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HomeMy WebLinkAbout15.E.1. Personnel Policy Amendments Regarding Involuntary Separations and Promotions-Res. No. 6080 IS:E./~ CITY OF SHAKOPEE Memorandum TO: Mayor and City Council FROM: Mark McNeill, City Administrator SUBJECT: Personnel Policy Amendments DATE: July 29, 2004 INTRODUCTION: The Council is asked to amend the personnel policy to accommodate recent changes regarding promotion of City employees and involuntary separation of long-term employees. BACKGROUND: Recently, the Council dealt with situations that will ultimately affect personnel policy: 1. Involuntary Separations: In May, there was an organizational restructuring which lead to the elimination of a position that was held by an employee who had been with the City more than 20 years. Lump Sum Payments: In recognition of that employee's long service to the City, it was recommended at that time that the City adopt a policy wherein any employee who had served for more than 12 years, and whose employment was being terminated for reasons other than poor performance, be provided a severance package. Bumsville has a policy that provides any full-time, non- contract employee, or a part-time employee who is eligible for benefits, severance pay equaling one week of pay for each year of service, up to 12 years. The Burnsville policy is more comprehensive than what is being proposed here, in that it covers incumbents of any non-contract eliminated position. The proposed policy would apply only to employees having twelve (12) or more years of service with the City. The severance benefit would be paid in a lump sum, and would be in addition to the normal reimbursement of unused vacation time, and percentage buyout of accumulated, unused sick leave. Shakopee's rate of sick leave buy-out is 45%. Outplacement Assistance: In addition, it is also recommended that the Personnel Policy be amended to allow for outplacement assistance, to help employees transition to other jobs. It is recommended at this time that a cap be set at $3500, which would be placed into an account from which payment could be drawn upon submittal and approval of job-transition related expenses. Burnsville's payment is capped at $2000, but we feel that this amount may be insufficient to provide adequate assistance for certain more specialized jobs. The actual amount of the outplacement assistance would be determined on a case by case basis. 2. Promotions: The current language regarding placement of promoted employees on the pay plan is as follows (III.A.): A. ADMINISTRATION OF COMPENSATION PLAN Promotion 1. When an employee is promoted, he or she shall receive the minimum rate for the job classification. If said minimum is less than the employee's former rate, the employee shall be paid at the next increment step above the previous rate. Additionally, if by being promoted an employee would lose monetarily because of a missed step increase under the old salary level, the employee will be paid two increment steps above their former rate, provided there are two steps available in the range to move to as the employee cannot be paid more than the maximum of the new pay range. 2. The date for additional step increases for an employee promoted shall be 12 months from the effective date of the promotion and, thereafter, at one-year intervals until the employee reaches the maximum rate of pay for the assigned classification. It has become apparent that this policy has created restrictions that put internal candidates at a competitive disadvantage, in that exterior candidates for the same job can be hired at pay ranges up to the second from the top step, depending upon qualifications. In some cases, the additional responsibilities ofthe new job require additional compensation to make it worthwhile for an employee to accept the promotion, and the City may be unduly constrained in its ability to negotiate a fair compensation with a promoted employee under the current language. Instead, it is recommend that the Personnel Policy be modified to allow for a compensation rate that is commensurate with the employee's job responsibilities, skills, and also considers the previous rate of pay. That would be negotiated by the department head and City Administrator, and recommended to the City Council for approval. In addition, the existing Personnel Policy specifies that subsequent step increases shall be 12 months after the effective day ofthe promotion. That is proposed to remain the typical case, but we recommend adding language that would allow for the ability in special circumstances to do an the next step increase after 6 months (with that then becoming the new anniversary date for subsequent step increases). Any variation from the twelve month step increase would be negotiated with the employee by the department head and City Administrator, and recommended to the City CounciL Note that if negotiated, it would provide for a step increase during the City's standard one-year probationary period. However, as it would negotiated as a part of the promotion package, it