HomeMy WebLinkAboutC-5176 - PSA for CityWide Classification and Compensation Study®
f" AMENDMENT NO. TWO TO
PROFESSIONAL SERVICES AGREEMENT
WITH FOX LAWSON & ASSOCIATES, A DIVISION OF GALLAGHER BENEFIT
() SERVICES, INC. FOR
CITYWIDE CLASSIFICATION AND COMPENSATION STUDY
THIS AMENDMENT NO. TWO TO PROFESSIONAL SERVICES AGREEMENT
("Amendment No. Two") is made and entered into as of this 17th day of June, 2015
("Effective Date'), by and between the CITY OF NEWPORT BEACH, a California
municipal corporation and charter city ("City"), and FOX LAWSON & ASSOCIATES, A
DIVISION OF GALLAGHER BENEFIT SERVICES, INC., a Delaware corporation
("Consultant"), whose address is P.O. Box 32985, Phoenix, Arizona 85064-2985, and is
made with reference to the following:
RECITALS
A. On July 10, 2012, City and Consultant entered into a Professional Services
Agreement ("Agreement") to conduct a comprehensive city-wide classification
and compensation study ("Project").
B. On November 26, 2013, City and Consultant entered into Amendment No. One
to the Agreement ("Amendment No. One") to extend the term of the Agreement
to December 31, 2014, to increase the total compensation, and to amend the
City's Project Manager and notice information.
C. City desires to enter into this Amendment No. Two to extend the term of the
Agreement to December 31, 2016.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
1. TERM
Section 1 of the Agreement is amended in its entirety and replaced with the
following: "The term of this Agreement shall commence on the Effective Date, and shall
terminate on December 31, 2016, unless terminated earlier as set forth herein."
2. INTEGRATED CONTRACT
Except as expressly modified herein, all other provisions, terms, and covenants
set forth in the Agreement shall remain unchanged and shall be in full force and effect.
[SIGNATURES ON NEXT PAGE]
Fox Lawson & Associates, a Division of Gallagher Benefit Services, Inc. Page 1
IN WITNESS WHEREOF, the parties have caused this Amendment No. Two to
be executed on the dates written below.
APPROVED AS TO FORM:
CITY ATT NEY'S OFFICE
Date:
By: a== -'/�
Aar . Harp c&m ►o
City Afforney
ATTEST: / + �, Ir
Date: l !�l
By:
Leilani I. Brown
City Clerk
o ��
CITY OF NEWPORT BEACH,
a Californiap 7i',qLcorporationp
Date:/ ,
By: l/t-U 'V C-vvv
Terri L. Cassidy
Deputy City Manager/Huma4esources
Director
CONSULTANT: Fox Lawson &
Associates, a Division of Gallagher Benefit
Services, In ., a Dejaware corporation
Date: fs7 l�
Bruce Lawson
Managing Director
[END OF SIGNATURES]
Fox Lawson & Associates, a Division of Gallagher Benefit Services, Inc. Page 2
U} AMENDMENT NO. ONE TO
t PROFESSIONAL SERVICES AGREEMENT
V WITH FOX LAWSON & ASSOCIATES, A DIVISION OF GALLAGHER BENEFITS
SERVICES, INC. FOR
CITY-WIDE CLASSIFICATION AND COMPENSATION STUDY
THIS AMENDMENT NO. ONE TO PROFESSIONAL SERVICES AGREEMENT
("Amendment No. One") is made and entered into as of this 26th day of November,
2013 ("Effective Date"), by and between the CITY OF NEWPORT BEACH, a California
municipal corporation and charter city ("City'), and FOX LAWSON & ASSOCIATES, A
DIVISION OF GALLAGHER BENEFITS SERVICES, INC., a Delaware corporation
("Consultant"), whose address is P.O. Box 32985, Phoenix, AZ, 850642985, and is
made with reference to the following:
RECITALS
A. On July 10, 2012, City and Consultant entered into a Professional Services
Agreement ("Agreement") for a City-wide classification and compensation study
("Project").
B. City desires to enter into this Amendment No. One to extend the term of the
Agreement to December 31, 2014, to increase the total compensation and to
amend the City's Project Manager and notice information.
C. City and Consultant mutually desire to amend the Agreement, as provided below.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
rll�140J,l
Section 1 of the Agreement is amended in its entirety and replaced with the
following: "The term of this Agreement shall commence on the July 10, 2012, and shall
terminate on December 31, 2014, unless terminated earlier as set forth herein."
2. SERVICES TO BE PERFORMED
Exhibit A to the Agreement shall be supplemented to include the Scope of
Services dated November 6, 2013, attached hereto as Exhibit A and incorporated
herein by reference ("Services" or "Work"). Exhibit A of the Agreement and Exhibit A of
Amendment No. One shall collectively be known as "Exhibit A". The City may elect to
delete certain Services within the Scope of Services at its sole discretion.
3. COMPENSATION TO CONSULTANT
Section 4.1 of the Agreement is amended in its entirety and replaced with the
following: "City shall pay Consultant for the Services on a time and expense not -to -
exceed basis in accordance with the provisions of this Section and the Schedule of
Billing Rates attached hereto as Exhibit B and incorporated herein by reference.
Consultant's compensation for all Work performed in accordance with this Agreement,
including all reimbursable items and subconsultant fees, shall not exceed One Hundred
Thirty Five Thousand Dollars and 001100 ($135,000.00), without prior written
authorization from City. No billing rate changes shall be made during the term of this
Agreement without the prior written approval of City."
The total amended compensation reflects Consultant's additional compensation
for additional Services to be performed in accordance with this Amendment No. One,
including all reimbursable items and subconsultant fees, in an amount not to exceed
Twenty Five Thousand Dollars and 001100 ($25,000.00).
4. ADMINISTRATION
Section 6 of the Agreement shall be amended to reflect Terri Cassidy, Deputy
City Manager/ Human Resources Director as the City's Project Manager.
5. NOTICE
Section 26.1 of the Agreement shall be revised to reflect the City of Newport
Beach's contact information as:
Attn: Terri Cassidy, Deputy
Director
City Manager's Office
City of Newport Beach
100 Civic Center Drive
PO Box 1768
Newport Beach, CA 92658
Phone: (949) 644-3300
6. INTEGRATED CONTRACT
City Manager/ Human Resources
Except as expressly modified herein, all other provisions, terms, and covenants
set forth in the Agreement shall remain unchanged and shall be in full force and effect.
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Fox Lawson & Associates, a Division of Gallagher Benefits Services, Inc. Page 2
IN WITNESS WHEREOF, the parties have caused this Amendment No. One to
be executed on the dates written below.
APPROVED AS TO FORM:
CITY ATT�RNYES OFFICE
Date: IIii I
in
Aaron C. Harp
City Attorney
ATTEST:
Date: 12-115,13
By:
Leilani I. Brown
City Clerk ��xr
`rte 12 N �+
I
r;
s
CITY OF NEWPORT BEACH,
a California municipal corporation
Date: IM ot,I1Z
By:
Z��Z��A \�
Dave iff
City Manager
CONSULTANT: Fox Lawson &
Associates, a Division of Gallagher
Benefits Services, Inc. , a Delaware
corporation
Date: ,° 2-/",//3
Bruce G. Lawson
Managing Director
[END OF SIGNATURES]
Attachments: Exhibit A - Scope of Services
Fox Lawson & Associates, a Division of Gallagher Benefits Services, Inc. Page 3
EXHIBIT A
SCOPE OF SERVICES
Fax Lawson & Associates, a Division of Gallagher Benefits Services, Inc, Page A-1
Fox Lawson & Associates
a I)Msion of Gallagher Benefit Scrroccs, Inc,
Compenuation and Human Resounw Speaaliats
November 6, 2013
Terri Cassidy, JD
Assistant City Manager/Director of Human Resources
City of Newport Beach
100 Civic Center Drive
Newport Beach CA 92660
Dear Terri:
PO Box 32985
Phoenix, AZ 85064-2985
Phone 602-840-1070
Fax 602-840-1071
www.foxla,mon.com
In response to your request dated November 4, 2013, this letter outlines the cost to provide
additional services to the City of Newport, as follows:
Additional visits and on-site presentations by the consultant, as needed, through
December 2014 to employee/management groups and possibly City Council.
