be necessary to the determination of grievances appealed to the arbitrator. The arbitrator shall be without power to make any decision:
a. Regarding matters of interest.
b. Contrary to, or inconsistent with or modifying in any way, the terms of this Memorandum of Agreement.
c. Granting any wage increases or decreases.
d. Granting pay or benefits for any period of time prior to the execution date of this Memorandum of Agreement.
Where either party seeks arbitration and the other party claims the matter is not subject to the arbitration provisions of the Memorandum of Agreement, the issue of arbitrability shall first be decided by the arbitrator using the standards and criteria set forth in this Memorandum of Agreement.
The arbitrator shall be without authority to require the City to delegate or relinquish any powers which by State law or City Charter the City cannot delegate or relinquish. Copies of the arbitrator's decision shall be submitted to the City and the aggrieved employee. All direct costs emanating from the arbitration procedure shall be shared equally by the City and the aggrieved employee or the Union.
It is further agreed that the provisions of this section shall be incorporated as part of Chapter 11 of the City of Palo Alto Merit System Rules and Regulations.
Existing procedures set forth in Chapter 11, to the extent they are inconsistent with the provisions contained herein, are superseded.
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40 ARTICLE XXXVIII- SAFETY COMMITTEE
Section 1. Committee A Safety Committee comprised of four representation unit members appointed by the Union, and at least two members of Management, will continue to meet. The Committee may make safety recommendations to the Fire Chief regarding equipment, vehicles and appara tus and may review all accidents involving represented personnel. Management shall inform the Safety Committee of all accidents involving injuries to represented personnel.
ARTICLE XXXVIIIX – MISCELLANEOUS
Section 1. Section 1. Uniforms.
The value of the purchase, rental and/or maintenance of the required uniforms shall be reported as special compensation to the extent legally permissible, pursuant to Title 2 CCR, Section 571(a)(5) as Uniform Allowance. Based upon existing uniform standards and the City’s cost experience, the value of this benefit shall be reported as $15.31 per pay period.
The City will supply complete uniforms as described in Fire Department Policy 1031. The City will issue four T-shirts to each uniformed employee each July These T-shirts are for use on duty only and will be maintained by the employee.
Section 2. Removal of Disciplinary Actions. Records of disciplinary actions shall be removed from the personnel file of a representation unit employee upon written request by the employee after a period of three years, or sooner if mutually agreed by the Fire Chief and the employee. If the disciplinary action involved violations of the City’s anti - harassment policy, state/federal harassment or discrimination laws, or if there have been subsequent violations of the same policy during the three- year period, the Fire Chief may deny the request for removal. In such cases, the employee may request a review meeting with the Fire Chief or designee, Union President or designee, and Human Resources. The final decision following this review meeting is final and not subject to any grievance or appeal rights.
ARTICLE XXXIXL - FULL UNDERSTANDING
Section 1. Full and Entire Understanding. The Memorandum of Agreement contains the full and entire understanding of the parties regarding the matters set forth herein.
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41 Section 2. Fair Labor Standards Act. Compensatory time off with Management approval may be used as an alternative to overtime compensation only within the 27- day work period within which the overtime is worked.
Section 3. Severability. Should any of the provisions herein contained be rendered or declared invalid by reason of any existing State or Federal legislation or by reason of State or U.S. Supreme Court ruling, such invalidation of such part or portion of this Memorandum of Agreement shall not invalidate the remaining portions hereof, and they shall remain in full force and effect, insofar as such remaining portions are severable.
Section 4. Good Faith. It is the intent of the parties that ordinances, resolutions, rules and regulations enacted pursuant to this Memorandum of Understanding be administered and observed in good faith.
Section 5. Merit System Rules and Regulations. During the term of this Memorandum of Agreement, Management may propose certain changes in the City Merit System Rules and Regulations. With regard to such changes which pertain to the representation unit, the parties agree to review, and upon request, me et and confer regarding the changes.
Section 6. Station Consolidation or Relocation . During the term of this agreement, at management request, the parties agree to meet and confer with regard to issues pertaining to fire station consolidation or relocation.
Section 7. Meet and Confer. Nothing in this agreement shall preclude the parties from mutually agreeing to meet and confer on any subject within the scope of representation during the term of this agreement.
ARTICLE XLI – 48/96 Work Schedule
The regular schedule for 56 hour personnel will be under a “48/96” model. With the adoption of this “48/96” schedule the parties agreed to revise Fire Department policy 205.6 typical workday and 1009.8.1 Reporting for Duty- Holidays.
ARTICLE XLII – FUTURE SERVICE DELIVERY MODELS
Effective upon request of the City, the parties will meet and confer in good faith regarding the service delivery model of current inspection services and transport during the term of this Agreement.
ARTICLE XLIII - DURATION
This Memorandum of Agreement shall become effective upon ratification by both Item 8
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38 EXECUTED:
FOR: FOR:
INTERNATIONAL ASSOCIATION CITY OF PALO ALTO
FIRE FIGHTERS
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1 MEMORANDUM OF AGREEMENT
Between
CITY OF PALO ALTO and
I.A.F.F. LOCAL 1319
July 1, 2025 – June 30, 2028
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2 PREAMBLE __________________________________________________________ 7 ARTICLE I - RECOGNITION _____________________________________________ 7 Section 1. Recognition. ______________________________________________________ 7 ARTICLE II - NO DISCRIMINATION _______________________________________ 7 Section 1. No Discrimination. __________________________________________________ 7 Section 2. Free Choice. ______________________________________________________ 7 Section 3. Human Relations Committee. _________________________________________ 7 ARTICLE III - PAYROLL DEDUCTIONS ____________________________________ 7 Section 1. Payroll Deductions and Written Authorization. ____________________________ 8 Section 2. Certification of Union Membership _____________________________________ 8 Section 3. Indemnification ____________________________________________________ 8 ARTICLE IV - UNION ACTIVITIES ________________________________________ 8 Section 1. On-Duty Time. _____________________________________________________ 8 Section 2. Interoffice Mail, Bulletin Boards, and E-Mail. ______________________________ 8 Section 3. Use of Meeting Places. ______________________________________________ 9 ARTICLE V - NO STRIKES ______________________________________________ 9 Section 1. No Strikes. ________________________________________________________ 9 ARTICLE VI - PROBATIONARY PERIOD __________________________________ 9 Section 2. Part of Testing Process. _____________________________________________ 9 Section 3. Suspension or Termination. __________________________________________ 9 ARTICLE VII - SALARY PROVISIONS ____________________________________ 10 Section 1. Base Wage Rates. ________________________________________________ 10 Section 2. Out-of-Class Compensation. _________________________________________ 11 Section 3. Salary Steps _____________________________________________________ 11 Section 4. Pay for Court Appearance. __________________________________________ 12 Section 4. Classifications ____________________________________________________ 12 ARTICLE VIII - PAY DIFFERENTIALS ____________________________________ 12 f. Paramedic Differential. _________________________________________________ 13 Section 2. Emergency Medical Technician Certification. _________________________ 14 Section 3. Bilingual Pay _____________________________________________________ 14 Section 4. Special Operations Assignment (Haz Mat) _____________________________ 14 Section 5. Fire Investigator Differential. ________________________________________ 14 Section 6. Education Incentive _____________________________________________ 15 ARTICLE IX - HOLIDAYS ______________________________________________ 16 Section 1. Named Holidays. __________________________________________________ 16 Section 2. Conditions. ______________________________________________________ 16 Item 8
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3 ARTICLE X - OVERTIME COMPENSATION _______________________________ 17 Section 1. Compensation. ___________________________________________________ 17 ARTICLE XI - APPARATUS STAFFING ___________________________________ 17 ARTICLE XII - WORK ASSIGNMENTS AND TRANSFERS ____________________ 18 Section 1. Shipouts. _______________________________________________________ 18 Section 2. Vacation Relief Positions. ___________________________________________ 18 Section 3. Transfer Requests. ________________________________________________ 19 Section 4. Special Assignments. ______________________________________________ 19 Section 5. Continuous Hourly Service. __________________________________________ 19 ARTICLE XIII - TRAINING COORDINATION _______________________________ 19 Section 1.Coordination ______________________________________________________ 19 ARTICLE XIV - PROMOTION ___________________________________________ 19 Section 1. Promotion Step Level. ______________________________________________ 19 Section 2. Promotion Process Information. ______________________________________ 19 ARTICLE XV - REDUCTION IN FORCE ___________________________________ 20 Section 1. Order of Reduction. ________________________________________________ 20 ARTICLE XVI - SELECTIVE CALL BACK WITH REGARD TO RESIDENCY ______ 20 Section 1. In Case of Emergency ______________________________________________ 20 ARTICLE XVII - HEALTH BENEFITS _____________________________________ 20 Section 1. Maintenance of Levels _____________________________________________ 20 Section 2. Vision Care ______________________________________________________ 20 Section 3. PEMHCA Health Plan. _____________________________________________ 20 ARTICLE XVIII - DENTAL BENEFITS _____________________________________ 23 Section 1. Level of Benefits. __________________________________________________ 23 Section 2. Premiums. _______________________________________________________ 23 ARTICLE XIX - LIFE INSURANCE _______________________________________ 24 ARTICLE XX - RETIREMENT BENEFITS __________________________________ 24 Section 1. PERS Retirement Formula. __________________________________________ 24 Section 2. PERS Member Contribution. ________________________________________ 25 Section 3. Additional Employee PERS contributions _______________________________ 25 Section 4. Option 2 Death Benefit. _____________________________________________ 26 Section 5. Military Service Credit. _____________________________________________ 26 Section 6. 1959 Survivor Benefit. _____________________________________________ 26 Section 7. Employer Contributions to 457 Plan ___________________________________ 26 ARTICLE XXI - RETIREMENT MEDICAL PLAN_____________________________ 26 Section 1. Retiree medical coverage for Unit employees hired before January 1, 2004: ____ 26 Item 8
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4 Section 2. 20-Year Vesting for Retiree Medical Coverage for Unit Employees Hired On Or After January 1, 2004: ____________________________________________________ 26 ARTICLE XXII - DEPENDENT CARE ASSISTANCE PROGRAM (DCAP) ________ 27 Section 1. DCAP. __________________________________________________________ 27 ARTICLE XXIII - VACATION ACCRUAL __________________________________ 27 Section 1. Accrual Rate. _____________________________________________________ 27 Section 2. Unused At Termination. _____________________________________________ 28 Section 3. Limits. __________________________________________________________ 28 ARTICLE XXIV - USE OF VACATION ____________________________________ 28 Section 1. Maximum Number of Slots __________________________________________ 28 Section 2. Approvals. _______________________________________________________ 28 Section 3. Vacation Pay. ____________________________________________________ 28 Section 4. Illness on Vacation. ________________________________________________ 28 Section 5. When to be Taken. ________________________________________________ 28 Section 6. Limitation on Use. _________________________________________________ 29 Section 7. Waiting Period. ___________________________________________________ 29 Section 8. Double Compensation Prohibited. _____________________________________ 29 Section 9. Cash out Option. __________________________________________________ 29 ARTICLE XXV - SICK LEAVE ___________________________________________ 29 Section 1. Statement of Policy. _______________________________________________ 29 Section 2. Eligibility ________________________________________________________ 29 Section 3. Accrual. _________________________________________________________ 29 Section 4. Accumulation. ____________________________________________________ 29 Section 5. Use. ____________________________________________________________ 29 Section 6. Depletion of Sick Leave Benefits. _____________________________________ 30 Section 7. Forfeiture Upon Termination. ________________________________________ 30 Section 8. Payment for Accumulated Sick Leave. _________________________________ 30 Section 9. Personal Business Leave Chargeable to Sick Leave. ______________________ 30 Section 10. Return to Work or Continue Work With Limited Duty. _____________________ 31 ARTICLE XXVI - SUBPOENAS __________________________________________ 31 ARTICLE XXVII - WORKERS' COMPENSATION ____________________________ 31 Section 1. Status Reporting While on Disability. __________________________________ 31 ARTICLE XXVIII - PHYSICAL FITNESS MEDICAL EXAMINATIONS ____________ 31 ARTICLE XXIX- LEAVES OF ABSENCE WITHOUT PAY _____________________ 31 Section 1. Disability. ________________________________________________________ 31 Section 2. Other Leaves. ____________________________________________________ 32 Item 8
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5 Section 3. Accrued Vacation Credits. ___________________________________________ 32 Section 4. Approval of Department Head ________________________________________ 32 Section 5. Approval by City Manager. __________________________________________ 32 Section 6. Absence Without Leave. ____________________________________________ 32 Section 7. Leave of Absence; Death Outside the Immediate Family. __________________ 32 Section 8. Military Leave of Absence ___________________________________________ 32 Section 9. Use of paid accruals while on leave. ___________________________________ 32 ARTICLE XXX - LEAVES OF ABSENCE WITH PAY _________________________ 32 Section 1. City Manager Granted Leaves. _______________________________________ 32 Section 2. Council Granted Leave. _____________________________________________ 32 Section 3. Employee's Time Off to Vote. ________________________________________ 33 Section 4. Leaves of Absence; Death in Immediate Family. _________________________ 33 Section 5. Jury Duty; Leave of Absence. ________________________________________ 33 ARTICLE XXXI – VOLUNTEER LEAVE PROGRAM _________________________ 33 ARTICLE XXXII- TUITION REIMBURSEMENT _____________________________ 34 Section 1. Options. _________________________________________________________ 35 ARTICLE XXXIII - PER DIEM TRAVEL EXPENSES__________________________ 35 Section 1. City Business. ____________________________________________________ 35 ARTICLE XXXIV - HOUSE FUND ITEMS __________________________________ 35 Section 1. Station House Fund. _______________________________________________ 35 Section 2. Non-Food House Items _____________________________________________ 35 ARTICLE XXXV- PARKING ____________________________________________ 35 Section 1. Entitlements. _____________________________________________________ 35 ARTICLE XXXVI- GRIEVANCES ________________________________________ 35 Step II ___________________________________________________________________ 36 Step III __________________________________________________________________ 36 Step IV __________________________________________________________________ 36 ARTICLE XXXVII- SAFETY COMMITTEE _________________________________ 38 Section 1. Committee _______________________________________________________ 38 ARTICLE XXXVIII – MISCELLANEOUS ___________________________________ 38 Section 1. Section 1. Uniforms. _______________________________________________ 38 Section 2. Removal of Disciplinary Actions. ______________________________________ 38 ARTICLE XXXIX - FULL UNDERSTANDING _______________________________ 38 Section 1. Full and Entire Understanding ________________________________________ 38 Section 2. Fair Labor Standards Act. ___________________________________________ 39 Section 3. Severability. ______________________________________________________ 39 Item 8
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6 Section 4. Good Faith. ______________________________________________________ 39 Section 5. Merit System Rules and Regulations. __________________________________ 39 Section 6. Station Consolidation or Relocation ___________________________________ 39 Section 7. Meet and Confer. __________________________________________________ 39 ARTICLE XL – 48/96 Work Schedule ____________________________________ 39 ARTICLE XLI – FUTURE SERVICE DELIVERY MODELS _____________________ 39 ARTICLE XLII - DURATION ____________________________________________ 39
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7 MEMORANDUM OF AGREEMENT
CITY OF PAL0 ALTO and I.A.F.F. LOCAL 1319
January 30, 2023 - June 30, 2025
PREAMBLE
This Memorandum of Agreement between the City of Palo Alto, hereinafter referred to as the "City", and Local 1319, International Association of Fire Fighters, hereinafter referred as the "Union", has been prepared and entered into in accordance with Title I, Division 4, Chapter 10, Sections 3500- 3510 of the California Government Code and Chapter 12 of the City of Palo Alto Merit System Rules and Regulations.
ARTICLE I - RECOGNITION
Section 1. Recognition. The City recognizes the Union as the exclusive representative of an employee group consisting solely of the classifications of Fire Apparatus Operator, Fire Fighter, Fire Captain, Fire Captain (forty -hour assignment), Fire Inspector Sworn and Non-Sworn, , and Hazmat Inspector, who are regularly employed by the City and others as amended into the representation unit from time to time under existing law and the Merit System Rules and Regulations.
ARTICLE II - NO DISCRIMINATION
Section 1. No Discrimination. The Union and the City hereby agree that there shall be no discrimination because of race, color, age, disability, sex, national origin, sexual orientation, political or religious affiliation under this Agreement. There shall be no discrimination in emplo yment conditions or treatment of employees on the basis of membership or non-membership in the Union, or participation in the lawful activities of the Union.
Section 2. Free Choice. The Union and the City hereby agree to protect the rights of all employees to exercise their free choice to join the Union and to abide by the express provisions of applicable State and local laws.
Section 3. Human Relations Committee. A Human Relations Committee will include up to five members appointed by the Union executive board and at least two members of management with representation from the Fire and Human Resources Departments.
The committee may make recommendations to management regarding recruitment outreach, equal employment opportunity and career development programs.
ARTICLE III - PAYROLL DEDUCTIONS
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8 Section 1. Payroll Deductions and Written Authorization. The City shall deduct Union membership dues assessments and insurances authorized by the Union. This will be accomplished by payroll deduction from the bi -weekly pay of member employees.
The dues deduction must be authorized in writing by the employee on a Union authorization card.
The Union will be the custodian of records for individual employee membership and dues deduction forms. The Union will maintain authorizations for dues deduction, signed by the individual from whose salary or wages the deduction or reduction is to be made. The City will direct employee requests to cancel or change deductions to the Union.
The City shall remit the deducted dues to the Union as soon as possible after deduction.
Section 2. Certification of Union Membership. The Union agrees to provide the City an initial certified list of members and statement that the Union has and will maintain written authorizations signed by the individuals from whose w ages the Union dues deductions are to be made. From that point forward the Union will update the list whenever there are changes.
Section 3. Indemnification. The Union shall indemnify and hold the City harmless against any liability arising from any claims, demands, or other action relating to this article. The Union shall comply with all statutory and legal requirements with respect to this article.
ARTICLE IV - UNION ACTIVITIES
Section 1. On-Duty Time. Local 1319 officers may use a reasonable amount of on- duty time to attend to Union business specifically related to representation of employees so long as:
a. Staffing is available
b. Operations are not interrupted
c. Advance approval is obtained from the Battalion Chief or Operations Chief
Section 2. Interoffice Mail, Bulletin Boards, and E-Mail. The Union shall have access to interoffice mail and existing bulletin boards in unit employee work areas for the purpose of posting, transmitting, or distributing notice or announcements including notices of social events, recreational events, Union membership meetings, result of elections and reports of minutes of Union meetings. Any other material must have prior approval of the Operations Chief or Fire Chief. Action on approval will be taken wit hin 24 hours of submission.
The Union may send e- mail messages only for the purposes set forth above. The I.T.
Division will maintain the IAFF list. The Union access to e-mail is based on the following conditions:
a. E-Mails to the IAFF list will be copied to the Fire Chief or Operations Chief at distribution.
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9 b. E-Mails to the IAFF list will only be sent by the Executive Board Members.
Section 3. Use of Meeting Places. The Union shall have the right to reserve City meeting and conference rooms for use during non- working hours or as subject to Battalion Chief approval. Such meeting places will be made available in conformity with City regulations and subject to the limitations of prior commitment.
ARTICLE V - NO STRIKES
Section 1. No Strikes. The Union, its representatives, or members, shall not engage in or cause, instigate, encourage, sanction, or condone a strike, withholding of services, leave of absence abuse, work stoppage or work slowdown of any kind against the City of Palo Alto or its citizens by employees covered under this Agreement. No employee shall refuse to cross any picket line in the conduct of Fire Department business, nor shall the Union, its representatives or members discriminate in any way toward any one who refuses to participate in a strike, or any of the job actions cited above.
ARTICLE VI - PROBATIONARY PERIOD
Section 1. Tentative and Subject to Probationary Period. All original appointments to regular or part -time municipal service positions shall be tentative and subject to a probationary period. With the exception of the Fire Inspector (Non-Sworn) classification, this probationary period shall include the fire training academ ies and an additional fourteen (14) to sixteen (16) months after completion of the academ ies (including in - house academy), excluding time off for extended leaves of absence. The probationary period will end at the sooner of 16 months or the completion of all probationary testing, inclusive of driver II certification.
All original appointments to Fire Inspector ( Sworn or Non -Sworn) classifications shall serve a twelve (12) month probationary period, commencing with the first day of employment in the classification. Promotion from a non-sworn to a sworn position will be subject to the applicable Probationary Period.
Section 2. Part of Testing Process. The probationary period shall be regarded as part of the testing process and shall be utilized for closely observing all aspects of the employee's qualifications, for ensuring the effective adjustment of a new employee to the position and for rejecting any probationary employee who, in the opinion of management, is not suitable to attain permanent status.
Section 3. Suspension or Termination. During the probationary period a new employee may be suspended or terminated at any time by the appointing authority without cause and without right of appeal or to submit a grievance. Said employee shall not have the right to proceed to arbitration on the issue of arbitrability or on the issue of its constitutional or discovery rights, nor those of any employee by reason of the Item 8
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10 foregoing. The Union shall not be a party to any lawsuit relating to the termination of a probationary employee.
ARTICLE VII - SALARY PROVISIONS
Section 1. Base Wage Rates.
a. The base wage rates of bargaining unit classifications will be as set forth in Appendix A of this MOA.
b. General Salary Increase
Effective the first full pay period following July 1, 2025, the salary ranges of all represented classifications will be increased by three percent (3%).
Effective the first full pay period following July 1, 2026, the salary ranges of all represented classifications will be increased by three half percent (3%)
Effective the first full pay period following July 1, 2027, the salary ranges of all represented classifications will be increased by three percent (3%).
c. Market Increase:
Effective the first full pay period following July 1, 2026, the salary ranges of all represented classifications will be increased by three-fourths of one percent (0.75%).
Effective the first full pay period following July 1, 2027, the salary ranges of all represented classifications will be increased by three -fourths of one percent (0.75%).
Total Compensation and Survey Database
Management and the Union have agreed to a compensation survey database structure. Survey Cities include: Alameda, Berkeley, Fremont, Hayward, Menlo Park Fire District, Milpitas, Mountain View, Redwood City, Pleasanton, San Jose, San Mateo, San Ramon Fire District, Santa Clara, Santa Clara County and South San Francisco. Compensation Criteria includes: top step salary, maximum longevity, maximum education, uniform allowance, EMT differential, Hazmat differential, deferred compensation, employee pick up of employer pension costs (Negative EPMC), and maximum City paid benefits (medical, dental, vision, life insurance, LTD, and EAP).
The database is intended to provide one source of information concerning how the compensation paid to employees in bargaining unit job classifications compares to that Item 8
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11 paid by other employers.
Section 2. Out -of-Class Compensation. All represented employees who are assigned work in a higher classification for longer than four (4) continuous hours will be compensated at a higher pay rate for all hours worked during the out -of-class assignment. This provision applies as follows:
Fire Fighter, Apparatus Operator, Captain or Inspector working in a higher classification: Step to step. Representation unit classification working as a Battalion Chief, 10% above 6 th-Step Captain, but not to exceed of the salary range of the Battalion Chief. Representation unit classification working in any other management position, within the range of the management position.
In accordance with Government Code 20480, an employee assigned to work in an “out- of-class appointment” may not exceed 960 hours worked in the appointment within a fiscal year if the employee is appointed to an upgraded position or higher classification that is vacant during recruitment for a permanent appointment. This limitation does not apply to a position that is temporarily available due to a leave of absence.
Section 3. Salary Steps
Employees in the Firefighter Rank initially appointed to the first step of the salary range of their classification shall be entitled to a merit increase to step two in the pay range upon successful completion of six (6) months of service, so long as they receive a satisfactory performance evaluation. The date of such increase shall be the first full pay period following the evaluation date.
Employees may be appointed to any step in the salary schedule for their classification as recommended by the Fire Chief and approved by the City Manager.
Employees appointed to the second step and above are eligible to receive a merit increase the first full pay period following successful completion of twelve (12) months of actual service, so long as they receive a satisfactory performance evaluation.
Employees in the Fire Inspector (Non-Sworn) classification shall be entitled to a step increase in the pay range upon successful completion of twelve (12) months of service, so long as they receive a satisfactory performance evaluation. The date of such increase shall be the first full pay period following the evaluation date.
Each twelve (12) months of actual service after the evaluation date, each employee receiving a satisfactory performance evaluation shall receive a step increase to the next higher step (effective the first full pay period following the evaluation date) until the top step of the pay range for the job class has been reached. An employee shall not receive a merit increase beyond the maximum steps established for the job classification.
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12 Section 4. Pay for Court Appearance. Sworn Fire personnel appearing in court for the People shall be compensated as follows:
Period Rate Minimum
a. Appearance on scheduled day
off
Time and one-half at
40-hour rate
4 hours
b. Any or all court time
during scheduled shift
Straight time during
shift at 56-hour rate
None
c. Appearance on scheduled Time and one-half at 2 hours work day but not during
scheduled shift
40-hour rate (2 hour minimum, may
not run into shift time)
The employee shall remit all fees received for such appearances to the City within thirty days from the termination of his/her services. Compensation for mileage or subsistence allowance shall not be considered as a fee and shall be retained by the employee.
Section 4. Classifications. The sworn Haz Mat Inspector and sworn Fire Inspector classification will be paid at the same level as the Fourt-hour Fire Captain.
One Fire Captain position will be assigned to a Fire Captain (Forty -hour Assignment) with the pay set at 5% above the Fire Captain.
ARTICLE VIII - PAY DIFFERENTIALS
Sworn Unit employees are eligible for the following pay differentials. Notwithstanding any provision of this agreement, eligible employees can receive up to two differentials in addition to the EMT and Paramedic Certification pay. Non-Sworn Fire Inspectors will not be eligible for the listed pay differentials.
Section 1. Paramedic Assignment
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13 a. Limit of Eligibility. The City reserves the right to limit eligibility for the Paramedic Program to the Fire Fighter classification. The City may, at its discretion, add other classifications within the represented bargaining unit to meet the need of program changes. Differentials for other classifications will be as provided in this Article.
b. Additional Candidate Training. As the Program progresses, Management will assess the need for training additional Paramedic candidates. It is Management's intention to provide for such additional training as necessary for Program continuity.
c. Section 3. Incentives. Paramedics will receive a one-time cash payment of $500 for each biennial recertification. This provision applies only to active incumbents of authorized paramedic positions who remain in the paramedic assignment for at least one additional year after rec ertification. The one year requirement after recertification does not apply to those paramedics who may leave the program because of work- related injury or illness, or promotion, nor does it apply when a paramedic is asked by management to recertify in order to voluntarily extend their paramedic service to meet special departmental needs for a period of less than one year.
d. Proctoring. Paramedic proctoring assignments will be made by the Chief from among qualified volunteers. Payment of $600 will be made to the primary proctoring paramedic at the conclusion of each proctoring assignment.
The Chief or their designee will maintain a list of qualified proctors from among volunteers. Personnel will be selected by the Fire Chief or his or her designee from the list to serve as paramedic proctors. If a conflict arises between the City and the Union regarding the Proctor Program, either side may suspend the program at the annual renewal period and shall remain suspended until a resolution or agreement is reached.
e. Field Training Stipend. Employees assigned to provide field training for new paramedic accreditation will receive a $300 stipend to train a new paramedic or EMT to successful completion of paramedic accreditation. This assignment is at the discretion of the Chief or their designee.
f. Paramedic Differential.
Paramedics who have completed the required training and have been accredited in accordance with the program and possess their paramedic license, will receive a 14% differential in addition to their base salary effective beginning with the date of assignment to Paramedic duty. The Paramedic salary differential will terminate with the cessation of assignment to Paramedic duty.
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14 Section 2. Emergency Medical Technician Certification.
All employees hired into sworn positions must maintain a current EMT certification as a condition of employment. Employees, including Paramedics, shall receive a three percent (3%) differential in addition to their base salary for the EMT certification. The EMT differential will be provided the first pay period following graduation from an entry level academy or on date of hire where an academy is not required. In the event an employee’s EMT certification expires, the employee will be taken off the line and placed in an unpaid status until the employee can submit proof of EMT recertification.
Section 3. Bilingual Pay
Employees who have successfully demonstrated proficiency in any of the approved languages shall receive a 5% premium in addition to their base salary.
a. Approved Languages:
Spanish, Chinese (Mandarin and Cantonese), Japanese, Tagalog, Korean, Vietnamese, Russian, American Sign Language, and such other languages as determined by management.
b. Proficiency Requirements
The City shall develop and provide a method of testing for proficiency in the above listed languages. The City will pay for the first test in any approved language however subsequent testing will be at the employee’s own expense. An employee must pass the proficiency test to maintain the bilingual pay. The Fire Chief shall have the authority to require employees receiving bilingual pay to re-certify with the Human Resources Department as necessary and reasonable.
c. Arbitratability
The City’s substantive evaluation of an employee’s knowledge of and skills in a designated second language shall not be subject to the grievance procedure or review by an arbitrator.
Section 4. Special Operations Assignment (Haz Mat)
A maximum of eighteen positions who are both members of the Special Operations group and assigned the Special Operations, inclusive of Technical Rescue and Hazardous Materials certified personnel, team will receive a 5% differential in addition to their base salary. The differential does not apply to minimum staffing replacements.
Section 5. Fire Investigator Differential.
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15 A maximum of six (6) Fire inspector personnel including Haz Mat Inspectors who have been trained as Fire investigators and who are regularly assigned to fire investigation duties by the Chief will receive a 5% differential in addition to their base salary. The Chief reserves the right to determine who is regularly assigned to such duties.
Section 6. Education Incentive
Employees who have successfully achieved the education and training required for the Career Development program will receive either:
Tier 1: 2.5% differential in addition to base salary
OR
Tier 2: 5% differential in addition to base salary
a. Tier 1: An employee shall be eligible for Tier 1 incentive upon completion of 300 hours of Fire Chief approved job-related coursework.
1. Tier 1 will begin the first full pay period including July 1, 2026.
2. Employees must successfully pass probation in order to become eligible. b. Tier 2: An employee shall be eligible for tier 2 incentive upon completion of 600 hours of Fire Chief approved job-related coursework.
1. Tier 2 will begin the first full pay period including July 1, 2027.
2. Employees must successfully obtain step 4 of the salary schedule in order to become eligible.
c. Conditions of Job-related coursework
1. An Associate’s degree from an accredited college or university in public safety field shall count toward 150 hours of job related coursework. A Bachelor’s degree or higher accredited college or university shall count toward 300 hours of job related coursework.
2. Job related coursework completed to hold EMT or Paramedic licensure in this Article will not be eligible to count toward Tier 1 or Tier 2 required job- related coursework.
3. On duty City provided job-related classes will not be eligible.
4. Under no circumstances may duplicative coursework be submitted. d. All education and training completed under this Program must be actively utilized in the course of the employee’s assigned duties.
e. A minimum of 32 hours of Fire Chief approved job-related coursework is required every other calendar year in order to maintain the education incentive. f. The employee is responsible for submitting appropriate official transcripts, certificates, and proof of course completion demonstrating completion of all qualifying components. No incentive shall be granted without verified documentation.
g. Incentive pay shall begin the first full pay period after approval by the Fire Chief or designee of require documentation.
h. The Fire Chief or designee, shall make final determinations regarding course approval, applicability of training, and eligibility for incentive payment. A joint labor-management committee shall meet as needed to discuss the program.
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16 ARTICLE IX - HOLIDAYS
Section 1. Named Holidays.
Holiday pay is compensation for employees who are normally required to work on an approved holiday because they work in positions that require scheduling staff without regard to holidays. The following holidays are recognized as municipal holidays for pay purposes, and regular, employees shall have these days off with pay, except as otherwise provided in these rules:
January 1 Veterans’ Day, November 11
Third Monday in January Thanksgiving Day
Third Monday in February Day after Thanksgiving Day
Last Monday in May December 25
July 4th Either December 24, or December 31 as provided below First Monday in September
Second Monday in October
Floating Holiday: In addition to the paid holidays listed above, employees shall be excused with pay for one full work shift as a day of reflection (floating holiday) per calendar year. Eligible employees may use the floating holiday on any day mutually agreed by the employee and their supervisor for a Day of Reflection, including:
Juneteenth Freedom Day (June 19) or Cesar Chavez/Dolores Huerta Day (March 31).
