HomeMy WebLinkAbout29 - Compensation Philosophy�a�WPO�r CITY OF
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�,CIF00.�P City Council Staff Report
Agenda Item No. 29
June 14, 2011
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: City Manager's Office
Dave Kiff, City Manager
949 -644 -3002, dkiff@newportbeachca.gov
PREPARED BY: Dave Kiff
APPROVED:V Urn,
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TITLE: Resolution 2011 -_: Compensation Philosophy
ABSTRACT:
The City Council seeks public input on a 'compensation philosophy' that would guide
the Council and the City in its total (salary, benefits) compensation practices.
RECOMMENDATION:
Adopt Resolution 2011 -_ relating to a Compensation Philosophy for the City of
Newport Beach.
FUNDING REQUIREMENTS:
There is no direct fiscal impact related to this item, although following the Philosophy
will have significant fiscal impact on the City into the future.
DISCUSSION:
As the City Council approaches labor negotiations between now and the end of 2011,
the Council has sought to establish general guidelines around how it compensates its
employees. This approach would include, but not be limited to:
r Market comparables — private and public sector.
• Cost sharing for pension programs.
Resolution 2011 -_: Compensation Philosophy
June 14, 2011
Page 2
e Diversification of pension alternatives.
e Classifications.
e "Special pays" relating to special training or experience.
A proposed Compensation Philosophy is attached as a part of a proposed resolution for
the Council's consideration.
ENVIRONMENTAL REVIEW:
Not a project under CEQA.
NOTICING:
The agenda item has been noticed according to the Brown Act (72 hours in advance of
the meeting at which the City Council considers the item).
Submitted by:
Dave ,, City Manager
Attachments: A. Resolution 2011 -_ Relating to a Compensation Philosophy
RESOLUTION 2011 -
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF NEWPORT BEACH
RELATING TO A TOTAL COMPENSATION PHILOSOPHY
WHEREAS, the City is desirous of attracting, motivating, and retaining a highly competent,
efficient and effective workforce at all levels; and
WHEREAS, the City also seeks to maintain its fiscal condition by appropriately compensating its
employees as well as maintaining strong reserves, infrastructure, programs and services; and
WHEREAS, the City appreciates the strong partnership it has had with its employees and
employee associations as employees and management have stepped forward to address rising pension
obligations through additional employee contributions and a "2"" Tier" for new employees; and
WHEREAS, the City believes that its compensation should be measured and compared in terms
of "Total Compensation" (not salary alone) cost to the City, including salaries, performance -based
incentives and other short-term cash compensation, deferred compensation, special incentive pays, and
other benefits including but not limited to medical, post- retirement medical and pension contributions;
and
WHEREAS, the City Council is desirous of adopting and following a Total Compensation
Philosophy and approach that would guide the Council and the City into the future, an approach that
should be regularly reviewed over time to ensure that it meets the needs of the City, the employees,
and residents; now, therefore be it:
RESOLVED by the City Council of the City of Newport Beach that it adopt and memorialize the
following Total Compensation Philosophy:
1. Total Compensation for individual positions will be measured with respect to market surveys,
including both municipal and relevant private sector comparisons as appropriate.
2. Total Compensation brackets for individual positions will be set with reference to the median
compensation for each position, generally falling within the second and third quartiles.
3. The City will seek to establish and maintain compensation practices that are comparable and
consistent across all departments.
4. The City's goal is to limit annual increases in its compensation structure (including its union
contracts) to a maximum of the rate of consumer inflation.
S. The retirement benefits portion of Total Compensation will be structured over time to achieve a
50/50 cost sharing between the City and the employees, including the implementation of
defined contribution programs in the event such programs are authorized for the City's use.
6. The City will seek to simplify its job classifications and pay practices over time to achieve greater
flexibility in job assignment, better comparability to market surveys, fewer and broader job
classifications and minimal special pay complexities.
7. Pay for individual employees will be established and maintained based on qualifications,
experience and job performance as reflected in regular and timely performance evaluations.
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8. The City's compensation structure will be reviewed and revised from time to time to assure
competitiveness versus the relevant market.
9. The City's Compensation Philosophy will be publicly reviewed from time to time, to assure
meaningful public input and maintain relevance as circumstances change.
10. The City will aggressively advocate for legislative and regulatory changes necessary to maximize
the tools available to achieve the principles embodied herein.
ADOPTED this 14`h Day of June, 2011
MIKE HENN
Mayor of Newport Beach
ATTEST:
LEILANI BROWN
City Clerk
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