The cost to provide perform this service will be $3,600 per day including travel
expenses.
Provide consulting on alternative compensation strategies, pay for performance
program options, and related executive level strategy development.
The services outlined can be provided either on an hourly basis or on a daily basis as
appropriate. Our billing rates for 2014 are estimated to increase as follows: Senior
Consultant - $275 per hour; Managing Director - $375 per hour. Accordingly, the daily
rate for on-site meetings for a Senior Consultant would be $2,800 including expenses
and the daily rate for on site meetings for a Managing Director will be $3,600.
Provide additional revisions to the job descriptions, beyond originally stated in the
Scope of Services, to include external/environmental factors. In addition, several
unique to NB classifications may need to be drafted.
For new job descriptions, the cost will be $500 per job description. For revisions as
needed, the cost will be $275 per hour.
Provide additional training and support to staff following implementation of the
class/comp study, for the purpose of administering the DBM classification program and
compensation structure.
Q-01
Fox Lawson & Associates
a Division of C,.tllaghcr &o,fit Smit s, Inc.
DBM training can be provided either via a web -based link or on-site. For web -based
training, the cost would be $1,000 per session (each session typically runs about 90
minutes). For on-site training, the cost would be $3,600, including expenses.
A general overview on the City Council objectives/goals, including the inclusion of
private sector data and the reasons for the comparable public sector agencies included
in the comparisons may need to be added to the project.
The cost to provide this information will be $275 per hour. For planning purposes, I
would budget $11,000 (40 hours of senior consultant time).
Provide consultation, as necessary, regarding the negotiable aspects of classification,
compensation with labor/employment counsel as issues are proposed.
The cost to provide this assistance would be $375 per hour (Managing Director) for
telephone consultation. For on-site assistance, the cost would be $3,600, including
expenses.
Should you need any additional information, please advise. If the information provided is
acceptable, please sign and return one copy of this letter as your authorization to amend the
contract and proceed with the additional work as requested, We appreciate having the
opportunity to work with you and the City on this significant effort.
With best regards;
Managing Director
ACCEPTED BY THE CITY OF NEWPORT BEACH
BY: DATE:
G'I
Fox Lawson & Associates
a fYvisron of Gai[ogFx &rkfi'c5crvaccg tnc
aeWPORr CITY OF
�T
NEWPORT BEACH
COUNCIL STAFF REPORT
Agenda Item No. 17
August 13, 2013
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: City Manager's Office
Dave Kiff, City Manager
949-644-3002, dkiff(cilnewportbeachca.gov
Human Resources Department
Terri L. Cassidy, Deputy City Manager/Human Resources Director
949-644-3303, tcassidy(cDnewportbeachca.gov
PREPARED BY: Terri L. Cassidy, Deputy City Manager/HR Director
Maggie Williams-Dalgart, Senior Human Resources Analyst
APPROVED:
TITLE: Approval of Comparator Agencies for the Fox Lawson & Associates
Classification and Compensation Study
ABSTRACT:
In August 2012, the City launched a comprehensive study of its classification and
compensation system in an effort to modernize job classifications and pay practices and
bring the City into the broader world of work. The City hired Fox Lawson & Associates
(FLA), a division of Gallagher Benefits, Inc., a well-established firm with a wide range of
public and private sector clients, to conduct the study. FLA is nearing completion of the
first phase of the study, the job classification review, and before proceeding with the
compensation review, staff requests the City Council provide direction on the
comparison agencies ("comparator agencies') Fox Lawson & Associates should include
for the purpose of conducting pay and benefits surveys.
RECOMMENDATION:
Use the comparator cities of Carlsbad, Chula Vista
Huntington Beach, Irvine, Oceanside, Orange, Santa
Torrance for the remaining FLA compensation review
Anaheim and Long Beach as comparator cities.
FUNDING REQUIREMENTS:
(new), Costa Mesa, Fullerton,
Ana, Santa Monica (new) and
. No longer use the cities of
There is no direct financial impact to the above recommendation.
Approval of Comparator Agencies for FLA Study
August 13, 2013
Page 2
DISCUSSION:
Since 2009 the City has undergone significant organizational change through
downsizing, restructuring and department consolidations. The dynamics of the City's
employee workforce have changed as the number of full-time employees has shrunk
from 833 in FY08-09 to 736 in FY13-14, without impacting public safety services.
However, the City's classification and compensation system has not changed: it is
burdened with too many narrow job classifications, limitations on cross-training/cross-
functionality, and a pay structure that is fairly inflexible. In order to continue providing
high levels of customer service with a smaller workforce, the City recognized it would
need to change its approach to how it classifies and pays employees.
In. June 2011 the City Council addressed the issue through adoption of a Total
Compensation Philosophy that provided a vision for the future of the City's classification
and compensation system (Resolution No. 2011-55, Attachment A). In the Philosophy
the City Council laid out a framework for a structure designed to meet changing
workplace demands, provide greater flexibility, is forward -thinking and long-lasting.
Resolution No. 2011-55 specified how the City should approach pay, and included an
expansion of labor market survey practices. Instead of using only local comparison
agencies in Orange County, which had been the City's practice for many years, the new
approach included a range of public agencies and private sector comparisons. The
Total Compensation Philosophy identified the following set of goals:
• A job evaluation system that is consistent and equitable across all departments and
with a reliable and objective methodology (philosophy #3)
• Market competitiveness that includes examination of public and private sector data,
as appropriate, and that generally compensates at market median (or within the
second and third quartile) (philosophies #1 and #2)
• A simplified job classification and pay structure that provides greater management
flexibility in job assignments, better comparability to market surveys, and fewer and
broader job classifications (philosophy #6)
A big step toward a new system was to contract with Fox Lawson & Associates, with
Principal Bruce Lawson serving as project manager, to review and assess the City's
structure. FLA initiated this process with a total compensation study of Executive level
positions in 2011 (including City Manager, City Attorney, City Clerk, public safety chiefs,
and department directors). As is standard with pay and benefits surveys, the FLA
Executive Total Compensation study compared Newport Beach pay and benefits
against other public agencies. At City Council's direction, eleven (11) agencies,
including several outside of Orange County, were selected to compare salary,
retirement benefits, healthcare and other fringe benefits.
Approval of Comparator Agencies for FLA Study
August 13, 2013
Page 3
Beginning with the Executive group was logical because several positions had
experienced turnover, and the group would serve as a small sample of the technique
and approach FLA would use for developing a new classification and compensation
system for the entire City.