Day of Reflection not used by the end of the fiscal year will be deemed forfeited and have no cash value.
161.5 hours are paid annually to an employee at a rate of 6.21 hours each pay period. Shift personnel shall receive pay in lieu of taking paid leave for accrued holidays. Such paid hours are in addition to the normal biweekly base pay. Shift personnel will be paid 6.21 hours of in lieu of holiday pay each pay period. Hours are prorated and accrued based on hours actually worked.
Accrued Holiday balances will be automatically paid off in the months of June and December.
Section 2. Conditions.
a. Personnel assigned to a 40- hour work schedule will receive paid holidays in accordance with Sections 517 and 518 of the Merit System Rules and Regulations.
b. Personnel assigned to a 40-hour work schedule will receive floating days off with pay in each of the following months: August, September, March, April, and June.
The following conditions will hold:
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17 (1) Management will designate the schedule of the paid day off under this section at least thirty days in advance.
(2) If, in conformance with this section, Management is unable to schedule a day off in the month indicated for reasons of shift operations, work scheduling or any other reason, the day will be added to the employee's vacation accrual.
(3) If an employee fails to take a day off as scheduled by Management under this section, the day off so scheduled will be forfeited.
ARTICLE X - OVERTIME COMPENSATION
Section 1. Compensation. Shift personnel assigned to overtime relief duty in addition to their regular 56-hour shift schedule shall receive overtime compensation at a rate of one and one -half times the employee's basic 56- hour rate, or out -of-class rate if such applies, for all hours of the relief duty shift. Required off-duty training, excluding remedial training, will be compensated at the rate of one and one- half times the basic 40- hour rate or as otherwise agreed. If an opportunity was provided to allow for the required training to be on duty, but the employee was unable to attend, the training scheduled for off duty will not be eligible for the 40-hour rate. Emergency callback will be compensated at a rate of one and one- half times the basic 40-hour rate to a maximum of 8 hours, and at a rate of one and one-half times the basic 56-hour rate for those hours in excess of 8 hours.
Overtime duty assignments will first be made from the voluntary overtime list. If such assignments cannot be filled from the voluntary overtime list, the vacant position will be filled by moving up on- shift personnel through out -of class assignment. Any re maining vacancy will then be filled by overtime duty assignment made in reverse order of hire date seniority according to specialty and qualifications required to be assigned. The overtime duty assignment seniority list will be adjusted annually on October 31.
ARTICLE XI - APPARATUS STAFFING
Engine, truck and combination rescue companies shall be deployed for emergency services purposes at the level of one Fire Captain, one Fire Apparatus Operator and one Fire Fighter. Truck companies have the option of deploying at the level of two Fire Apparatus Operators instead of one Fire Apparatus Operator and one Firefighter. This option shall be determined by seniority. Paramedic ambulance staffing shall be two personnel; the City will dispatch personnel on Emergency Medical Service calls such that a mi nimum of 1 licensed paramedic responds. The Foothill Fire Station #8, when activated by the Fire Chief, shall be staffed with a minimum of one Fire Apparatus Operator and one Fire Fighter. City may dispatch a two-person apparatus (ex: squad or quick response vehicle) with a minimum of 1 paramedic.
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18 ARTICLE XII - WORK ASSIGNMENTS AND TRANSFERS
It is the intent of the Palo Alto Fire Administration and Local 1319 that work assignments and transfers will reflect the best interests of the Fire Department and the City. The Fire Department will maintain a constant state of readiness to defend against fire and other disasters. It is therefore imperative that all Fire Department divisions assign personnel in the best manner to respond to the needs of the City and the Department. It is also acknowledged that the Fire Chief is responsible to make and/or approve the work assignments or transfers of Fire Department personnel.
The Fire Chief or designee will maintain a three year station and shift assignment, seniority-based bid system covering the following classifications within Fire Operations on a rotational basis: Fire Captain, Apparatus Operator and Fire Fighter.
The Fire Chief, or his designee, shall initiate personnel assignments and transfers to balance platoon or division strength, fill permanent or temporary vacancies and provide required training to individual personnel. Such assignments will be based on seni ority, except where career development, training, special assignments, skills and documented performance issues are specifically identified in writing, management may make assignments based on such issues. For purposes of this article, seniority shall be computed from the date of entry into the current classification.
Section 1. Shipouts. When possible, least senior Fire Fighters will be given short term or shipout relief duty. In order to maintain training continuity, shipouts of probationary personnel will be subject to the approval of the Fire Chief or their designee.
Section 2. Vacation Relief Positions. In order that platoon strengths can be balanced more quickly and to reduce the need for excess overtime, two positions will be designated for vacation relief. These positions will be the lowest two on the Department seniority list who have completed their probationary period.
a. The vacation relief persons will be assigned to one station when not on relief assignment.
b. Relief assignment can be made to any Station or shift where a shortage of personnel will cause unnecessary overtime.
c. Shortages may be caused by vacation, sick leave, disability or any leave of absence that causes a shift to be short of personnel while another has a surplus.
d. Shift transfers will be made so as not to cause the relief person to work more than the prescribed number of hours in the prescribed period.
e. Relief assignments will be made and hours will be coordinated by the Battalion Item 8
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19 Chief's office.
Section 3. Transfer Requests. Non-probationary fire personnel may submit transfer requests to their immediate supervisor to be forwarded to the appropriate chief officer.
Providing that Departmental needs are satisfied, such transfers will be administered using first a mutually agreeable exchange, secondly seniority.
The transfer requests shall remain on file during the year and may be granted when a vacancy occurs, providing the requesting employee possesses the experience and performance ability required to fill the vacancy.
Section 4. Special Assignments. Management reserves the right to assign personnel to career development opportunities, special projects, seminars, programs and selected educational and/or training courses, based on Fire Department needs and the performance of the employee.
Section 5. Continuous Hourly Service. Continuous hours of service in excess of 96 hours are subject to approval by the Fire Chief or designee. Approval may be granted up to 120 hours when an employee has not been engaged in a greater than usual level of activity or is not fatigued.
ARTICLE XIII - TRAINING COORDINATION
Section 1.Coordination. Three shift employees per platoon may be assigned to assist the Training Officer in the coordination, preparation and scheduling of the training program. It is agreed that volunteers will first be sought for such assignment, and further agreed that the details of this section shall be established by mutual agreement between the Fire Chief and the Union.
ARTICLE XIV - PROMOTION
Section 1. Promotion Step Level. All regular promotions from classifications within the representation unit to the classification of Fire Captain will be made at the sixth step on the salary range.
Section 2. Promotion Process Information. For promotions to positions within the representation unit, promotion process information will be available in the Human Resources Department office at the time of posting. Information will include applications, Item 8
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20 minimum qualifications, study material reference information, if appropriate, and information on passing scores. Any changes in an established testing process must be submitted in writing to the Union for review and input no fewer than 60 days prior to the beginning of the process.
ARTICLE XV - REDUCTION IN FORCE
Section 1. Order of Reduction. If the work force is reduced (reduction in force) within a represented classification, unit employees having the shortest length of service with the Fire Department will be laid off first so long as employees retained are fully qualified, trained and capable of performing remaining work.
ARTICLE XVI - SELECTIVE CALL BACK WITH REGARD TO RESIDENCY
Section 1. In Case of Emergency Management may use selective call back with regard to residency in cases of emergency.
ARTICLE XVII - HEALTH BENEFITS
Section 1. Maintenance of Levels Except as otherwise set forth herein, the City will maintain the present level of benefits on all City-sponsored medical programs.
Section 2. Vision Care
a) Level of Benefits: The City provides a base vision plan for all eligible employees and dependents. Additionally, eligible employees will have the option to enroll in a vision “buy-up” plan. Dependents include domestic partners, as defined under Article XX Section 3(b).
b) Premiums: The City shall pay all premium payments on behalf of employees and dependents who are eligible and enrolled in coverage under the base vision plan.
Employees will be responsible for premium payments required to enroll in the “buy up” vision plan.
Section 3. PEMHCA Health Plan.
a. ACTIVE EMPLOYEES: During the term of this contract, 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:
Effective July 1, 2025, the City will increase its maximum contribution to the following:
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21 Medical Category Premium Total Maximum City Contribution (inclusive of PEMHCA contribution*)
effective July 1, 2025
Employee Only
Employee plus one
Employee Family
$943.00
$1,885.00
$2,444.00
Effective January 1, 2027, the City will increase its maximum contribution to medical premiums by the following percentages:
• Employee only: 2%
• Employee plus one: 3%
• Employee family: 5%
Medical Category Premium Total Maximum City Contribution (inclusive of PEMHCA contribution*)
effective January 1, 2027
Employee Only
Employee plus one
Employee Family
$962.00
$1,942.00
$2,566.00
Effective January 1, 2028, the City will increase its maximum contribution to medical premiums by four percent (4%).
Medical Category Premium Total Maximum City Contribution (inclusive of PEMHCA contribution*)
effective January 1, 2028
Employee Only
Employee plus one
Employee Family
$1,000.00
$2,020.00
$2,669.00
The City’s total maximum contribution towards medical premiums for eligible part time employees shall be prorated based on the number of hours per week the part-time employee is assigned to work.
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22 * Any increases to the PEMHCA minimum during the term of this contract will result in a corresponding decrease to the amount of the additional City contribution, so that the total maximum City contribution never exceeds the Total Maximum City Contribution described above.
If the State of California or federal government requires the City to participate and contribute toward coverage under any medical plan outside of PEMHCA including but not limited to the Affordable Care Act, the City’s total liability for enrolled employees and retirees and their eligible family members shall not exceed what the City would have paid toward PEMHCA coverage in the absence of such state or federal plan. The parties will meet and confer over the impact of such change on matters within the scope of representation before implementing any change.
b. Flexible Compensation:
Effective January 28, 2023, in lieu of additional increases to the City’s medical premiums, hourly wages for all bargaining unit classifications were increased by $100 per month ($1200 per year). Employees can utilize this cash payment for any purpose, including to cover health insurance premiums or contribute to flexible spending accounts/457 deferred compensation plans. Effective the first full pay period of January 2024, hourly wages for all bargaining unit classifications were increased by an additional $100 per month.
c. Active employee domestic partners whose domestic partnership is registered with the State of California may add their domestic partner as a dependent to their elected health plan coverage if the domestic partner is registered with the Secretary of State.
Active employee domestic partners whose domestic partnership is not registered with the State but who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department, will be eligible for reimbursement of the actual monthly premium cost of an individual health plan, not to exceed 90% of the average monthly premium cost of individual coverage under the PEMHCA health plans in 2016. Effective with the first pay period including Januar y 1, 2017, a stipend of two hundred eighty four ($284) per month toward the cost of an individual health plan will be provided. Evidence of premium payment will be required with request for reimbursement.
d. Alternate Medical Benefit Program.
If a regular employee and/or the employee’s dependent(s) are eligible for and elect to receive medical insurance through any non- City of Palo Alto sponsored or association medical plan, the employee may choose to waive his/her right to the City of Palo Alto’s medical insurance coverage and receive cash payments in the amount of two hundred and eighty four dollars ($284) for each month City coverage is waived.
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23 Examples of waivers eligible for this payment are:
• Employee waives all applicable City medical coverage; or • Employee is eligible to enroll his or her spouse or domestic partner and waives medical coverage for the spouse or domestic partner; or • Employee has additional eligible dependents and waives family-level medical coverage.
Participation must result in a health insurance cost savings to the City and payments per employee shall not exceed a total of two hundred eighty four dollars ($284) per month. To participate in the program the employee and dependents must be eligible for coverage under PEMHCA medical plans, complete a waiver of medical coverage form, and provide proof of eligible alternative medical coverage.
Payments will be made in the employee’s paycheck beginning the first month following the employee’s completion of the waiver form. Payments are subject to state and federal taxes and are not considered earnings under PERS law.
Employees are responsible for notifying the City of any change in status affecting eligibility for this program (for example, life changes affecting dependent’s eligibility for medical coverage through the employee) and will be responsible for repayment of amounts paid by the City contrary to the terms of this program due to the employee’s failure to notify the City of a change in status.
e. Dual Coverage.
When a City employee is married to another City employee each shall be covered only once (as an individual or as a spouse of the other City employee, but not both) and dependent children, if any, shall be covered only by one spouse.
ARTICLE XVIII - DENTAL BENEFITS
Section 1. Level of Benefits. The City will maintain the present level of benefits on the City- sponsored dental program. The City provides a base dental plan for all eligible employees and dependents. Additionally, eligible employees will have the option to enroll in a dental “buy-up” plan.
Section 2. Premiums. The City shall pay all premium payments on behalf of employees and dependents who are eligible and enrolled for coverage under the base dental plan.
Dependents will include domestic partners, as defined under Article XX, Section 3(b).
Employees will be responsible for premium payments required to enroll in the “buy up” dental plan.
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24 ARTICLE XIX - LIFE INSURANCE
Section 1. Premiums.
The City will provide employees with Basic and Supplemental life insurance plans.
The City shall pay the premium for basic life insurance coverage equal to one times the employee’s annual salary. Employees will have the option of enrolling in supplemental life insurance by paying the premiums required to enroll in the plan.
ARTICLE XX - RETIREMENT BENEFITS
Section 1. PERS Retirement Formula.
Safety Pension Group A: 3%@50 Safety Retirement
The City will continue the present benefits under the Public Employees' Retirement System (PERS) "3 percent at 50 (3%@50)" formula for employees hired before the effective date of the “3 percent at 55” (3%@55) formula for new hires as described herein. The final year compensation for employees hired under the 3% at 50 formula will continue to be “Single highest year” or the highest average annual compensation earnable by the member during one (1) year of employment immediately preceding retirement or the one- year period otherwise designated by the member (Government Code section 20042).
Safety Pension Group B: 3%@55 Safety Retirement
Effective December 7, 2012, the City amended its contract with CalPERS to provide employees hired on or after that date who are not “new members” of CalPERS, as defined in the Public Employees’ Pension Reform Act (ofte n referred to as “classic” CalPERS members) with the CalPERS retirement formula three percent of final salary at age 55 (“3%@55”), with the final salary determination for such employees of “3 highest consecutive years” based on the highest average annual compensation earnable by the member du ring three (3) consecutive years of employment immediately preceding retirement or the three -year period otherwise designated by the member (Government Code section 20037).
Safety Pension Group C: 2.7% at Age 57 Safety Retirement Employees hired on or after January 1, 2013 meeting the definition of “new member” under the Public Employees’ Pension Reform Act (Gov’t. Code s. 7522 et seq.) shall be subject to all of the provisions of that law, including but not limited to the two point seven percent at age 57 (2.7%@57) retirement formula with a three year final compensation period.
Miscellaneous Pension Formulas:
a. Miscellaneous Pension Group A: 2.7% at 55. The City provides retirement Item 8
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2.7% at age 55 for employees hired before July 17, 2010, with a one year final compensation period.
b. Miscellaneous Pension Group B: 2% at 60:For miscellaneous employees hired on or after July 17, 2010, and before January 1, 2013, and employees hired on or after January 1, 2013 who are not “new members” of CalPERS as defined in the Public Employees’ Pensio n Reform Act (often referred to as “Classic” CalPERS members)the City offers the CalPERS retirement formula two percent (2.0%) of final salary at age sixty (60), with a one (1) year final compensation period.
c. Miscellaneous Pension Group C: 2% at 62. Employees hired on or after January 1, 2013 meeting the definition of “new member” under the Public Employees’ Pension Reform Act (Gov’t. Code s. 7522 et seq.) shall be subject to all of the provisions of that law, including but not limited to the two percent at age 62 (2%@62) retirement formula with a three (3) year final compensation period.
Section 2. PERS Member Contribution.
a. Employees in all represented classes in Pension Groups A and B described above will make the 9% PERS member contributions by payroll deduction.
b. Employees in all represented classes in Pension Group C described above shall pay the employee contribution required by the Public Employees’ Pension Reform Act, currently calculated at fifty percent (50%) of the normal cost.
c. When employees pay their PERS Member Contribution pursuant to section 3a and 3b above, the City will provide for member contributions to be made as allowed under provisions of IRS Code Section 414(h)(2).
Section 3. Additional Employee PERS contributions
In addition to the PERS member contribution as required under section 2. a, b and c above, all employees in pension groups a, b and c shall contribute the additional following contributions:
a. In addition to the Member Contribution required per CalPERS 20516 contract amendment all employees regardless of pension formula in this unit shall pay 3% towards the Employer share of Pension.
b. Effective the first full pay period following July 1, 2020, all employees regardless of pension formula in this unit shall, in addition to the Member Contribution required, pay an additional 1% towards the employer share of Pension for a total of 4%.
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26 Section 4. Option 2 Death Benefit. The City provides the Pre -Retirement Option Settlement 2 Death Benefit. The Pre- Retirement Optional Settlement 2 Death Benefit provides the spouse of a deceased member, who was eligible to retire for service at the time of death, with an alternate option to the lump sum Basic Death Benefit whereby the surviving spouse can elect a monthly allowance equal to the amount the member would receive if he/she had retired from service on the date of death and elected Optional Settlement 2 (the highest monthly allowance a member can leave a spouse).
Section 5. Military Service Credit. The City will provide the Public Employees’ Retirement System benefit known as “Section 20930.3, Military Service Credit as Public Service.”
Section 6. 1959 Survivor Benefit.
The City will continue to provide the basic level of 1959 PERS Survivor Benefit to eligible employees in accordance with Government Code section 21571.
Section 7. Employer Contributions to 457 Plan
Effective the first full pay period following July 1, 2020, the City will contribute the equivalent of 1% of the employee’s pensionable salary into the 457 plan.
Eligibility:
a. Employees must be enrolled in an eligible City sponsored 457 plan b. Employees who reach the maximum as defined by the IRS will not receive additional contributions
c. Employee must be making PERS contributions
ARTICLE XXI - RETIREMENT MEDICAL PLAN
Section 1. 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 that retire on or before December 31, 2006. Effective January 1, 2007 for an employee retiring on or after that date the City will pay up to the monthly medical premium for the 2
nd most expensive plan offered to IAFF employees among the existing array of plans. However, the City contribution for an employee hired before January 1, 2004 who retires on or after December 1, 2011 shall be the same contribution amount it makes for active City employees.
Starting June 1, 2016 through August 31, 2016, the City provided active unit employees who were hired before January 1, 2004 with a one- time opportunity to opt -in to retiree health benefits provided under California Government Code section 22893.
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27 Hired On Or After January 1, 2004:
The retiree health benefit provided in California Government Code section 22893 shall apply to all employees hired on or after January 1, 2004. Under this law, an employee is eligible to receive Fifty (50) percent of benefit after ten (10) years; each additional service credit year after Ten (10) years will increase employer credit by Five (5%) percent until Twenty (20) years is reached at which time employee is eligible for One Hundred (100%) percent of annuitant-only coverage and Ninety (90%) percent of the additional premium for dependents.
ARTICLE XXII - DEPENDENT CARE ASSISTANCE PROGRAM (DCAP) Section 1. DCAP. The City will provide a dependent care assistance program for employees subject to the provisions of applicable law. The program will remain in effect subject to a reasonable minimum participation level and availability of third party administrative services at a reasonable cost. Disputes regarding the administration of the plan shall be subject to the dispute resolution procedure provided by the plan document.
Section 2. HCFSA. The City will provide healthcare flexible spending program for employees subject to the provision of applicable law. Disputes regarding the administration of the plan shall be subject to the dispute resolution procedure provided by the plan document.
The HCFSA program will be available to employees effective January l, 2026, and remain in effect subject to a reasonable minimum participation level and availability of third-party administrative services at a reasonable cost.
ARTICLE XXIII - VACATION ACCRUAL
Section 1. Accrual Rate. All eligible fire suppression persons shall accrue vacation at the following rate for continuous service performed in a pay status. Non -shift representation unit employees shall accrue the 40- hour equivalent --one shift equals sixteen hours.
a. For employees completing less than four years continuous service, the accrual rate shall be five duty shifts per year.
b. For employees completing four but not more than nine years continuous service, the accrual rate shall be eight duty shifts per year.
c. For employees completing nine but not more than 14 years continuous service, the accrual rate shall be 10 duty shifts per year.
d. For employees completing 14 but less than 19 years continuous service, the accrual rate shall be 11 duty shifts per year.
e. For employees completing 19 or more years continuous service, the accrual rate shall be 12 duty shifts per year.
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28 At the time of initial appointment to the City, the City may credit an employee for prior years of public service in a city, county, special district, state or federal government agency, up to a maximum of four (4) years of service. The City Manager or designee shall identify the number of years for which the employee will receive credit (up to the four (4) year maximum).
Section 2. Unused At Termination. Represented employees who fail to use all vacation as accrued may continue the accrual balance and be entitled to all accrued but unused vacation upon termination, except as limited below.
Section 3. Limits. Vacation accrual balances shall be limited to three times the annual accrual rate. Accrual credit beyond this limit shall not be recognized or compensated, except that for employees of record as of January 1, 1984 who have vacation excess on a one-time basis shall be set aside (banked) to be subsequently used as vacation or paid at termination. No additions may be made to the bank. The bank is established only to facilitate changeover from unlimited to three times annual accrual rate lim itation on vacation accrual as herein provided.
ARTICLE XXIV - USE OF VACATION
Section 1. Maximum Number of Slots. The maximum number of vacation scheduling slots for representation unit suppression employees is four (4) per platoon on a year- round basis. During the term of the contract, parties agree to meet to discuss the impact of the number of vacation slots per day on daily staffing.
Section 2. Approvals. Vacation scheduling must be approved by the Battalion Chief or Fire Chief. The minimum is twelve (12) hours or more for suppression employees.
Advance vacation schedules for suppression shall begin either at 8:00 a.m. or 8:00 p.m.
Section 3. Vacation Pay. Vacation pay shall be made available in advance of regular pay day provided that employee requests such advance in writing to the Finance Department at least two weeks prior to his/her vacation date. The employee's supervisor must verify vacation date on the request.
Section 4. Illness on Vacation. When an employee becomes ill while on vacation and such illness can be supported by a statement from an accredited physician or the employee is hospitalized for any period, the employee shall have the period of illness charged against sick leave and not against vacation leave.
Section 5. When to be Taken. The time at which an employee may use accrued vacation leave and the amount to be taken at any one time shall be determined by the Chief with particular regard for the needs of the City, but insofar as possible, considering Item 8
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29 the wishes of the employee.
Section 6. Limitation on Use. Employees may not use more than three times their annual rate of accrual in any calendar year period provided, however, that the Chief may grant exceptions to this limitation.
Section 7. Waiting Period. Employees shall complete six months continuous service before using accrued vacation leave.
Section 8. Double Compensation Prohibited. Employees shall not work for the City during their vacation.
Section 9. Cash out Option.
Once each calendar year an employee may cash out eight (8) or more hours of vacation accrual in excess of eighty (80) hours to a maximum of one hundred twenty (120) hours; PROVIDED, that the employee has taken eighty (80) hours of vacation off with pay in the previous twelve (12) months.
ARTICLE XXV - SICK LEAVE
Section 1. Statement of Policy. Sick leave shall be allowed and used only in case of actual personal sickness or disability, medical or dental treatment, or as authorized in Section 9. Sick leave may be used for illness in the immediate family (wife, husband, child, parent, parent-in-law, brother, sister, registered domestic partner, or close relative residing in the household of the employee.)
Section 2. Eligibility. Regular employees shall be eligible to accrue and use sick leave.
Section 3. Accrual. Sick leave shall be accrued bi-weekly, provided the employee has been in a pay status for 50 percent or more of a bi -weekly pay period. Sick leave shall be accrued at the rate of six shifts per year.
Section 4. Accumulation. Accumulated sick leave may be accrued without limit, except as provided in Section 8 below.
Section 5. Use. Sick leave may be used as needed and approved, to the point of depletion, at which time the employee will no longer receive pay for sick leave. A new employee may, if necessary, use up to forty -eight (48) hours or shift equivalent of sick leave at any time during the first six months of employment. Any negative balances generated by such utilization will be charged against future accrual or deducted from final paycheck in the event of termination.
An employee who has been disabled for 60 consecutive days and who is otherwise eligible both for payment under the long- term disability group insurance coverage and accrued sick leave benefits may, at his/her option, choose either to receive the long- term disability benefits or to utilize the remainder of his/her accrued sick leave prior to Item 8
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Sick leave will not be granted for illness occurring during any leave of absence other than sick leave, unless the employee can demonstrate that it was necessary to come under the care of a doctor while on such other leave of absence.
When an employee finds it necessary to be absent for any reason, he/she should cause the facts to be reported to the department within 60 minutes prior to his/her regular starting time on the first working day of absence, and shall regularly report on, or account in advance for each work day thereafter unless hospitalized or otherwise indisposed. Such reports may be subject to written documentation. Sick leave shall not be granted unless such report or advance accounting has been made, provided, however, that the department head may grant exception to this policy where the circumstances warrant.
Section 6. Depletion of Sick Leave Benefits. Upon depletion of sick leave or the beginning of the period to be covered by payments under long- term disability group insurance coverage, whichever comes first, an employee may be granted a medical leave of absence without pay for a period not exceeding s ixty days. If the employee is unable to return to work at the end of this period, he/she must request further medical leave which will be subject to the approval of the City Manager. If further leave is granted, the employee must notify the City of intent to return to work every thirty days. If further leave is not granted, the employee's service with the City shall be considered terminated.
Section 7. Forfeiture Upon Termination. Employees leaving the municipal service shall forfeit all accumulated sick leave, except as otherwise provided by law and Section
8. In the event that notice of resignation is given, sick leave may be used only through the day which was designated as the final day of work by such notice.
Section 8. Payment for Accumulated Sick Leave. Eligible employees (those hired before December 31, 1983) who leave the municipal service in good standing, or who die while employed in good standing by the City, and who have fifteen or more years of continuous service, shall receive compensation for unused sick leave hours in a sum equal to two and one- half percent of their unused sick leave hours multiplied by their years of continuous service and their basic hourly rate of pay at termination. Full sick leave accrual will be paid in the event of termination due to disability.
For new employees hired after December 31, 1983, sick leave accrual accumulation will be limited to 1,000 hours with no payoff provisions for unused balance at termination for any reason.
Section 9. Personal Business Leave Chargeable to Sick Leave. It is agreed between the parties that all shift personnel represented by the Union shall have the right to charge up to forty-eight (48) hours personal business leave per year to sick leave, and that all non-shift personnel shall have the right to charge up to twenty (20) hours personal business leave per year to sick leave. Such personal business leave shall be allowed Item 8
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31 only on a staffing available basis and where the provisions of the minimum staffing agreement are not affected. "Staffing available" means at or above minimum staffing levels as defined in Article XII.
Section 10. Return to Work or Continue Work With Limited Duty. In cases of non- work-related injury, illness or pregnancy an employee, upon approval of the Fire Chief and the City Safety Officer, may return to work or continue work with doctor -approved limited duty. Approval for such limited duty shall be based upon department ability to provide work consistent with medical limitations and the length of time of the limitations.
Shift employees must be willing to accept any non- shift limited duty schedule work location and may be subject to the reasonable availability of limited duty assignments.
The City doctor may be consulted in determining work limitations.
ARTICLE XXVI - SUBPOENAS
Employees required to answer subpoenas as a witness for the City of Palo Alto or for a plaintiff where the City of Palo Alto is a defendant shall not lose pay or benefits for work time lost to answer depositions or to appear in court.
ARTICLE XXVII - WORKERS' COMPENSATION
Section 1. Status Reporting While on Disability. Persons on disability will be required to appear or otherwise report at regular two-week intervals to the Fire Chief or designate to discuss his/her status of medical treatment therapy and physical condition. This section is not meant to unreasonably rest rict employee's activities so long as such activities are cleared by the treating physician, treating program or alternative treatment program is maintained and employee is available for full or restricted duty as soon as medical clearance can be received.
ARTICLE XXVIII - PHYSICAL FITNESS MEDICAL EXAMINATIONS
Physical fitness medical examinations for all represented employees may include chest x-rays every three years unless otherwise directed by a physician, eye examination and hearing examination.
ARTICLE XXIX- LEAVES OF ABSENCE WITHOUT PAY
Section 1. Disability. Leaves of absence without pay may be granted in cases of disability not covered by sick leave. Pregnancy will be considered as any other disability.
Leaves of absence for disability are subject to physician's verification including diagnosis and medical work restriction.
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32 Section 2. Other Leaves. Leaves of absence without pay may be granted in cases of personal emergency or when such absences would not be contrary to the best interest of the City. Non- disability prenatal and/or postpartum leave is available under this provision, but such leave shall not begin more than six months prenatal nor extend more than six months postpartum.
Section 3. Accrued Vacation Credits. During unpaid leaves of absence for disability or other reasons, the employee may elect to use accrued vacation credits. Requests for leaves without pay shall not be unreasonably denied. In order to avoid misunderstandings, all leaves without pay must be in writing to be effective.
Section 4. Approval of Department Head. Leave of absence without pay for one week or less may be granted by the department head, depending on the merit of the individual case.
Section 5. Approval by City Manager. Leave of absence without pay in excess of one week's duration may be granted by the City Manager on the merit of the case, but such leave shall not exceed twelve months' duration.
Section 6. Absence Without Leave. Unauthorized leave of absence shall be considered to be without pay, and reductions in the employee's pay shall be made accordingly. Unauthorized leave of absence may result in termination of employment.
Section 7. Leave of Absence; Death Outside the Immediate Family. Leave without pay may be granted a regular employee by his/her department head in the event of death to family members other than one of the immediate family, such leave to be granted in accordance with Section 2 and Section 4.
Section 8. Military Leave of Absence. State law shall govern the granting of military leaves of absence and the rights of employees returning from such absence.
Section 9. Use of paid accruals while on leave. During unpaid leaves of absence for disability or other reasons, the employee may elect and the City may require the employee to use accrued vacation paid leave credits in a manner consistent with state and federal law. Requests for leaves without pay shal l not be unreasonably denied. In order to avoid misunderstandings, all leaves without pay must be in writing to be effective.
ARTICLE XXX - LEAVES OF ABSENCE WITH PAY
Section 1. City Manager Granted Leaves. The City Manager may grant a regular employee under his control a leave of absence with pay for a period not exceeding thirty calendar days for reasons he deems adequate and in the best interest of the City.
Section 2. Council Granted Leave. The City Council may grant a regular employee a leave of absence with pay for a period not to exceed one year for reasons the Council considers adequate and in the best interest of the City.
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33 Section 3. Employee's Time Off to Vote. Time off with pay to vote at any general or direct primary election shall be granted as provided in the State of California Elections Code, and notice that an employee desires such time off shall be given in accordance with the provisions of said Code.
Section 4. Leaves of Absence; Death in Immediate Family. Leave of absence with pay of one shift with provision for approval of one additional shift for travel outside the area may be granted an employee by the Chief in the event of death in the employee's immediate family, which is defined for purposes of this section as wife, husband, son, son-in-law, daughter, daughter -in-law, father, mother, brother, brother -in-law, sister, sister-in-law, mother-in-law, father-in-law, grandfather, grandfather-in-law, grandmother, grandmother-in-law, uncle, aunt, registered domestic partner, or a close relative residing in the household of the employee. Such leave shall be at full pay and shall not be charged against the employee's accrued vacation or sick leave. Requests for leave in excess of two shifts shall be subject to the approval of the City Manager.
Section 5. Jury Duty; Leave of Absence. Employees required to report for jury duty shall be granted a leave of absence with pay from their assigned duties until released by the court, provided the employee remits to the City all fees received for such duties other than mileage or subsistence al lowances within thirty days from the termination of his or her jury service.
ARTICLE XXXI – VOLUNTEER LEAVE PROGRAM
The City of Palo Alto has established a Firefighter Voluntary Leave Program to provide members of Local 1319 International Association of Fire Fighters (IAFF) employees the opportunity to donate their accrued vacation time to assist fellow members of IAFF either due to: (a) an employee’s own verifiable non- industrial catastrophic illness or injury (as defined herein) or (b) in order to care for a member of the employee’s immediate family (spouse, child, parent or registered domestic partner suffering from a verifiable catastrophic illness or injury) and have exhausted or will presently exhaust all of their paid leave.
