HomeMy WebLinkAbout10.22.13 Work Session Minutes Council Workshop Minutes
Classification and Compensation Study Final Report
October 22,2013
Mayor Larson called the workshop to order at 6:32 p.m.
Present: Larson, Bartholomay(arrived 6:38 p.m.), Bonar,Donnelly
Absent: Fogarty
Also Present: David McKnight, City Administrator;Brenda Wendlandt, Human Resources
Director; Cynthia Muller, Executive Assistant;Mike Verdoorn, Fox Lawson
MOTION by Donnelly, second by Bonar to approve the agenda. APIF,MOTION CARRIED.
Mr. Mike Verdoorn, of Fox Lawson, presented the results of the wage study. The objectives of
the study were to evaluate the classifications to make sure there was internal equity and order,
assign the jobs to the correct pay grade based on job duties and responsibilities, collect market
data from comparable organizations, and develop a salary structure that is more competitive.
This includes all employees except for police officers and sergeants.
The first step was to apply a job evaluation methodology to all the jobs. The evaluation tool is a
decision band method. It places an internal job hierarchy and helps to place jobs into the right
pay grade. The City also used the decision band method in the 2002 study. Fox Lawson
identified 39 positions based on matches to the LMC database. The labor market was identified
in local county and city organizations. Fox Lawson developed a recommended pay plan and
assigned jobs to pay grades based on the job evaluation, and developed a transition plan and
costs. The minimum match is 70%for overall job responsibilities. Benchmark comparisons of
the market were provided to Human Resources. The guidelines for determining the competitive
nature of the benchmark positions and the overall compensation of the City are:
+1- 5%=Highly Competitive
+1- 10%=Competitive
+1- 10-15%=Possible misalignment with market
>15%= Significant misalignment with market
Looking at how the City's salaries and salary range compares to the market, following is an
aggregate comparison of all benchmark positions to the market data:
Actual salaries -5.6% (This is what salaries actually are today).
Salary Range Minimum -5.2%
Salary Range Midpoint -0.3%
Salary Range Maximum 4.2%
Regarding maximums,we have two maximums per job. Step 5 is midpoint and where most
employees max out. Beyond that to Step 9 was merit pay where one third of employees are. The
maximum shown above is Step 9 of the merit pay. The City is considered competitive with the
market.
Actual salaries—Highly Competitive
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Salary Range Minimum—Possible misalignment with market
Salary Range Midpoint-Competitive
Salary Range Maximum—Highly Competitive
Currently the City has a 35%—45%range spread compared to an average of 26% for the market.
To ensure the structure is competitive, we need to adjust the salary range spread so there is a
competitive minimum, midpoint,and maximum.
A trend line was developed by comparing the City and the market. The trend line of the market
is slightly higher and reflects 5.2%—5.6%below on actual salaries. Fox Lawson also compared
the current minimums to the market minimums which shows current minimums are 5.2%below
the market. Using these trend lines, a salary structure based on median actual salaries and
median minimum salaries was developed.
Salary Range Salary Range Salary Range
Minimum Midpoint Maximum
Current v Market -5.2% -0.3% 4.2%
Actual Structure v 6.2% 7.9% 9.6%
Market
Minimum Structure v 0.7% 0.1% -0.1%
Market
If we use the actual salary structure, it would create a structure consistently higher than the
market because it would be based on longer tenured employees,those that are toward the higher
end of their salary range. By taking the minimum structure to create a salary range, the structure
would be .7% above the minimum, .1%above at midpoint, and .1%below at max. This would
have a 25%range spread which matches the market.
An 11 step salary structure was created. This allows for step increases of 2.5%-3%. There are
three implementation options to consider:
1. Increase to the minimum method—ensures all employees are paid at the minimum of the
new salary range.
2. Increase to current step—would place all employees at the same step they are at
currently.
3. Up to closest step—moves all employees up to the next closest step based on their salary.
Increase to the minimum method—there are five employees below the new minimum and seven
employees above the new maximum. The estimated cost for this option is$9,147 or 0.3%of
current payroll. Fox Lawson recommends at least this method should be done.
Increase to current step method—the new salary structure includes 11 steps. Each step up to the
midpoint equals one year. Each step from the midpoint to the maximum equals two years. This
would increase 22 employee salaries. The cost is $27,959 or 0.8%of current payroll.
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Up to closest step—All employees are moved up to the next closest step in the salary structure
for the 11 step structure. This increases 52 employee salaries. Cost would be$39,429 or 1.2%
of current payroll. Fox Lawson recommends this option.
With the 11 step structure everyone is eligible to get to step 11 over time. Moving people to the
next step could be$1 increase or$1,500 increase. Those five that are below the minimum need
to get moved up. The seven that are above the max, it is proposed to freeze them until the scale
catches up. There are two positions that have been increased a grade and one position has come
down a grade.
City Administrator Update
City Administrator McKnight asked about the See Click Fix app. This allows residents to take a
picture of an issue using this application on their phone and send it to the City. This provides
easier communication and follow-up. Residents can vote for an issue and the response will be
sent to all. Eden Prairie currently uses this feature. Council reached a consensus on trying this
tool for a year. The cost is$5,000/year.
MOTION by Bartholomay, second by Bonar to adjourn at 7:30 p.m. APIF,MOTION
CARRIED.
Respectfully submitted,
Cynthia Muller
Executive Assistant
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