The list of approved agencies for the Executive Compensation study has been the
standard group for conducting pay and benefits surveys ("total compensation" surveys)
since 2011. With changing demographics and shifts in local economies, staff has
proposed the consideration of alternate or replacement agencies before FLA initiates
the City-wide compensation study phase of the project. Attachment 8 provides a
comparison of agency characteristics for select municipalities within the Orange, Los
Angeles, and San Diego counties. The list consists of predominantly medium-sized
cities that have one or more characteristics similar to Newport Beach (coastal/beach
community, comparable population size, provides similar public services, full range of
governmental services offered). Attachment C provides the list of comparator agencies
used in the Executive Compensation study (Column 1) and a possible alternate grouping
of agencies for the City-wide study (Column ll).
Professional compensation practices support the philosophy that organizations use a
minimum of five data samples when conducting comparison surveys. However, larger
sample size increases validity of the data and helps to minimize any skewing effects of
anomalous data (high or low) from one particular agency. For these reasons, Fox
Lawson & Associates recommends a sample size of ten when conducting benchmark
salary surveys. The options presented to Council maintain that standard/best practice.
In conjunction with analyzing public sector data, and consistent with the City Council's
Total Compensation Philosophy, the FLA compensation review will include private
sector pay data from published sources. To provide a broad representation of private
sector pay trends FLA will compile salary data from multiple survey sources, including
Towers Watson, Mercer, Gallagher Surveys, among others. These companies are
governed by different regulations concerning confidentiality of the data and follow
professional standards. These surveys are also conducted annually so that the data is
current and they use benchmark job classifications common among certain industries.
Following City Council approval of the comparator public sector survey agencies, Fox
Lawson & Associates will initiate the compensation review of the
classification/compensation study.
ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this action is not subject to the California
Environmental Quality Act ("CEQA") pursuant to Sections 15060(c)(2) (the activity will
not result in a direct or reasonably foreseeable indirect physical change in the
environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378)
Approval of Comparator Agencies for FLA Study
August 13, 2013
Page 4
of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it
has no potential for resulting in physical change to the environment, directly or
indirectly.
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:
Terri L. Cassidy
Deputy City Manager/HR Director
Attachments: A. Resolution No. 2011-55, Total Compensation Philosophy
B. Cities in Orange/Los Angeles/San Diego Counties — Agency
Characteristics
C. Potential Group of Comparator Agencies for FLA City-wide Study
ATTACHMENT A
RESOLUTION 2011-55
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 "2nd 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.
5. 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.
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" day of June, 2011
ATTEST:
LEILANI I. BROWN
City Clerk
,L, -
MICHAEL F. HENN
Mayor of Newport Beach
Attachment B
Cities in Orange/Los Angeles/San Diego Counties - Agency Characteristics
Full-time equivalent positions (all full-time position and part-time positions converted to full-time)
8/13/13
Proximity
If of
General Fund
City
City
County
to NB (in
Employees
Services Provided
Budget FY13-14
Population
miles)
(FTE*)
(in millions)
Police, Fire, Marine Safety,
Newport Beach
Orange
---
86,464
847.9
Harbor, water, Library,
$162.3
Parks/Rec
Police, Fire, Water,
Anaheim
Orange
20
341,034
1,856.0
Electric/Utilities, Library,
$251.0
Parks Rec Conventn Ctr
Carlsbad
San Diego
46
160,888
811.5
Police, Fire, Water, Library,
$115.8
Parks/Rec
Chula Vista
San Diego
86
228,000
1,067.0
Police, Fire, Recreation, Library,
$127.4
Animal Care
Costa Mesa
Orange
6
113,143
543.8
Police, Fire, Water, Parks/Rec
$115.6
Encinitas
San Diego
55
65,000
239.0
Fire, Marine Safety, Water
$49 9
District, Parks/Rec
Fullerton
Orange
23
137,183
706.2
Police, Fire, Airport, Water,
$75.9
Library
Huntington Beach
Orange
10
189,707
979.8
Police, Fire, Marine Safety,
$193.5
Harbor, Library, Parks/Rec
Irvine
Orange
8
223,729
952.8
Police, Water, Animal Srvcs,
$143.7
Parks/Rec, Great Park
Laguna Beach
Orange
7
24,800
247,0
Police, Fire, Marine Safety,
$48.5
Commty Services/Cultural Arts
Long Beach
Los Angeles
25
492,912
4,968.0
Police, Fire, Water, Health,
$396.0
Gas/Oil, Library, Parks/Rec
Manhattan Beach
Los Angeles
41
35,135
265.0
Police, Fire, Parks/Rec
$53.1
Oceanside
San Diego
43
169,350
915.0
Police, Fire, Harbor, Water,
$121.0
Library, Parks/Rec
Orange
Orange
14
140,849
763.0
Police, Fire, Water, Library,
$g1.7
Parks/Rec
Redondo Beach
Los Angeles
40
66,748
397.0
Police, Fire, Marine Safety,
$63.7
Harbor, Water, Library, Parks/Rec
Santa Ana
Orange
11
353,428
1,050.0
Police, Water, Library, Parks/Rec
$205.7
Police, Fire, Recreation, Library,
Santa Monica
Los Angeles
53
89,736
2,162.0
Community/ Cultural Services,
$306.1
Transit
Torrance
Los Angeles
38
147,020
1,480.5
Police, Fire, Water, Transit,
$177.9
Library, Parks/Rec
Full-time equivalent positions (all full-time position and part-time positions converted to full-time)
8/13/13
Potential Group of Comparator Agencies for the FLA City-wide Study
Column I
Agencies Used in the Executive
Compensation Study
Anaheim
Carlsbad
Costa Mesa
Fullerton
Huntington Beach
Irvine
Long Beach
Oceanside
Orange
Santa Ana
Torrance
Attachment C
Column II
Agencies to Consider for
City-wide Study
Carlsbad
Chula Vista (added)
Costa Mesa
Fullerton
Huntington Beach
Irvine
Oceanside
Orange
Santa Ana
Santa Monica (added)
Torrance
Removed:
Anaheim
Long Beach
8/13/13
PROFESSIONAL SERVICES AGREEMENT
WITH FOX LAWSON AND ASSOCIATES, A DIVISION OF GALLAGHER
BENEFITS SERVICES, INC. FOR
A CITY-WIDE CLASSIFICATION AND COMPENSATION STUDY
THIS AGREEMENT FOR PROFESSIONAL SERVICES ("Agreement') is made
and entered into as of this _Oilay of July, 2012 ("Effective Date") by and between the
CITY OF NEWPORT BEACH, a California Municipal Corporation ("City"), and Fox
Lawson and Associates, a Division of Gallagher Benefits Services, Inc., a Delaware
corporation ("Consultant'), whose address is P.O. Box 32985, Phoenix, AZ 85064-2985
and is made with reference to the following:
RECITALS
A. City is a municipal corporation duly organized and validly existing under the laws
of the State of California with the power to carry on its business as it is now being
conducted under the statutes of the State of California and the Charter of City.
B. City desires to engage Consultant to conduct a comprehensive city-wide
classification and compensation study ("Project').
C. Consultant possesses the skill, experience, ability, background, certification and
knowledge to provide the professional services described in this Agreement.
D. The principal member of Consultant for purposes of Project shall be Bruce G.
Lawson.
E. City has solicited and received a proposal from Consultant, has reviewed the
previous experience and evaluated the expertise of Consultant, and desires to
retain Consultant to render professional services under the terms and conditions
set forth in this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
TERM
The term of this Agreement shall commence on the Effective Date, and shall
terminate on December 31, 2013 unless terminated earlier as set forth herein.