In order to be eligible to receive donated leave, an employee must have a catastrophic illness or injury or an employee’s immediate family member must have a catastrophic illness or injury that requires the employee to provide full -time care for this famil y member. Care will be taken to emphasize the voluntary nature of the plan and to insure confidentiality of employee participants and medical conditions (where applicable).
A Firefighter Voluntary Leave Sharing Program has been established to accept donations of vacation in accordance with the Program’s guidelines. All donations shall be:
1. Voluntary
2. Irrevocable
3. Confidential, unless disclosure is required by law
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34 4. In whole hour increments of at least four (4) hours, with the hours donated being converted to donee hours based on the donee’s salary rate (so that there will be no cost to the City due to salary differential).
5. The employee shall be required to exhaust all other types of leave to request donated leave
6. It is understood that employees seeking or receiving leave under this program will apply for long-term disability benefits for which they may be eligible
7. Where any of the period during which an employee receives donated leave is designated as family leave under the California Family Rights Act (CFRA/Family Medical Leave Act (FMLA), the employee will be eligible for continuation of medical and other available benefits during that the family leave period (for up to 12 weeks), in accordance with the requirements of those laws. If the employee receiving donated leave is not eligible for CFRA/FMLA benefit continuation, or after the employee has exhausted the avai lable CFRA/FMLA leave period, the employee will need to pay the premiums for continued medical and other available benefits if the employee chooses to continue such coverages through the City
8. If the donation request is based on the need for an employee to care for an immediate family member, as defined above, the family member must require full- time care by the employee. Certification of this requirement by a health care professional is required
9. The maximum donated time a donee may receive is 12 months (if available).
10. Applications to donate leave or receive leave under this Program are made to the Human Resources Department
11. This is a pilot program and is subject to cancellation by either party
IAFF members interested in donating leave or in applying to receive donated leave shall complete forms provided by the Human Resources Department. If an applicant for leave is found to meet the criteria set forth herein, Human Resources will determine th e availability of and (as applicable) allocation of donated paid leave. Payroll will be notified in writing of the number of hours to be deducted from each donating employee’s vacation balance and transferred to the donee employee(s).
The City reserves the right to modify or terminate this program at any time.
Catastrophic Illness or Injury (also referred to as “medical emergency” in Revenue Ruling 90-29 and Sections 801(c) and 812 of the Merit Rules and Regulations): A non- occupational medical condition of an employee that will require the prolonged absence of the employee from duty and which will result in a substantial loss of income to the employee because the employee will have exhausted all paid leave available apart from the Voluntary Employee Leave sharing Program. Non- disability postpartum leave as referenced in Merit Rule 801(b) shall not be considered a catastrophic illness or injury under this Policy.
ARTICLE XXXII- TUITION REIMBURSEMENT
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35 Section 1. Options.
Effective July 1, 2004 the tuition reimbursement program was amended to provide each employee the option of receiving the $1,000 as taxable cash or as a contribution to deferred compensation. The tuition reimbursement program will be eliminated effective July 1, 2012 with no further payouts starting in FY 12-13 and on-going.
ARTICLE XXXIII - PER DIEM TRAVEL EXPENSES
Section 1. City Business. Unless other mutually agreeable arrangements are made, representation unit employees who are required to travel away from the City on City business will receive travel expenses, according to City policies which are currently in effect.
ARTICLE XXXIV - HOUSE FUND ITEMS
Section 1. Station House Fund. The station house fund per year, per shift employee shall be $100.00.
Section 2. Non-Food House Items. The City agrees to furnish and maintain each fire station with non- food house fund items: TV purchase and repair. Kitchen cooking utensils, small kitchen appliances and other specific items to be determined by mutual agreement of the parties will be purc hased from the station house fund. The Fire Fighters agree to maintain the voter registration program.
ARTICLE XXXV- PARKING
Section 1. Entitlements. Employees in represented classes assigned to Civic Center or adjacent work locations shall be entitled to free parking in the Civic Center Garage, or a commute incentive which will be subject to meet and confer. Employees hired after July 1, 1994, may initially receive a parking permit for another downtown lot, subject to availability of space at the Civic Center Garage. Light duty employees assigned to the Civic Center will receive Civic Center parking temporary permits for the duration of the light duty assignment.
ARTICLE XXXVI- GRIEVANCES
The City and the Union agree to establish a grievance procedure as follows:
1. Definition: A grievance is any complaint or dispute regarding the application of interpretation of this Memorandum of Understanding, Department rules, regulations, policies or procedures relating to wages, hours or other terms and Item 8
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2. Any non-probationary employee represented by the Union may file and process a grievance. Such aggrieved employees may be represented by the Union or may represent themselves in preparing and presenting their grievance at any level of review. The Union may file a grievance when a Union right not directly related to an individual employee becomes subject to dispute.
3. Any retroactivity on monetary grievances shall be limited to the date of occurrence, except in no case will retroactivity be granted prior to three months before the grievance was filed in writing.
4. Written grievances shall be submitted on forms provided by the City or on forms which are mutually agreeable to the City and the Union. The Union shall deliver a copy of a written grievance to the Human Resources Department Director on the same date that i t is first filed with another City representative under the provisions of the below grievance procedure.
5. The time limits specified in this section may be extended by mutual agreement in writing of the aggrieved employee or Union and the reviewer concerned. Should a decision not be rendered within a stipulated time limit, the aggrieved employee may immediately appeal to the next step. The grievance will be considered settled if the decision of any step is not appealed within the specified time limit.
6. If a grievance is related to a promotional process to positions within the representation unit, Step I shall be directed to the Deputy Fire Chief (or Fire Marshal for FPB positions).
7. Step I. The aggrieved employee will first attempt to resolve the grievance through informal discussions with the immediate supervisor by the end of the tenth business day following the discovery of the incident upon which the grievance is based. Every attempt will be made to settle the issue at this level.
Step II. If the grievance is not resolved through informal discussion, it may be submitted in writing to the Battalion Chief (Deputy Fire Chief for Captain grievances) within ten business days of the informal discussion. The Battalion Chief/Assistant Fire Chief will have ten business days from receipt of the grievance to review the matter and prepare a written response. If the grievance is denied, the response shall contain the reasons therefore.
Step III. If the grievance is not resolved in Step II, it may be submitted in writing to the Fire Chief within ten business days of receipt of the Battalion Chief's/ Deputy Fire Chief's written response. The Fire Chief will have ten business days from receipt of the grievance to review the matter and prepare a written response.
If the grievance is denied, the response shall contain the reasons therefore.
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37 submit the grievance to the City Manager for final determination or to binding grievance arbitration. All Step IV appeals must be filed in writing at the Human Resources Department Office within ten business days of receipt of the Fire Chief's response under Step III. All hearings before the City Manager shall be pursuant to the rules and regulations set forth in the City of Palo Alto Merit Rules and Regulations. Hearings before an arbitrator will be as set forth below.
In the event the aggrieved employee decides to proceed to arbitration, he/she shall select jointly with the Director of Human Resources an arbitrator. If the parties are unable to agree on an arbitrator, they shall jointly request a panel of five qualified and experienced arbitrators from the State Conciliation Service.
Upon receipt of the list of arbitrators, the names shall be alternately struck until one name remains who shall serve as arbitrator. The arbitrator shall be jointly contacted by the parties.
The arbitrator shall have jurisdiction and authority only to interpret, apply, or determine compliance with the provisions of the Memorandum of Agreement and such Merit System rules, regulations, policies, procedures, City ordinances or regulations relating to terms or conditions of employment, wages or fringe benefits, as may hereafter be in effect in the City insofar as may be necessary to the determination of grievances appealed to the arbitrator. The arbitrator shall be without power to make any decision:
a. Regarding matters of interest.
b. Contrary to, or inconsistent with or modifying in any way, the terms of this Memorandum of Agreement.
c. Granting any wage increases or decreases.
d. Granting pay or benefits for any period of time prior to the execution date of this Memorandum of Agreement.
Where either party seeks arbitration and the other party claims the matter is not subject to the arbitration provisions of the Memorandum of Agreement, the issue of arbitrability shall first be decided by the arbitrator using the standards and criteria set forth in this Memorandum of Agreement.
The arbitrator shall be without authority to require the City to delegate or relinquish any powers which by State law or City Charter the City cannot delegate or relinquish. Copies of the arbitrator's decision shall be submitted to the City and the aggrieved employee. All direct costs emanating from the arbitration procedure shall be shared equally by the City and the aggrieved employee or the Union.
It is further agreed that the provisions of this section shall be incorporated as part of Chapter 11 of the City of Palo Alto Merit System Rules and Regulations.
Existing procedures set forth in Chapter 11, to the extent they are inconsistent with the provisions contained herein, are superseded.
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38 ARTICLE XXXVII- SAFETY COMMITTEE
Section 1. Committee A Safety Committee comprised of four representation unit members appointed by the Union, and at least two members of Management, will continue to meet. The Committee may make safety recommendations to the Fire Chief regarding equipment, vehicles and appara tus and may review all accidents involving represented personnel. Management shall inform the Safety Committee of all accidents involving injuries to represented personnel.
ARTICLE XXXVIII – MISCELLANEOUS
Section 1. Section 1. Uniforms.
The value of the purchase, rental and/or maintenance of the required uniforms shall be reported as special compensation to the extent legally permissible, pursuant to Title 2 CCR, Section 571(a)(5) as Uniform Allowance. Based upon existing uniform standards and the City’s cost experience, the value of this benefit shall be reported as $15.31 per pay period.
The City will supply complete uniforms as described in Fire Department Policy 1031. The City will issue four T-shirts to each uniformed employee each July These T-shirts are for use on duty only and will be maintained by the employee.
Section 2. Removal of Disciplinary Actions. Records of disciplinary actions shall be removed from the personnel file of a representation unit employee upon written request by the employee after a period of three years, or sooner if mutually agreed by the Fire Chief and the employee. If the disciplinary action involved violations of the City’s anti - harassment policy, state/federal harassment or discrimination laws, or if there have been subsequent violations of the same policy during the three- year period, the Fire Chief may deny the request for removal. In such cases, the employee may request a review meeting with the Fire Chief or designee, Union President or designee, and Human Resources. The final decision following this review meeting is final and not subject to any grievance or appeal rights.
ARTICLE XXXIX - FULL UNDERSTANDING
Section 1. Full and Entire Understanding. The Memorandum of Agreement contains the full and entire understanding of the parties regarding the matters set forth herein.
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39 Section 2. Fair Labor Standards Act. Compensatory time off with Management approval may be used as an alternative to overtime compensation only within the 27- day work period within which the overtime is worked.
Section 3. Severability. Should any of the provisions herein contained be rendered or declared invalid by reason of any existing State or Federal legislation or by reason of State or U.S. Supreme Court ruling, such invalidation of such part or portion of this Memorandum of Agreement shall not invalidate the remaining portions hereof, and they shall remain in full force and effect, insofar as such remaining portions are severable.
Section 4. Good Faith. It is the intent of the parties that ordinances, resolutions, rules and regulations enacted pursuant to this Memorandum of Understanding be administered and observed in good faith.
Section 5. Merit System Rules and Regulations. During the term of this Memorandum of Agreement, Management may propose certain changes in the City Merit System Rules and Regulations. With regard to such changes which pertain to the representation unit, the parties agree to review, and upon request, me et and confer regarding the changes.
Section 6. Station Consolidation or Relocation . During the term of this agreement, at management request, the parties agree to meet and confer with regard to issues pertaining to fire station consolidation or relocation.
Section 7. Meet and Confer. Nothing in this agreement shall preclude the parties from mutually agreeing to meet and confer on any subject within the scope of representation during the term of this agreement.
ARTICLE XL – 48/96 Work Schedule
The regular schedule for 56 hour personnel will be under a “48/96” model. With the adoption of this “48/96” schedule the parties agreed to revise Fire Department policy 205.6 typical workday and 1009.8.1 Reporting for Duty- Holidays.
ARTICLE XLI – FUTURE SERVICE DELIVERY MODELS
Effective upon request of the City, the parties will meet and confer in good faith regarding the service delivery model of current inspection services and transport during the term of this Agreement.
ARTICLE XLII - DURATION
This Memorandum of Agreement shall become effective upon ratification by both parties hereto and remain in effect through June 30, 2028.
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38 EXECUTED:
FOR: FOR:
INTERNATIONAL ASSOCIATION CITY OF PALO ALTO
FIRE FIGHTERS
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Memorandum of Agreement
City of Palo Alto and
Palo Alto Fire Chiefs’ Association
July 1, 2025 – June 30, 2028
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1 MEMORANDUM OF AGREEMENT
Table of Contents
PREAMBLE ____________________________________________________________________________________ 4 ARTICLE I - RECOGNITION _______________________________________________________________________ 4 SECTION 1. ___________________________________________________________________________________ 4 ARTICLE II - NO DISCRIMINATION _________________________________________________________________ 4 SECTION 1. ___________________________________________________________________________________ 4 SECTION 2 ___________________________________________________________________________________ 4 ARTICLE III - PAYROLL DEDUCTIONS _______________________________________________________________ 4 SECTION 1 ___________________________________________________________________________________ 4 SECTION 2. CERTIFICATION OF UNION MEMBERSHIP _______________________________________________________ 5 SECTION 3. INDEMNIFICATION ______________________________________________________________________ 5 ARTICLE IV - NO STRIKES ________________________________________________________________________ 5 SECTION 1 ___________________________________________________________________________________ 5 ARTICLE V - SALARY PROVISIONS _________________________________________________________________ 5 SECTION 1. SALARY RANGE ADJUSTMENTS. _____________________________________________________________ 5 SECTION 2. EMT DIFFERENTIAL _____________________________________________________________________ 6 SECTION 3. 40-HOUR WORK WEEK ASSIGNMENT DIFFERENTIAL _______________________________________________ 6 SECTION 4. OUT OF COUNTY STRIKE TEAM PAY. _________________________________________________________ 6 ARTICLE VI – HOLIDAYS _________________________________________________________________________ 7 SECTION 1. NAMED HOLIDAYS. _____________________________________________________________________ 7 SECTION 2. DAY OF REFLECTION _____________________________________________________________________ 7 SECTION 3. 56-HOUR WORK WEEK ASSIGNMENTS. _______________________________________________________ 7 SECTION 4. 40-HOUR WORK WEEK ASSIGNMENTS. _______________________________________________________ 8 ARTICLE VII - VACATION ACCRUAL _________________________________________________________________ 8 SECTION 1. ___________________________________________________________________________________ 8 SECTION 2. 56-HOUR WORKWEEK ASSIGNMENTS ________________________________________________________ 8 SECTION 3. 40-HOUR WORKWEEK ASSIGNMENTS. ________________________________________________________ 8 ARTICLE VIII - VACATION CASH OUT _______________________________________________________________ 9 SECTION 1. LIMITATION ON USE. ____________________________________________________________________ 9 SECTION 2. CASH OUT OPTION. _____________________________________________________________________ 9 ARTICLE IX - MANAGEMENT ANNUAL LEAVE _______________________________________________________ 10 SECTION 1 __________________________________________________________________________________ 10 ARTICLE X - OTHER PAID LEAVES _________________________________________________________________ 10 SECTION 1. CITY MANAGER GRANTED LEAVES __________________________________________________________ 10 SECTION 2. COUNCIL GRANTED LEAVE _______________________________________________________________ 10 SECTION 3. EMPLOYEE'S TIME OFF TO VOTE ___________________________________________________________ 10 SECTION 4. LEAVES OF ABSENCE; DEATH IN IMMEDIATE FAMILY ______________________________________________ 11 Item 8
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2 SECTION 5. JURY DUTY; LEAVE OF ABSENCE ____________________________________________________________ 11 SECTION 6. SUBPOENAS _________________________________________________________________________ 11 ARTICLE XI - OTHER LEAVE PROVISIONS ___________________________________________________________ 12 SECTION 1. DISABILITY. __________________________________________________________________________ 12 SECTION 2. OTHER UNPAID LEAVES. _________________________________________________________________ 12 SECTION 3. ACCRUED VACATION CREDITS. _____________________________________________________________ 12 SECTION 4. APPROVAL OF DEPARTMENT HEAD. _________________________________________________________ 12 SECTION 5. APPROVAL BY CITY MANAGER _____________________________________________________________ 12 SECTION 6. ABSENCE WITHOUT LEAVE. _______________________________________________________________ 12 SECTION 7. LEAVE OF ABSENCE; DEATH OUTSIDE THE IMMEDIATE FAMILY. _______________________________________ 12 SECTION 8. MILITARY LEAVE OF ABSENCE. _____________________________________________________________ 12 ARTICLE XII - VOLUNTARY CATASTROPHIC LEAVE PROGRAM _________________________________________ 12 SECTION 1. __________________________________________________________________________________ 12 SECTION 2. __________________________________________________________________________________ 12 SECTION 3. __________________________________________________________________________________ 13 SECTION 4. __________________________________________________________________________________ 13 SECTION 5. __________________________________________________________________________________ 13 SECTION 6. __________________________________________________________________________________ 14 ARTICLE XIII - ADDITIONAL COMPENSATION FOR BC CLASSIFICATIONS _________________________________ 14 ARTICLE XIV - EXCESS BENEFIT REIMBURSEMENT ___________________________________________________ 15 SECTION 1. __________________________________________________________________________________ 15 ARTICLE XV - PHYSICAL EXAMS __________________________________________________________________ 16 ARTICLE XVI - BENEFIT PROGRAMS _______________________________________________________________ 16 SECTION 1. HEALTH PLAN - ACTIVE EMPLOYEES ______________________________________________________ 16 SECTION 2. DUAL COVERAGE. _____________________________________________________________________ 18 SECTION 3 DENTAL BENEFITS ______________________________________________________________________ 18 SECTION 4. VISION CARE. ________________________________________________________________________ 18 SECTION 5. EMPLOYEE ASSISTANCE PLAN _____________________________________________________________ 18 ARTICLE XVII – RETIREMENT MEDICAL PLAN _______________________________________________________ 19 SECTION 1. RETIREE MEDICAL COVERAGE FOR UNIT EMPLOYEES HIRED BEFORE JANUARY 1, 2004: ______________________ 19 SECTION 2. 20-YEAR VESTING FOR RETIREE MEDICAL COVERAGE FOR UNIT EMPLOYEES HIRED ON OR AFTER JANUARY 1, 2004: _ 19 ARTICLE XIII – BASIC LIFE INSURANCE _____________________________________________________________ 19 ARTICLE XIX– SUPPLEMENTAL LIFE INSURANCE _____________________________________________________ 19 ARTICLE XX– LONG TERM DISABILITY INSURANCE ___________________________________________________ 19 ARTICLE XXI - EFFECTIVE DATE OF BENEFIT COVERAGE FOR NEW EMPLOYEES ____________________________ 20 ARTICLE XXII-WORKERS’ COMPENSATION _________________________________________________________ 20 ARTICLE XXIII- RETIREMENT PENSION PLANS _______________________________________________________ 20 SECTION 1. SAFETY PERS RETIREMENT FORMULA. _______________________________________________________ 20 SECTION 2. STATUS DETERMINATION ________________________________________________________________ 21 SECTION 3. EMPLOYER CONTRIBUTIONS TO 457 PLAN _____________________________________________________ 21 ARTICLE XXIV - MISCELLANEOUS EMPLOYMENT-RELATED EXPENSES ___________________________________ 22 SECTION 1. STATION HOUSE FUND. _________________________________________________________________ 22 Item 8
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3 SECTION 2. NON-FOOD HOUSE ITEMS _______________________________________________________________ 22 SECTION 3. PER DIEM TRAVEL EXPENSES FOR CITY BUSINESS ________________________________________________ 22 SECTION 4. PARKING ___________________________________________________________________________ 22 SECTION 5. UNIFORM. __________________________________________________________________________ 22 ARTICLE XXV – WORK ASSIGNMENTS _____________________________________________________________ 22 SECTION 1. __________________________________________________________________________________ 22 SECTION 2. WORKING OUT OF CLASSIFICATION __________________________________________________________ 22 ARTICLE XXVI - FULL UNDERSTANDING ____________________________________________________________ 23 SECTION 1 __________________________________________________________________________________ 23 SECTION 2. SEVERABILITY. ________________________________________________________________________ 23 SECTION 3. __________________________________________________________________________________ 23 SECTION 4. __________________________________________________________________________________ 23 SECTION 5. __________________________________________________________________________________ 23 ARTICLE XXVII - DURATION _____________________________________________________________________ 23 ARTICLE XXVIII- 48/96 WORK SCHEDULE __________________________________________________________ 23 APPENDIX A__________________________________________________________________________________ 25 Item 8
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4 CITY OF PALO ALTO AND PALO ALTO FIRE CHIEFS’ ASSOCIATION
PREAMBLE
This Memorandum of Agreement between the City of Palo Alto, hereinafter referred to as the "City", and the Palo Alto Fire Chiefs’ Association, hereinafter referred as the "Association", has been prepared and entered into in accordance with Title I, Division 4, Chapter 10, Sections 3500-3510 of the California Government Code and Chapter 12 of the City of Palo Alto Merit System Rules and Regulations.
ARTICLE I - RECOGNITION
Section 1. The City recognizes the Association as the exclusive representative of an employee group consisting solely of the classifications of Battalion Chief 56-hour workweek, and Battalion Chief 40-hour workweek who are regularly employed by the City.
ARTICLE II - NO DISCRIMINATION
Section 1. The Association and the City hereby agree that there shall be no discrimination because of race, color, age, disability, sex, national origin, sexual orientation, political or religious affiliation or any other basis recognized by federal, state or local law under this Agreement. There shall be no discrimination in employment conditions or treat ment of employees on the basis of membership or non-membership in the Association, or participation in the lawful activities of the Association.
Section 2 . The Association and the City hereby agree to protect the rights of all employees to exercise their free choice to join the Association and to abide by the express provisions of applicable State and local laws.
ARTICLE III - PAYROLL DEDUCTIONS
Section 1. The City shall deduct Association membership dues assessments and insurances authorized by the Association. This will be accomplished by payroll deductions from the bi- weekly pay of member employees. The dues deduction must be authorized in writing by the employee on an authorization card.
The Association will be the custodian of records for individual employee membership and dues deduction forms. The Association will maintain all authorizations for dues deduction, signed by the individual from whose salary or wages the deduction or reduction is to be made. The City Item 8
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5 will direct employee requests to cancel or change deductions to the Association.
The City shall remit the deducted dues to the Association as soon as possible after deduction.
Section 2. Certification of Association Membership. The Association agrees to provide the City a certified list of members and statement that the Association has and will maintain written authorizations signed by the individuals from whose wages the Association dues deductions are to be made. The Association will update the list whenever there are changes.
Section 3. Indemnification. The Association shall indemnify and hold the City harmless against any liability arising from any claims, demands, or other action relating to this article. The Association shall comply with all statutory and legal requirements with respect to this article.
ARTICLE IV - NO STRIKES
Section 1 . The Association, its representatives, or members, shall not engage in or cause, instigate, encourage, sanction, or condone a strike, withholding of services, leave of absence abuse, work stoppage or work slowdown of any kind against the City of Palo Alto or its citizens by employees covered under this Agreement. No employee shall refuse to cross any picket line in the conduct of Fire Department business, nor shall the Association, its representatives or members discriminate in any way toward anyone who refuses to participate in a strike, or any of the job actions cited above.
ARTICLE V - SALARY PROVISIONS
Section 1. Salary Range Adjustments.
The base wage rates of the bargaining unit classifications will be set forth in Appendix A of this MOA.
a) General Salary Increase: Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA, the salary ranges of all represented classifications will be increased by three percent (3.0%).
b) Market Adjustment: Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA, the salary ranges of all represented classifications will be increased by one and one half percent (1.5%). The 40hr training Battalion Chief position will be increased by an additional half percent (0.5%).
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6 c) General Salary Increase: Effective the first full pay period following July 1, 2026, the salary ranges of all represented classifications will be increased by three percent (3.0%).
d) Market Adjustment: Effective the first full pay period following July 1, 2027, the salary ranges of all represented classifications will receive a market adjustment of two percent (2.0%).
e) General Salary Increase: Effective the first full pay period following July 1, 2027, the salary ranges of all represented classifications will be increased by three percent (3.0%).
f) Total Compensation and Survey Database: Management and the Union have agreed to a compensation survey database structure. Survey Cities include: Alameda, Berkeley, Fremont, Hayward, Menlo Park Fire District, Milpitas, Mountain View, Redwood City, Pleasanton, San Jose, San Mateo, San Ramon Fire District, Santa Clara, Santa Clara County and South San Francisco. Compensation Criteria includes: top step salary, maximum longevity, maximum education, uniform allowance, EMT differential, Hazmat differential, deferred compensation, employee pick up of employer pension costs (Negative EPMC), and maximum City paid benefits (medical, dental, vision, life insurance, LTD, and EAP). The database is intended to provide one source of information concerning how the compensation paid to employees in bargaining unit job classifications compares to that paid by other employers.
Section 2. EMT Differential . The former EMT differential of 3.0% was rolled into base pay.
This one time conversion to base pay, shall constitute the City’s incentive payment for EMT skills.
This conversion was cost neutral to the City.
Section 3. 40- hour Work Week Assignment Differential . Employees assigned to a 40- hour workweek schedule will be paid a differential of five percent (5%) of base salary in -lieu of holiday pay differential which 56-hour shift Battalion Chiefs receive.
Section 4. Out of County Strike Team Pay.
A Battalion Chief sent on out of County strike team duty will receive the following compensation only if the City is reimbursed from the state or federal government for the labor costs incurred by the City.
Compensation to the employee will not exceed the rate for which the City is reimbursed by the State of California or other external entity, excluding reimbursements for other labor costs (e.g. workers compensation, administrative expense, etc.).
A Battalion Chief on their regular duty shift deployed on an out of County strike team will be eligible for compensation at their normal hourly rate (1.0 hourly rate), assuming a regular 56 hour schedule.
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7 A Battalion Chief on non-regular duty shift days deployed on an out of County strike team will be eligible for compensation at a rate of 1.5 of their normal hourly rate.
For 40 hour Battalion Chiefs deployed on an out of County strike team, any out of County strike team compensation will be calculated at a 56 hour Battalion Chief Schedule hourly rate.
Payment for out of county strike team duty will be calculated based on the number of twenty- four hour shifts worked and prorated for any partial shifts.
A Personnel Action Form will be completed in a timely manner to process this payment. The amount of the payment will be calculated in a manner described above. If the City is not reimbursed, no payment is due to the employee. If the City is reimbursed in part, a prorated payment will be calculated based on the reimbursement rate. As outlined above, compensation to the employee will not exceed the rate for which the City is reimbursed by the State of California or other external entity.
ARTICLE VI – HOLIDAYS
Section 1. Named Holidays.
Holiday pay is compensation for employees who are normally required to work on an approved holiday because they work in positions that require scheduling staff without regard to holidays. The following holidays are recognized as municipal holidays for pay purposes. Regular, employees shall have these days off with pay, except as otherwise provided in these rules:
January 1 Veterans’ Day, November 11
Third Monday in January Thanksgiving Day
Third Monday in February Day after Thanksgiving Day
Last Monday in May December 25
July 4 Either December 24, or December 31
First Monday in September
Second Monday in October
Section 2. Day of Reflection. In addition to the paid holidays listed above, employees shall be excused with pay for one full work shift as a day of reflection (floating holiday) per calendar year, Employees may use the floating holiday on any day mutually agreed by the employee and their supervisor for a Day of Reflection, including: Juneteenth Freedom Day (June 19) or Cesar Chavez/Dolores Huerta Day (March 31). Day of Reflection not used by the end of the calendar year will be forfeited and have no cash value.
Section 3. 56-Hour Work Week Assignments. Shift personnel shall receive pay in lieu of taking paid leave for accrued holidays. One hundred sixty one and one half (161.5) hours are paid annually to an employee at a rate of 6.21 hours each pay period. Such paid hours will be paid 6.21 hours of in lieu of holiday pay each pay period. Hours are prorated and accrue based on hours worked.
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8 Section 4. 40- Hour Work Week Assignments. Employees assigned to a 40-hour workweek schedule receive paid holidays in accordance with Sections 517 and 518 of the Merit System Rules and Regulations.
ARTICLE VII - VACATION ACCRUAL
Section 1. Vacation is accrued when an employee is in a pay status and is credited on a bi-weekly basis. Such accrual balance and credit may not exceed three times the annual rate of accrual.
Accrual rates by work week assignments are indicated in Section 2 and Section 3 below.
Section 2. 56- Hour Workweek Assignments . Employees assigned to a 56-hour workweek schedule (24- hour shift) accrue vacation at the following rates:
a) For employees having completed less than four (4) years continuous service, the accrual rate shall be five (5) duty shifts per year.
b) For employees having completed four (4), but less than nine (9) years continuous service, the accrual rate shall be eight (8) duty shifts per year. c) For employees having completed nine (9), but less than fourteen (14) years continuous service, the accrual rate shall be ten (10) duty shifts per year.
d) For employees having completed fourteen (14), but less than nineteen (19) years continuous service, the accrual rate shall be eleven (11) duty shifts per year.
e) For employees having completed nineteen (19) or more years continuous service, the accrual rate shall be twelve (12) duty shifts per year.
Section 3. 40-Hour Workweek Assignments. Personnel assigned to a 40-hour workweek schedule accrue vacation at the following rates:
a) For employees having completed less than four (4) years continuous service, the accrual rate shall be eighty
(80) hours per year.
b) For employees having completed four (4), but less than nine (9) years continuous service, the accrual rate shall be one-hundred twenty (120) hours per year.
c) For employees having completed nine (9), but less than fourteen (14) years continuous service, the accrual rate shall be one-hundred sixty (160) hours per year.
d) For employees having completed fourteen (14), but less than nineteen (19) years continuous service, the accrual rate shall be one-hundred eighty (180) hours vacation leave per year.
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9 e) For employees having completed nineteen (19) or more years continuous service, the accrual rate shall be two- hundred (200) hours vacation leave per year.
ARTICLE VIII - VACATION CASH OUT
Section 1. Limitation on Use. Employees may not use more than three times their annual rate of accrual in any calendar year period provided, however, that the Chief may grant exceptions to this limitation.
Section 2. Cash out Option.
a) Once each calendar year, employees are eligible to cash out vacation accrual balances in excess of 80 hours. An employee may cash out a minimum of eight (8) hours to a maximum of 120 hours of accrued vacation provided employee has taken 80 vacation hours in the previous 12 months and has followed the election procedures set forth in this section.
b) Employee must elect the number of vacation hours they will cash-out during the next calendar year, up to the maximum of 120 hours. For the 2012 calendar vacation year, employees will make their election for vacation hours to cash out no later than November 1, 2012. The election will apply only to vacation hours that are accrued in the next calendar year and that are eligible for cash-out.
c) The election to cash-out vacation hours in each designated year will be irrevocable. This means that employees who elect to cash -out vacation hours must cash- out the number of accrued hours pre-designates on the election form.
d) Employees who do not elect a cash-out amount by November of the prior calendar year will be deemed to have waived the right to cash out any leave in the following tax year and will not be eligible to cash-out vacation hours in the next tax year.
e) Employees who elect cash-out amount may request a cash-out at any time in the designated tax year by submitting a cash-out form to payroll. Payroll will complete the cash-out form upon request, provided the requested cash-out amount has accrued and is consistent with the amount the employee pre-designated. If the full amount of hours designated for cash-out is not available at the time of cash-out, the maximum available will be paid. For employees who have not requested cash-out of the elected amount by November 1 of year, Payroll will automatically cash- out the elected amount in a paycheck issued on or after the payroll date including November 1.
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10 ARTICLE IX - MANAGEMENT ANNUAL LEAVE
Section 1. Forty (40) hour non-shift employees not eligible for overtime shall be credited at the beginning of each calendar year with eighty (80) hours of annual leave. Fifty-six (56) hour shift employees shall be credited one hundred and twelve (112) hours of annual leave.
