Loading...
092208 CC WS MinCITY OF SHOREWOOD CITY COUNCIL WORK SESSION MONDAY, SEPTEMBER 22, 2008 MINUTES 1. CONVENE CITY COUNCIL WORK SESSION 5735 COUNTRY CLUB ROAD SOUTHSHORE CENTER 6:00 P.M. Mayor Lizee called the meeting to order at 6:10 P.M. A. Roll Call Present. Mayor Lizee; Councilmembers Bailey, Turgeon, Wellens and Woodruff; City Administrator Heck; Planning Director Nielsen; Director of Public Works Brown; and Engineer Landini Absent: None B. Review Agenda Wellens moved, Turgeon seconded, approving the agenda as presented. Councilmember Woodruff requested Item 2.A, Publicizing Sessions with Elected Officials during an Election Campaign, be added to the agenda. Without objection from the seconder, the maker of the motion accepted the friendly amendment. Motion passed 5/0. 2. COMPENSATION PHILOSOPHY Administrator Heck stated at its August 25, 2008, work session Council asked him to review the City's compensation plan for non-union personnel approved in 2006 and to provide Council with his perspective as to whether or not that plan supported a merit (pay-for-performance) philosophy. He has since reviewed the consultant's report on the compensation study, the compensation policy manual and information on the implementation of the plan. He has summarized his findings and recommendations in a memorandum dated September 18, 2008, which was included in the meeting packet (a copy of the memorandum is on file). The current compensation system is a hybrid system; all personnel are provided with an annual increase and have the opportunity to receive additional compensation based on their performance. Heck then stated several changes would have to be made to the compensation plan to migrate to a pure merit compensation system which is what he thought he heard Council say it wanted. The performance evaluation system should be changed so employees receive more in-depth evaluations. All supervisors and managers should receive proper training in conducting evaluations. To make the performance evaluation system work supervisors need to conduct informal evaluations and discussions with staff throughout the year to ensure each employee knows and understands the expectations. A shift to a pure merit compensation system involves a significant cultural shift. Heck then reviewed his recommendations. The compensation plan should be changed to a pure merit system; a minimum, mid-point, maximum and maximum plus wage schedule should be identified for each different job position. Because of the amount of time it will take to work out the details and change CITY OF SHOREWOOD WORK SESSION MEETING MINUTES September 22, 2008 Page 2 of 3 the performance evaluation forms and to train all of the supervisors in conducting evaluations, implementing a pure merit based compensation system should be delayed until 2010. Adjustments to an employee's compensation which is below market rate should be addressed separate from their merit compensation adjustment. A formal recognition system that provides for employee awards for years of service should be implemented; the award can be modest and does not have to be monetary. Councilmember Woodruff thanked Administrator Heck for clarifying the compensation system for him. In response to a question from Councilmember Woodruff, Administrator Heck stated the City's compensation consultant conducted a compensation survey of approximately 14 cities and the City's maximum market rate for a position was set at the average maximum rate it was compared to. Councilmember Turgeon stated at the time of the survey she did not think it was appropriate to evaluate the City's compensation for positions against those in a city with a much larger population. Heck stated a market comparison is usually done against cities of comparable population, demographics and services provided. If Council chooses to revise the system he can present a list of potential cities for comparative analysis for Council's review. In response to a question from Councilmember Woodruff, Administrator Heck explained if the compensation scale is keeping pace with the market by making economic adjustments to the wage schedule, then there is not a need to conduct another market survey. The City may want to verify its wage schedule is consistent with the market rate every five years or so. He explained the League of Minnesota Cities and the Association of Minnesota Counties have contracted with the Waters Consulting Group (WCG); WCG has a database of salaries, health benefits, vacation days, holidays, union or non-union classification, etc. for every position in the city and county group. That resource easily allows a person to select relative comparison data. In response to a question from Councilmember Woodruff, Administrator Heck stated the merit compensation system would be for non-union personnel as the current labor agreement does not allow for merit-based compensation. The recognition program would be for union. and non-union employees. He noted he would prefer to have all employees under the same compensation system. Administrator Heck explained his memo used the example of the top of a salary range equal to 100 percent of the average maximum rate determined with a market analysis. The start of each range would be 76 percent of the market average, and the mid-point would be 87 percent of the market. Those were just examples of how it could work, they were not his recommendations. Additional lump-sum merit payments could be earned by employees who have reached the top of their pay scale; these payments would not be added to an employee's base compensation. Councilmember Bailey questioned if a lump- sump merit payment could be given to any employee independent of where they are in their salary range, or would it just be for those at the maximum of their range. Heck stated alump-sum payment could probably be given to anyone, but it would make more sense to use it for those at their maximum range. He will research that to determine if there is any type of restriction with lump-sum payments. He explained if an employee is at the maximum of their range, and the range is adjusted upward then the employee would be eligible for an increase to their base compensation if their performance warrants it. Councilmember Woodruff stated the City Administrator as well as the department heads are responsible to ensure merit increases do not exceed the amount budgeted for increases. Councilmember Wellens stated Administrator Heck addressed compensation increases, but did not address what happens when an employee's performance is not acceptable. Heck stated if an employee's performance is not acceptable they would not receive a salary increase, and if their salary range is adjusted upward their compensation would ultimately end up lower in the range. It was an employee's CITY OF SHOREWOOD WORK SESSION MEETING MINUTES September 22, 2008 Page 3 of 3 supervisor's responsibility to work with the employee to improve their performance. He noted a performance evaluation system is a development system not a punitive system. He stated there are times when an employee cannot perform to the level they have to, and the employee will have to be removed from their position. Councilmember Turgeon stated she liked Administrator Heck's approach to a compensation system. She commented she was not sure the union would ever agree to a merit compensation system. Heck stated it can be difficult to migrate to a merit-based compensation system from a step system for employees governed by a labor contract. Councilmember Bailey questioned what the next steps are. Administrator Heck stated the current compensation program is structured fairly well. He explained details such as identifying what level of performance equates to what levels of merit increase have to be determined. He noted there are a number of communities who have used amerit-based compensation system for a long time, and those could be a good starting point. He will work with staff on establishing some parameters. Councilmember Woodruff questioned what Administrator Heck proposed to do with regard to compensation increases for 2009, noting the draft budget has $30,000 allocated to merit increases. Heck recommended the current compensation program be continued in 2009. He explained part of the merit pool would be used for merit increases and part of it would be used to train supervisors on the performance evaluation process. Mayor Lizee thanked Administrator Heck for clarifying the current compensation system and his recommendations. Administrator Heck commented that staff had related when the City implemented the compensation program they had not received training on conducting performance evaluations. A. Publicizing Sessions With Elected Officials During An Election Campaign Councilmember Woodruff informed Administrator Heck that in 2007 there was Council consensus to temporarily stop publicizing sessions with an elected official in official City communications during an election campaign period if an official was running for office. 3. ADJOURN Wellens moved, Woodruff seconded, Adjourning the City Council Work Session Meeting of September 22, 2008, at 6:38 P.M. Motion passed 5/0. RESPECTFULLY SUBMITTED, Christine Freeman, Recorder /`i ~i ~,~v~~ie Christine Lizee, Mayor ATTEST: Administrator/Clerk