2. SERVICES TO BE PERFORMED
City and Consultant acknowledge that the above Recitals are true and correct
and are hereby incorporated by reference into this Agreement. Consultant shall
diligently perform all the services described in the Scope of Services attached hereto as
Exhibit A and incorporated herein by reference ("Services" or "Work"). The City may
elect to delete certain Services within the Scope of Services at its sole discretion.
3. TIME OF PERFORMANCE
3.1 Time is of the essence in the performance of Services under this
Agreement and Consultant shall perform the Services in accordance with the schedule
included in Exhibit A. In the absence of a specific schedule, the Services shall be
performed to completion in a diligent and timely manner. The failure by Consultant to
strictly adhere to the schedule set forth in Exhibit A, if any, or perform the Services in a
diligent and timely manner may result in termination of this Agreement by City.
3.1.1 Notwithstanding the foregoing, Consultant shall not be responsible
for delays due to causes beyond Consultant's reasonable control. However, in the case
of any such delay in the Services to be provided for the Project, each party hereby
agrees to provide notice within two (2) days of the occurrence causing the delay to the
other party so that all delays can be addressed.
3.2 Consultant shall submit all requests for extensions of time for performance
in writing to the Project Administrator (as defined in Section 6 below) not later than ten
(10) calendar days after the start of the condition that purportedly causes a delay. The
Project Administrator shall review all such requests and may grant reasonable time
extensions for unforeseeable delays that are beyond Consultant's control.
3.3 For all time periods not specifically set forth herein, Consultant shall
respond in the most expedient and appropriate manner under the circumstances, by
fax, hand -delivery or mail.
4. COMPENSATION TO CONSULTANT
4.1 City shall pay Consultant for the Services on a time and expense not -to -
exceed basis in accordance with the provisions of this Section and the Schedule of
Billing Rates or Progress Payments Schedule attached hereto as Exhibit B and
incorporated herein by reference. Consultant's compensation for all Work performed in
accordance with this Agreement, including all reimbursable items and subconsultant
fees, shall not exceed One Hundred Fifteen Thousand Dollars and 00/100
($115,000.00) without prior written authorization from City. No billing rate changes shall
be made during the term of this Agreement without the prior written approval of City.
4.2 Consultant shall submit monthly invoices to City describing the Work
performed the preceding month. Consultant's bills shall include the name of the person
who performed the Work, a brief description of the Services performed and/or the
specific task in the Scope of Services to which it relates, the date the Services were
performed, the number of hours spent on all Work billed on an hourly basis, and a
description of any reimbursable expenditures. City shall pay Consultant no later than
thirty (30) days after approval of the monthly invoice by City staff.
4.3 City shall reimburse Consultant only for those costs or expenses
specifically identified in Exhibit B to this Agreement, or specifically approved in writing in
advance by City.
4.4 Consultant shall not receive any compensation for Extra Work performed
without the prior written authorization of City. As used herein, "Extra Work" means any
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 2
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 and which the parties did
not reasonably anticipate would be necessary at the execution of this Agreement.
Compensation for any authorized Extra Work shall be paid in accordance with the
Schedule of Billing Rates as set forth in Exhibit B.
5. PROJECT MANAGER
5.1 Consultant shall designate a Project Manager, who shall coordinate all
phases of the Project. This Project Manager shall be available to City at all reasonable
times during the Agreement term. Consultant has designated Bruce G. Lawson to be its
Project Manager. Consultant shall not remove or reassign the Project Manager or any
personnel listed in Exhibit A or assign any new or replacement personnel to the Project
without the prior written consent of City. City's approval shall not be unreasonably
withheld with respect to the removal or assignment of non -key personnel.
5.2 Consultant, at the sole discretion of City, shall remove from the Project
any of its personnel assigned to the performance of Services upon written request of
City. Consultant warrants that it will continuously furnish the necessary personnel to
complete the Project on a timely basis as contemplated by this Agreement.
5.3 If Consultant is performing inspection services for City, the Project
Manager and any other assigned staff shall be equipped with a cellular phone to
communicate with City staff. The Project Manager's cellular phone number shall be
provided to the City.
6. ADMINISTRATION
This Agreement will be administered by the City Manager's Office. Dana Smith,
Assistant City Manager or her designee, shall be the Project Administrator and shall
have the authority to act for City under this Agreement. The Project Administrator or her
designee shall represent City in all matters pertaining to the Services to be rendered
pursuant to this Agreement.
7. CITY'S RESPONSIBILITIES
To assist Consultant in the execution of its responsibilities under this Agreement,
City agrees to provide access to and upon request of Consultant, one copy of all
existing relevant information on file at City. City will provide all such materials in a
timely manner so as not to cause delays in Consultant's Work schedule.
8. STANDARD OF CARE
8.1 All of the Services shall be performed by Consultant or under Consultant's
supervision. Consultant represents that it possesses the professional and technical
personnel required to perform the Services required by this Agreement, and that it will
perform all Services in a manner commensurate with the highest professional
standards. For purposes of this Agreement, the phrase "highest professional
standards" shall mean those standards of practice recognized by one (1) or more first-
class firms performing similar work under similar circumstances.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 3
8.2 All Services shall be performed by qualified and experienced personnel
who are not employed by City. By delivery of completed Work, Consultant certifies that
the Work conforms to the requirements of this Agreement; all applicable federal, state
and local laws; and the highest professional standard.
8.3 Consultant represents and warrants to City that it has, shall obtain, and
shall keep in full force and effect during the term hereof, at its sole cost and expense, all
licenses, permits, qualifications, insurance and approvals of whatsoever nature that is
legally required of Consultant to practice its profession. Consultant shall maintain a City
of Newport Beach business license during the term of this Agreement.
8.4 Consultant shall not be responsible for delay, nor shall Consultant be
responsible for damages or be in default or deemed to be in default by reason of strikes,
lockouts, accidents, acts of God, or the failure of City to furnish timely information or to
approve or disapprove Consultant's Work promptly, or delay or faulty performance by
City, contractors, or governmental agencies.
9. HOLD HARMLESS
9.1 To the fullest extent permitted by law, Consultant shall indemnify, defend
and hold harmless City, its City Council, boards and commissions, officers, agents and
employees (collectively, the "Indemnified Parties") from and against any and all claims
(including, without limitation, claims for bodily injury, death or damage to property),
demands, obligations, damages, actions, causes of action, suits, losses, judgments,
fines, penalties, liabilities, costs and expenses (including, without limitation, attorney's
fees, disbursements and court costs) of every kind and nature whatsoever (individually,
a Claim; collectively, "Claims"), which may arise from or in any manner relate (directly or
indirectly) to any breach of the terms and conditions of this Agreement, any Work
performed or Services provided under this Agreement including, without limitation,
defects in workmanship or materials or Consultant's presence or activities conducted on
the Project (including the negligent and/or willful acts, errors and/or omissions of
Consultant, its principals, officers, agents, employees, vendors, suppliers, consultants,
subcontractors, anyone employed directly or indirectly by any of them or for whose acts
they may be liable or any or all of them).
9.2 Notwithstanding the foregoing, nothing herein shall be construed to
require Consultant to indemnify the Indemnified Parties from any Claim arising from the
sole negligence or willful misconduct of the Indemnified Parties. Nothing in this
indemnity shall be construed as authorizing any award of attorney's fees in any action
on or to enforce the terms of this Agreement. This indemnity shall apply to all claims
and liability regardless of whether any insurance policies are applicable. The policy
limits do not act as a limitation upon the amount of indemnification to be provided by the
Consultant.