Such leave may be taken as paid time off, added to vacation accrual (subject to vacation accrual limitations), taken as cash, or taken as deferred compensation. Entitlement under this provision will be reduced on a prorated basis for part-time status, or according to the number of months in paid status during the calendar year.
At the end of the calendar year, unused management annual leave will be paid in cash, unless a different option as indicated above is elected by the employee.
ARTICLE X - OTHER PAID LEAVES
Section 1. City Manager Granted Leaves . The City Manager may grant a regular employee under his control a leave of absence with pay for a period not exceeding thirty calendar days for reasons he deems adequate and in the best interest of the City.
Section 2. Council Granted Leave. The City Council may grant a regular employee a leave of absence with pay for a period not to exceed one year for reasons the Council considers adequate and in the best interest of the City.
Section 3. Employee's Time Off to Vote . Time off with pay to vote at any general or direct primary election shall be granted as provided in the State of California Elections Code, and notice that an employee desires such time off shall be given in accordance with the provisions of said Code.
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11 Section 4. Leaves of Absence; Death in Immediate Family. Leave of absence with pay may be granted an employee by the Chief in the event of death in the employee's immediate family, which is defined for purposes of this section as:
wife
husband
son
son-in-law
daughter
daughter-in-law
father
mother
brother
brother-in-law
sister
sister-in-law
mother-in-law
father-in-law
step-father
step-mother
step-sister
step-brother
grandfather
grandfather-in-law
grandmother
grandmother-in-law
uncle
aunt
niece
nephew
registered domestic
partner
close relative residing in
the household of the
employee
56 hour shift employees may receive one shift with provision for approval of one additional shift for travel outside the area. Such leave shall be at full pay and shall not be charged against the employee's accrued vacation or sick leave. Shift employees may supplement paid bereavement leave with accrued leave (including vacation or sick leave) or unpaid leave to reach 48 hours of consecutive time off per incident of bereavement. Requests for leave in excess of two shifts shall be subject to the approval of the City Manager.
Employees assigned to a 40-hour work week may be granted by the Chief three (3) days of leave with pay in the event of death in the employee’s immediate family. Non -shift employees may supplement paid bereavement leave with accrued leave (including vacation or sick leave) or unpaid leave to reach a total of five (5) workdays of time off per incident of bereavement.
Section 5. Jury Duty; Leave of Absence. Employees required to report for jury duty shall be granted a leave of absence with pay from their assigned duties until released by the court, provided the employee remits to the City all fees received for such duties other than mileage or subsistence allowances within thirty days from the termination of his or her jury service.
Section 6. Subpoenas. Employees required to answer subpoenas as a witness for the City of Palo Alto or for a plaintiff where the City of Palo Alto is a defendant shall not lose pay or benefits for work time lost to answer depositions or to appear in court.
Section 7. Personal Business. Employees may use up to thirty (30) hours of sick leave per calendar year for personal business. The scheduling of such leave is subject to the approval of the appropriate level of management.
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12 ARTICLE XI - OTHER LEAVE PROVISIONS
Section 1. Disability. Leaves of absence without pay may be granted in cases of disability not covered by sick leave. Pregnancy will be considered as any other disability. Leaves of absence for disability are subject to physician's verification including diagnosis and medical work restriction.
Section 2. Other Unpaid Leaves. Leaves of absence without pay may be granted in cases of personal emergency or when such absences would not be contrary to the best interest of the City.
Requests for leaves without pay shall not be unreasonably denied. Approval of leave without pay must be in writing to be effective. Non-disability prenatal and/or postpartum leave is available under this provision, but such leave shall not begin more than six months prenatal nor extend more than six months postpartum.
Section 3. Accrued Vacation Credits. During unpaid leaves of absence for disability or other reasons, the employee may elect to use accrued vacation credits.
Section 4. Approval of Department Head. Leave of absence without pay for one week or less may be granted by the department head, depending on the merit of the individual case.
Section 5. Approval by City Manager. Leave of absence without pay in excess of one (1) week may be granted by the City Manager on the merit of the case, but such leave shall not exceed twelve (12) months.
Section 6. Absence Without Leave. Unauthorized leave of absence shall be without pay, and reductions in the employee's pay shall be made accordingly. Unauthorized leave of absence may result in discipline, including termination of employment.
Section 7. Leave of Absence; Death Outside the Immediate Family. Leave without pay may be granted a regular employee by their department head in the event of a death outside the immediate family, such leave to be granted in accordance with Section 2 and Section 4.
Section 8. Military Leave of Absence. Applicable law shall govern the granting of military leaves of absence and the rights of employees returning from such absence.
ARTICLE XII - VOLUNTARY CATASTROPHIC LEAVE PROGRAM
Section 1. The City of Palo Alto has established a Firefighter Voluntary Leave Program to provide FCA employees the opportunity to donate their accrued vacation time to assist fellow members of FCA either due to: (a) an employee’s own verifiable non-industrial catastrophic illness or injury (as defined herein) or (b) in order to care for a member of the employee’s immediate family (spouse, child, parent or registered domestic partner suffering from a verifiable catastrophic illness or injury) and have exhausted or will presently exhaust all of their paid leave.
Section 2. In order to be eligible to receive donated leave, an employee must have a catastrophic Item 8
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13 illness or injury or an employee’s immediate family member must have a catastrophic illness or injury that requires the employee to provide full-time care for this family member. Care will be taken to emphasize the voluntary nature of the plan and to insure confidentiality of employee participants and medical conditions (where applicable).
Section 3. A Firefighter Voluntary Leave Sharing Program has been established to accept donations of vacation in accordance with the Program’s guidelines. All donations shall be:
a) Voluntary
b) Irrevocable
c) Confidential, unless disclosure is required by law
d) In whole hour increments of at least four (4) hours, with the hours donated being converted to donee hours based on the donee’s salary rate (so that there will be no cost to the City due to salary differential).
e) The employee shall be required to exhaust all other types of leave to request donated leave
f) It is understood that employees seeking or receiving leave under this program will apply for long- term disability benefits for which they may be eligible g) Where any of the period during which an employee receives donated leave is designated as family leave under the California Family Rights Act (CFRA/Family Medical Leave Act (FMLA), the employee will be eligible for continuation of medical and other available benefits during that the family leave period (for up to 12 weeks), in accordance with the requirements of those laws. If the employee receiving donated leave is not eligible for CFRA/FMLA benefit continuation, or after the employee has exhausted the available CFRA/FMLA leave period, the employee will need to pay the premiums for continued medical and other available benefits if the employee chooses to continue such coverage through the City
h) If the donation request is based on the need for an employee to care for an immediate family member, as defined above, the family member must require full-time care by the employee. Certification of this requirement by a health care professional is required i) The maximum donated time a donee may receive is 12 months (if available). j) Applications to donate leave or receive leave under this Program are made to the Human Resources Department
k) The tax treatment of donation or receipt of vacation under this section is governed by the IRS and not the City.
Section 4. FCA members interested in donating leave or in applying to receive donated leave shall complete forms provided by the Human Resources Department. If an applicant for leave is found to meet the criteria set forth herein, Human Resources will determine the availability of and (as applicable) allocation of donated paid leave. Payroll will be notified in writing of the number of hours to be deducted from each donating employee’s vacation balance and transferred to the donee employee(s).
Section 5. The City reserves the right to modify or terminate this program at any time.
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14 Section 6. Catastrophic Illness or Injury (also referred to as “medical emergency” in Revenue Ruling 90-29 and Sections 801(c) and 812 of the Merit Rules and Regulations): A non-occupational medical condition of an employee that will require the prolonged absence of the employee from duty and which will result in a substantial loss of income to the employee because the employee will have exhausted all paid leave available apart from the Voluntary Employee Leave sharing Program. Non-disability postpartum leave as referenced in Merit Rule 801(b) shall not be considered a catastrophic illness or injury under this Policy.
ARTICLE XIII - ADDITIONAL COMPENSATION FOR BC CLASSIFICATIONS
POTENTIAL BATTALION CHIEF EXTRA SHIFT COVERAGE
Battalion Chiefs who back fill for an operations shift (or shifts) for a 56-hour work week Battalion Chief will be provided additional compensation for the extra shift coverage, provided that the extra shift requires working hours beyond regularly scheduled hours.
Extra Shift Coverage Eligibility
• Extra shift coverage pay applies to the level of Battalion Chief only and is not intended as compensation for Battalion Chiefs to backfill a lower classification. • A minimum of eight (8) continuous hours of the extra shift coverage must be worked to be eligible for compensation. After the minimum of eight (8) continuous hours is met, the Battalion Chief will be paid for the entire shift worked.
Extra Shift Coverage Pay Rate
• Compensation for the extra shift coverage by a 56-hour or 40-hour Battalion Chief will be paid at one and one-half times (1.5x) the 56-hour straight-time rate of the Battalion Chief performing the back fill.
First Rights of Refusal
• Battalion Chiefs shall be provided first rights of refusal for the extra shift coverage.
If no Battalion Chiefs are available to back fill the extra coverage shift, the shift will be assigned to fire personnel at a lower classification in accordance with the standard protocols of the department.
Extra Shift Coverage Pay Not PERSable
• All pay under this extra shift coverage provision will be reported to CALPERS by the City of Palo Alto in a manner that excludes such pay from PERSable income. As such, the extra shift coverage pay is not subject to CALPERS contributions by the employer or employee and is not included as a factor in the employee’s final compensation for pension purposes.
Fire Chief Discretion
• In accordance with management rights provisions, the Fire Chief maintains discretion to approve, modify or disapprove extra shift coverage assignments.
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15 FLSA Exempt Status
• Nothing in the extra shift coverage provision is intended to impact the FLSA-exempt status of Battalion Chiefs. Battalion Chiefs remain FLSA-exempt and are therefore not eligible for overtime pay or compensatory time.
ARTICLE XIV - EXCESS BENEFIT REIMBURSEMENT
Section 1. The benefit provided by this Article is designed to meet the requirements of Section 125 of the Internal Revenue Code. Every calendar year, each employee will be provided with $2,500 that they can designate among the following options:
a) Medical Flexible Spending Account (Medical FSA) . Provides reimbursement for excess medical/dental/vision, or expenses that are incurred by employees and their dependents which are not covered or reimbursed by any other source, including existing City-sponsored plans. This includes prescribed medications and co-payments as specified in applicable federal law.
b) Dependent Care Flexible Spending Account (Dependent Care FSA) . Provides reimbursement for qualified dependent care expenses under the City's Dependent Care Assistance Program (DCAP), subject to the limits specified in applicable federal law.
1) Dependent care expenses not reimbursed under this section may be eligible for reimbursement under the City Voluntary Dependent Care FSA program. However, the maximum amount reimbursed under the Voluntary Dependent Care FSA program will be reduced by any amount reimbursed under the Excess Benefit Plan.
c) Professional Development
Employees may use these funds for professional development purposes on a taxable basis to the extent such expenses (e.g., job-related training and education, seminars, training manuals, etc.) are not paid or reimbursed under any other plan of the City.
d) Deferred Compensation. Provides a one-time contribution to the employee’s City- sponsored I.R.C. § 457 Deferred Compensation plan with either ICMA -RE or Mass Mutual, subject to the contribution limitations of applicable law.
Amounts designated by employees to either the Medical FSA, Dependent Care FSA, or Professional Development options are done so on a “use –it-or-lose-it” basis. This means that any amounts designated and not used by the end of the calendar year (or end of the extended grace period for the medical FSA) will be forfeited by the employee and returned to the plan.
Specified amounts under this benefit will be applied on a pro-rata basis for employees who are part-time or who are in FCA pay status for less than the full fiscal year. Such benefits Item 8
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16 will be pro-rated in the first year of employment (based on hire date) but will not be pro- rated upon separation of employment.
ARTICLE XV - PHYSICAL EXAMS
Physical fitness medical examinations for all represented employees will be provided in accordance with the Fire Department Physical Fitness Program General Order.
ARTICLE XVI - BENEFIT PROGRAMS
Section 1. Health Plan - ACTIVE EMPLOYEES : During the term of this contract, the maximum City contribution towards medical premiums for eligible full time employees per employee category shall be the following for any plan:
Medical Premium
Category
PEMHCA
Contribution*
Total Maximum City
Contribution (inclusive of
PEMHCA contribution)
effective July 1, 2025
Employee Only $151.00 $943
Employee plus one $151.00 $1885
Employee Family $151.00 $2444
Effective January 1, 2027, the City will increase its maximum contribution to medical premiums by the following percentages:
• Employee only: 2%
• Employee plus one: 3%
• Employee family: 5%
Medical Premium
Category
PEMHCA
Contribution*
Total Maximum City
Contribution (inclusive of
PEMHCA contribution)
effective January 1, 2027
Employee Only $151.00 $962
Employee plus one $151.00 $1942
Employee Family $151.00 $2566
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17 Effective January 1, 2028, the City will increase its maximum contribution to medical premiums by 4%.
Medical Premium
Category
PEMHCA
Contribution*
Total Maximum City
Contribution (inclusive of
PEMHCA contribution)
effective January 1, 2028
Employee Only $151.00 $1000
Employee plus one $151.00 $2020
Employee Family $151.00 $2669
*Any increases to the PEMHCA minimum during the term of this contract will result in a corresponding decrease to the amount of the additional City contribution, so that the total maximum City contribution never exceeds the Total Maximum City Contribution described above.
The City’s total maximum contribution towards medical premiums for eligible part time employees shall be prorated based on the number of hours per week the part-time employee is assigned to work.
If the State of California or federal government requires the City to participate and contribute toward coverage under any medical plan outside of PEMHCA including but not limited to the Affordable Care Act, the City’s total liability for enrolled employees and retirees and their eligible family members shall not exceed what the City would have paid toward PEMHCA coverage in the absence of such state or federal plan. The parties will meet and confer over the impact of such change on matters within the scope of representation before implementing any change.
a. Active employee domestic partners whose domestic partnership is registered with the State of California may add their domestic partner as a dependent to their elected health plan coverage if the domestic partner is registered with the Secretary of State. Active employee domestic partners whose domestic partnership is not registered with the State but who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department, will be eligible for reimbursement of the actual monthly premium cost of an individual health plan, not to exceed 90% of the average monthly premium cost of individual coverage under the PEMHCA health plans in 2016. Effective with the first pay period including January 1, 2017, a stipend of two hundred eighty four ($284) per month toward the cost of an individual health plan will be provided. Evidence of premium payment will be required with request for reimbursement.
Flexible Compensaiton: Effective the first pay period following Council adoption of the MOU, in lieu of additional increases to the City’s medical premiums, hourly wages for all bargaining unit classifications will be increased by $100 per month ($1,200 per year). Employees can utilize this cash payment for any purpose, including to cover health insurance premiums or contribute to flexible spending accounts/457 deferred compensation plans. Effective the first full pay period of Item 8
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18 January 2024, hourly wages for all bargaining unit classifications will be increased by an additional $100 per month.
Section 2. Dual Coverage. When a City employee is married to another City employee each shall be covered only once (as an individual or as a spouse of the other City employee, but not both) and dependent children, if any, shall be covered only by one spouse.
Section 3 Dental Benefits
a. Level of Benefits: The City will maintain the present level of benefits on the City- sponsored dental program. The City provides a base dental plan for all eligible employees and dependents. Eligible employees may enroll in a dental buy-up plan.
b. Premiums: The City shall pay all premium payments on behalf of employees and dependents who are eligible and enrolled for coverage under the base dental plan.
Section 4. Vision Care.
a) Level of Benefits: The City provides a base vision plan for all eligible employees and dependents. Eligible employees may enroll in a vision buy-up plan.
b) Premiums: The City shall pay all premium payments on behalf of employees and dependents who are eligible and enrolled in coverage under the base vision plan. Employees are responsible for premium payments required to enroll in the buy-up vision plan.
Section 5. Employee Assistance Plan . The Employee Assistance Plan (EAP) provides employees with confidential personal counseling, work and family related issues, eldercare, substance abuse, etc. In addition, EAP programs provide a valuable tool for supervisors to refer troubled employees to professional outside help. This service staffed by experienced clinicians is available to employees and their dependents by calling a toll-free phone line 24 hours a day, seven days a week. Guidance is also available online.
Section 6. Alternative Medical Benefit Program.
If a regular employee and/or the employee’s dependent(s) are eligible for and elect to receive medical insurance through any other non- City of Palo Alto employer sponsored or association- sponsored group medical plan, the employee may choose to waive his/her right to the City of Palo Alto’s medical plan insurance and receive cash payments in the amount of two hundred eighty-four dollars ($284) for each month City coverage is waived.
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19 ARTICLE XVII – RETIREMENT MEDICAL PLAN
Section 1. 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 that retire on or before December 31, 2006. Effective January 1, 2007 for an employee retiring on or after that date the City will pay up to the monthly medical premium for the 2nd most expensive plan offered to FCA employees among the existing array of plans. However, the City contribution for an employee hired before January 1, 2004 who retires on or after December 1, 2011 shall be the same contribution amount it makes for active City employees.
Section 2. 20-Year Vesting for Retiree Medical Coverage for Unit Employees Hired On Or After January 1, 2004:
The retiree health benefit provided in California Government Code section 22893 shall apply to all employees hired on or after January 1, 2004. Under this law, an employee is eligible to receive Fifty (50) percent of benefit after ten (10) years; each additional service credit year after Ten (10) years will increase employer credit by Five (5%) percent until Twenty (20) years is reached at which time employee is eligible for One Hundred (100%) percent of annuitant-only coverage and Ninety (90%) percent of the additional premium for dependents.
ARTICLE XIII – BASIC LIFE INSURANCE
The City shall provide a basic life and AD & D insurance plan in an amount equal to the employee's annual base compensation (rounded to the next highest $1,000).
ARTICLE XIX– SUPPLEMENTAL LIFE INSURANCE
An employee may, at his/her cost, purchase additional life insurance and additional AD&D coverage. The total amount of life insurance available to the employee is $325,000 and the total amount of AD&D coverage available is $325,000.
ARTICLE XX– LONG TERM DISABILITY INSURANCE
Employees may elect to enroll in the City’s Long Term Disability Insurance program.
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20 ARTICLE XXI - EFFECTIVE DATE OF BENEFIT COVERAGE FOR NEW
EMPLOYEES
For newly-hired regular employees coverage begins on the first day of the month following date of hire for the health plan, dental plan, vision care plan, life insurance and long term disability plans if these benefits are elected.
ARTICLE XXII-WORKERS’ COMPENSATION
Persons on disability will be required to appear or otherwise report at regular two-week intervals to the Fire Chief or designate to discuss his/her status and ability to return to full or restricted work status. This section is not meant to unreasonably restrict employee's activities so long as such activities are cleared by the treating physician, treating program or alternative treatment program is maintained and employee is available for full or restricted duty as soon as medical clearance can be received.
ARTICLE XXIII- RETIREMENT PENSION PLANS
Section 1. Safety PERS Retirement Formula.
a. Safety Pension Group A: 3%@50 Safety Retirement: The City will continue the present benefits under the Public Employees' Retirement System (PERS) "3 percent at 50 (3%@50)" formula for employees hired before the effective date of the “3 percent at Section 2. 55” (3%@55) formula for new hires as described herein. The final year compensation for employees hired under the 3% at 50 formula will continue to be “Single highest year” or the highest average annual compensation earnable by the member during one (1) year of employment immediately preceding retirement or the one -year period otherwise designated by the member (Government Code section 20042).
b. Safety Pension Group B: 3%@55 Safety Retirement: Effective December 7, 2012, the City amended its contract with CalPERS to provide employees hired on or after that date who are not “new members” of CalPERS, as defined in the Public Employees’ Pension Reform Act (after referred to as “classic” CalPERS members) with the CalPERS retirement formula three percent of final salary at age 55 (“3%@55”), with the final salary determination for such employees of “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 (Government Code section 20037).
c. Safety Pension Group C: 2.7% at Age 57 Safety Retirement: Employees hired on or after January 1, 2013 meeting the definition of “new member” under the Public Employees’ Pension Reform Act (Gov’t. Code s. 7522 et seq.) shall be subject to all of the provisions of that law, including but not limited to the two point seven percent at age 57 (2.7%@57) retirement formula with a three year final compensation period.
d. Safety PERS Member Contribution.
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21 1. Employees in all classifications in Pension Groups A and B described above shall pay a total of 9% towards the PERS member contributions by payroll deduction.
2. Employees in all represented classes in Pension Group C described above shall pay the employee contribution required by the Public Employees’ Pension Reform Act, currently calculated at fifty percent (50%) of the normal cost.
3. When employees pay their PERS Member Contribution pursuant to section 2a and 2b above, the City will provide for member contributions to be made as allowed under provisions of IRS Code Section 414(h)(2).
e. Additional Employee PERS contributions:
In addition to the PERS member contribution as required under section 2d 1, 2 and 3 above, all employees in pension groups a, b and c shall contribute the additional following contributions:
1. All employees regardless of pension formula in this unit shall, in addition to the Member Contribution required, shall pay an additional 3% towards the Employer share of Pension regardless of pension formula through a CalPERS 20516 contract amendment.
2. Effective the first full pay period following July 1, 2020, all employees regardless of pension formula in this unit shall, in addition to the Member Contribution required, pay an additional 1% towards the Employer share of Pension for a total of 4%.
Section 2. Status Determination. An employee’s membership in and designation as Safety for CalPERS pension plan purposes shall be determined based on applicable California law.
Section 3. Employer Contributions to 457 Plan
Effective the later of July 1, 2025 or the adoption of the MOA, the City will contribute $300 monthly to the 457 plan of each represented employee.
Effective July 1, 2026 the City will contribute $600 monthly to the 457 plan of each represented employee.
Eligibility:
1. Employees must be enrolled in an eligible City sponsored 457 plan
2. Employees who reach the maximum as defined by the IRS will not receive additional contributions
3. Employee must be making PERS contributions
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22 ARTICLE XXIV - MISCELLANEOUS EMPLOYMENT-RELATED EXPENSES
Section 1. Station House Fund. The Station House Fund per year per shift employee shall be $100.00.
Section 2. Non-Food House Items. The City agrees to furnish and maintain each fire station with the following non-food house fund items: TV purchase and repair. Kitchen cooking utensils, small kitchen appliances and other specific items to be determined by mutual agreement of the parties will be purchased from the Station House Fund.
Section 3. Per Diem Travel Expenses For City Business. Unless other mutually agreeable arrangements are made, representation unit employees who are required to travel away from the City on City business will receive travel expenses, according to City policies which are currently in effect.
Section 4. Parking. Employees in represented classes assigned to Civic Center or adjacent work locations shall be entitled to free parking in the Civic Center Garage, or a commute incentive which will be subject to meet and confer. Employees hired after July 1, 1994 may initially receive a parking permit for another downtown lot subject to availability of space at the Civic Center garage. Light duty employees assigned to the Civic Center will receive Civic Center parking temporary permits for the duration of the light duty assignment.
Section 5. Uniform. The value of the purchase, rental and/or maintenance of the required uniforms shall be reported as special compensation to the extent legally permissible, pursuant to Title 2 CCR, Section 571(a)(5) as Uniform Allowance. Based upon existing uniform standards and the City’s cost experience, the value of this benefit shall be reported as $15.31 per pay period. The City will supply complete uniforms as described in Fire Department Policy 1031.
ARTICLE XXV – WORK ASSIGNMENTS
Section 1. Selection of and assignment to Training Battalion Chief (40-hour workweek) shall be based upon seniority, except where operational needs are determined by the Fire Chief or designee, the Fire Chief or designee reserves the right to assign personnel based on Fire Department needs. For purposes of this article, seniority shall be calculated from date of entry into the Battalion Chief classification.
Section 2. Working out of Classification. Where employees, on a temporary basis, are assigned to perform all significant duties of a higher classification, for a period of one week or more, the Fire Chief may authorize payment within the range of the higher classification for the specified time frame. Working above classification will not exceed six months, unless renewed at the discretion of the Fire Chief. Working above classification pay is not to exceed 10% more than the employee’s current salary and shall be documented on a Personnel Action Form, with a description of the additional duties in the higher classification to be performed and an end date.
Employees assigned to work out of classification will receive out of class pay beginning the first day of the assignment.
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23 ARTICLE XXVI - FULL UNDERSTANDING
Section 1. The Memorandum of Agreement contains the full and entire understanding of the parties regarding the matters set forth herein.
Section 2. Severability. If any of the provision herein contained be rendered or declared invalid by reason of any State or Federal legislation, or by ruling of any court of competent jurisdiction, such invalidation of such part or portion of this Memorandum of Agreement shall not invalidate the remaining portions hereof, and they shall remain in full force and effect, insofar as such remaining portions are severable.
Section 3. It is the intent of the parties that ordinances, resolutions, rules and regulations enacted pursuant to this Memorandum of Agreement be administered and observed in good faith.
Section 4. Nothing in this Memorandum of Agreement shall preclude the parties from mutually agreeing to meet and confer on any subject with the scope of representation during the term of this agreement.
Section 5. Merit System Rules and Regulations During the term of this Memorandum of Agreement, Management may propose certain changes in the City Merit System Rules and Regulations. With regard to such changes which pertain to the representation unit, the parties agree to review, and upon request, meet and confer regarding the changes.
ARTICLE XXVII - DURATION
This Memorandum of Agreement shall become effective upon signing by the parties hereto, except that those provisions herein that have specific effective dates shall take effect on those dates regardless of signing date, once this Memorandum of Agreement is signed by the parties hereto. This Memorandum of Agreement shall expire June 30, 2028.
ARTICLE XXVIII- 48/96 WORK SCHEDULE
The regular schedule for 56 hour personnel will be under a “48/96” model. With the adoption of this “48/96” schedule the parties agreed to revise Fire department policy 205.6 typical workday and 1009.8.1 reporting for Duty-Holidays.
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24 EXECUTED:
FOR: FOR:
FIRE CHIEFS ASSOCIATION CITY OF PALO ALTO
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APPENDIX A
[Salary Schedule Attachment B]
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Memorandum of Agreement
City of Palo Alto and
Palo Alto Fire Chiefs’ Association
July 1, 2025 – June 30, 2028
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1 MEMORANDUM OF AGREEMENT
Table of Contents
PREAMBLE ____________________________________________________________________________________ 4 ARTICLE I - RECOGNITION _______________________________________________________________________ 4 SECTION 1. ___________________________________________________________________________________ 4 ARTICLE II - NO DISCRIMINATION _________________________________________________________________ 4 SECTION 1. ___________________________________________________________________________________ 4 SECTION 2 ___________________________________________________________________________________ 4 ARTICLE III - PAYROLL DEDUCTIONS _______________________________________________________________ 4 SECTION 1 ___________________________________________________________________________________ 4 SECTION 2. CERTIFICATION OF UNION MEMBERSHIP _______________________________________________________ 5 SECTION 3. INDEMNIFICATION ______________________________________________________________________ 5 ARTICLE IV - NO STRIKES ________________________________________________________________________ 5 SECTION 1 ___________________________________________________________________________________ 5 ARTICLE V - SALARY PROVISIONS _________________________________________________________________ 5 SECTION 1. SALARY RANGE ADJUSTMENTS. _____________________________________________________________ 5 SECTION 2. EMT DIFFERENTIAL _____________________________________________________________________ 6 SECTION 3. 40-HOUR WORK WEEK ASSIGNMENT DIFFERENTIAL _______________________________________________ 6 SECTION 4. OUT OF COUNTY STRIKE TEAM PAY. _________________________________________________________ 6 ARTICLE VI – HOLIDAYS _________________________________________________________________________ 7 SECTION 1. NAMED HOLIDAYS. _____________________________________________________________________ 7 SECTION 2. DAY OF REFLECTION _____________________________________________________________________ 7 SECTION 3. 56-HOUR WORK WEEK ASSIGNMENTS. _______________________________________________________ 7 SECTION 4. 40-HOUR WORK WEEK ASSIGNMENTS. _______________________________________________________ 8 ARTICLE VII - VACATION ACCRUAL _________________________________________________________________ 8 SECTION 1. ___________________________________________________________________________________ 8 SECTION 2. 56-HOUR WORKWEEK ASSIGNMENTS ________________________________________________________ 8 SECTION 3. 40-HOUR WORKWEEK ASSIGNMENTS. ________________________________________________________ 8 ARTICLE VIII - VACATION CASH OUT _______________________________________________________________ 9 SECTION 1. LIMITATION ON USE. ____________________________________________________________________ 9 SECTION 2. CASH OUT OPTION. _____________________________________________________________________ 9 ARTICLE IX - MANAGEMENT ANNUAL LEAVE _______________________________________________________ 10 SECTION 1 __________________________________________________________________________________ 10 ARTICLE X - OTHER PAID LEAVES _________________________________________________________________ 10 SECTION 1. CITY MANAGER GRANTED LEAVES __________________________________________________________ 10 SECTION 2. COUNCIL GRANTED LEAVE _______________________________________________________________ 10 SECTION 3. EMPLOYEE'S TIME OFF TO VOTE ___________________________________________________________ 10 SECTION 4. LEAVES OF ABSENCE; DEATH IN IMMEDIATE FAMILY ______________________________________________ 11 Item 8
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2 SECTION 5. JURY DUTY; LEAVE OF ABSENCE ____________________________________________________________ 11 SECTION 6. SUBPOENAS _________________________________________________________________________ 11 ARTICLE XI - OTHER LEAVE PROVISIONS ___________________________________________________________ 12 SECTION 1. DISABILITY. __________________________________________________________________________ 12 SECTION 2. OTHER UNPAID LEAVES. _________________________________________________________________ 12 SECTION 3. ACCRUED VACATION CREDITS. _____________________________________________________________ 12 SECTION 4. APPROVAL OF DEPARTMENT HEAD. _________________________________________________________ 12 SECTION 5. APPROVAL BY CITY MANAGER _____________________________________________________________ 12 SECTION 6. ABSENCE WITHOUT LEAVE. _______________________________________________________________ 12 SECTION 7. LEAVE OF ABSENCE; DEATH OUTSIDE THE IMMEDIATE FAMILY. _______________________________________ 12 SECTION 8. MILITARY LEAVE OF ABSENCE. _____________________________________________________________ 12 ARTICLE XII - VOLUNTARY CATASTROPHIC LEAVE PROGRAM _________________________________________ 12 SECTION 1. __________________________________________________________________________________ 12 SECTION 2. __________________________________________________________________________________ 13 SECTION 3. __________________________________________________________________________________ 13 SECTION 4. __________________________________________________________________________________ 13 SECTION 5. __________________________________________________________________________________ 14 SECTION 6. __________________________________________________________________________________ 14 ARTICLE XIII - ADDITIONAL COMPENSATION FOR BC CLASSIFICATIONS _________________________________ 14 ARTICLE XIV - EXCESS BENEFIT REIMBURSEMENT ___________________________________________________ 15 SECTION 1. __________________________________________________________________________________ 15 ARTICLE XV - PHYSICAL EXAMS __________________________________________________________________ 16 ARTICLE XVI - BENEFIT PROGRAMS _______________________________________________________________ 16 SECTION 1. HEALTH PLAN - ACTIVE EMPLOYEES ______________________________________________________ 16 SECTION 2. DUAL COVERAGE. _____________________________________________________________________ 18 SECTION 3 DENTAL BENEFITS ______________________________________________________________________ 18 SECTION 4. VISION CARE. ________________________________________________________________________ 18 SECTION 5. EMPLOYEE ASSISTANCE PLAN _____________________________________________________________ 19 ARTICLE XVII – RETIREMENT MEDICAL PLAN _______________________________________________________ 19 SECTION 1. RETIREE MEDICAL COVERAGE FOR UNIT EMPLOYEES HIRED BEFORE JANUARY 1, 2004: ______________________ 19 SECTION 2. 20-YEAR VESTING FOR RETIREE MEDICAL COVERAGE FOR UNIT EMPLOYEES HIRED ON OR AFTER JANUARY 1, 2004: _ 19 ARTICLE XIII – BASIC LIFE INSURANCE _____________________________________________________________ 20 ARTICLE XIX– SUPPLEMENTAL LIFE INSURANCE _____________________________________________________ 20 ARTICLE XX– LONG TERM DISABILITY INSURANCE ___________________________________________________ 20 ARTICLE XXI - EFFECTIVE DATE OF BENEFIT COVERAGE FOR NEW EMPLOYEES ____________________________ 20 ARTICLE XXII-WORKERS’ COMPENSATION _________________________________________________________ 20 ARTICLE XXIII- RETIREMENT PENSION PLANS _______________________________________________________ 20 SECTION 1. SAFETY PERS RETIREMENT FORMULA. _______________________________________________________ 20 SECTION 2. STATUS DETERMINATION ________________________________________________________________ 22 SECTION 3. EMPLOYER CONTRIBUTIONS TO 457 PLAN _____________________________________________________ 22 ARTICLE XXIV - MISCELLANEOUS EMPLOYMENT-RELATED EXPENSES ___________________________________ 22 SECTION 1. STATION HOUSE FUND. _________________________________________________________________ 22 Item 8
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3 SECTION 2. NON-FOOD HOUSE ITEMS _______________________________________________________________ 22 SECTION 3. PER DIEM TRAVEL EXPENSES FOR CITY BUSINESS ________________________________________________ 22 SECTION 4. PARKING ___________________________________________________________________________ 22 SECTION 5. UNIFORM. __________________________________________________________________________ 22 ARTICLE XXV – WORK ASSIGNMENTS _____________________________________________________________ 23 SECTION 1. __________________________________________________________________________________ 23 SECTION 2. WORKING OUT OF CLASSIFICATION __________________________________________________________ 23 ARTICLE XXVI - FULL UNDERSTANDING ____________________________________________________________ 23 SECTION 1 __________________________________________________________________________________ 23 SECTION 2. SEVERABILITY. ________________________________________________________________________ 23 SECTION 3. __________________________________________________________________________________ 23 SECTION 4. __________________________________________________________________________________ 23 SECTION 5. __________________________________________________________________________________ 23 ARTICLE XXVII - DURATION _____________________________________________________________________ 24 ARTICLE XXVIII- 48/96 WORK SCHEDULE __________________________________________________________ 24 APPENDIX A__________________________________________________________________________________ 26 Item 8
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4 CITY OF PALO ALTO AND PALO ALTO FIRE CHIEFS’ ASSOCIATION
PREAMBLE
This Memorandum of Agreement between the City of Palo Alto, hereinafter referred to as the "City", and the Palo Alto Fire Chiefs’ Association, hereinafter referred as the "Association", has been prepared and entered into in accordance with Title I, Division 4, Chapter 10, Sections 3500-3510 of the California Government Code and Chapter 12 of the City of Palo Alto Merit System Rules and Regulations.