should not be construed that receiving this an accelerated step advancement would imply satisfactory progress on during the probationary period. RECOMMENDATION: It is recommended that the personnel policy be amended to allow for outplacement and additional severance packages for long-term employees whose position has been eliminated for reasons other than poor performance, and also language that would allow an additional ability to negotiate step placements for promoted employees. ACTION REQUIRED; If the Council concurs, it should, by motion authorize adopt the following Resolution: RESOLUTION NO. 6080 A RESOLUTION OF THE CITY OF SHAKOPEE, MINNESOTA AMENDING RESOLUTION NO. 4231, ADOPTING A PERSONNEL HANDBOOK lMJL1fI/v~ Mark McNeill City Administrator RESOLUTION NO. 6080 A RESOLULTIN OF THE CITY OF SHAKOPEE MINNESOTA AMENDING RESOLUTION NO. 4231, ADOPTING A PERSONNEL HANDBOOK WHEREAS, on May 2, 1995, the City Council adopted Resolution No. 4213, adopting a new Personnel Handbook for the Employees of the City; and WHEREAS, the existing City Personnel Policy places limits on where an existing City employee may be placed on the pay plan when being considered for a promotion, which then places existing internal candidates at a competitive disadvantage; and WHEREAS, the City also has a desire to provide an additional severance benefit to employees who have served the City in excess of twelve years, but whose employment is terminated for reasons other than poor perfonriance; WHEREAS, said additional severance package shall be in the form of a lump sum payment, and in the form of outplacement assistance. NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL that the following paragraphs are hereby amended for the purpose of insertion into the City's personnel handbook: Section III A. ADMINISTRATION OF COMPENSATION PLAN Promotion 1. When an employee is promoted, he or she shall receive the minimum rate for the job classification. If said mirtimum is less than the employee's former rate, the employee shall be paid at the next increment step above the previous rate. Additionally, ifby being promoted an employee would lose monetarily because of a missed step increase under the old salary level, the employee will be paid two increment steps above their former rate, provided there are two steps available in the range to move to as the employee cannot be paid more than the maximum of the new pay range. In special circumstances, when recommended by the de'Partment head and City Administrator , a promoted employee may be -placed at a starting rate of pay in excess of the normal beginning step, when it is determined that market forces, additional iob res'Ponsibilities, or the previous compensation level dictate a need for said special placement. 2. The date for additional step increases for an employee promoted shall be 12 months from the effective date of the promotion and, thereafter, at one-year intervals until the employee reaches the maximum rate of pay for the assigned classification. However, when recommended by the department head and City Administrator, in special circumstances the subsequent step increase may be after six months, rather than twelve. In that case, the new anniversary date for step increases shall be twelve months from the subsequent anniversary date. Additionally, Severance/Lavoff Policy for Lon\!- Term Emplovees 1. Eligibility: A regular full-time, non-contract employee who has been employed by the City for twelve or more years, and whose position has been eliminated resulting in an involuntary separation, may be eligible for additional severance assistance from the City. An employee who is discharged for cause or allowed to resign in lieu of discharge: whose position is funded by State or Federal grants for a specified period of time and this time period has expired: or who resigns voluntarily or is unable to perform hislher job due to a disability is not eligible. 2. Benefits: Eligible staff will receive the following benefits, which shall be in addition to vacation, sick leave or other termination benefits covered in the personnel ordinance or other City policies): A. Up to twelve weeks of severance pay as a lump sum payment. as determined by the City Council. B. Outplacement assistance up to a maximum of $3,500 per employee. The amount of assistance shall be determined on a case bv case basis by the Council. upon recommendation of the City Admininistrator, and shall take into consideration the type of position affected and market factors which may affect re-employment. The assistance shall be made in the form of reimbursement, and shall be made after the receipt of written documentation for eligible expenses. 