10. INDEPENDENT CONTRACTOR
It is understood that City retains Consultant on an independent contractor basis
and Consultant is not an agent or employee of City. The manner and means of
conducting the Work are under the control of Consultant, except to the extent they are
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 4
limited by statute, rule or regulation and the expressed terms of this Agreement. No
civil service status or other right of employment shall accrue to Contractor or its
employees. Nothing in this Agreement shall be deemed to constitute approval for
Consultant or any of Consultant's employees or agents, to be the agents or employees
of City. Consultant shall have the responsibility for and control over the means of
performing the Work, provided that Consultant is in compliance with the terms of this
Agreement. Anything in this Agreement that may appear to give City the right to direct
Consultant as to the details of the performance of the Work or to exercise a measure of
control over Consultant shall mean only that Consultant shall follow the desires of City
with respect to the results of the Services.
11. COOPERATION
Consultant agrees to work closely and cooperate fully with City's designated
Project Administrator and any other agencies that may have jurisdiction or interest in the
Work to be performed. City agrees to cooperate with the Consultant on the Project.
12. CITY POLICY
Consultant shall discuss and review all matters relating to policy and Project
direction with City's Project Administrator in advance of all critical decision points in
order to ensure the Project proceeds in a manner consistent with City goals and
policies.
13. PROGRESS
Consultant is responsible for keeping the Project Administrator and/or his/her
duly authorized designee informed on a regular basis regarding the status and progress
of the Project, activities performed and planned, and any meetings that have been
scheduled or are desired.
14. INSURANCE
Without limiting Consultant's indemnification of City, and prior to commencement
of Work, Consultant shall obtain, provide and maintain at its own expense during the
term of this Agreement or for other periods as specified in this Agreement, policies of
insurance of the type, amounts, terms and conditions described in the Insurance
Requirements attached hereto as Exhibit C, and incorporated herein by reference.
15. PROHIBITION AGAINST ASSIGNMENTS AND TRANSFERS
Except as specifically authorized under this Agreement, the Services to be
provided under this Agreement shall not be assigned, transferred contracted or
subcontracted out without the prior written approval of City. Any of the following shall
be construed as an assignment: The sale, assignment, transfer or other disposition of
any of the issued and outstanding capital stock of Consultant, or of the interest of any
general partner or joint venturer or syndicate member or cotenant if Consultant is a
partnership or joint -venture or syndicate or cotenancy, which shall result in changing the
control of Consultant. Control means fifty percent (50%) or more of the voting power, or
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 5
twenty-five percent (25%) or more of the assets of the corporation, partnership or joint -
venture.
16. SUBCONTRACTING
The subcontractors authorized by City, if any, to perform Work on this Project are
identified in Exhibit A. Consultant shall be fully responsible to City for all acts and
omissions of any subcontractor. Nothing in this Agreement shall create any contractual
relationship between City and any subcontractor nor shall it create any obligation on the
part of City to pay or to see to the payment of any monies due to any such
subcontractor other than as otherwise required by law. The City is an intended
beneficiary of any Work performed by the subcontractor for purposes of establishing a
duty of care between the subcontractor and the City. Except as specifically authorized
herein, the Services to be provided under this Agreement shall not be otherwise
assigned, transferred, contracted or subcontracted out without the prior written approval
of City.
17. OWNERSHIP OF DOCUMENTS
17.1 Each and every report, draft, map, record, plan, document and other
writing produced (hereinafter "Documents"), prepared or caused to be prepared by
Consultant, its officers, employees, agents and subcontractors, in the course of
implementing this Agreement, shall become the exclusive property of City, and City
shall have the sole right to use such materials in its discretion without further
compensation to Consultant or any other party. Consultant shall, at Consultant's
expense, provide such Documents to City upon prior written request.
17.2 Documents, including drawings and specifications, prepared by
Consultant pursuant to this Agreement are not intended or represented to be suitable
for reuse by City or others on any other project. Any use of completed Documents for
other projects and any use of incomplete Documents without specific written
authorization from Consultant will be at City's sole risk and without liability to
Consultant. Further, any and all liability arising out of changes made to Consultant's
deliverables under this Agreement by City or persons other than Consultant is waived
against Consultant and City assumes full responsibility for such changes unless City
has given Consultant prior notice and has received from Consultant written consent for
such changes.
17.3 Each party shall retain all right, title and interest in and to its respective
proprietary information including, but not limited to, proprietary job leveling/evaluation
methodology ("Intellectual Property"). Each party shall use the other's Intellectual
Property only as provided, and shall not alter the Intellectual Property in any way, nor
shall it act or permit action in any way that would impair the rights of owning party in its
Intellectual Property. Each party acknowledges that its use of the other party's
Intellectual Property shall not create any right, title or interest in or to such Intellectual
Property. Each party shall have the right to monitor the quality of the other party's use of
its Intellectual Property. Additionally, each party shall notify the other promptly in writing
of any known infringement of the other's Intellectual Property. Any references to a
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 6
party's Intellectual Property shall contain the appropriate trademark, copyright or other
legal notice provided from time to time by owning party
18. COMPUTER DELIVERABLES
All written documents shall be transmitted to City in formats compatible with
Microsoft Office and/or viewable with Adobe Acrobat.
19. CONFIDENTIALITY
All Documents, including drafts, preliminary drawings or plans, notes and
communications that result from the Services in this Agreement, shall be kept
confidential unless City expressly authorizes in writing the release of information.
20. INTELLECTUAL PROPERTY INDEMNITY
The Consultant shall defend and indemnify City, its agents, officers,
representatives and employees against any and all liability, including costs, for
infringement or alleged infringement of any United States' letters patent, trademark, or
copyright, including costs, contained in Consultant's Documents provided under this
Agreement.
21. RECORDS
Consultant shall keep records and invoices in connection with the Services to be
performed under this Agreement. Consultant shall maintain complete and accurate
records with respect to the costs incurred under this Agreement and any Services,
expenditures and disbursements charged to City, for a minimum period of three (3)
years, or for any longer period required by law, from the date of final payment to
Consultant under this Agreement. All such records and invoices shall be clearly
identifiable. Consultant shall allow a representative of City to examine, audit and make
transcripts or copies of such records and invoices during regular business hours.
Consultant shall allow inspection of all Work, data, Documents, proceedings and
activities related to the Agreement for a period of three (3) years from the date of final
payment to Consultant under this Agreement.
22. WITHHOLDINGS
City may withhold payment to Consultant of any disputed sums until satisfaction
of the dispute with respect to such payment. Such withholding shall not be deemed to
constitute a failure to pay according to the terms of this Agreement. Consultant shall
not discontinue Work as a result of such withholding. Consultant shall have an
immediate right to appeal to the City Manager or his/her designee with respect to such
disputed sums. Consultant shall be entitled to receive interest on any withheld sums at
the rate of return that City earned on its investments during the time period, from the
date of withholding of any amounts found to have been improperly withheld.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 7
23. ERRORS AND OMISSIONS
In the event of errors or omissions that are due to the negligence or professional
inexperience of Consultant which result in expense to City greater than what would
have resulted if there were not errors or omissions in the Work accomplished by
Consultant, the additional design, construction and/or restoration expense shall be
borne by Consultant. Nothing in this Section is intended to limit City's rights under the
law or any other sections of this Agreement.