ARTICLE I - RECOGNITION
Section 1. The City recognizes the Association as the exclusive representative of an employee group consisting solely of the classifications of Battalion Chief 56-hour workweek, and Battalion Chief 40-hour workweek who are regularly employed by the City.
ARTICLE II - NO DISCRIMINATION
Section 1. The Association and the City hereby agree that there shall be no discrimination because of race, color, age, disability, sex, national origin, sexual orientation, political or religious affiliation or any other basis recognized by federal, state or local law under this Agreement. There shall be no discrimination in employment conditions or treat ment of employees on the basis of membership or nonmembership in the Association, or participation in the lawful activities of the Association.
Section 2 . The Association and the City hereby agree to protect the rights of all employees to exercise their free choice to join the Association and to abide by the express provisions of applicable State and local laws.
ARTICLE III - PAYROLL DEDUCTIONS
Section 1. The City shall deduct Union Association membership dues assessments and insurances authorized by the Union Association. This will be accomplished by payroll deductions from the bi-weekly pay of member employees. The dues deduction must be authorized in writing by the employee on an Union authorization card.
The Union Association will be the custodian of records for individual employee membership and dues deduction forms. The Union Association will maintain all authorizations for dues deduction, signed by the individual from whose salary or wages the deduction or reduction is to Item 8
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5 be made. The City will direct employee requests to cancel or change deductions to the Association.
The City shall remit the deducted dues to the Association as soon as possible after deduction.
Section 2. Certification of Union Association Membership. The Union Association agrees to provide the City an initial certified list of members and statement that the Association has and will maintain written authorizations signed by the individuals from whose wages the Union Association dues deductions are to be made. From that point forward the Union Association will update the list whenever there are changes.
Section 3. Indemnification. The Union Association shall indemnify and hold the City harmless against any liability arising from any claims, demands, or other action relating to this article. The Union Association shall comply with all statutory and legal requirements with respect to this article.
ARTICLE IV - NO STRIKES
Section 1 . The Association, its representatives, or members, shall not engage in or cause, instigate, encourage, sanction, or condone a strike, withholding of services, leave of absence abuse, work stoppage or work slowdown of any kind against the City of Palo Alto or its citizens by employees covered under this Agreement. No employee shall refuse to cross any picket line in the conduct of Fire Department business, nor shall the Association, its representatives or members discriminate in any way toward anyone who refuses to participate in a strike, or any of the job actions cited above.
ARTICLE V - SALARY PROVISIONS
Section 1. Salary Range Adjustments.
The base wage rates of the bargaining unit classifications will be set forth in Appendix A of this MOA.
a) General Salary Increase: Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA, the salary ranges of all represented classifications will be increased by three percent (3.0%).
b) Market Adjustment: Effective the first full pay period including following the later of July 1, 2025 or the adoption of the MOA, the salary ranges of all represented classifications will be increased by one and one half percent (1.5%). The 40hr training Battalion Chief position will be increased by an Item 8
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6 additional half percent (0.5%). receive a market adjustment of ten percent (10.0%) and an equity adjustment of one percent (1.0%) for a total of eleven (11%).
c) General Salary Increase: Effective the first full pay period following July 1, 2026 2023, the salary ranges of all represented classifications will be increased by four three percent (4 3.0%).
d) Market Adjustment part 2: Effective the first full pay period following January July 1, 2027 2024, the salary ranges of all represented classifications will receive a market adjustment of two percent (2.0%). e) General Salary Increase: Effective the first full pay period following July 1, 2027 2024, the salary ranges of all represented classifications will be increased by four three percent (4 3.0%).
f) Total Compensation and Survey Database: Management and the Union have agreed to a compensation survey database structure. Survey Cities include: Alameda, Berkeley, Fremont, Hayward, Menlo Park Fire District, Milpitas, Mountain View, Redwood City, Pleasanton, San Jose, San Mateo, San Ramon Fire District, Santa Clara, Santa Clara County and South San Francisco. Compensation Criteria includes: top step salary, maximum longevity, maximum education, uniform allowance, EMT differential, Hazmat differential, deferred compensation, employee pick up of employer pension costs (Negative EPMC), and maximum City paid benefits (medical, dental, vision, life insurance, LTD, and EAP). The database is intended to provide one source of information concerning how the compensation paid to employees in bargaining unit job classifications compares to that paid by other employers.
Section 2. EMT Differential . The former EMT differential of 3.0% was rolled into base pay.
This one time conversion to base pay, shall constitute the City’s incentive payment for EMT skills.
This conversion was cost neutral to the City.
Section 3. 40- hour Work Week Assignment Differential . Employees assigned to a 40- hour workweek schedule will be paid a differential of five percent (5%) of base salary in -lieu of holiday pay differential which 56-hour shift Battalion Chiefs receive.
Section 4. Out of County Strike Team Pay.
A Battalion Chief sent on out of County strike team duty will receive the following compensation only if the City is reimbursed from the state or federal government for the labor costs incurred by the City.
Compensation to the employee will not exceed the rate for which the City is reimbursed by the State of California or other external entity, excluding reimbursements for other labor costs (e.g. workers compensation, administrative expense, etc.).
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7 eligible for compensation at their normal hourly rate (1.0 hourly rate), assuming a regular 56 hour schedule.
A Battalion Chief on non-regular duty shift days deployed on an out of County strike team will be eligible for compensation at a rate of 1.5 of their normal hourly rate.
For 40 hour Battalion Chiefs deployed on an out of County strike team, any out of County strike team compensation will be calculated at a 56 hour Battalion Chief Schedule hourly rate.
Payment for out of county strike team duty will be calculated based on the number of twenty- four hour shifts worked and prorated for any partial shifts.
A Personnel Action Form will be completed in a timely manner to process this payment. The amount of the payment will be calculated in a manner described above. If the City is not reimbursed, no payment is due to the employee. If the City is reimbursed in part, a prorated payment will be calculated based on the reimbursement rate. As outlined above, compensation to the employee will not exceed the rate for which the City is reimbursed by the State of California or other external entity.
ARTICLE VI – HOLIDAYS
Section 1. Named Holidays.
Holiday pay is compensation for employees who are normally required to work on an approved holiday because they work in positions that require scheduling staff without regard to holidays. The following holidays are recognized as municipal holidays for pay purposes., and rRegular, employees shall have these days off with pay, except as otherwise provided in these rules:
January 1 Veterans’ Day, November 11
Third Monday in January Thanksgiving Day
Third Monday in February Day after Thanksgiving Day
Last Monday in May December 25
July 4th Either December 24, or December 31 as provided below First Monday in September
Second Monday in October
Section 2. Day of Reflection. In addition to the paid holidays listed above, employees shall be excused with pay for one full work shift as a day of reflection (floating holiday) per calendar year, Employees may use the floating holiday on any day mutually agreed by the employee and their supervisor for a Day of Reflection, including: Juneteenth Freedom Day (June 19) or Cesar Chavez/Dolores Huerta Day (March 31). Day of Reflection not used by the end of the calendar year will be deemed forfeited and have no cash value.
Section 3. 56-Hour Work Week Assignments. Shift personnel shall receive pay in lieu of taking paid leave for accrued holidays. One hundred sixty one and one half (161.5) hours are Item 8
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8 paid annually to an employee at a rate of 6.21 hours each pay period. Shift personnel shall receive pay in lieu of taking paid leave for accrued holidays. Such paid hours will be paid 6.21 hours of in lieu of holiday pay each pay period. Hours are prorated and accrued based on hours actually worked.
Section 4. 40- Hour Work Week Assignments. Employees assigned to a 40-hour workweek schedule will receive paid holidays in accordance with Sections 517 and 518 of the Merit System Rules and Regulations.
ARTICLE VII - VACATION ACCRUAL
Section 1. Vacation will be is accrued when an employee is in a pay status and will be is credited on a bi-weekly basis. Such accrual balance and credit may not exceed three times the annual rate of accrual. Accrual rates are by work week assignments as are indicated in Section 1 2 and Section 2 3 below.
Section 2. 56- Hour Workweek Assignments . Employees assigned to a 56-hour workweek schedule (24- hour shift) will accrue vacation at the following rates: for continuous service performed in a pay status.
a) For employees completing having completed less than four (4) years continuous service, the accrual rate shall be five (5) duty shifts per year.
b) For employees completing having completed four (4), but less than nine (9) years continuous service, the accrual rate shall be eight (8) duty shifts per year. c) For employees completing having completed nine (9), but less than fourteen (14) years continuous service, the accrual rate shall be ten (10) duty shifts per year.
d) For employees completing having completed fourteen (14), but less than nineteen (19) years continuous service, the accrual rate shall be eleven (11) duty shifts per year.
e) For employees completing having completed nineteen (19) or more years continuous service, the accrual rate shall be twelve (12) duty shifts per year.
Section 3. 40-Hour Workweek Assignments. Personnel assigned to a 40-hour workweek schedule will accrue vacation at the following rates: for continuous service performed in a pay status.
a) For employees completing having completed less than four (4) years continuous service, the accrual rate shall be eighty
(80) hours per year.
b) For employees completing having completed four (4), but less than nine (9) years continuous service, the accrual rate shall be one-hundred twenty (120) hours per year.
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9 c) For employees completing having completed nine (9), but less than fourteen (14) years continuous service, the accrual rate shall be one-hundred sixty (160) hours per year.
d) For employees completing having completed fourteen (14), but less than nineteen (19) years continuous service, the accrual rate shall be one-hundred eighty (180) hours vacation leave per year.
e) For employees completing having completed nineteen (19) or more years continuous service, the accrual rate shall be two- hundred (200) hours vacation leave per year.
ARTICLE VIII - VACATION CASH OUT
Section 1. Limitation on Use. Employees may not use more than three times their annual rate of accrual in any calendar year period provided, however, that the Chief may grant exceptions to this limitation.
Section 2. Cash out Option.
a) Once each calendar year, employees are eligible to cash out vacation accrual balances in excess of 80 hours. An employee may cash out a minimum of eight (8) hours to a maximum of 120 hours of accrued vacation provided employee has taken 80 vacation hours in the previous 12 months and has followed the election procedures set forth in this section.
b) Employee must elect the number of vacation hours they will cash-out during the next calendar year, up to the maximum of 120 hours. For the 2012 calendar vacation year, employees will make their election for vacation hours to cash out no later than November 1, 2012. The election will apply only to vacation hours that are accrued in the next calendar year and that are eligible for cash-out.
c) The election to cash-out vacation hours in each designated year will be irrevocable. This means that employees who elect to cash -out vacation hours must cash- out the number of accrued hours pre-designates on the election form.
d) Employees who do not elect a cash-out amount by November of the prior calendar year will be deemed to have waived the right to cash out any leave in the following tax year and will not be eligible to cash-out vacation hours in the next tax year.
e) Employees who elect cash-out amount may request a cash-out at any time in the designated tax year by submitting a cash-out form to payroll. Payroll will complete the cash-out form upon request, provided the requested cash-out amount has accrued and is Item 8
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10 consistent with the amount the employee pre-designated. If the full amount of hours designated for cash-out is not available at the time of cash-out, the maximum available will be paid. For employees who have not requested cash-out of the elected amount by November 1 of year, Payroll will automatically cash- out the elected amount in a paycheck issued on or after the payroll date including November 1.
ARTICLE IX - MANAGEMENT ANNUAL LEAVE
Section 1. Forty (40) hour and fifty-six (56) hour workweek non-shift employees not eligible for overtime shall be credited at the beginning of each calendar year with eighty (80) hours of annual leave. Fifty-six (56) hour shift employees shall be credited (one hundred and twelve (112) hours of annual leave. for 56- hour assignments)
which Such leave may be taken as paid time off, added to vacation accrual (subject to vacation accrual limitations), taken as cash, or taken as deferred compensation. Entitlement under this provision will be reduced on a prorated basis for part-time status, or according to the number of months in paid status during the calendar year.
Unused balances as of At the end of the calendar year, unused management annual leave will be paid in cash, unless a different option as indicated above is elected by the employee.
The Management Annual Leave accrual will be changed to an annual accrual rather than fiscal year. Effective July 1, 2012, employees will be credited with forty (40) hours of management annual leave to be used by December 31, 2012 or automatically will be cashed out.
Effective January 1, 2012, and every January 1 thereafter, employees will be credited with eighty (80) hours of management annual leave (one hundred and twelve (112) for 56- hour assignments) to be used by December 31st or automatically will be cashed out.
ARTICLE X - OTHER PAID LEAVES
Section 1. City Manager Granted Leaves . The City Manager may grant a regular employee under his control a leave of absence with pay for a period not exceeding thirty calendar days for reasons he deems adequate and in the best interest of the City.
Section 2. Council Granted Leave. The City Council may grant a regular employee a leave of absence with pay for a period not to exceed one year for reasons the Council considers adequate and in the best interest of the City.
Section 3. Employee's Time Off to Vote . Time off with pay to vote at any general or direct Item 8
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11 primary election shall be granted as provided in the State of California Elections Code, and notice that an employee desires such time off shall be given in accordance with the provisions of said Code.
Section 4. Leaves of Absence; Death in Immediate Family. Leave of absence with pay of one shift for 56 -hour shift employees with provision for approval of one additional shift for travel outside the area may be granted an employee by the Chief in the event of death in the employee's immediate family, which is defined for purposes of this section as:
wife
husband
son
son-in-law
daughter
daughter-in-law
father
mother
brother
brother-in-law
sister
sister-in-law
mother-in-law
father-in-law
step-father
step-mother
step-sister
step-brother
grandfather
grandfather-in-law
grandmother
grandmother-in-law
uncle
aunt
niece
nephew
registered domestic
partner
close relative residing in
the household of the
employee
56 hour shift employees may receive one shift with provision for approval of one additional shift for travel outside the area. Such leave shall be at full pay and shall not be charged against the employee's accrued vacation or sick leave. Shift employees may supplement paid bereavement leave with accrued leave (including vacation or sick leave) or unpaid leave to reach 48 hours of consecutive time off per incident of bereavement. Requests for leave in excess of two shifts shall be subject to the approval of the City Manager.
Employees assigned to a 40-hour work week are eligible for leave of absence may be granted by the Chief with pay for three (3) days of leave with pay in the event of death in the employee’s immediate family which is defined above. Non-shift employees may supplement paid bereavement leave with accrued leave (including vacation or sick leave) or unpaid leave to reach a total of five (5) workdays of time off per incident of bereavement.
Section 5. Jury Duty; Leave of Absence. Employees required to report for jury duty shall be granted a leave of absence with pay from their assigned duties until released by the court, provided the employee remits to the City all fees received for such duties other than mileage or subsistence allowances within thirty days from the termination of his or her jury service.
Section 6. Subpoenas. Employees required to answer subpoenas as a witness for the City of Palo Alto or for a plaintiff where the City of Palo Alto is a defendant shall not lose pay or benefits for work time lost to answer depositions or to appear in court.
Section 7. Personal Business. Employees may use up to thirty (30) hours of sick leave per calendar year for personal business. The scheduling of such leave is subject to the approval of Item 8
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12 the appropriate level of management.
ARTICLE XI - OTHER LEAVE PROVISIONS
Section 1. Disability. Leaves of absence without pay may be granted in cases of disability not covered by sick leave. Pregnancy will be considered as any other disability. Leaves of absence for disability are subject to physician's verification including diagnosis and medical work restriction.
Section 2. Other Unpaid Leaves. Leaves of absence without pay may be granted in cases of personal emergency or when such absences would not be contrary to the best interest of the City.
Requests for leaves without pay shall not be unreasonably denied. Approval of leave without pay must be in writing to be effective. Non-disability prenatal and/or postpartum leave is available under this provision, but such leave shall not begin more than six months prenatal nor extend more than six months postpartum.
Section 3. Accrued Vacation Credits. During unpaid leaves of absence for disability or other reasons, the employee may elect to use accrued vacation credits. Requests for leaves without pay shall not be unreasonably denied. In order to avoid misunderstandings, all leaves without pay must be in writing to be effective.
Section 4. Approval of Department Head. Leave of absence without pay for one week or less may be granted by the department head, depending on the merit of the individual case.
Section 5. Approval by City Manager . Leave of absence without pay in excess of one week 's duration may be granted by the City Manager on the merit of the case, but such leave shall not exceed twelve (12) months' duration.
Section 6. Absence Without Leave. Unauthorized leave of absence shall be considered to be without pay, and reductions in the employee's pay shall be made accordingly. Unauthorized leave of absence may result in discipline, including termination of employment.
Section 7. Leave of Absence; Death Outside the Immediate Family. Leave without pay may be granted a regular employee by his/her their department head in the event of a death outside to family members other than one of the immediate family, such leave to be granted in accordance with Section 2 and Section 4.
Section 8. Military Leave of Absence. State Applicable law shall govern the granting of military leaves of absence and the rights of employees returning from such absence.
ARTICLE XII - VOLUNTARY CATASTROPHIC LEAVE PROGRAM
Section 1. The City of Palo Alto has established a Firefighter Voluntary Leave Program to Item 8
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13 provide FCA employees the opportunity to donate their accrued vacation time to assist fellow members of FCA either due to: (a) an employee’s own verifiable non-industrial catastrophic illness or injury (as defined herein) or (b) in order to care for a member of the employee’s immediate family (spouse, child, parent or registered domestic partner suffering from a verifiable catastrophic illness or injury) and have exhausted or will presently exhaust all of their paid leave.
Section 2. In order to be eligible to receive donated leave, an employee must have a catastrophic illness or injury or an employee’s immediate family member must have a catastrophic illness or injury that requires the employee to provide full-time care for this family member. Care will be taken to emphasize the voluntary nature of the plan and to insure confidentiality of employee participants and medical conditions (where applicable).
Section 3. A Firefighter Voluntary Leave Sharing Program has been established to accept donations of vacation in accordance with the Program’s guidelines. All donations shall be:
a) Voluntary
b) Irrevocable
c) Confidential, unless disclosure is required by law
d) In whole hour increments of at least four (4) hours, with the hours donated being converted to donee hours based on the donee’s salary rate (so that there will be no cost to the City due to salary differential).
e) The employee shall be required to exhaust all other types of leave to request donated leave
f) It is understood that employees seeking or receiving leave under this program will apply for long- term disability benefits for which they may be eligible g) Where any of the period during which an employee receives donated leave is designated as family leave under the California Family Rights Act (CFRA/Family Medical Leave Act (FMLA), the employee will be eligible for continuation of medical and other available benefits during that the family leave period (for up to 12 weeks), in accordance with the requirements of those laws. If the employee receiving donated leave is not eligible for CFRA/FMLA benefit continuation, or after the employee has exhausted the available CFRA/FMLA leave period, the employee will need to pay the premiums for continued medical and other available benefits if the employee chooses to continue such coverage through the City
h) If the donation request is based on the need for an employee to care for an immediate family member, as defined above, the family member must require full-time care by the employee. Certification of this requirement by a health care professional is required i) The maximum donated time a donee may receive is 12 months (if available). j) Applications to donate leave or receive leave under this Program are made to the Human Resources Department
k) The tax treatment of donation or receipt of vacation under this section is governed by the IRS and not the City.
Section 4. FCA members interested in donating leave or in applying to receive donated leave shall complete forms provided by the Human Resources Department. If an applicant for leave is found Item 8
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14 to meet the criteria set forth herein, Human Resources will determine the availability of and (as applicable) allocation of donated paid leave. Payroll will be notified in writing of the number of hours to be deducted from each donating employee’s vacation balance and transferred to the donee employee(s).
Section 5. The City reserves the right to modify or terminate this program at any time.
Section 6. Catastrophic Illness or Injury (also referred to as “medical emergency” in Revenue Ruling 90-29 and Sections 801(c) and 812 of the Merit Rules and Regulations): A non-occupational medical condition of an employee that will require the prolonged absence of the employee from duty and which will result in a substantial loss of income to the employee because the employee will have exhausted all paid leave available apart from the Voluntary Employee Leave sharing Program. Non-disability postpartum leave as referenced in Merit Rule 801(b) shall not be considered a catastrophic illness or injury under this Policy.
ARTICLE XIII - ADDITIONAL COMPENSATION FOR BC CLASSIFICATIONS
POTENTIAL BATTALION CHIEF EXTRA SHIFT COVERAGE
Battalion Chiefs who back fill for an operations shift (or shifts) for a 56-hour work week Battalion Chief will be provided additional compensation for the extra shift coverage, provided that the extra shift requires working hours beyond regularly scheduled hours.
Extra Shift Coverage Eligibility
• Extra shift coverage pay applies to the level of Battalion Chief only and is not intended as compensation for Battalion Chiefs to backfill a lower classification. • A minimum of eight (8) continuous hours of the extra shift coverage must be worked to be eligible for compensation. After the minimum of eight (8) continuous hours is met, the Battalion Chief will be paid for the entire shift worked.
Extra Shift Coverage Pay Rate
• Compensation for the extra shift coverage by a 56-hour or 40-hour Battalion Chief will be paid at one and one-half times (1.5x) the 56-hour straight-time rate of the Battalion Chief performing the back fill.
First Rights of Refusal
• Battalion Chiefs shall be provided first rights of refusal for the extra shift coverage.
If no Battalion Chiefs are available to back fill the extra coverage shift, the shift will be assigned to fire personnel at a lower classification in accordance with the standard protocols of the department.
Extra Shift Coverage Pay Not PERSable
• All pay under this extra shift coverage provision will be reported to CALPERS by the City of Palo Alto in a manner that excludes such pay from PERSable income. As such, the extra shift coverage pay is not subject to CALPERS contributions by the Item 8
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15 employer or employee and is not included as a factor in the employee’s final compensation for pension purposes.
Fire Chief Discretion
• In accordance with management rights provisions, the Fire Chief maintains discretion to approve, modify or disapprove extra shift coverage assignments.
FLSA Exempt Status
• Nothing in the extra shift coverage provision is intended to impact the FLSA-exempt status of Battalion Chiefs. Battalion Chiefs remain FLSA-exempt and are therefore not eligible for overtime pay or compensatory time.
ARTICLE XIV - EXCESS BENEFIT REIMBURSEMENT
Section 1. The benefit provided by this Article is designed to meet the requirements of Section 125 of the Internal Revenue Code. Every calendar year, each employee will be provided with $2,500 that they can designate among the following options:
a) Medical Flexible Spending Account (Medical FSA) . Provides reimbursement for excess medical/dental/vision, or expenses that are incurred by employees and their dependents which are not covered or reimbursed by any other source, including existing City-sponsored plans. This includes prescribed medications and co-payments as specified in applicable federal law.
b) Dependent Care Flexible Spending Account (Dependent Care FSA) . Provides reimbursement for qualified dependent care expenses under the City's Dependent Care Assistance Program (DCAP), subject to the limits specified in applicable federal law.
1) Dependent care expenses not reimbursed under this section may be eligible for reimbursement under the City Voluntary Dependent Care FSA program. However, the maximum amount reimbursed under the Voluntary Dependent Care FSA program will be reduced by any amount reimbursed under the Excess Benefit Plan.
c) Professional Development
Employees may use these funds for professional development purposes on a taxable basis to the extent such expenses (e.g., job-related training and education, seminars, training manuals, etc.) are not paid or reimbursed under any other plan of the City.
d) Deferred Compensation. Provides a one-time contribution to the employee’s City- sponsored I.R.C. § 457 Deferred Compensation plan with either ICMA -RE or Mass Mutual, subject to the contribution limitations of applicable law.
Amounts designated by employees to either the Medical FSA, Dependent Care FSA, or Item 8
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16 Professional Development options are done so on a “use –it-or-lose-it” basis. This means that any amounts designated and not used by the end of the calendar year (or end of the extended grace period for the medical FSA) will be forfeited by the employee and returned to the plan.
Specified amounts under this benefit will be applied on a pro-rata basis for employees who are part-time or who are in FCA pay status for less than the full fiscal year. Such benefits will be pro-rated in the first year of employment (based on hire date) but will not be pro- rated upon separation of employment.
ARTICLE XV - PHYSICAL EXAMS
Physical fitness medical examinations for all represented employees will be provided in accordance with the Fire Department Physical Fitness Program General Order.
ARTICLE XVI - BENEFIT PROGRAMS
Section 1. Health Plan - ACTIVE EMPLOYEES : During the term of this contract, 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 Premium
Category
PEMHCA
Contribution*
Total Maximum City
Contribution (inclusive of
PEMHCA contribution)
effective January July 1,
2025 2023
Employee Only $151.00 $943 871
Employee plus one $151.00 $1885 1,742
Employee Family $151.00 $2444 2,260
Effective January 1, 2027, the City will increase its maximum contribution to medical premiums by the following percentages:
• Employee only: 2%
• Employee plus one: 3%
• Employee family: 5%
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17 Medical Premium
Category
PEMHCA
Contribution*
Total Maximum City
Contribution (inclusive of
PEMHCA contribution)
effective January 1, 2027
Employee Only $151.00 $962
Employee plus one $151.00 $1942
Employee Family $151.00 $2566
Effective January 1, 2028, the City will increase its maximum contribution to medical premiums by 4%.
Medical Premium
Category
PEMHCA
Contribution*
Total Maximum City
Contribution (inclusive of
PEMHCA contribution)
effective January 1, 2028
Employee Only $151.00 $1000
Employee plus one $151.00 $2020
Employee Family $151.00 $2669
The City’s total maximum contribution towards medical premiums for eligible part time employees shall be prorated based on the number of hours per week the part-time employee is assigned to work.
*Any increases to the PEMHCA minimum during the term of this contract will result in a corresponding decrease to the amount of the additional City contribution, so that the total maximum City contribution never exceeds the Total Maximum City Contribution described above.
If the State of California or federal government requires the City to participate and contribute toward coverage under any medical plan outside of PEMHCA including but not limited to the Affordable Care Act, the City’s total liability for enrolled employees and retirees and their eligible family members shall not exceed what the City would have paid toward PEMHCA coverage in the absence of such state or federal plan. The parties will meet and confer over the impact of such change on matters within the scope of representation before implementing any change.
a. Active employee domestic partners whose domestic partnership is registered with the State of California may add their domestic partner as a dependent to their elected health plan coverage if the domestic partner is registered with the Secretary of State. Active employee domestic partners whose domestic partnership is not registered with the State but who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department, will be eligible for reimbursement of the actual monthly premium cost of an individual health plan, not to exceed 90% of the average monthly premium cost of individual coverage under the Item 8
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18 PEMHCA health plans in 2016. Effective with the first pay period including January 1, 2017, a stipend of two hundred eighty four ($284) per month toward the cost of an individual health plan will be provided. Evidence of premium payment will be required with request for reimbursement.
Flexible Compensaiton: Effective the first pay period following Council adoption of the MOU, in lieu of additional increases to the City’s medical premiums, hourly wages for all bargaining unit classifications will be increased by $100 per month ($1,200 per year). Employees can utilize this cash payment for any purpose, including to cover health insurance premiums or contribute to flexible spending accounts/457 deferred compensation plans. Effective the first full pay period of January 2024, hourly wages for all bargaining unit classifications will be increased by an additional $100 per month.
Section 2. Dual Coverage. When a City employee is married to another City employee each shall be covered only once (as an individual or as a spouse of the other City employee, but not both) and dependent children, if any, shall be covered only by one spouse.
Section 3 Dental Benefits
a. Level of Benefits: The City will maintain the present level of benefits on the City- sponsored dental program. Maximum benefits per calendar year shall be $2,000. The City provides a base dental plan for all eligible employees and dependents. Eligible employees may enroll in a dental buy-up plan.
b. Premiums: The City shall pay all premium payments or equivalent self-insured program charges on behalf of employees and dependents who are eligible and enrolled for coverage under the base existing dental plan. Dependents will include domestic partners, as defined under Article XVII Section 3. c. Orthodontia Benefit Maximum. The City will provide a 50% of reasonable charges, $2,000 lifetime maximum orthodontic benefit for representation unit employees and their dependents.
Section 4. Vision Care.
The City offers vision care coverage for employees and dependents. Coverage is equivalent to $20 Deductible Plan A under the Vision Service Plan, with monthly premiums paid by the employer. Dependents include domestic partners, as defined under Article XVII Section 1.
a) Level of Benefits: The City provides a base vision plan for all eligible employees and dependents. Eligible employees may enroll in a vision buy-up plan.
b) Premiums: The City shall pay all premium payments on behalf of employees and dependents who are eligible and enrolled in coverage under the base vision plan. Employees are responsible for premium payments required to enroll in the buy-up vision plan.
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19 Section 5. Employee Assistance Plan . The Employee Assistance Plan (EAP) provides employees with confidential personal counseling, work and family related issues, eldercare, substance abuse, etc. In addition, EAP programs provide a valuable tool for supervisors to refer troubled employees to professional outside help. This service staffed by experienced clinicians is available to employees and their dependents by calling a toll-free phone line 24 hours a day, seven days a week. Guidance is also available online.
Section 6. Alternative Medical Benefit Program.
If a regular employee and/or the employee’s dependent(s) are eligible for and elect to receive medical insurance through any other non- City of Palo Alto employer sponsored or association- sponsored group medical plan, the employee may choose to waive his/he r right to the City of Palo Alto’s medical plan insurance and receive cash payments in the amount of two hundred eighty-four dollars ($284) for each month City coverage is waived.