3. Procedure: The severance pay will be based on the employee's current rate at the time of separation. It will be paid in a lump sum two weeks after the employee's last paycheck. Employees will be notified in writing of the applicable dates and severance benefits. Adopted in session ofthe City Council ofthe City of Shakopee, held this day of ,2004. Mayor of the City of Shako pee ATTEST: City Clerk M lS ,E . J , ()~ {~IaL~ l: CITY OF SHAKOPEE NOTE: CHANGES ARE IN Memorandum ITALICS & UNDERLINED TO: Mayor and City Council FROM: Mark McNeill, City Administrator SUBJECT: Personnel Policy Amendments DATE: July 29, 2004 INTRODUCTION: The Council is asked to amend the personnel policy to accommodate recent changes regarding promotion of City employees and involuntary separation of long-term employees. BACKGROUND: Recently, the Council dealt with situations that will ultimately affect personnel policy: 1. Involuntary Separations: In May, there was an organizational restructuring which lead to the elimination of a position that was held by an employee who had been with the City more than 20 years. Lump Sum Payments: In recognition of that employee's long service to the City, it was recommended at that time that the City adopt a policy wherein any employee who had served for more than 12 years, and whose employment was being terminated for reasons other than poor performance, be provided a severance package. Bumsville has a policy that provides any full-time, non- contract employee, or a part-time employee who is eligible for benefits, involuntarv separation . pay equaling one week of pay for each year of service, up to 12 years. The Bumsville policy is more comprehensive than what is being proposed here, in that it covers incumbents of any non-contract eliminated position. The proposed policy would apply only to employees having twelve (12) or more years of service with the City. The severance benefit would be paid in a lump sum, and would be in addition to the normal reimbursement of unused vacation time, and percentage buyout of accumulated, unused sick leave. Shakopee's rate of sick leave buy-out is 45%. ~ J Outplacement Assistance: In addition, it is also recommended that the Personnel Policy be amended to allow for outplacement assistance, to help employees transition to other jobs. It is recommended at this time that a cap be set at $3500, which would be placed into an account from which payment could be drawn upon submittal and approval of job-transition related expenses. Burnsville's payment is capped at $2000, but we feel that this amount may be insufficient to provide adequate assistance for certain more specialized jobs. The actual amount ofthe outplacement assistance would be determined on a case by case basis. 2. Promotions: The current language regarding placement of promoted employees on the pay plan is as follows (ill.A.): A. ADMINISTRATION OF COMPENSATION PLAN Promotion 1. When an employee is promoted, he or she shall receive the minimum rate for the job classification. If said minimum is less than the employee's former rate, the employee shall be paid at the next increment step above the previous rate. Additionally, if by being promoted an employee would lose monetarily because of a missed step increase under the old salary level, the employee will be paid two increment steps above their former rate, provided there are two steps available in the range to move to as the employee cannot be paid more than the maximum of the new pay range. 2. The date for additional step increases for an employee promoted shall be 12 months from the effective date of the promotion and, thereafter, at one-year intervals until the employee reaches the maximum rate of pay for the assigned classification. It has become apparent that this policy has created restrictions that put internal candidates at a competitive disadvantage, in that exterior candidates for the same job can be hired at pay ranges up to the second from the top step, depending upon qualifications. In some cases, the additional responsibilities ofthe new job require additional compensation to make it worthwhile for an employee to accept the promotion, and the City may be unduly constrained in its ability to negotiate a fair compensation with a promoted employee under the current language. Instead, it is recommend that the Personnel Policy be modified to allow for a compensation rate that is commensurate with the employee's job responsibilities, skills, and also considers the previous rate of pay. That would be negotiated by the department head and City Administrator, and recommended to the City Council for approval. '" In addition, the existing Personnel Policy specifies that subsequent step increases shall be 12 months after the effective day ofthe promotion. That is proposed to remain the typical case, but we recommend adding language that would allow for the ability in special circumstances to do an the next step increase after 6 months (with that then . " becoming the new anniversary date for subsequent step increases). Any variation from the twelve month step increase would be negotiated with the employee by the department head and City Administrator, and recommended to the City Council. Note that if negotiated, it would provide for a step increase during the City's standard one-year probationary period. However, as it would negotiated as a part of the promotion package, it should not be construed that receiving this an accelerated step