24. CITY'S RIGHT TO EMPLOY OTHER CONSULTANTS
City reserves the right to employ other Consultants in connection with the
Project.
25. CONFLICTS OF INTEREST
25.1 The Consultant or its employees may be subject to the provisions of the
California Political Reform Act of 1974 (the "Act"), which (1) requires such persons to
disclose any financial interest that may foreseeably be materially affected by the Work
performed under this Agreement, and (2) prohibits such persons from making, or
participating in making, decisions that will foreseeably financially affect such interest.
25.2 If subject to the Act, Consultant shall conform to all requirements of the
Act. Failure to do so constitutes a material breach and is grounds for immediate
termination of this Agreement by City. Consultant shall indemnify and hold harmless
City for any and all claims for damages resulting from Consultant's violation of this
Section.
26. NOTICES
26.1 All notices, demands, requests or approvals, including any change in
mailing address, to be given under the terms of this Agreement shall be given in writing,
and conclusively shall be deemed served when delivered personally, or on the third
business day after the deposit thereof in the United States mail, postage prepaid, first-
class mail, addressed as hereinafter provided. All notices, demands, requests or
approvals from Consultant to City shall be addressed to City at:
Attn: Dana Smith, Assistant City Manager
City Manager's Office
City of Newport Beach
3300 Newport Boulevard
PO Box 1768
Newport Beach, CA 92658
Phone: 949-644-3003
Fax: 949-644-3020
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 8
26.2 All notices, demands, requests or approvals from City to Consultant shall
be addressed to Consultant at:
Attn: Bruce G. Lawson
Fox Lawson and Associates, a Division of Gallagher Benefits
Services, Inc.
P.O. Box 32985
Phoenix, AZ 85064-2985
Phone: 602-840-1070
Fax: 602-840-1071
27. CLAIMS
Unless a shorter time is specified elsewhere in this Agreement, before making its
final request for payment under this Agreement, Consultant shall submit to City, in
writing, all claims for compensation under or arising out of this Agreement.
Consultant's acceptance of the final payment shall constitute a waiver of all claims for
compensation under or arising out of this Agreement except those previously made in
writing and identified by Consultant in writing as unsettled at the time of its final request
for payment. The Consultant and the City expressly agree that in addition to any claims
filing requirements set forth in the Agreement, the Consultant shall be required to file
any claim the Consultant may have against the City in strict conformance with the Tort
Claims Act (Government Code sections 900 et seq.).
28. TERMINATION
28.1 In the event that either party fails or refuses to perform any of the
provisions of this Agreement at the time and in the manner required, that party shall be
deemed in default in the performance of this Agreement. If such default is not cured
within a period of two (2) calendar days, or if more than two (2) calendar days are
reasonably required to cure the default and the defaulting party fails to give adequate
assurance of due performance within two (2) calendar days after receipt of written
notice of default, specifying the nature of such default and the steps necessary to cure
such default, and thereafter diligently take steps to cure the default, the non -defaulting
party may terminate the Agreement forthwith by giving to the defaulting party written
notice thereof.
28.2 Notwithstanding the above provisions, City shall have the right, at its sole
and absolute discretion and without cause, of terminating this Agreement at any time by
giving no less than seven (7) calendar days prior written notice to Consultant. In the
event of termination under this Section, City shall pay Consultant for Services
satisfactorily performed and costs incurred up to the effective date of termination for
which Consultant has not been previously paid. On the effective date of termination,
Consultant shall deliver to City all reports, Documents and other information developed
or accumulated in the performance of this Agreement, whether in draft or final form.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 9
29. STANDARD PROVISIONS
29.1 Compliance with all Laws. Consultant shall at its own cost and expense
comply with all statutes, ordinances, regulations and requirements of all governmental
entities, including federal, state, county or municipal, whether now in force or hereinafter
enacted. In addition, all Work prepared by Consultant shall conform to applicable City,
county, state and federal laws, rules, regulations and permit requirements and be
subject to approval of the Project Administrator and City.
29.2 Waiver. A waiver by either party of any breach, of any term, covenant or
condition contained herein shall not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant or condition contained herein, whether
of the same or a different character.
29.3 Integrated Contract. This Agreement represents the full and complete
understanding of every kind or nature whatsoever between the parties hereto, and all
preliminary negotiations and agreements of whatsoever kind or nature are merged
herein. No verbal agreement or implied covenant shall be held to vary the provisions
herein.
29.4 Conflicts or Inconsistencies. In the event there are any conflicts or
inconsistencies between this Agreement and the Scope of Services or any other
attachments attached hereto, the terms of this Agreement shall govern.
29.5 Interpretation. The terms of this Agreement shall be construed in
accordance with the meaning of the language used and shall not be construed for or
against either party by reason of the authorship of the Agreement or any other rule of
construction which might otherwise apply.
29.6 Amendments. This Agreement may be modified or amended only by a
written document executed by both Consultant and City and approved as to form by the
City Attorney.
29.7 Severability. If any term or portion of this Agreement is held to be invalid,
illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining
provisions of this Agreement shall continue in full force and effect.
29.8 Controlling Law and Venue. The laws of the State of California shall
govern this Agreement and all matters relating to it and any action brought relating to
this Agreement shall be adjudicated in a court of competent jurisdiction in the County of
Orange, State of California.
29.9 Equal Opportunity Employment. Consultant represents that it is an equal
opportunity employer and it shall not discriminate against any subcontractor, employee
or applicant for employment because of race, religion, color, national origin, handicap,
ancestry, sex, age or any other impermissible basis under law.
29.10 No Attorney's Fees. In the event of any dispute or legal action arising
under this Agreement, the prevailing party shall not be entitled to attorney's fees.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 10
29.11 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which shall be deemed an original and all of which together shall
constitute one (1) and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date: % /12-
By:
12By:
� C
Aaron C. Harp
City Attorney
ATTEST:
Date: T
CITY OF NEWPORT BEACH,
A California mymicipal corporation
Date: 7// 7 //-),-
By:
Y
Nancy
Mayor
ner
CONSULTANT: Fox
Associates, a Division
Benefits Services, Inc.,
Corporation
Date: -,74z-.r I/ Z- -"
4
A
By: B
Leilani I. Brown 10
City Clerk
Pop
��
Bruce G. Lawson
Managing Director
[END OF SIGNATURES]
Attachments: Exhibit A - Scope of Services
Exhibit B - Schedule of Billing Rates
Exhibit C - Insurance Requirements
A 12-00476/f.• I apps)catl cycoml wpdocsl d 0121 p006100012154. docx
Lawson and
of Gallagher
a Delaware
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 11
EXHIBIT A
SCOPE OF SERVICES
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-1
Fox L.aw Son & Assoaatcs
s 17wisitlu pf GnttaQl:er Ffelzeli4 �i.•bes, Inc,
Cnnvnmr ifra��r. Hvmn lRasiwu x-Fw.--frxtr
June 22,2012
I c" K. 12)93
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a�s' A.L:xI;.sbJ:ttom
Re_ Proposal to Conduct a. jab Classification and.. Compensation Study
11'T;W7T.qKLfMA IM'",
Y - �
%! YIrYf ••`.