ARTICLE XVII – RETIREMENT MEDICAL PLAN
Section 1. 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 that retire on or before December 31, 2006. Effective January 1, 2007 for an employee retiring on or after that date the City will pay up to the monthly medical premium for the 2nd most expensive plan offered to FCA employees among the existing array of plans. However, the City contribution for an employee hired before January 1, 2004 who retires on or after December 1, 2011 shall be the same contribution amount it makes for active City employees.
Effective upon ratification and adoption of this Agreement, the City shall provide active unit employees who were hired before January 1, 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 Human Resources Department of their election in writing no later than 90 days following the ratification and adoption of this Agreement.
Section 2. 20-Year Vesting for Retiree Medical Coverage for Unit Employees Hired On Or After January 1, 2004:
The retiree health benefit provided in California Government Code section 22893 shall apply to all employees hired on or after January 1, 2004. Under this law, an employee is eligible to receive Fifty (50) percent of benefit after ten (10) years; each additional service credit year after Ten (10) years will increase employer credit by Five (5%) percent until Twenty (20) years is reached at which time employee is eligible for One Hundred (100%) percent of annuitant-only coverage and Ninety (90%) percent of the additional premium for dependents.
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20 ARTICLE XIII – BASIC LIFE INSURANCE
The City shall provide a basic life and AD & D insurance plan in an amount equal to the employee's annual base compensation (rounded to the next highest $1,000).
ARTICLE XIX– SUPPLEMENTAL LIFE INSURANCE
An employee may, at his/her cost, purchase additional life insurance and additional AD&D coverage. The total amount of life insurance available to the employee is $325,000 and the total amount of AD&D coverage available is $325,000.
ARTICLE XX– LONG TERM DISABILITY INSURANCE
In lieu of providing long-term disability insurance program to eligible employees, the City shall add $40.00 per month to the base salary of eligible employees. This $40.00 per month shall not be calculated into the labor market salary comparison.
Employees may elect to enroll in the City’s Long Term Disability Insurance program.
ARTICLE XXI - EFFECTIVE DATE OF BENEFIT COVERAGE FOR NEW
EMPLOYEES
For newly-hired regular employees coverage begins on the first day of the month following date of hire for the health plan, dental plan, vision care plan, life insurance and long term disability plans if these benefits are elected.
ARTICLE XXII-WORKERS’ COMPENSATION
Persons on disability will be required to appear or otherwise report at regular two-week intervals to the Fire Chief or designate to discuss his/her status and ability to return to full or restricted work status. This section is not meant to unreasonably restrict employee's activities so long as such activities are cleared by the treating physician, treating program or alternative treatment program is maintained and employee is available for full or restricted duty as soon as medical clearance can be received.
ARTICLE XXIII- RETIREMENT PENSION PLANS
Section 1. Safety PERS Retirement Formula.
a. Safety Pension Group A: 3%@50 Safety Retirement: The City will continue the present benefits under the Public Employees' Retirement System (PERS) "3 percent at 50 (3%@50)" formula for employees hired before the effective date of the “3 percent at Item 8
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21 Section 2. 55” (3%@55) formula for new hires as described herein. The final year compensation for employees hired under the 3% at 50 formula will continue to be “Single highest year” or the highest average annual compensation earnable by the member during one (1) year of employment immediately preceding retirement or the one -year period otherwise designated by the member (Government Code section 20042).
b. Safety Pension Group B: 3%@55 Safety Retirement: Effective December 7, 2012, the City amended its contract with CalPERS to provide employees hired on or after that date who are not “new members” of CalPERS, as defined in the Public Employees’ Pension Reform Act (after referred to as “classic” CalPERS members) with the CalPERS retirement formula three percent of final salary at age 55 (“3%@55”), with the final salary determination for such employees of “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 (Government Code section 20037).
c. Safety Pension Group C: 2.7% at Age 57 Safety Retirement: Employees hired on or after January 1, 2013 meeting the definition of “new member” under the Public Employees’ Pension Reform Act (Gov’t. Code s. 7522 et seq.) shall be subject to all of the provisions of that law, including but not limited to the two point seven percent at age 57 (2.7%@57) retirement formula with a three year final compensation period.
d. Safety PERS Member Contribution.
1. Employees in all classifications in Pension Groups A and B described above shall pay a total of 9% towards the PERS member contributions by payroll deduction.
2. Employees in all represented classes in Pension Group C described above shall pay the employee contribution required by the Public Employees’ Pension Reform Act, currently calculated at fifty percent (50%) of the normal cost.
3. When employees pay their PERS Member Contribution pursuant to section 2a and 2b above, the City will provide for member contributions to be made as allowed under provisions of IRS Code Section 414(h)(2).
e. Additional Employee PERS contributions:
In addition to the PERS member contribution as required under section 2d 1, 2 and 3 above, all employees in pension groups a, b and c shall contribute the additional following contributions:
1. All employees regardless of pension formula in this unit shall, in addition to the Member Contribution required, shall pay an additional 3% towards the Employer share of Pension regardless of pension formula through a CalPERS 20516 contract amendment.
2. Effective the first full pay period following July 1, 2020, all employees regardless of pension formula in this unit shall, in addition to the Member Contribution required, Item 8
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22 pay an additional 1% towards the Employer share of Pension for a total of 4%.
Section 2. Status Determination. An employee’s membership in and designation as Safety for CalPERS pension plan purposes shall be determined based on applicable California law.
Section 3. Employer Contributions to 457 Plan
Effective the later of July 1, 2025 or the adoption of the MOA first full pay period following July 1, 2020, the City will contribute $300 monthly the equivalent of 1% of the employee’s pensionable salary into the to the 457 plan of each represented employee.
Effective July 1, 2026 the City will contribute $600 monthly to the 457 plan of each represented employee.
Eligibility:
1. Employees must be enrolled in an eligible City sponsored 457 plan
2. Employees who reach the maximum as defined by the IRS will not receive additional contributions
3. Employee must be making PERS contributions
ARTICLE XXIV - MISCELLANEOUS EMPLOYMENT-RELATED EXPENSES
Section 1. Station House Fund. The Station House Fund per year per shift employee shall be $100.00.
Section 2. Non-Food House Items. The City agrees to furnish and maintain each fire station with the following non-food house fund items: TV purchase and repair. Kitchen cooking utensils, small kitchen appliances and other specific items to be determined by mutual agreement of the parties will be purchased from the Station House Fund.
Section 3. Per Diem Travel Expenses For City Business. Unless other mutually agreeable arrangements are made, representation unit employees who are required to travel away from the City on City business will receive travel expenses, according to City policies which are currently in effect.
Section 4. Parking. Employees in represented classes assigned to Civic Center or adjacent work locations shall be entitled to free parking in the Civic Center Garage, or a commute incentive which will be subject to meet and confer. Employees hired after July 1, 1994 may initially receive a parking permit for another downtown lot subject to availability of space at the Civic Center garage. Light duty employees assigned to the Civic Center will receive Civic Center parking temporary permits for the duration of the light duty assignment.
Section 5. Uniform. The value of the purchase, rental and/or maintenance of the required uniforms shall be reported as special compensation to the extent legally permissible, pursuant to Item 8
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23 Title 2 CCR, Section 571(a)(5) as Uniform Allowance. Based upon existing uniform standards and the City’s cost experience, the value of this benefit shall be reported as $15.31 per pay period. The City will supply complete uniforms as described in Fire Department Policy 1031.
ARTICLE XXV – WORK ASSIGNMENTS
Section 1. Selection of and assignment to Training Battalion Chief (40-hour workweek) shall be based upon seniority, except where operational needs are determined by the Fire Chief or designee, the Fire Chief or designee reserves the right to assign personnel based on Fire Department needs. For purposes of this article, seniority shall be calculated from date of entry into the Battalion Chief classification.
Section 2. Working out of Classification. Where employees, on a temporary basis, are assigned to perform all significant duties of a higher classification, for a period of one week or more, the Fire Chief may authorize payment within the range of the higher classification for the specified time frame. Working above classification will not exceed six months, unless renewed at the discretion of the Fire Chief. Working above classification pay is not to exceed 10% more than the employee’s current salary and shall be documented on a Personnel Action Form, with a description of the additional duties in the higher classification to be performed and an end date.
Employees assigned to work out of classification will receive out of class pay beginning the first day of the assignment.
ARTICLE XXVI - FULL UNDERSTANDING
Section 1. The Memorandum of Agreement contains the full and entire understanding of the parties regarding the matters set forth herein.
Section 2. Severability. If any of the provision herein contained be rendered or declared invalid by reason of any State or Federal legislation, or by ruling of any court of competent jurisdiction, such invalidation of such part or portion of this Memorandum of Agreement shall not invalidate the remaining portions hereof, and they shall remain in full force and effect, insofar as such remaining portions are severable.
Section 3. It is the intent of the parties that ordinances, resolutions, rules and regulations enacted pursuant to this Memorandum of Agreement be administered and observed in good faith.
Section 4. Nothing in this Memorandum of Agreement shall preclude the parties from mutually agreeing to meet and confer on any subject with the scope of representation during the term of this agreement.
Section 5. Merit System Rules and Regulations During the term of this Memorandum of Item 8
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24 Agreement, Management may propose certain changes in the City Merit System Rules and Regulations. With regard to such changes which pertain to the representation unit, the parties agree to review, and upon request, meet and confer regarding the changes.
ARTICLE XXVII - DURATION
This Memorandum of Agreement shall become effective upon signing by the parties hereto, except that those provisions herein that have specific effective dates shall take effect on those dates regardless of signing date, once this Memorandum of Agreement is signed by the parties hereto. This Memorandum of Agreement shall expire June 30, 2028 2025.
ARTICLE XXVIII- 48/96 WORK SCHEDULE
The regular schedule for 56 hour personnel will be under a “48/96” model. With the adoption of this “48/96” schedule the parties agreed to revise Fire department policy 205.6 typical workday and 1009.8.1 reporting for Duty-Holidays.
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25 EXECUTED:
FOR: FOR:
FIRE CHIEFS ASSOCIATION CITY OF PALO ALTO
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APPENDIX A
[Salary Schedule Attachment B]
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Memorandum of Agreement Between Utilities Management and Professional Association of Palo Alto and the City of Palo Alto effective July 1, 2025 to June 30, 2028
1 CITY OF PALO ALTO
Memorandum of
Agreement
City of Palo Alto and Utilities Management and
Professional Association of Palo Alto
Effective dates:
July 1, 2025 – June 30, 2028
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2 Table of Contents
PREAMBLE .................................................................................................................................. 4 ARTICLE I – RECOGNITION .................................................................................................. 4 ARTICLE II – NO DISCRIMINATION .................................................................................... 4 ARTICLE III – PAYROLL DUES DEDUCTION .................................................................... 4 ARTICLE IV – WORK STOPPAGE AND LOCKOUTS ........................................................ 4 ARTICLE V – CITY RIGHT TO MANAGE ............................................................................ 4 ARTICLE VI – Compensation .................................................................................................... 5 Section 1 – Job Families and Salary Schedule ............................................................................ 5 Section 2 – Base Salary Increases ............................................................................................... 5 Section 3 – Market Based Adjustments ...................................................................................... 6 Section 4. Working Above Classification ................................................................................... 7 Section 5. Engineers in Responsible Charge .............................................................................. 7 Section 6. Standby Compensation .............................................................................................. 7 Section 7. Utility Cost Efficiency Incentive Pilot Program ........................................................ 7 ARTICLE VII – HEALTH BENEFITS ..................................................................................... 7 Section 1 – Group Insurance ....................................................................................................... 7 Article VIII – Deferred Compensation Match ......................................................................... 12 ARTICLE IX – LEAVES ........................................................................................................... 12 Section 1 – Sick Leave .............................................................................................................. 12 Section 2 – Management Annual Leave ................................................................................... 13 Section 3 – Vacation ................................................................................................................. 13 Section 4 – Bereavement .......................................................................................................... 14 Section 5 – All Other Leaves .................................................................................................... 14 Section 6 – Vacation Benefits for Deceased Employees .......................................................... 14 Section 7 – Voluntary Leave Program ...................................................................................... 14 ARTICLE X – WORKERS’ COMPENSATION .................................................................... 15 Section 1 – Employees unable to work due to occupational injury, illness or disease ............. 15 Section 2 – Temporary Disability ............................................................................................. 15 ARTICLE XI – RETIREMENT PENSION ............................................................................. 15 ARTICLE XII – MISCELLANEOUS ...................................................................................... 17 Section 1 – Reimbursement for Relocation Expense ................................................................ 17 Section 2 – Meal allowance ...................................................................................................... 17 Section 3 – Reduction in Workforce...................................................................................... 17 Section 4 - Contracting Out ...................................................................................................... 17
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3 Section 5- Association Security ................................................................................................ 18 Section 6- Notification to the Association ................................................................................ 18 Section 7- Association Representative Access to Work Locations .......................................... 18 Section 8- Release Time ........................................................................................................... 18 Section 9- Personnel Files ......................................................................................................... 18 ARTICLE XIII – GRIEVANCE PROCEDURE ..................................................................... 18 Section 1 - General Provisions .................................................................................................. 18 Section 2 – Definitions.............................................................................................................. 18 Section 3 - Conduct of Grievance Procedure ............................................................................ 19 Section 4 - Grievance and Appeal Procedure ........................................................................... 19 ARTICLE XIV – FULL UNDERSTANDING ......................................................................... 21 Section 1 – Full Understanding................................................................................................. 21 Section 2 – Severability ............................................................................................................ 21 Section 3 – Good Faith ............................................................................................................. 21 Section 4 – Mid-Contract Negotiations .................................................................................... 21 Section 5 – Merit System .......................................................................................................... 21 ARTICLE XV-DURATION ...................................................................................................... 21
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Memorandum of Agreement Between Utilities Management and Professional Association of Palo Alto and the City of Palo Alto effective July 1, 2025 to June 30, 2028
4 PREAMBLE
This memorandum of Agreement between the City of Palo Alto, hereinafter referred to as the “City”, and the Utilities Management and Professional Association of Palo Alto (UMPAPA), hereinafter referred to as the “Association” or “UMPAPA”, has been prepared and entered into in accordance with Title I, Division 4, Sections Chapter 10, 3500-3510 of the California government Code and Chapter 12 of the City of Palo Alto Merit System Rules and Regulations.
ARTICLE I – RECOGNITION
The City recognizes the Association as the exclusive representative of employees occupying positions in the bargaining unit certified by the City in accordance with the decision of Arbitrator Kagel dated April 13, 2011.
ARTICLE II – NO DISCRIMINATION
The Association and the City hereby agree that there shall be no discrimination because of race, color, age, handicap, sex, national origin, sexual or gender orientation, political or religious affiliation under this Agreement. There shall be no discrimination in employment conditions or treatment of employees on the basis of membership or non-membership in the Association, or participation in the lawful activities of the Association.
ARTICLE III – PAYROLL DUES DEDUCTION
The City shall deduct Association member dues, and any other mutually agreed upon payroll deduction from the bi-weekly pay of bargaining unit employees. The dues deduction must be authorized in writing by the employee on an authorization form acceptable to the City and to the Association. City shall remit the deducted dues to the Association as soon as possible after deduction.
ARTICLE IV – WORK STOPPAGE AND LOCKOUTS
The Association, its representatives or members shall not engage in , or cause, instigate, encourage, sanction or condone a work stoppage or sympathy work stoppage, withholding of services, leave of absence abuse or work slowdown of any kind against the City of Palo Alto or its citizens by its members during the term of this MOA. No Association member shall refuse to cross any picket line in the conduct of the Utility business, nor shall the Association, its representatives or members discriminate in any way towards anyone who refuses to participate in a work stoppage or any of the job actions cited above. The City agrees that it will not lock out Association members.
ARTICLE V – CITY RIGHT TO MANAGE
The City retains and reserves, without limitation, all powers, rights, authority, duties, and responsibilities to manage the City as stated in the City Merit Rules, Chapter 12, Section 1207(d).
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5 Nothing in this Agreement is to be interpreted as constituting a waiver of the City’s rights and responsibilities to manage the City and create and maintain programs and services that reflect its public's wishes. The intent of this MOA is to establish wages, working hours, and conditions of employment with the Association.
ARTICLE VI – Compensation
Section 1 – Job Families and Salary Schedule
Effective the first full pay period following adoption of this Memorandum by Council, all salaries of covered classifications shall be as listed in Appendix A.
Appendix A shall clearly outline benchmark classifications for future total compensation surveys and for the purposes of internal alignment of the Association job families and career paths.
The parties agree to continue a jointly-staffed benchmark committee. All recommendations or research conducted by the committee will be included in the next bargaining process.
Section 2 – Base Salary Increases
a) General Salary Increase: Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA 2023, salary ranges and salaries of all represented classifications will be increased by three four percent (4 3.0%).
b) Market Adjustment: Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA, salary ranges and salaries of all classifications in the Manager, Utilities Strategic Business Services (Admin) job family will be increased by seven tenth s of a percent (0.7%).
Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA the following classifications will receive targeted market adjustments in the amount of six percent (6.0%):
• Principal Electrical Engineer
• Manager, Electrical Engineering
Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA the following classifications will receive targeted market adjustments in the amount of four percent (4.0%):
• Principal WGW Engineer
• Manager, WGW Engineering
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6 c) General Salary Increase: Effective the first full pay period following July 1, 2026 2024 salary ranges and salaries of all represented classifications will be increased by three four percent (4
3.0%).
d) General Salary Increase: Effective the first full pay period following July 1, 2027 salary ranges and salaries of all represented classifications will be increased by three percent (3.0%). e) Effective July 2023 the first pay period following Council adoption of the MOU , and in lieu of additional increases to the City’s medical premiums, hourly wages for all bargaining unit classifications will be increased by $100 per month ($1200 per year). Employees can utilize this cash payment for any purpose, including to cover health insu rance premiums or contribute to flexible spending accounts/457 deferred compensation plans.
f) Effective the first pay period of January 2024, all classifications will receive an additional one hundred dollars ($100) monthly flexible compensation payment built into base hourly rate of pay.
Section 3 – Market Based Adjustments
Within the Term of this Agreement, the City will conduct a total compensation study of UMPAPA Benchmarked positions based on the following agencies:
Alameda
Anaheim
Burbank
East Bay MUD
Long Beach
Mountain View
Pacific Gas and Electric
Redwood City
Roseville
Sacramento MUD
San Jose
Santa Clara
Silicon Valley Clean Energy
Sunnyvale
The City’s total compensation study will include a geographic adjustment for agencies which are outside of the immediate region. Those agencies receiving a geographic adjustment are: Anaheim, Burbank, Long Beach, Sacramento MUD and Roseville. For the purposes of recruiting and retaining employees within the Utility market place, the parties will add to the survey universe data from Pacific Gas and Electric (PG&E) Bay Area region where data can be found. For the term of this agreement, where PG&E data cannot be verified or acquired the parties agree to include an above-median comparator for the purposes of calculating benchmarks.
The City’s survey is intended to provide a single source of information regarding compensation paid to bargaining unit employees and its comparison to compensation paid by other entities. The survey data does not obligate the City or the Association to propose or agree to any market-based adjustments. The next total compensation study will be started 180 days prior to expiration of this agreement.
Effective the first full pay period following the adoption of the MOA, salary ranges identified classifications will be increased in an amount sufficient to bring them to market as determined by the City’s market study.
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7 Section 4. Working Above Classification
Where covered employees, on a temporary basis, are assigned to perform all significant duties of a higher classification for a period of one pay period or more, the City Manager or designee may authorize payment within the range of the higher classification for the specified time frame. Working above classification will not exceed six months, unless renewed at the discretion of the City Manager or designee. On expiration of that timeframe, working above classification pay will cease and the employee will return to their former pay level. Working above classification pay is not to exceed 10% more than the employee’s current salary and shall be documented on a Personnel Action Form, with a description of the additional duties in the higher classification to be performed and an end date. Any disputes with the application of this provision shall be subject to Chapter 11 of the City’s Merit Rules.
Section 5. Engineers in Responsible Charge
Principal Engineers designated as engineers in responsible charge shall receive working above classification pay as defined in Section 4 above.
Section 6. Standby Compensation
Utility Operations Supervisors in WGW or Electric who are assigned to standby duty shall be compensated at the daily rate of two (2) hours at their base hourly salary on days the employee is assigned to be on standby duty.
Section 7. Utility Cost Efficiency Incentive Pilot Program During the term of this agreement, the parties will meet in an attempt to develop a pilot for a Utility Cost Efficiency Incentive bonus program. The Pilot Program will be implemented only upon mutual agreement of the City and UMPAPA but will have the following general parameters:
1. The Parties must agree on measurable objectives/criteria focused on curbing controllable costs associated with rate increases,
2. If the agreed-upon on “measurable objectives/criteria” are met during the Pilot Program, the City would provide a onetime non-pensionable bonus in an amount agreed to by the parties.
All covered employees who are active at the time of payment will be elig ible if the objectives/criteria are met.
3. The Pilot Program will begin and end on dates mutually agreed by the parties. However, the pilot program will end with expiration of the current MOA between the parties unless the parties agree in writing to an extension of the program.
The parties agree to continue the pilot program and its incentive pays for the term of the agreement.
ARTICLE VII – HEALTH BENEFITS
Section 1 – Group Insurance
Except as otherwise set forth herein, the City will maintain the present level of benefits on all City - sponsored medical programs.
a) Effective Date of Coverage
For newly-hired regular employees coverage begins on the first day of the month following submission of new hire forms date of hire for the health plan, dental plan, vision care plan, long term disability and life insurance plans if these benefits are elected. Effective on the first of the calendar month falling sixty (60) Item 8
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8 days after adoption of this MOA, City health premium contributions (medical, dental and vision) are will be prorated for part-time employees based on the number of hours per week the part-time employee is assigned to work. Until that time, part -time employees will remain subject to the practice in effect at adoption of this MOA.
b) Active Employee Health Coverage
During the term of this MOA, 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 Premium
Category
Total Maximum City Contribution (inclusive of
PEMHCA contribution*) Effective the later of July Jan
1, 2025 2021 or the adoption of the MOA.
EE only $943 871
EE plus one $1885 1742
EE plus family $2444 2260
Effective January 1, 2027, the City will increase its maximum contribution to medical premiums by the following percentages:
• Employee only: 2%
• Employee plus one: 3%
• Employee family: 5%
Medical Premium
Category
Total Maximum City Contribution (inclusive of
PEMHCA contribution*) Effective January 1, 2027 or
the adoption of the MOA.
EE only $962
EE plus one $1942
EE plus family $2566
Effective January 1, 2028, the City will increase its maximum contribution to medical premiums by four percent (4%).
Medical Premium
Category
Total Maximum City Contribution (inclusive of
PEMHCA contribution*) Effective January 1, 2028 or
the adoption of the MOA.
EE only $1000
EE plus one $2020
EE plus family $2669
*For the duration of this MOA if the PEHMCA Minimum charges increase they will be included in the City’s maximum contribution and will not result in an increase to the City’s maximum contribution rates.
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9 c) Coverage for Domestic Partners.
1. Domestic Partnership Registered with the California Secretary of State: Employees may add their domestic partner as a dependent to their elected health plan coverage if the domestic partnership is registered with the Secretary of State.
2. Domestic Partner Not Registered with the California Secretary of State:; Domestic partners who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department, will be eligible for a stipend of two hundred and eighty four dollars ($284) per month toward the cost of an individual health plan. Evidence of premium payment will be required with request for reimbursement. d) Alternative Medical Benefit Program
If a regular employee and/or the employee’s dependent(s) are eligible for medical insurance through another employer-sponsored or association medical plan, the employee may opt for alternative medical insurance coverage through the other employer-sponsored or association plan and waives his/her their right to the City of Palo Alto’s medical insurance coverage for same individuals. Employees waiving City coverage may receive a stipend of $284 per month.
e) Retiree Health Plan
a. Employees Hired Prior to January 1, 2004
Monthly City-paid premium contributions for a retiree-selected health plan through the CalPERS Health Benefits Program will be made as provided under the Public Employees' Medical and Hospital Care Act.
The City's contribution for an employee hired before January 1, 2004 and whose retirement date is on or after May 1, 2011 shall be the same contribution amount it makes from time to time for active City employees.
b. Post - 1/1/04 Hires
Government Code section 22893 applies to those Unit members hired after January I, 2004, and provides that, upon retirement from the City an employee is eligible for 50% of the specified employer health premium contribution after ten (10) years of service credit, provided at least five of those years were performed at the City of Palo Alto. After ten years of service credit, each additional service credit year increases the employer contribution percentage by 5% until, at twenty (20) years' service credit; the employee will be eligible upon retirement for 100% of the specified employer contribution and 90% of the contribution for their dependent coverage. The City of Palo Alto's health premium contribution for eligible post - 1/1/04 hires shall be the minimum contribution set by PERS under section Government Code section 22893.
For employees hired prior to January 1, 2004 who wish to opt in to Government code section 22893, the City provided a 90 calendar day period, in which employees hired prior to January 1, 2004 will have the opportunity to opt in to Government code section 22893. For a 90 day period following adoption of this agreement by Council, the City will offer a one-time opt in to Government code section 22893 for employees hired prior to 12/1/2013.
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10 f) Dental Plan
1. The City shall pay covered plan charges on behalf of all eligible employees and dependents.
Dependents include eligible domestic partners as defined in Section 1 subsection c of this Article VII, Health Benefits.
2. The City provides a base dental plan for all eligible employees and dependents. Eligible employees may enroll in a dental buy-up plan. The City shall pay all premium payments on behalf of employees and dependents who are eligible and enrolled for coverage under the base dental plan.
2. The City’s Dental Plan provides the following:
a. Maximum Benefits per Calendar Year- $2,000 per person b. Lifetime Maximum for Orthodontics- The City will pay up to $2,000.00 for orthodontia coverage (not included in annual dental maximum)
c. Major Dental Services 50% UCR*
d. Orthodontics 50% UCR*
e. Basic Benefits (All other covered services)
i) First Calendar Year of Eligibility 70% UCR*
ii) Subsequent Calendar Years 70%-100%
iii) *Usual, Customary, and Reasonable
iv) For each dental plan member, the percentage of coverage for basic benefits will begin at 70% for the first calendar year of coverage and increase by 10% (up to a maximum of 100%) effective the first day of the next calendar year as long as the member utilizes the plan at least once during the current year. Per the Delta Dental contract effective October 1, 2005, if the member does not use the plan during the current year, the percentage of coverage for the next calendar year shall remain unchanged from the current year.
v) If a dental plan member loses coverage under the plan, the applicable percentage of coverage for basic benefits provided during any future period of coverage will commence at 70% as if the dental plan member was a new enrollee. Examples of when a member might lose coverage under the plan include:
• Employee goes on an unpaid leave of absence and elects not to pay the required dental premiums for his/her family’s coverage during the leave. • Employee elects to drop one or more covered dependents from the plan during an open enrollment period so that they might be covered on a spouse’s non-City of Palo Alto dental plan.
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11 g) Vision Care
1. Level of Benefits: The City provides a base vision plan for all eligible employees and dependents. Eligible employees may enroll in a vision buy-up plan.
2. Premiums: The City shall pay all premium payments on behalf of employees and dependents who are eligible and enrolled in coverage under the base vision plan. Employees are responsible for premium payments required to enroll in the buy-up vision plan.
3. The City shall provide vision care coverage for employee and dependents. Coverage is administered by Vision Service Plan (VSP). The plan will provide an exam every 12 months; lenses every 24 months; frames every 24 months, all subject to a twenty dollar ($ 20) co - payment as defined in the Vision Services Benefits Plan A schedule.
3. Dependents include eligible domestic partners as defined in Section 1, Subsection c of this Article VII, Health Benefits.
h) No dual coverage for dental and vision benefits. When a City employee is married to or has a registered domestic partner with the California Secretary of State with another City employee, each shall only be covered once. (as an individual or as a spouse of the other City employees, but not both) and dependent children, if any, shall be covered by only one spouse. i) Basic Life Insurance
The City shall provide a basic group term life insurance with Accidental Death and Dismemberment (AD&D) coverage, in an amount equal to the employee's annual basic pay (rounded to the next highest $1,000) at no -cost to the employee. AD&D pays an additional amount equal to the employee’s annual basic pay (rounded to the next highest $1,000).
j) Supplemental Life And AD&D Insurance
An employee may, at his/her their cost, purchase additional life insurance and additional AD&D coverage equal to one - or two -times his or her annual salary. The maximum amount of life insurance available to the employee is up to $325,000 and the maximum amount of AD&D coverage available is up to $325,000.
k) Long Term Disability Insurance
The City shall provide long term disability (LTD) insurance with a benefit of 2/3 monthly salary, up to a maximum benefit of ten thousand dollars ($10,000) per month. The LTD plan will have a waiting period of sixty days, as provided by the applicable carrier agreement. The City shall pay the premium for the first six thousand dollars ($6,000) of base monthly salary. For employees whose base monthly salary exceeds six thousand dollars ($6,000), the employee shall pay the cost of the required premium based u pon their monthly salary between six thousand dollars ($6,000) and fifteen thousand dollars ($15,000).
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12 l) Employee Assistance Plan
The Employee Assistance Plan (EAP) provides employees with confidential personal counseling, work and family related issues, eldercare, substance abuse, etc. In addition, EAP programs provide a valuable tool for supervisors to refer troubled employees to p rofessional outside help. This service staffed by experienced clinicians is available to employees and their dependents by calling a toll-free phone line twenty-four (24) hours a day, seven days a week. Guidance is also available online.
Article VIII – Deferred Compensation Match
Effective January 1, 2019 tThe City will match employee contributions into their City-approved 457 plans up to a maximum of $4000. No combination of Employee and Employer funds can exceed the IRS limits for City approved 457 plans. The table below is for illustrative purposes only:
Employee Contribution Employer Matching Contribution
$1,000
$2,500
$1,000
$2,500
$4,000 $4,000
$11,000 $4,000
ARTICLE IX – LEAVES
Section 1 – Sick Leave
a) Sick leave shall be accrued bi-weekly provided the employee has been in a pay status for 50 percent or more of a bi-weekly pay period. Sick leave shall be accrued at the rate of 3.7 hours per bi- weekly pay period for those employees working a forty-hour duty schedule. Those assigned work schedules, which are greater or lesser than forty hours will accrue sick leave at the ratio of their work schedule to forty hours.
b) Employees may use up to twenty thirty (30) hours of sick leave per calendar year for personal business. The scheduling of such leave is subject to the approval of the appropriate level of Management.
c) Employees leaving the municipal service shall forfeit all accumulated sick leave, except as otherwise provided by law and by Section 609 of the Merit Rules and Regulations. In the event that notice of resignation is given, sick leave may be used only thro ugh the day which was designated as the final day of work by such notice.
d) Employees that were hired before December 1, 1983 and who leave the municipal service in good standing, or who die while employed in good standing by the city, and who have fifteen or more years of continuous service shall receive compensation for unused s ick leave hours in a sum equal to two and one-half percent of their unused sick leave hours multiplied by their years of continuous service and their basic hourly rate of pay at termination. Full sick leave accrual will be paid in the event of termination due to disability. See Merit System Rules and Regulations, Chapter 6, Section 609.
e) Up to nine days of s Sick leave per calendar year may be used for illness in the immediate family, including a registered domestic partner or other individuals required by law.
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13 f) Employees eligible, as specified above if hired before December 1, 1983, to be compensated for sick leave may annually convert sick leave hours in excess of 600 to cash or deferred compensation, according to the formula set forth above, up to a maximum of $2,000 per fiscal year.
Section 2 – Management Annual Leave
At the beginning of each calendar year designated exempt employees will be credited with 80 hours of management annual leave. This leave is granted in recognition of the extra hours exempt employees work over their regular schedule. This leave may be taken as paid time off, added to vacation accrual (subject to vacation accrual limitations), taken as cash or taken as deferred compensation. When time off is taken under this provision, 10-hour shift workers will receive one shift off for each 8 hours charged. Entitlement under this provision will be reduced on a prorated basis for part-time status, or according to the number of months in paid status during the fiscal year; employees who have used more than the pro-rated share at the time they leave City se rvice shall be required to repay the balance or have it deducted from their final check. Unused balances as of the end of the calendar year will be paid in cash unless a different option as indicated above is elected by the employee.