advancement would imply satisfactory progress on during the probationary period. RECOMMENDATION: It is recommended that the personnel policy be amended to allow for outplacement and additional involuntary seoaration packages for long-term employees whose position has been eliminated for reasons other than poor performance, and also language that would allow an additional ability to negotiate step placements for promoted employees. ACTION REQUIRED; If the Council concurs, it should, by motion authorize adopt the following Resolution: RESOLUTION NO. 6080 A RESOLUTION OF THE CITY OF SHAKOPEE, MINNESOTA AMENDING RESOLUTION NO. 4231, ADOPTING A PERSONNEL HANDBOOK Mark McNeill City Administrator ,. , RESOLUTION NO. 6080 A RESOLULTION OF THE CITY OF SHAKOPEE MINNESOTA AMENDING RESOLUTION NO. 4231, ADOPTING A PERSONNEL HANDBOOK WHEREAS, on May 2, 1995, the City Council adopted Resolution No. 4213, adopting a new Personnel Handbook for the Employees of the City; and WHEREAS, the existing City Personnel Policy places limits on where an existing City employee may be placed on the pay plan when being considered for a promotion, which then places existing internal candidates at a competitive disadvantage; and WHEREAS, the City also has a desire to provide an additional involuntary separation pay to employees who have served the City in excess of twelve years, but whose employment is terminated for reasons other than poor performance; WHEREAS, said additional involuntary seoaration oav shall be in the form of a lump sum payment, and in the form of outplacement assistance. NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL that the following paragraphs are hereby amended for the purpose of insertion into the City's personnel handbook: Section ill.A. ADMINISTRATION OF COMPENSATION PLAN Promotion 1. When an employee is promoted, he or she shall receive the minimum rate for the job classification. If said minimum is less than the employee's former rate, the employee shall be paid at the next increment step above the previous rate. Additionally, ifby being promoted an employee would lose monetarily because of a missed step increase under the old salary level, the employee will be paid two increment steps above their former rate, provided there are two steps available in the range to move to as the employee cannot be paid more than the maximum of the new pay range. In special circumstances. when recommend by the department head and City Administrator. a promoted employee may be placed at a starting rate of pay in excess of the normal beginning step. when it is determined that market forces. additional lob responsibilities. or the previous compensation level dictate a need for said special placement. 2. The date for additional step increases for an employee promoted shall be 12 months from the effective date of the promotion and, thereafter, at one- year intervals until the employee reaches the maximum rate of pay for the . ; 'J assigned classification. However. when recommended by the department head and City Administrator. in special circumstances the subsequent step increase may be after six months. rather than twelve. In that case. the new anniversary date for step increases shall be twelve months from the subsequent anniversary date. Additionally, Severance/Lavoff Policy for Lon!!- Term Emplovees 1. Eligibility: A regular full-time. non-contract employee who has been employed by the City for twelve or more years. and whose position has been eliminated resulting in an involuntary separation. may be eligible for additional involuntary separation pay from the City. An employee who is discharged for cause or allowed to resign in lieu of discharge~ whose position is funded by State or Federal grants for a specified period oftime and this time period has expired~ or who resigns voluntarily or is unable to perform hislher lob due to a disability is not eligible. 2. Benefits: Eligible staff will receive the following benefits. which shall be in addition to vacation. sick leave or other termination benefits covered in the personnel ordinance or other City policies. A. Up to twelve weeks of involuntary separation pay as a lump sum payment. as determined by the City Council. B. Outplacement assistance up to a maximum of$3.500 per em?loyee. The amount of assistance shall be determined on a case-by- case basis by the Council. upon recommendation of the City Administrator. and shall take into consideration the type of position affected and market factors that may affect re-emoloyment. The assistance shall be made in the form of reimbursement. and shall be made after the recei?t of written documentation for eligible expenses. 3. Procedure: The involuntary separation pay will be based on the employee's current rate at the time of separation. It will be paid in a lump sum two weeks after the employee's last paycheck. Employees will be notified in writing of the applicable dates and severance benefits. ", , ! ~ Adopted in session of the City Council of the City of Shakopee, held this day of ,2004. Mayor of the City of Shakopee ATTEST: City Clerk