OWN
tY }
developwilt be a newYY..ff -that js simplerf
order to provide both greater flextbffity M terms
f organlZatIOU&I change and
g—reater•)f• - ff t - f y`
assessment of total compensation tlanugh a marluBt compensation and benefits
study Ultimately, the new "stem should he easier •manage lijan the current
System. as WeH as provide for appropriate
filroughout the City ti
" +. L a• - - Ler •1:.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-2
employee interviews to assess the type and level of workperformance_ This wiR
allawus to outline a proposedclassification structure forthe City that is consistent
with the. Compensation Philosophy that has been adopted by the CounciL in
addition, the classification system will help tlue City define career progressions for
current andfuture employees_
Internal Equity (fob Evaluation) - The purpose of job evaluation is to establish file
T}{feruai worth of all job classes- The basic premise of job evaluation dictates flat the
more a job isvalued internally. the more it: should, be compensated_ Furthermore, it
is a valuable tool for slotting classifications into. appropriate salary grades when.
market data are not availablefor certain classifications, orfor ctasiuficationS that are
notbenchmaiked.
Internal equity is established with a formal job evaluation methodology, such as
banding,pomt:factoruugorwholejobrarildng. Having implementedavariety of job
evaluation methods in hundreds of organizations over the past 3(3...years, we.
understand the desire son's organization may have to examine alternative job
evaluation methods when facedwith general classification and compensation
challenges. We willwork with the City in Phase 11 to develop and implement a job
evaluation methodology such as the Decision Bandw Method that we believe is well
suited to the broad job classification concept that the City is seelan g-
Alarket Parity (Total Compensation) - The purpose of the compensation study is to
ensure that your pay structure and benefits of are competitive with the
relevantlabormarkets in which you compete :for -qualifned personnel. Wewillwork
with. you to identifybenchnrark organizations and job class--fi^-tionson which to
collect comparable market salary data
We will collect market dat& through data mining from web -sites, imlimrig either
currently- available data 9• i F wigi i
i i i& tl tl. b
1 ♦ • F}
- F
- a' • a- - - F. a
° - tl - ♦ - F.
i
- i a - - i• F-.
- �iie •R •ra -
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-3
6Vhile we useproven procedures to maximize participation, we ultimately have no
control. over either orgaiumtione work schedules, and/or their desire or ability to
participate in a salary survey_ We make no guarantee that we will obtain good data
for all jobs from each of the organizations that we invite to participatein. the. survey
In aur experience, we have found that private organizations do not. typically
Participate in smaller, customized surveys sponsored by government Organizations.
Therefore, with the City's approval, we will draw information frompubiished datain
order to provide a representation of the private market This will assure that
accurate and valid private sector data is utilized ina cost manner -
If we are able to use available
data, we will use data from
database .. sourcesTowers+,.d
ercer
othesurveys of public and private sectarjobs to obtain
rcominercially available
marlue-tinfor...i# f the City- For local agenmes, we willDlitain
information as possible from information provided outheir
Y3
usingWe will analyze the market data standard analytical_
analyms. In. addliicn� we WIM integrate the job evaluation resultswith the labor
market survey anal�
of internal and external equity -
a s this Phase, the City will be responsible for
assisting- u i
organizations
order
accomplish your stated objectives for this compensation system
we will need to, do at least the following. ystem
• Review of class
structures i •
b' f w• type and level of
!
work performed by employees within the occupational group_
ByWhesis of best practices, current City Structures and
occupationala-
feedback to result In
ations forthenewcIass
• t -•• job a b• i cns� incluclingidenthificationofstructureessential duties fDr -qualifications,iA
characteristicsw familyor series, and
requirements
i
er to comply with Me American's withDisabilities Act
• �ff _ _ tl...f -
achjob
l + a . i f
. b b • e -_ assess f
internala f -a A r.+ fwithin
ication f.
including kaining forCity-HR station Mat the 04 can maintain the system,
. Recommendation
y
requested. f administration app (Optional Ai.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-4
• Recommendations for methods to implement the findings of the study and
options and direction, given current and recommended personnel policies and
procedures-
• Transition plans for implementing the findings of the study. our
recommendations will take into consideration the culture and financial resources
of the city.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-5
;t wiverahles
Deliverables include=
• New/Revised. jab classification structure_
• New/Revisedaob descriptions_
• Recommended position allomtlons_
• New job evaluation system to address issues related to internal equity_
• Recommended salary structure_
• Recommended changes to the Guy's benefits program and pap practices
F:>K 1. ::ri % Ali:w t rw
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-6
• Recommended salary scales-
• Summary report including recommended implementation and maintenance costs
and options -
In conducting salary studies, we follow professionally accepted compensation
principles and practices as outlined by WorldatWorl, SHRM, the U -g- Department of
Justice and the Federal Trade Commission- We have also authored many articles on
various aspects of conducting salary studies; please refer to our website
www-foslawson-com for these specific articles-
FLA has comprehensive quality and performance standards. Each deliverable is
reviewed by two individuals in the firm for quality control- if clients have issues that
need. to be addressed, the first contact is the project manager who will attempt to
resolve the issues with, as necessary, the assistance of one of the Managing
Directors_
Project Schedule
The schedule following is predicated on an effective start date in laterAugust with
completion in approximately five to six months.
Project Cost
We understand the importance of this study as one of many strategies to address
current human resource issues and realize the delicate nature of City spending_
Therefore, we have proposed a sensible fee schedule that generates project results
destined to add value to the City- It will. provide the flexibility necessary to attract,
retain, and motivate employees to provide quality services and emure the system is
not an administrative and/or costly burden to the City, now or in the future -
We would not like fees to be the major impediment to acquiring the most
experienced provider to address these important needs during this unprecedented
time period- We would be pleased to explore options that may reduce the fees to fit
your budget -
our fees to conduct the project outlined (including out of pocket expenses) will not
exceed $l l'5,000 -
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-7
BRUCE G. LAWSON, MPA, CCP, IPMA-CP — PROJECT DIRECTOR
Mr. Lawson is a Managing Director of the firm. In this capacity, Mr. Lawson
serves as the project director and/or technical advisor, providing technical direction and
quality assurance. He is responsible for all consulting activities in the areas of job
evaluation and compensation, organization analysis, personnel systems and policy
development. Mr. Lawson has been directing classification and compensation studies
for more than 30 years. Prior to forming Fox Lawson, he spent 15 years with the firm of
Ernst & Young LLP where he served as the national director of their public sector
compensation consulting practice. He also served as City Manager in two California
cities (Los Altos Hills and Belvedere), was the County Administrative Officer in
Multnomah County (Portland) Oregon, Assistant City Manager/Personnel Director in
Corvallis, Oregon, and Assistant to the City Administrator/Personnel Director in
Placentia, CA. Mr. Lawson served on the City of Phoenix (AZ) Public Safety
Employees Retirement Board for 12 years. Mr. Lawson has a Master's Degree in
Public Administration from the California State University at Fullerton and is a.b.d. in
Public Administration from Golden Gate University in San Francisco, and has earned
his CCP certification from WorldatWork. He is also an active member of several
professional associations including the College & University Professional Association for
Human Resources, the International City & County Management Association,
International Public Management Association for Human Resources, the Society for
Human Resources Management, and Wor/datWork.. Mr. Lawson co-authors a monthly
compensation article called the CompDoctorTM. Bruce is located in Phoenix, AZ.