Section 3 – Vacation
Vacation will be is accrued when an employee is in pay status and will be credited on a bi-weekly basis.
Total vacation accrual at any one time may not exceed three times the annual rate of accrual. Each eligible employee shall accrue vacation at the following rate for continuous service performed in pay status:
a) Less than nine years. For employees completing less than nine years continuous service: 120 hours vacation leave per year; provided that:
The City manager is authorized to adjust the annual vacation accrual of employees hired on or after July 1, 2001, to provide up to 40 additional hours (i.e., to a maximum annual accrual of 160 hours) for service with a prior employer.
b) Nine, but less than fourteen years. For employees completing nine, but not more than fourteen years continuous service; 160 hours vacation per year.
c) Fourteen, but less than nineteen years. For employees completing fourteen, but not more than nineteen years continuous service; 180 hours vacation leave per year.
d) Nineteen or more years. For employees completing nineteen or more years continuous service; 200 hours vacation leave per year.
e) Employees are eligible to cash out vacation accrual balances in excess of 80 hours. An employee may cash out a minimum of eight (8) hours to a maximum of 120 hours of accrued vacation provided the employee has taken 80 vacation hours in the previous 12 mo nths and has followed the election procedures set forth in this section.
Employees must elect the number of vacation hours they will cash-out during the next calendar year, up to the maximum of 120 hours. The election will apply only to vacation hours that are accrued in the next calendar year and that are eligible for cash-out.
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14 The election to cash-out vacation hours in each designated year will be irrevocable. This means that employees who elect to cash -out vacation hours must cash -out the number of accrued hours pre - designated on the election form.
Employees who do not elect a cash -out amount by December 31 of the prior calendar year will be deemed to have waived the right to cash out any leave in the following tax year and will not be eligible to cash-out vacation hours in the next tax year. Employees who elect cash-out amounts may request a cash-out at any time in the designated tax year by submitting a cash-out form to payroll. Payroll will complete the cash -out upon request, provided the requested cash -out amount has accrued and is consistent with the amount the employee pre-designated. If the full amount of hours designated for cash-out is not available at the time of cash -out request, the maximum available will be paid. For employees who have not requested cash -out of the elected amount by Nov ember 1 of each year, Payroll will automatically cash -out the elected amount, or the maximum available amount, in a paycheck issued on or after the payroll date including November 1.
Section 4 – Bereavement
Leave of absence with pay of three (3) days may be granted to an employee by the head of their his/her department in the event of death in the employee’s immediate family, which is defined for purposes of this section as:
wife
husband
son
son-in-law
daughter
daughter-in-law
father
mother
brother
brother-in-law
sister
adopted child
sister-in-law
mother-in-law
father-in-law
step-father
step-mother
step-sister
step-brother
grandfather
grandfather-in-law
grandmother
grandmother-in-law
uncle
aunt
niece
nephew
registered domestic partner
close relative residing in the
household of the employee
Such leave shall be at full pay and shall not be charged against the employee’s accrued vacation or sick leave. Employees may supplement paid bereavement leave with accrued leave (including vacation or sick leave) or unpaid leave to reach a total of five (5) workdays of time off per incident of bereavement.
Requests for leave in excess of three five (5) days shall be subject to the approval of the City Manager or their designee. a Council-Appointed Officer for employees under his/her control.
Section 5 – All Other Leaves
For all other leaves of absence refer to Chapters 5 and 8 of the City’s Merit Rules and Regulations.
Section 6 – Vacation Benefits for Deceased Employees
An employee who is eligible for vacation leave and who dies while in the municipal service shall have the amount of any accrued vacation paid to the employee's estate within thirty days. This proration will be computed at the last basic rate of pay.
Section 7 – Voluntary Leave Program
If permitted by agreement between the City and the Association, members of the Association may participate in the "Voluntary Leave Program" to assist in maintaining the pay of an employee who is Item 8
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15 eligible by virtue of a qualifying catastrophic medical condition. Such participation, when authorized by City- Association agreement, shall be allowed only as long as the donors remain anonymous (unless disclosure is required by law).
Section 8 Floating Holiday – Days of Historical Significance Employees will be provided one floating holiday each calendar year in acknowledgement of days of historical significance. The employee with prior approval from their supervisor can use this floating holiday at any time during the year. This holiday has no cash value and will expire if unused.
ARTICLE X – WORKERS’ COMPENSATION
Section 1 – Employees unable to work due to occupational injury, illness or disease Employees unable to work due to occupational injury, illness or disease will be required to report to management to discuss his/her their status and ability to return to work on restricted or unrestricted duty, subject to the limitations imposed by applicable law. This requirement is not meant to unreasonably restrict employee’s activities while off work due to such incapacity as long as such activities are cleared by the treating physician, treating program or alternative treatment program and the employee is available for restricted or unrestricted duty as soon as medical clearance can be received.
Section 2 – Temporary Disability
While temporarily disabled, employees shall be entitled to use accrued sick leave for the first three (3) days following the date of injury and thereafter shall be paid full base salary for a period not to exceed fifty-seven (57) calendar days (including S aturdays, Sundays and Holidays), unless hospitalized, in which case employees shall be paid full base salary for a period not to exceed sixty (60) days from date of injury.
For any temporary disability continuing beyond the time limits set forth above, employees shall be paid two-thirds (66.66%) of their full base salary at the time of injury for the duration of such temporary disability in conformance with State law.
During the period of temporary disability, an employee’s eligibility for health, dental, life, LTD, or other insured program will continue with City contributions at the same rate as for active employees and vacation and sick leave benefits shall continue to accrue. In case of temporary disability beyond the time limits set forth above, sick leave and vacation benefits shall not be accrued.
ARTICLE XI – RETIREMENT PENSION
a) Employees hired before July 17, 2010
1. Retirement formula. Effective pay period inclusive of 1/6/07, the City’s Public Employees’ Retirement System (PERS) benefits changed to the 2.7%@ 55 formula for non -safety members (from 2% @55).
2. Employee contributions. Employees under the 2.7%@55 retirement formula will pay the full eight percent (8%) employee contribution.
3. Final compensation. Final compensation for purposes of retirement shall be as set forth in the City’s contract with CalPERS, including, when applicable, the Government Code Section 20692 Optional Benefit.
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16 b) Employees hired on or after July 17, 2010.
1. Retirement formula. For miscellaneous employees hired on or after July 17, 2010, or on or after January 1, 2013 who are not subject to the pension formula in the Public Employees’ Pension Reform Act (PEPRA), the City offers the CalPERS retirement formula t wo percent (2.0%) of final salary at age sixty (60).
2. Employee contributions. Employees under the 2%@60 retirement formula will pay the full seven percent (7%) employee contribution.
3. Final compensation. Final compensation for purposes of retirement shall be as set forth in the City’s contract with CalPERS, including, when applicable, the Government Code Section 20692 Optional Benefit or as required by law.
c) New Employees hired on or after January 1, 2013
Employees hired on or after January 1, 2013 who are “new members” as defined by the California Public Employees’ Pension Reform Act (PEPRA), will be subject to the terms of that statute including but not limited to the following provisions:
1. Retirement formula. Effective for employees hired on or after January 1, 2013, the PEPRA requires the City to provide new employees, as defined in that law, the CalPERS retirement formula two percent of final salary at age 62 (2%@62).
2. Employee contributions. Employees under the 2%@62 formula shall pay at least 50 percent of the total normal cost or the same contribution rate as “similarly situated” employees, whichever is higher.
3. Final compensation. Final compensation for employees under the 2%@62 benefit shall be as set forth in PEPRA, including calculation based on the average of three highest consecutive years and a cap on pensionable compensation (currently $136,440) based on I RS limits for employers that do not participate in social security.
d) Effective as soon as administratively feasible but no sooner than the first full pay period of March 2019, bargaining unit employees shall contribute 1% of their salary toward the employer cost of retirement.
Pensions Group Pension
Formula
Employee Contribution Contribution to
Employer Side
Total
Contribution from
Employees
Group A 2.7@ 55 8% 1% 9%
Group B & C 2@60 7% 1% 8%
Group D 2@62 50% of the normal Cost
(Currently 6.25%)
1% Will fluctuate
(Currently 7.25%)
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17 e) Employee CalPERS contributions tax deferred. Employee CalPERS contributions shall be made on a tax deferred basis, in accordance with Section 414(h)(2) of the Internal Revenue Code. All provisions of this subsection are subject to and conditioned upon compliance with IRS regulations.
ARTICLE XII – MISCELLANEOUS
Section 1 – Reimbursement for Relocation Expense
The City of Palo Alto, in rare instances, may, provide a Basic Relocation Benefits Package for new employees, upon the approval of the City Manager or designated subordinate. In addition, the provision of “Optional Benefits”, or portions thereof, may be extended for exceptional circumstances and only by approval of the City Manager or designee. The details of the Relocation Expense program are specified in the City’s Relocation Expense policy.
Section 2 – Meal allowance
Employees assigned to attend night meetings or who travel for business purposes are eligible to receive reimbursement as described by City policy. This provision covers only receipted meals actually taken and submitted for reimbursement.
Section 3 – Reduction in Workforce
The City will make every effort to provide written notice of its intent to lay off employees in this unit and will meet with Association upon request to discuss alternatives to layoff.
Section 4 - Contracting Out
a. As provided in subsection b , the City shall provide notice of any planned action(s) that would result in the layoff of one or more Association bargaining unit members and where either of the following apply:
1. The planned City action(s) is to contract out work historically and exclusively performed by Association bargaining unit members;
2. The planned City action is to substantially increase the scope or amount of work historically but not exclusively performed by Association bargaining unit members (e.g. work shared with other City employees outside the Association bargaining unit or contractors).
b. The City shall deliver written notice to the Association at least thirty (30) days before it implements any action(s) described in subsection a. Within seven (7) days after it receives such notice, the Association may deliver to the City’s Chief People Officer a written request to meet and discuss the effects of the City action(s). After the City’s receipt of such request, the parties will promptly meet and undertake discussions. The discussions will conclude no later than the thirtieth (30th) day following the Association’s receipt of the City’s notice of the planned action(s), as described above. Thereafter, the City may implement the action(s) without further discussion as originally planned or as modified as a result of such discussions. If the Association does not deliver timely notice of its desire to meet and discuss the effects of the action(s) identified in the City’s notice, the City may proceed with the planned action(s).
c. The City retains its right to determine the methods, means, and personnel by which services are carried out at its sole discretion in circumstances no covered by subsection a above.
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18 Section 5- Association Security
a) When a person is hired in any of the covered job classifications, the City shall notify that person that the Association is the recognized bargaining representative for the employee in said Association and give the employee a current copy of the Memorandum of Agreement. b) Members of the Association Board may use a reasonable amount of on-duty time without loss of pay to meet with the City specifically related to representation of employees.
For purposes of this section, representation shall include:
(i) Meetings with represented employees or the City related to a grievance or disciplinary action, including investigation and preparation time.
(ii) Any meeting with the City related to benefits, working conditions or other terms and conditions of employment.
Section 6- Notification to the Association
The Association shall be informed in advance in writing by the City before any proposed changes not covered by this Memorandum of Agreement are made in benefits, working conditions, or other terms and conditions of employment which require meet and confer or meet and consult process.
Section 7- Association Representative Access to Work Locations Employee and nonemployee representatives of the Association will be granted access to City work locations to conduct business related to the administration or negotiation of the parties' Memorandum of Agreement, as long as advance arrangements for such visits have been made with the affected department manager and no disruption of work occurs.
Section 8- Release Time
The Association Chair, Vice-Chair or his/her their designee in the representation unit may use a reasonable amount of time without loss of pay for matters related to the bargaining process, labor relations, and administration of the MOA, violations of the MOA, grievances, disciplinary
Section 9- Personnel Files
Records of all disciplinary actions shall be kept in the central personnel file. Employees shall be entitled to sign and date any all action forms in their personnel files. Employees are entitled to review their personnel files upon written request or to authorize, in writing, review by their Association representatives. An employee shall be allowed, copies of materials in their an employee's personnel file.
ARTICLE XIII – GRIEVANCE PROCEDURE
Section 1 - General Provisions
The City and the Association recognize that early settlement of grievances is essential to sound employee-employer relations. The parties seek to establish a mutually satisfactory method for the settlement of Association grievances as provided for below. In presenting a grievance the aggrieved and/or his/her their representative is assured freedom from restraint, interference, coercion, discrimination or reprisal.
Section 2 – Definitions
Grievance means an unresolved complaint or dispute regarding the interpretation or application of this Memorandum of Agreement, excluding however those provisions of this MOA which specifically provide that the decision of any City official shall be final, the interpretation or application of those provisions Item 8
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19 not being subject to the grievance.
Section 3 - Conduct of Grievance Procedure
a) An aggrieved employee may be represented by the Association or may represent himself/herself themselves in preparing and presenting a grievance at any level of review. No grievance settlement may be made in violation of an existing merit rule or memorandum of agreement.
b) An employee and the representative steward, if any, may use a reasonable amount of work time so long as there is no disruption of work, in conferring about and presenting a grievance. Requests for release time to prepare grievances shall be made in advance and approved by the immediate supervisor.
c) The time limits specified in this Article may be extended by mutual agreement in writing of the aggrieved employee or the Association and the reviewer concerned.
d) Should a decision not be rendered within a stipulated time limit, the grievant may immediately appeal to the next step.
e) The grievance shall be considered settled if the decision of any step is not appealed within the specified time limit.
f) Grievances shall be made in writing and submitted on forms provided by the City. The written grievance shall contain clear, factual and concise language, including: (1) the name of the grievant; (2) a statement of the facts upon which the grievance is based, including relevant dates, times and places; (3) specific provisions of this Agreement the grievant alleges has been violated; (4) a summary of any steps taken toward resolution; and (5) the action the grievant believes will resolve the grievance.
g) Any retroactivity on monetary grievances shall be limited to the date of occurrence, except in no case will retroactivity be granted prior to three months before the grievance was filed in writing.
h) For purposes of time limits, “working days” are considered to be Monday through Friday, exclusive of City holidays.
i) If a mutually agreed solution is reached during any step of this grievance procedure, the agreement shall be placed in writing and signed by the City and the grievant or Association.
j) Upon request of either party, meetings to discuss the grievance shall be held at any step in the grievance procedure.
Section 4 - Grievance and Appeal Procedure
Step I. Informal Discussion
Within fifteen (15) working days after the incident or discovery of the incident on which the grievance is based the aggrieved employee shall present the grievance action to his/her their immediate supervisor and attempt to resolve the grievance through informal discussions. Every attempt will be made to settle the issue at this level.
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20 Step II. Formal Grievance
If the grievance is not resolved through the informal discussion in Step 1 the employee will reduce the grievance to writing and submit copies to the Department head or his/her their designee within fifteen (15) working days of the discussion with the immediate. The Department Head or designee shall have fifteen (15) working days from the receipt of a written grievance to review the matter and prepare a written statement.
Step III. Human Resources Director
If the grievance is not resolved and/or the aggrieved employee is not satisfied with the Step II decision, the grievant may appeal to the Human Resource Director or his/her their designee in writing within fifteen (15) working days of the receipt of the Department Head's response. The written appeal to the Human Resources level shall include a copy of the original grievance, the Department Head’s decision at Step II, and a clear statement of the reasons for appeal. Within fifteen (15) working days, after receiving the written appeal, the Human Resource Director shall review the matter and prepare a written statement. If a mutually agreed solution is reached during this process the agreement shall be placed in writing and signed.
Step IV. City Manager /Arbitration
If the grievance is not resolved at Step III, the aggrieved employee may choose between final and binding resolution of the grievance through appeal to the City Manager or through appeal to final and binding arbitration. For the term of this Memorandum of Agreement, appeals to final and binding arbitration may be processed only with Association approval. All Step IV appeals must be filed in writing at the Human Resources Department Office within fifteen (15) working days of receipt of the Human Resource Director’s decision at Step 3.
If the grievant or appellant elects final and binding resolution by the City Manager, the City Manager will choose the methods he or she they considers appropriate to review and settle the grievance. The City Manager shall render a written decision to all parties directly involved within fifteen (15) working days after receiving the grievant/appellant’s appeal.
If the grievant/appellant elects final and binding arbitration in accordance with this provision, the parties shall mutually select an arbitrator. In the event the parties cannot agree on an arbitrator, they shall mutually request a panel of five arbitrators from the California State Conciliation Service or from the American Arbitration Association if either party objects to the State Conciliation Service, and select an arbitrator by the alternate strike method.
The arbitrator shall have jurisdiction and authority only to interpret, apply, or determine compliance with the provisions of this Memorandum of Agreement. The arbitrator shall be without power to make any decision contrary to, or inconsistent with or modifying in any way, the terms of this Memorandum Of Agreement. The arbitrator shall be without authority to require the City to delegate or relinquish any powers which by State law or City Charter the City cannot delegate or relinquish. Copies of the arbitrator's decision shall be submitted to the City, the aggrieved employee and the Association. All direct costs emanating from the arbitration procedure shall be paid in full by the party in which the decision was found against.
ARTICLE XIV – PERFORMANCE EVALUATIONS
Performance evaluations for represented employees shall be conducted in accordance with processes defined in the City’s Management and Professional Compensation Plan.
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21 ARTICLE XIV XV – FULL UNDERSTANDING
Section 1 – Full Understanding
The Memorandum of Agreement contains the full and entire understanding of the parties regarding the matters set forth herein.
Section 2 – Severability
If, at the conclusion of any applicable appeals, any provision of this Memorandum of Agreement is ultimately held invalid and unenforceable by a decision of the relevant Court or Administrative Agency of competent jurisdiction such holding shall apply only to the provision(s) of this Memorandum of Agreement specified in the decision. Such decision shall not invalidate any other portion of this Memorandum of Understanding, and the unaffected provisions shall remain in full force and effect. The Parties agree that within ten (10) days after the date of such decision, they shall meet and confer in an effort to negotiate a substitute for the invalidated provision(s).
Section 3 – Good Faith
Ordinances, resolutions, rules and regulations enacted pursuant to this Memorandum of Agreement that regulate matters within the scope of representation shall, to the extent they are within the scope of representation, be administered in good faith.
Section 4 – Mid-Contract Negotiations
Subjects within the scope of representation that are not covered by this Memorandum of Agreement remain subject to the duty to meet and confer in good faith on timely notice and request. Neither party is obligated to meet and confer over matters within the scope of representation covered by this Memorandum of Agreement, except for purposes of negotiating over the terms of a successor to this Memorandum of Agreement.
Section 5 – Merit System
Merit System Rules and Regulations, during the term of this Memorandum of Agreement, Management may propose certain changes in the City Merit System Rules and Regulations. With regard to such changes which pertain to the representation unit, the parties agree to review, and upon request, meet and confer regarding the changes.
ARTICLE XVI - DURATION
This Memorandum of Agreement shall become effective once the Memorandum of Agreement is signed by the parties hereto and adopted by the City Council. This Memorandum of Agreement shall remain in effect through June 30, 2028 2025. At the request of either party negotiation of a successor agreement shall commence, however they should begin no sooner than 6 months prior to expiration of this agreement and no later than 3 months prior to the expiration of this agreement.
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22 For the City: For the Association:
__ ______
Ed Shikada, City Manager Aaron Perkins, Principal WGW Engineer
__ ______
Sandra Blanch, Human Resources Director Jim Pachikara, Principal Electrical Engineer
__
Tori Anthony, Manager Employee Relations Dave Yuan, Utilities Strategic Business Manager
__
Ben Farnsworth, Sr HR Administrator Kevin Enderby, Principal Business Analyst
__ _______________________________________
Sandhya Uthup, HR Representative Abel Silva, Supervisor WGW Operations
_______________________________________
Alan Davis, UMPAPA Outside Counsel
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23 Appendix A Benchmark Classifications and Salary Schedule
Division Classifications in Job Family
Resource Planning
Assistant Director, Utilities Resource Management
Senior Resource Planner
Manager, Utilities Program Services
Electric & Fiber Utilities
Assistant Director, Electric and Fiber Optic Utilities
Manager, Engineering, Electric and Fiber Utilities
Manager, Operations - Electric and Fiber Utilities
Manager, Utilities Compliance
Principal Engineer, Electric and Fiber Utilities
Operations Supervisor, Electric and Fiber Utilities
Supervising Project Engineer, Electric and Fiber Utilities Manager, Fiber Optic Utility
Utilities Safety Officer
Water, Gas Wastewater
Utilities
Assistant Director, Water-Gas-Wastewater (WGW) Utilities Manager, Engineering, WGW Utilities
Manager, Operations - WGW Utilities
Principal Engineer, WGW Utilities
Operations Supervisor, Water-Gas-Wastewater (WGW) Utilities Supervising Project Engineer, WGW Utilities
Customer Support
Assistant Director, Utilities Customer Support Services Manager, Utilities Credit & Collection
Manager, Utilities Customer Service
Admin
Manager, Utilities Strategic Business Services
Utilities Principal Business Analyst
Utilities Management Analyst
Manager, Utilities Public Communications
Utilities Senior Business Analyst
Utilities Senior Management Analyst
Utilities Administrative Assistant
*Benchmark Classifications in Bold
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1 CITY OF PALO ALTO
Memorandum of
Agreement
City of Palo Alto and Utilities Management and
Professional Association of Palo Alto
Effective dates:
July 1, 2025 – June 30, 2028
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2 Table of Contents
PREAMBLE .................................................................................................................................. 4 ARTICLE I – RECOGNITION .................................................................................................. 4 ARTICLE II – NO DISCRIMINATION .................................................................................... 4 ARTICLE III – PAYROLL DUES DEDUCTION .................................................................... 4 ARTICLE IV – WORK STOPPAGE AND LOCKOUTS ........................................................ 4 ARTICLE V – CITY RIGHT TO MANAGE ............................................................................ 4 ARTICLE VI – Compensation .................................................................................................... 5 Section 1 – Job Families and Salary Schedule ............................................................................ 5 Section 2 – Base Salary Increases ............................................................................................... 5 Section 3 – Market Based Adjustments ...................................................................................... 6 Section 4. Working Above Classification ................................................................................... 6 Section 5. Engineers in Responsible Charge .............................................................................. 7 Section 6. Standby Compensation .............................................................................................. 7 Section 7. Utility Cost Efficiency Incentive Pilot Program ........................................................ 7 ARTICLE VII – HEALTH BENEFITS ..................................................................................... 7 Section 1 – Group Insurance ....................................................................................................... 7 Article VIII – Deferred Compensation Match ......................................................................... 10 ARTICLE IX – LEAVES ........................................................................................................... 11 Section 1 – Sick Leave .............................................................................................................. 11 Section 2 – Management Annual Leave ................................................................................... 11 Section 3 – Vacation ................................................................................................................. 12 Section 4 – Bereavement .......................................................................................................... 12 Section 5 – All Other Leaves .................................................................................................... 13 Section 6 – Vacation Benefits for Deceased Employees .......................................................... 13 Section 7 – Voluntary Leave Program ...................................................................................... 13 ARTICLE X – WORKERS’ COMPENSATION .................................................................... 13 Section 1 – Employees unable to work due to occupational injury, illness or disease ............. 13 Section 2 – Temporary Disability ............................................................................................. 14 ARTICLE XI – RETIREMENT PENSION ............................................................................. 14 ARTICLE XII – MISCELLANEOUS ...................................................................................... 15 Section 1 – Reimbursement for Relocation Expense ................................................................ 15 Section 2 – Meal allowance ...................................................................................................... 15 Section 3 – Reduction in Workforce...................................................................................... 15 Section 4 - Contracting Out ...................................................................................................... 16
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3 Section 5- Association Security ................................................................................................ 16 Section 6- Notification to the Association ................................................................................ 16 Section 7- Association Representative Access to Work Locations .......................................... 17 Section 8- Release Time ........................................................................................................... 17 Section 9- Personnel Files ......................................................................................................... 17 ARTICLE XIII – GRIEVANCE PROCEDURE ..................................................................... 17 Section 1 - General Provisions .................................................................................................. 17 Section 2 – Definitions.............................................................................................................. 17 Section 3 - Conduct of Grievance Procedure ............................................................................ 17 Section 4 - Grievance and Appeal Procedure ........................................................................... 18 ARTICLE XIV – FULL UNDERSTANDING ......................................................................... 19 Section 1 – Full Understanding................................................................................................. 19 Section 2 – Severability ............................................................................................................ 19 Section 3 – Good Faith ............................................................................................................. 19 Section 4 – Mid-Contract Negotiations .................................................................................... 20 Section 5 – Merit System .......................................................................................................... 20 ARTICLE XV-DURATION ...................................................................................................... 20
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4 PREAMBLE
This memorandum of Agreement between the City of Palo Alto, hereinafter referred to as the “City”, and the Utilities Management and Professional Association of Palo Alto (UMPAPA), hereinafter referred to as the “Association” or “UMPAPA”, has been prepared and entered into in accordance with Title I, Division 4, Sections Chapter 10, 3500-3510 of the California government Code and Chapter 12 of the City of Palo Alto Merit System Rules and Regulations.
ARTICLE I – RECOGNITION
The City recognizes the Association as the exclusive representative of employees occupying positions in the bargaining unit certified by the City in accordance with the decision of Arbitrator Kagel dated April 13, 2011.
ARTICLE II – NO DISCRIMINATION
The Association and the City hereby agree that there shall be no discrimination because of race, color, age, handicap, sex, national origin, sexual or gender orientation, political or religious affiliation under this Agreement. There shall be no discrimination in employment conditions or treatment of employees on the basis of membership or non-membership in the Association, or participation in the lawful activities of the Association.
ARTICLE III – PAYROLL DUES DEDUCTION
The City shall deduct Association member dues, and any other mutually agreed upon payroll deduction from the bi-weekly pay of bargaining unit employees. The dues deduction must be authorized in writing by the employee on an authorization form acceptable to the City and to the Association. City shall remit the deducted dues to the Association as soon as possible after deduction.
ARTICLE IV – WORK STOPPAGE AND LOCKOUTS
The Association, its representatives or members shall not engage in, cause, instigate, encourage, sanction or condone a work stoppage or sympathy work stoppage, withholding of services, leave of absence abuse or work slowdown of any kind against the City of Palo Alto or its citizens by its members during the term of this M OA. No Association member shall refuse to cross any picket line in the conduct of the Utility business, nor shall the Association, its representatives or members discriminate in any way towards anyone who refuses to participate in a work stoppage or any o f the job actions cited above. The City agrees that it will not lock out Association members.
ARTICLE V – CITY RIGHT TO MANAGE
The City retains and reserves, without limitation, all powers, rights, authority, duties, and responsibilities to manage the City as stated in the City Merit Rules, Chapter 12, Section 1207(d).
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5 Nothing in this Agreement is to be interpreted as constituting a waiver of the City’s rights and responsibilities to manage the City and create and maintain programs and services that reflect its public's wishes. The intent of this MOA is to establish wages, working hours, and conditions of employment with the Association.
ARTICLE VI – Compensation
Section 1 – Job Families and Salary Schedule
Effective the first full pay period following adoption of this Memorandum by Council, all salaries of covered classifications shall be as listed in Appendix A.
Appendix A shall clearly outline benchmark classifications for future total compensation surveys and for the purposes of internal alignment of the Association job families and career paths.
The parties agree to continue a jointly-staffed benchmark committee. All recommendations or research conducted by the committee will be included in the next bargaining process.
Section 2 – Base Salary Increases
a) General Salary Increase: Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA , salary ranges and salaries of all represented classifications will be increased by three percent (3.0%).
b) Market Adjustment: Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA, salary ranges and salaries of all classifications in the Manager, Utilities Strategic Business Services (Admin) job family will be increased by seven tenth s of a percent (0.7%).
Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA the following classifications will receive targeted market adjustments in the amount of six percent (6.0%):
• Principal Electrical Engineer
• Manager, Electrical Engineering
Effective the first full pay period following the later of July 1, 2025 or the adoption of the MOA the following classifications will receive targeted market adjustments in the amount of four percent (4.0%):
• Principal WGW Engineer
• Manager, WGW Engineering
c) General Salary Increase: Effective the first full pay period following July 1, 2026 salary ranges and salaries of all represented classifications will be increased by three percent (3.0%).
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6 d) General Salary Increase: Effective the first full pay period following July 1, 2027 salary ranges and salaries of all represented classifications will be increased by three percent (3.0%). e) Effective July 2023, and in lieu of additional increases to the City’s medical premiums, hourly wages for all bargaining unit classifications will be increased by $100 per month ($1200 per year).
Employees can utilize this cash payment for any purpose, including to cover health insurance premiums or contribute to flexible spending accounts/457 deferred compensation plans.
f) Effective the first pay period of January 2024, all classifications will receive an additional one hundred dollars ($100) monthly flexible compensation payment built into base hourly rate of pay.
Section 3 – Market Based Adjustments
Within the Term of this Agreement, the City will conduct a total compensation study of UMPAPA Benchmarked positions based on the following agencies:
Alameda
Anaheim
Burbank
East Bay MUD
Long Beach
Mountain View
Pacific Gas and Electric
Redwood City
Roseville
Sacramento MUD
San Jose
Santa Clara
Silicon Valley Clean Energy
Sunnyvale
The City’s total compensation study will include a geographic adjustment for agencies which are outside of the immediate region. Those agencies receiving a geographic adjustment are: Anaheim, Burbank, Long Beach, Sacramento MUD and Roseville. For the purposes of recruiting and retaining employees within the Utility market place, the parties will add to the survey universe data from Pacific Gas and Electric (PG&E) Bay Area region where data can be found. For the term of this agreement, where PG&E data cannot be verified or acquired the parties agree to include an above-median comparator for the purposes of calculating benchmarks.
The City’s survey is intended to provide a single source of information regarding compensation paid to bargaining unit employees and its comparison to compensation paid by other entities. The survey data does not obligate the City or the Association to propose or agree to any market-based adjustments. The next total compensation study will be started 180 days prior to expiration of this agreement.
Effective the first full pay period following the adoption of the MOA, salary ranges identified classifications will be increased in an amount sufficient to bring them to market as determined by the City’s market study.
Section 4. Working Above Classification
Where covered employees, on a temporary basis, are assigned to perform all significant duties of a higher classification for a period of one pay period or more, the City Manager or designee may authorize payment within the range of the higher classification for the specified time frame. Working above classification will not exceed six months, unless renewed at the discretion of the City Manager or designee. On expiration of that timeframe, working above classification pay will cease and the employee will return to their former Item 8
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7 pay level. Working above classification pay is not to exceed 10% more than the employee’s current salary and shall be documented on a Personnel Action Form, with a description of the additional duties in the higher classification to be performed and an end date. Any disputes with the application of this provision shall be subject to Chapter 11 of the City’s Merit Rules.
Section 5. Engineers in Responsible Charge
Principal Engineers designated as engineers in responsible charge shall receive working above classification pay as defined in Section 4 above.
Section 6. Standby Compensation
Utility Operations Supervisors in WGW or Electric who are assigned to standby duty shall be compensated at the daily rate of two (2) hours at their base hourly salary on days the employee is assigned to be on standby duty.
Section 7. Utility Cost Efficiency Incentive Pilot Program
The parties agree to continue the pilot program and its incentive pays for the term of the agreement.
ARTICLE VII – HEALTH BENEFITS
Section 1 – Group Insurance
Except as otherwise set forth herein, the City will maintain the present level of benefits on all City - sponsored medical programs.
a) Effective Date of Coverage
For newly-hired regular employees coverage begins on the first day of the month following submission of new hire forms for the health plan, dental plan, vision care plan, long term disability and life insurance plans if these benefits are elected. City health premium contributions (medical, dental and vision) are prorated for part -time employees based on the number of hours per week the part -time employee is assigned to work.
b) Active Employee Health Coverage
During the term of this MOA, the maximum City contribution towards medical premiums for eligible full time employees per employee category shall be the following for any plan:
Medical Premium
Category
Total Maximum City Contribution (inclusive of
PEMHCA contribution*) Effective the later of July 1,
2025 or the adoption of the MOA.
EE only $943
EE plus one $1885
EE plus family $2444
Effective January 1, 2027, the City will increase its maximum contribution to medical premiums by the Item 8
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8 following percentages:
• Employee only: 2%
• Employee plus one: 3%
• Employee family: 5%
Medical Premium
Category
Total Maximum City Contribution (inclusive of
PEMHCA contribution*) Effective January 1, 2027 or
the adoption of the MOA.
EE only $962
EE plus one $1942
EE plus family $2566
Effective January 1, 2028, the City will increase its maximum contribution to medical premiums by four percent (4%).
Medical Premium
Category
Total Maximum City Contribution (inclusive of
PEMHCA contribution*) Effective January 1, 2028 or
the adoption of the MOA.
EE only $1000
EE plus one $2020
EE plus family $2669
*For the duration of this MOA if the PEHMCA Minimum charges increase they will be included in the City’s maximum contribution and will not result in an increase to the City’s maximum contribution rates. c) Coverage for Domestic Partners.
1. Domestic Partnership Registered with the California Secretary of State: Employees may add their domestic partner as a dependent to their elected health plan coverage if the domestic partnership is registered with the Secretary of State.
2. Domestic Partner Not Registered with the California Secretary of State: Domestic partners who meet the requirements of the City of Palo Alto Declaration of Domestic Partnership, and are registered with the Human Resources Department, will be eligible for a stipend of two hundred and eighty four dollars ($284) per month toward the cost of an individual health plan. Evidence of premium payment will be required with request for reimbursement. d) Alternative Medical Benefit Program
If a regular employee and/or the employee’s dependent(s) are eligible for medical insurance through another employer-sponsored or association medical plan, the employee may opt for alternative medical insurance coverage through the other employer-sponsored or association plan and waives their right to the City of Palo Alto’s medical insurance coverage for same individuals. Employees waiving City coverage may receive a stipend of $284 per month
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9 e) Retiree Health Plan
a. Employees Hired Prior to January 1, 2004
Monthly City-paid premium contributions for a retiree-selected health plan through the CalPERS Health Benefits Program will be made as provided under the Public Employees' Medical and Hospital Care Act.
The City's contribution for an employee hired before January 1, 2004 and whose retirement date is on or after May 1, 2011 shall be the same contribution amount it makes from time to time for active City employees.
b. Post - 1/1/04 Hires
Government Code section 22893 applies to those Unit members hired after January I, 2004, and provides that, upon retirement from the City an employee is eligible for 50% of the specified employer health premium contribution after ten (10) years of service credit, provided at least five of those years were performed at the City of Palo Alto. After ten years of service credit, each additional service credit year increases the employer contribution percentage by 5% until, at twenty (20) years' service credit; the employee will be eligible upon retirement for 100% of the specified employer contribution and 90% of the contribution for their dependent coverage. The City of Palo Alto's health premium contribution for eligible post - 1/1/04 hires shall be the minimum contribution set by PERS under section Government Code section 22893.
For employees hired prior to January 1, 2004 who wish to opt in to Government code section 22893, the City provided a 90 calendar day period, in which employees hired prior to January 1, 2004 will have the opportunity to opt in to Government code section 22893. For a 90 day period following adoption of this agreement by Council, the City will offer a one-time opt in to Government code section 22893 for employees hired prior to 12/1/2013.
f) Dental Plan
1. The City shall pay covered plan charges on behalf of all eligible employees and dependents.
Dependents include eligible domestic partners as defined in Section 1 subsection c of this Article VII, Health Benefits.
2. The City provides a base dental plan for all eligible employees and dependents. Eligible employees may enroll in a dental buy-up plan. The City shall pay all premium payments on behalf of employees and dependents who are eligible and enrolled for coverage under the base dental plan.
g) Vision Care
1. Level of Benefits: The City provides a base vision plan for all eligible employees and dependents. Eligible employees may enroll in a vision buy-up plan.
2. Premiums: The City shall pay all premium payments on behalf of employees and dependents who are eligible and enrolled in coverage under the base vision plan. Employees are responsible for premium payments required to enroll in the buy-up vision plan.
2. Dependents include eligible domestic partners as defined in Section 1, Subsection c of this Article VII, Health Benefits.
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10 h) No dual coverage for dental and vision benefits. When a City employee is married to or has a registered domestic partner with the California Secretary of State with another City employee, each shall only be covered once. (as an individual or as a spouse of the other City employees, but not both) and dependent children, if any, shall be covered by only one spouse. i) Basic Life Insurance
The City shall provide a basic group term life insurance with Accidental Death and Dismemberment (AD&D) coverage, in an amount equal to the employee's annual basic pay (rounded to the next highest $1,000) at no -cost to the employee. AD&D pays an additional amount equal to the employee’s annual basic pay (rounded to the next highest $1,000).
j) Supplemental Life And AD&D Insurance
An employee may, at their cost, purchase additional life insurance and additional AD&D coverage equal to one - or two -times his or her annual salary. The maximum amount of life insurance available to the employee is up to $325,000 and the maximum amount of AD&D coverage available is up to $325,000.
k) Long Term Disability Insurance
The City shall provide long term disability (LTD) insurance with a benefit of 2/3 monthly salary, up to a maximum benefit of ten thousand dollars ($10,000) per month. The LTD plan will have a waiting period of sixty days, as provided by the applicable carrier agreement. The City shall pay the premium for the first six thousand dollars ($6,000) of base monthly salary. For employees whose base monthly salary exceeds six thousand dollars ($6,000), the employee shall pay the cost of the required premium based u pon their monthly salary between six thousand dollars ($6,000) and fifteen thousand dollars ($15,000).
l) Employee Assistance Plan
The Employee Assistance Plan (EAP) provides employees with confidential personal counseling, work and family related issues, eldercare, substance abuse, etc. In addition, EAP programs provide a valuable tool for supervisors to refer troubled employees to p rofessional outside help. This service staffed by experienced clinicians is available to employees and their dependents by calling a toll-free phone line twenty-four (24) hours a day, seven days a week. Guidance is also available online.
Article VIII – Deferred Compensation Match
The City will match employee contributions into their City-approved 457 plans up to a maximum of $4000. No combination of Employee and Employer funds can exceed the IRS limits for City approved 457 plans. The table below is for illustrative purposes only:
Employee Contribution Employer Matching Contribution
$1,000
$2,500
$1,000
$2,500
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11 $4,000 $4,000
$11,000 $4,000
ARTICLE IX – LEAVES
Section 1 – Sick Leave
a) Sick leave shall be accrued bi-weekly provided the employee has been in a pay status for 50 percent or more of a bi-weekly pay period. Sick leave shall be accrued at the rate of 3.7 hours per bi- weekly pay period for those employees working a forty-hour duty schedule. Those assigned work schedules, which are greater or lesser than forty hours will accrue sick leave at the ratio of their work s chedule to forty hours.
b) Employees may use up to thirty (30) hours of sick leave per calendar year for personal business. The scheduling of such leave is subject to the approval of the appropriate level of Management.
c) Employees leaving the municipal service shall forfeit all accumulated sick leave, except as otherwise provided by law and by Section 609 of the Merit Rules and Regulations. In the event that notice of resignation is given, sick leave may be used only thro ugh the day which was designated as the final day of work by such notice.
d) Employees that were hired before December 1, 1983 and who leave the municipal service in good standing, or who die while employed in good standing by the city, and who have fifteen or more years of continuous service shall receive compensation for unused sick leave hours in a sum equal to two and one-half percent of their unused sick leave hours multiplied by their years of continuous service and their basic hourly rate of pay at termination. Full sick leave accrual will be paid in the event of termination due to disability. See Merit System Rules and Regulations, Chapter 6, Section 609.
e) Sick leave may be used for illness in the immediate family, including a registered domestic partner or other individuals required by law.
f) Employees eligible, as specified above if hired before December 1, 1983, to be compensated for sick leave may annually convert sick leave hours in excess of 600 to cash or deferred compensation, according to the formula set forth above, up to a maximum of $2,000 per fiscal year.
Section 2 – Management Annual Leave
At the beginning of each calendar year designated exempt employees will be credited with 80 hours of management annual leave. This leave is granted in recognition of the extra hours exempt employees work over their regular schedule. This leave may be taken as paid time off, added to vacation accrual (subject to vacation accrual limitations), taken as cash or taken as deferred compensation. When time off is taken under this provision, 10-hour shift workers will receive one shift off for each 8 hours charged. Entitlement under this provision will be reduced on a prorated basis for part-time status, or according to the number of months in paid status during the fiscal year; employees who have used more than the pro-rated share at the time they leave City se rvice shall be required to repay the balance or have it deducted from their final check. Unused balances as of the end of the calendar year will be paid in cash unless a different option as indicated above is elected by the employee.
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12 Section 3 – Vacation
Vacation is accrued when an employee is in pay status and is credited on a bi-weekly basis. Total vacation accrual at any one time may not exceed three times the annual rate of accrual. Each eligible employee shall accrue vacation at the following rate for continuous service performed in pay status:
a) Less than nine years. For employees completing less than nine years continuous service: 120 hours vacation leave per year; provided that:
The City manager is authorized to adjust the annual vacation accrual of employees hired on or after July 1, 2001, to provide up to 40 additional hours (i.e., to a maximum annual accrual of 160 hours) for service with a prior employer.
b) Nine, but less than fourteen years. For employees completing nine, but not more than fourteen years continuous service; 160 hours vacation per year.
c) Fourteen, but less than nineteen years. For employees completing fourteen, but not more than nineteen years continuous service; 180 hours vacation leave per year.
d) Nineteen or more years. For employees completing nineteen or more years continuous service; 200 hours vacation leave per year.
e) Employees are eligible to cash out vacation accrual balances in excess of 80 hours. An employee may cash out a minimum of eight (8) hours to a maximum of 120 hours of accrued vacation provided the employee has taken 80 vacation hours in the previous 12 mo nths and has followed the election procedures set forth in this section.
Employees must elect the number of vacation hours they will cash-out during the next calendar year, up to the maximum of 120 hours. The election will apply only to vacation hours that are accrued in the next calendar year and that are eligible for cash-out.
The election to cash-out vacation hours in each designated year will be irrevocable. This means that employees who elect to cash -out vacation hours must cash -out the number of accrued hours pre - designated on the election form.
Employees who do not elect a cash -out amount by December 31 of the prior calendar year will be deemed to have waived the right to cash out any leave in the following tax year and will not be eligible to cash-out vacation hours in the next tax year. Employees who elect cash-out amounts may request a cash-out at any time in the designated tax year by submitting a cash-out form to payroll. Payroll will complete the cash -out upon request, provided the requested cash -out amount has accrued and is consistent with the amount the employee pre-designated. If the full amount of hours designated for cash-out is not available at the time of cash -out request, the maximum available will be paid. For employees who have not requested cash -out of the elected amount by Nov ember 1 of each year, Payroll will automatically cash -out the elected amount, or the maximum available amount, in a paycheck issued on or after the payroll date including November 1.
Section 4 – Bereavement
Leave of absence with pay of three (3) days may be granted to an employee by the head of their department in the event of death in the employee’s family, which is defined for purposes of this section as:
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13 wife
husband
son
son-in-law
daughter
daughter-in-law
father
mother
brother
brother-in-law
sister
adopted child
sister-in-law
mother-in-law
father-in-law
step-father
step-mother
step-sister
step-brother
grandfather
grandfather-in-law
grandmother
grandmother-in-law
uncle
aunt
niece
nephew
registered domestic partner
close relative residing in the
household of the employee
Such leave shall be at full pay and shall not be charged against the employee’s accrued vacation or sick leave. Employees may supplement paid bereavement leave with accrued leave (including vacation or sick leave) or unpaid leave to reach a total of five (5) workdays of time off per incident of bereavement.
Requests for leave in excess of five (5) days shall be subject to the approval of the City Manager or their designee.
Section 5 – All Other Leaves
For all other leaves of absence refer to Chapters 5 and 8 of the City’s Merit Rules and Regulations.
Section 6 – Vacation Benefits for Deceased Employees
An employee who is eligible for vacation leave and who dies while in the municipal service shall have the amount of any accrued vacation paid to the employee's estate within thirty days. This proration will be computed at the last basic rate of pay.
Section 7 – Voluntary Leave Program
If permitted by agreement between the City and the Association, members of the Association may participate in the "Voluntary Leave Program" to assist in maintaining the pay of an employee who is eligible by virtue of a qualifying catastrophic medical condition. Such participation, when authorized by City- Association agreement, shall be allowed only as long as the donors remain anonymous (unless disclosure is required by law).
Section 8 Floating Holiday – Days of Historical Significance Employees will be provided one floating holiday each calendar year in acknowledgement of days of historical significance. The employee with prior approval from their supervisor can use this floating holiday at any time during the year. This holiday has no cash value and will expire if unused.
ARTICLE X – WORKERS’ COMPENSATION
Section 1 – Employees unable to work due to occupational injury, illness or disease Employees unable to work due to occupational injury, illness or disease will be required to report to management to discuss their status and ability to return to work on restricted or unrestricted duty, subject to the limitations imposed by applicable law. This requirement is not meant to unreasonably restrict employee’s activities while off work due to such incapacity as long as su ch activities are cleared by the treating physician, treating program or alternative treatment program and the employee is available for restricted or unrestricted duty as soon as medical clearance can be received.
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14 Section 2 – Temporary Disability
While temporarily disabled, employees shall be entitled to use accrued sick leave for the first three (3) days following the date of injury and thereafter shall be paid full base salary for a period not to exceed fifty-seven (57) calendar days (including S aturdays, Sundays and Holidays), unless hospitalized, in which case employees shall be paid full base salary for a period not to exceed sixty (60) days from date of injury.
For any temporary disability continuing beyond the time limits set forth above, employees shall be paid two-thirds (66.66%) of their full base salary at the time of injury for the duration of such temporary disability in conformance with State law.
During the period of temporary disability, an employee’s eligibility for health, dental, life, LTD, or other insured program will continue with City contributions at the same rate as for active employees and vacation and sick leave benefits shall continue to accrue. In case of temporary disability beyond the time limits set forth above, sick leave and vacation benefits shall not be accrued.
ARTICLE XI – RETIREMENT PENSION
a) Employees hired before July 17, 2010
1. Retirement formula. Effective pay period inclusive of 1/6/07, the City’s Public Employees’ Retirement System (PERS) benefits changed to the 2.7%@ 55 formula for non -safety members (from 2% @55).
2. Employee contributions. Employees under the 2.7%@55 retirement formula will pay the full eight percent (8%) employee contribution.
3. Final compensation. Final compensation for purposes of retirement shall be as set forth in the City’s contract with CalPERS, including, when applicable, the Government Code Section 20692 Optional Benefit.
b) Employees hired on or after July 17, 2010.
1. Retirement formula. For miscellaneous employees hired on or after July 17, 2010, or on or after January 1, 2013 who are not subject to the pension formula in the Public Employees’ Pension Reform Act (PEPRA), the City offers the CalPERS retirement formula t wo percent (2.0%) of final salary at age sixty (60).
2. Employee contributions. Employees under the 2%@60 retirement formula will pay the full seven percent (7%) employee contribution.
3. Final compensation. Final compensation for purposes of retirement shall be as set forth in the City’s contract with CalPERS, including, when applicable, the Government Code Section 20692 Optional Benefit or as required by law.
c) New Employees hired on or after January 1, 2013
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15 Employees hired on or after January 1, 2013 who are “new members” as defined by the California Public Employees’ Pension Reform Act (PEPRA), will be subject to the terms of that statute including but not limited to the following provisions:
1. Retirement formula. Effective for employees hired on or after January 1, 2013, the PEPRA requires the City to provide new employees, as defined in that law, the CalPERS retirement formula two percent of final salary at age 62 (2%@62).
2. Employee contributions. Employees under the 2%@62 formula shall pay at least 50 percent of the total normal cost or the same contribution rate as “similarly situated” employees, whichever is higher.
3. Final compensation. Final compensation for employees under the 2%@62 benefit shall be as set forth in PEPRA, including calculation based on the average of three highest consecutive years and a cap on pensionable compensation (currently $136,440) based on I RS limits for employers that do not participate in social security.
d) Effective as soon as administratively feasible but no sooner than the first full pay period of March 2019, bargaining unit employees shall contribute 1% of their salary toward the employer cost of retirement.
Pensions Group Pension
Formula
Employee Contribution Contribution to
Employer Side
Total
Contribution from
Employees
Group A 2.7@ 55 8% 1% 9%
Group B & C 2@60 7% 1% 8%
Group D 2@62 50% of the normal Cost
(Currently 6.25%)
1% Will fluctuate
(Currently 7.25%)
e) Employee CalPERS contributions tax deferred. Employee CalPERS contributions shall be made on a tax deferred basis, in accordance with Section 414(h)(2) of the Internal Revenue Code. All provisions of this subsection are subject to and conditioned upon compliance with IRS regulations.
ARTICLE XII – MISCELLANEOUS
Section 1 – Reimbursement for Relocation Expense
The City of Palo Alto, in rare instances, may, provide a Basic Relocation Benefits Package for new employees, upon the approval of the City Manager or designated subordinate. In addition, the provision of “Optional Benefits”, or portions thereof, may be extended for exceptional circumstances and only by approval of the City Manager or designee. The details of the Relocation Expense program are specified in the City’s Relocation Expense policy.
Section 2 – Meal allowance
Employees assigned to attend night meetings or who travel for business purposes are eligible to receive reimbursement as described by City policy. This provision covers only receipted meals actually taken and submitted for reimbursement.
Section 3 – Reduction in Workforce
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16 The City will make every effort to provide written notice of its intent to lay off employees in this unit and will meet with Association upon request to discuss alternatives to layoff.
Section 4 - Contracting Out
a. As provided in subsection b , the City shall provide notice of any planned action(s) that would result in the layoff of one or more Association bargaining unit members and where either of the following apply:
1. The planned City action(s) is to contract out work historically and exclusively performed by Association bargaining unit members;
2. The planned City action is to substantially increase the scope or amount of work historically but not exclusively performed by Association bargaining unit members (e.g. work shared with other City employees outside the Association bargaining unit or contractors).
b. The City shall deliver written notice to the Association at least thirty (30) days before it implements any action(s) described in subsection a. Within seven (7) days after it receives such notice, the Association may deliver to the City’s Chief People Officer a written request to meet and discuss the effects of the City action(s). After the City’s receipt of such request, the parties will promptly meet and undertake discussions. The discussions will conclude no later than the thirtieth (30th) day following the Association’s receipt of the City’s notice of the planned action(s), as described above. Thereafter, the City may implement the action(s) without further discussion as originally planned or as modified as a result of such discussions. If the Association does not deliver timely notice of its desire to meet and discuss the effects of the action(s) identified in the City’s notice, the City may proceed with the planned action(s).
c. The City retains its right to determine the methods, means, and personnel by which services are carried out at its sole discretion in circumstances no covered by subsection a above.
Section 5- Association Security
a) When a person is hired in any of the covered job classifications, the City shall notify that person that the Association is the recognized bargaining representative for the employee in said Association and give the employee a current copy of the Memorandum of Agreement. b) Members of the Association Board may use a reasonable amount of on-duty time without loss of pay to meet with the City specifically related to representation of employees.
For purposes of this section, representation shall include:
(i) Meetings with represented employees or the City related to a grievance or disciplinary action, including investigation and preparation time.
(ii) Any meeting with the City related to benefits, working conditions or other terms and conditions of employment.
Section 6- Notification to the Association
The Association shall be informed in advance in writing by the City before any proposed changes not covered by this Memorandum of Agreement are made in benefits, working conditions, or other terms and conditions of employment which require meet and confer or meet and consult process.
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17 Section 7- Association Representative Access to Work Locations Employee and nonemployee representatives of the Association will be granted access to City work locations to conduct business related to the administration or negotiation of the parties' Memorandum of Agreement, as long as advance arrangements for such visits have been made with the affected department manager and no disruption of work occurs.
Section 8- Release Time
The Association Chair, Vice-Chair or their designee in the representation unit may use a reasonable amount of time without loss of pay for matters related to the bargaining process, labor relations, and administration of the MOA, violations of the MOA, grievances, disciplinary
Section 9- Personnel Files
Records of all disciplinary actions shall be kept in the central personnel file. Employees shall be entitled to sign and date any action forms in their personnel files. Employees are entitled to review their personnel files upon written request or to authorize, in writing, review by their Association representatives. An employee shall be allowed,
copies of materials in their personnel file.
ARTICLE XIII – GRIEVANCE PROCEDURE
Section 1 - General Provisions
The City and the Association recognize that early settlement of grievances is essential to sound employee-employer relations. The parties seek to establish a mutually satisfactory method for the settlement of Association grievances as provided for below. In presenting a grievance the aggrieved and/or their representative is assured freedom from restraint, interference, coercion, discrimination or reprisal.
Section 2 – Definitions
Grievance means an unresolved complaint or dispute regarding the interpretation or application of this Memorandum of Agreement, excluding however those provisions of this MOA which specifically provide that the decision of any City official shall be final, the interpretation or application of those provisions not being subject to the grievance.
Section 3 - Conduct of Grievance Procedure
a) An aggrieved employee may be represented by the Association or may represent themselves in preparing and presenting a grievance at any level of review. No grievance settlement may be made in violation of an existing merit rule or memorandum of agreement.
b) An employee and the representative steward, if any, may use a reasonable amount of work time so long as there is no disruption of work, in conferring about and presenting a grievance. Requests for release time to prepare grievances shall be made in advance and approved by the immediate supervisor.
c) The time limits specified in this Article may be extended by mutual agreement in writing of the aggrieved employee or the Association and the reviewer concerned.
d) Should a decision not be rendered within a stipulated time limit, the grievant may immediately appeal to the next step.
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18 e) The grievance shall be considered settled if the decision of any step is not appealed within the specified time limit.
f) Grievances shall be made in writing and submitted on forms provided by the City. The written grievance shall contain clear, factual and concise language, including: (1) the name of the grievant; (2) a statement of the facts upon which the grievance is based, including relevant dates, times and places; (3) specific provisions of this Agreement the grievant alleges has been violated; (4) a summary of any steps taken toward resolution; and (5) the action the grievant believes will resolve the grievance.
g) Any retroactivity on monetary grievances shall be limited to the date of occurrence, except in no case will retroactivity be granted prior to three months before the grievance was filed in writing.
h) For purposes of time limits, “working days” are considered to be Monday through Friday, exclusive of City holidays.
i) If a mutually agreed solution is reached during any step of this grievance procedure, the agreement shall be placed in writing and signed by the City and the grievant or Association.
j) Upon request of either party, meetings to discuss the grievance shall be held at any step in the grievance procedure.
Section 4 - Grievance and Appeal Procedure
Step I. Informal Discussion
Within fifteen (15) working days after the incident or discovery of the incident on which the grievance is based the aggrieved employee shall present the grievance action to their immediate supervisor and attempt to resolve the grievance through informal discussions. Every attempt will be made to settle the issue at this level.
Step II. Formal Grievance
If the grievance is not resolved through the informal discussion in Step 1 the employee will reduce the grievance to writing and submit copies to the Department head or their designee within fifteen (15) working days of the discussion with the immediate. The Department Head or designee shall have fifteen (15) working days from the receipt of a written grievance to review the matter and prepare a written statement.
Step III. Human Resources Director
If the grievance is not resolved and/or the aggrieved employee is not satisfied with the Step II decision, the grievant may appeal to the Human Resource Director or their designee in writing within fifteen (15) working days of the receipt of the Department Head's response. The written appeal to the Human Resources level shall include a copy of the original grievance, the Department Head’s decision at Step II, and a clear statement of the reasons for appeal. Within fifteen (15) working days, after receiving the written appeal, the Human Resource Director shall review the matter and prepare a written statement.
If a mutually agreed solution is reached during this process the agreement shall be placed in writing and signed.
Step IV. City Manager /Arbitration
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19 If the grievance is not resolved at Step III, the aggrieved employee may choose between final and binding resolution of the grievance through appeal to the City Manager or through appeal to final and binding arbitration. For the term of this Memorandum of Agreement, appeals to final and binding arbitration may be processed only with Association approval. All Step IV appeals must be filed in writing at the Human Resources Department Office within fifteen (15) working days of receipt of the Human Resource Director’s decision at Step 3.
If the grievant or appellant elects final and binding resolution by the City Manager, the City Manager will choose the methods they consider appropriate to review and settle the grievance. The City Manager shall render a written decision to all parties directly involved within fifteen (15) working days after receiving the grievant/appellant’s appeal.
If the grievant/appellant elects final and binding arbitration in accordance with this provision, the parties shall mutually select an arbitrator. In the event the parties cannot agree on an arbitrator, they shall mutually request a panel of five arbitrators from the California State Conciliation Service or from the American Arbitration Association if either party objects to the State Conciliation Service, and select an arbitrator by the alternate strike method.
The arbitrator shall have jurisdiction and authority only to interpret, apply, or determine compliance with the provisions of this Memorandum of Agreement. The arbitrator shall be without power to make any decision contrary to, or inconsistent with or modifying in any way, the terms of this Memorandum Of Agreement. The arbitrator shall be without authority to require the City to delegate or relinquish any powers which by State law or City Charter the City cannot delegate or relinquish. Copies of the arbitrator's decision shall be submitted to the City, the aggrieved employee and the Association. All direct costs emanating from the arbitration procedure shall be paid in full by the party in which the decision was found against.
ARTICLE XIV – PERFORMANCE EVALUATIONS
Performance evaluations for represented employees shall be conducted in accordance with processes defined in the City’s Management and Professional Compensation Plan.
ARTICLE XV – FULL UNDERSTANDING
Section 1 – Full Understanding
The Memorandum of Agreement contains the full and entire understanding of the parties regarding the matters set forth herein.
Section 2 – Severability
If, at the conclusion of any applicable appeals, any provision of this Memorandum of Agreement is ultimately held invalid and unenforceable by a decision of the relevant Court or Administrative Agency of competent jurisdiction such holding shall apply only to the provision(s) of this Memorandum of Agreement specified in the decision. Such decision shall not invalidate any other portion of this Memorandum of Understanding, and the unaffected provisions shall remain in full force and effect. The Parties agree that within ten (10) days after the date of such decision, they shall meet and confer in an effort to negotiate a substitute for the invalidated provision(s).
Section 3 – Good Faith
Ordinances, resolutions, rules and regulations enacted pursuant to this Memorandum of Agreement that regulate matters within the scope of representation shall, to the extent they are within the scope of representation, be administered in good faith.
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20 Section 4 – Mid-Contract Negotiations
Subjects within the scope of representation that are not covered by this Memorandum of Agreement remain subject to the duty to meet and confer in good faith on timely notice and request. Neither party is obligated to meet and confer over matters within the scope of representation covered by this Memorandum of Agreement, except for purposes of negotiating over the terms of a successor to this Memorandum of Agreement.
Section 5 – Merit System
Merit System Rules and Regulations, during the term of this Memorandum of Agreement, Management may propose certain changes in the City Merit System Rules and Regulations. With regard to such changes which pertain to the representation unit, the parties agree to review, and upon request, meet and confer regarding the changes.
ARTICLE XVI - DURATION
This Memorandum of Agreement shall become effective once the Memorandum of Agreement is signed by the parties hereto and adopted by the City Council. This Memorandum of Agreement shall remain in effect through June 30, 2028. At the request of either party negotiation of a successor agreement shall commence, however they should begin no sooner than 6 months prior to expiration of this agreement and no later than 3 months prior to the expiration of this agreement.
For the City: For the Association:
__ ______
Ed Shikada, City Manager Aaron Perkins, Principal WGW Engineer
__ ______
Sandra Blanch, Human Resources Director Jim Pachikara, Principal Electrical Engineer
__
Tori Anthony, Manager Employee Relations Dave Yuan, Utilities Strategic Business Manager
__
Ben Farnsworth, Sr HR Administrator Kevin Enderby, Principal Business Analyst
__ _______________________________________
Sandhya Uthup, HR Representative Abel Silva, Supervisor WGW Operations
_______________________________________
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21 Alan Davis, UMPAPA Outside Counsel
Appendix A Benchmark Classifications and Salary Schedule
Division Classifications in Job Family
Resource Planning
Assistant Director, Utilities Resource Management
Senior Resource Planner
Manager, Utilities Program Services
Electric & Fiber Utilities
Assistant Director, Electric and Fiber Optic Utilities
Manager, Engineering, Electric and Fiber Utilities
Manager, Operations - Electric and Fiber Utilities
Manager, Utilities Compliance
Principal Engineer, Electric and Fiber Utilities
Operations Supervisor, Electric and Fiber Utilities
Supervising Project Engineer, Electric and Fiber Utilities Manager, Fiber Optic Utility
Utilities Safety Officer
Water, Gas Wastewater
Utilities
Assistant Director, Water-Gas-Wastewater (WGW) Utilities Manager, Engineering, WGW Utilities
Manager, Operations - WGW Utilities
Principal Engineer, WGW Utilities
Operations Supervisor, Water-Gas-Wastewater (WGW) Utilities Supervising Project Engineer, WGW Utilities
Customer Support
Assistant Director, Utilities Customer Support Services Manager, Utilities Credit & Collection
Manager, Utilities Customer Service
Admin
Manager, Utilities Strategic Business Services
Utilities Principal Business Analyst
Utilities Management Analyst
Manager, Utilities Public Communications
Utilities Senior Business Analyst
Utilities Senior Management Analyst
Utilities Administrative Assistant
*Benchmark Classifications in Bold
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COMPENSATION PLAN
FOR
Management and Professional Personnel
And Council Appointees
Effective December 31, 2022 through June
30, 2025July 1, 2025, except where
specifically noted.
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2 SECTION I. COMPENSATION ................................................................................................................ 4 A. MANAGEMENT AND PROFESSIONAL COMPENSATION POLICY ............................................ 4 B. BASIC PLAN ELEMENTS .......................................................................................................... 4 C. General Salary Increases ........................................................................................................ 5 D. Annual Performance Review and Merit Increases ................................................................ 6 E. Classification Compensation Review: .................................................................................... 7 SECTION II. SPECIAL COMPENSATION............................................................................................... 8 A. OVERTIME .............................................................................................................................. 8 B. Holiday ................................................................................................................................. 24 F. IN LIEU HOLIDAY PAY ............................................................................................................. 9 D. WORKING ABOVE CLASSIFICATION PAY ...................................................................................... 9 G. CALL OUT PAY ........................................................................................................................ 9 H. NIGHT SHIFT PREMIUM ....................................................................................................... 10 I. UNIFORM PURCHASE PLAN - SWORN POLICE, FIRE PERSONNEL, and OPEN SPACE PERSONNEL .................................................................................................................................... 10 J. SAFETY DIFFERENTIALS ........................................................................................................ 10 SECTION III. BENEFIT PROGRAMS ................................................................................................ 11 A. HEALTH PLAN ....................................................................................................................... 11 B. Employee Assistance Program ............................................................................................. 18 C. Excess Benefit ...................................................................................................................... 19 D. Professional Development ................................................................................................... 22 E. COMMUTE INCENTIVES and PARKING .....................................................................................
F. MEAL ALLOWANCE .............................................................................................................. 23 IV. LEAVES .......................................................................................................................................... 23 A. Sick Leave ............................................................................................................................. 23 B. Management Annual Leave ................................................................................................. 24 C. Vacation ............................................................................................................................... 26 D. Bereavement ........................................................................................................................ 27 V. RETIREMENT .................................................................................................................................. 28 E. Miscellaneous Pension Formulas: ........................................................................................ 28 F. Safety Pension Formulas: ..................................................................................................... 28 G. Employee PERS Share. ......................................................................................................... 29 H. Employer Share .................................................................................................................... 29 Item 8
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2 I. AT-WILL STATUS ....................................................................................................................... 30 J. HIRING PROVISIONS ............................................................................................................. 32 K. GRIEVANCES REGARDING COUNCIL APPOINTED OFFICERS ................................................ 33 L. MERIT RULES ........................................................................................................................ 33 Attachment B .................................................................................................................................................. 34 At-Will Positions Management and Professional Unit ................................................................................... 34 Item 8
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