JAMES C. FOX, Ph.D., IPMA-CP — TECHNICAL ADVISOR AND ALTERNATE
PROJECT DIRECTOR
Dr. Fox is a Managing Director of the firm. In this capacity, he serves as project
director and/or technical advisor on all projects, providing technical direction and quality
assurance. He is responsible for all consulting activities in the areas of personnel
management, job evaluation and compensation, organization and management
analysis, executive compensation, and survey research. Dr. Fox has been directing
classification and compensation studies for more than 25 years. Prior to forming the
firm, he was a Partner in the firm of Ernst & Young LLP and headed up the firm's
regional compensation practice, with national responsibility for the public sector
compensation practice. Dr. Fox holds both M.A. and Ph.D. Degrees in Sociology from
the University of Minnesota. He has been an instructor at Metropolitan State University
and the University of Minnesota, and has been a guest lecturer at regional conferences
and meetings. He is a member of the Society of Human Resource Management,
WorldatWork,where he is on the faculty, and was the Professional Development
Coordinator of the Compensation Council of the Twin Cities Personnel Association. He
is the Chairman of the Human Resources Committee of the Board of the Northern Star
Council of the Boy Scouts, the past Chairman of the Board of Project Pathfinder and is
a member of the Ramsey County Personnel Review Board. Dr. Fox co-authors a
monthly compensation article called the CompDoctorTM. Jim is located in St. Paul, MN.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-8
HEIDI NELSON, CCP, CBP, IPMA-CP — SENIOR CONSULTANT
Ms. Nelson is a Senior Consultant of the firm. She is responsible for leading and
conducting compensation consulting projects. She has been conducting compensation
studies for our firm for over 20 years andspecializes in base pay compensation, total
compensation, survey research, pay administration planning, and executive
compensation. Ms. Nelson has worked with all types of organizations, including states,
cities, counties, colleges, school districts, universities, special districts, and private
sector organizations includingconducting two prior studies for the City of Kansas City.
Prior to joining the firm, Ms. Nelson spent 6 years serving in a similar capacity with
Ernst & Young. Ms. Nelson attended the University of Minnesota specializing in
Business Management and has completed continuing education coursework from the
same institution in Industrial Relations, Methodology and Design of Salary Surveys, and
Compensation Administration, and has earned her CCP and CBP certifications from
WorldatWork. She is a member of the International Public Management Association for
Human Resources, and WorldatWork. Heidi is located in St. Paul, MN.
MIKE VERDOORN, MA-HRIR, CCP, IPMA-CP — SENIOR CONSULTANT
Mr. Verdoorn is a Senior Consultant with the firm. He is responsible for
conducting classification and compensation consulting projects. He has been
conducting classification and compensation studies for our firm for 6 years and
specializes in the areas of classification, job evaluation and compensation, survey
research, executivecompensation, and statistical analysis. Mr. Verdoorn has worked
with various types of organizations including states, cities, counties, school districts,
colleges, universities, specialdistricts, and private sector organizations. Prior to joining
the firm Mr. Verdoorn was a compensation analyst with Imation, a computer disk
storage manufacturer. Mr. Verdoorn has a Bachelor's Degree in History from the
University of Minnesota and a Master's Degree in Human Resources and Industrial
Relations from the same institution, and has earned his CCP certification from
WorldatWork. He is a member of the International Public Management Association for
Human Resources, and WorldatWork. Mike is located in St. Paul, MN.
GAIL MERIWEATHER, MBA
Ms. Meriweather is an Area Vice President for Human Resources Consulting
Services. She will assist with the market analyses and salary structure design. Prior to
joining Gallagher in 2001, she was a partner with Burgess & Associates, a consulting
firm located in Lenexa, Kansas. She has extensive training and experience in designing
and implementing compensation systems including executive compensation, incentives,
traditional and alternative rewards. She has assisted clients with job analysis, job
evaluations, external market analysis, and salary structure design and administration.
Ms. Meriweather provides develops employee handbooks, affirmative action plans, job
descriptions, performance management systems and management training programs.
She has BA in Business Administration fromthe University of Missouri Kansas City and
an MBA from the same institution. Gail is based in our Kansas City, MO office.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-9
ANNETTE HOEFER, MBA, CCP
Ms. Hoefer is a Senior Consultant. She is responsible for conducting
classification and compensation consulting projects. She has been conducting
classification and compensation studies for our firm for 5 years and specializes in the
areas of classification, job evaluation and compensation, personnel systems and policy
development, performance management systems, employee communications, strategy
discussions, pay administration planning, and focus group facilitation. Ms. Hoefer has
worked with various types of organizations including states, cities, counties, colleges,
universities, special districts, and private sector organizations. Prior to joining the firm,
Ms. Hoefer worked for 9 years in the same capacity at Lee and Burgess Associates, a
consulting firm based in Colorado, and prior to that, had held human resources
positions in energy and insurance companies. Ms. Hoefer has a Bachelor's Degree in
Business Administration from the University of Iowa and a Master's Degree in Business
Administration with an emphasis in Human Resources from same institution, and has
earned her CCP certificationfrom WorldatWork. Annette is located in Cedar Rapids, IA.
LORI MESSER, MA, CCP
Ms. Messer is a Senior Consultant of the firm. She is responsible for conducting
classification and compensation consulting projects. Ms. Messer has worked with and
for a variety of public and private sector organizations, including states, cities, counties,
school districts, colleges, universities, and special districts. Prior to joining the firm, Ms.
Messer held a variety of consultative human resources and compensation positions in
high tech, distribution, healthcare and local government organizations. Ms. Messer has
a Bachelor's Degree in Business Administration from Arizona State University and a
Master's Degree in Education from the University of Phoenix. She is also a member of
WorldatWork and has earned her CCP certification. Lori is based in Phoenix, AZ.
SANDRA SPELLMAN, MPA, IPMA-CP
Ms. Spellman is a Senior Consultant with the firm. She is responsible for
conducting classification, job evaluation, and human resource process consulting
projects. She has been conducting studies for our firm for 4 years and specializes in
the areas of classification, communications, human resource strategy and process, and
employee and management focus group meetings. Ms. Spellman has worked with
various types of organizations including states, cities, counties, colleges and
universities, and the federal government. Prior to joining the firm, Ms. Spellman spent
18 years with Ernst & Young's consulting practices where she was responsible for client
and internal change management, communications, and training strategies. She has
also held state executive and legislative positions addressing a wide range of human
resource and related issues. Ms. Spellman has a Bachelor's Degree in
Sociology/Political Science from Arizona State University and a Master's Degree in
Public Administration with an emphasis in Organizational Development from the same
institution. She is a member of several professional associations, including the College
& University Professional Association for Human Resources, International Public
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-10
Management Association for Human Resources, and WorldatWork. Sandy is located in
Washington, DC,
CHELSEA CHRISTIE, SS-HRIR, CCP, GRP
Ms. Christie is a Consulting Associate with the firm. She is responsible for
providing supportduring all phases of classification and compensation studies. She has
been supporting classification and compensation studies for our firm for 2 years and
specializes in the areas of classification, job evaluation and compensation, survey
research, and job description preparation. Ms. Christie has worked with various types
of organizations including states, cities, counties, school districts, colleges, universities,
and special districts. Prior to joining the firm Ms. Christie worked at Aramark as a
Student Hiring Manager and also completed a competitive internship with Cargill, Inc.
Ms. Christie has a Bachelor's Degree in Human Resources and Industrial Relations,
and Insurance/Risk Management from the University of Minnesota, and has earned her
CCP certification from WorldatWork. She is a member of the Twin Cities Compensation
Network (TCCN) and WorldatWork. Chelsea is located in St. Paul, MN.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page A-11
EXHIBIT B
SCHEDULE OF BILLING RATES
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page B-1
EXHIBIT C
1. INSURANCE REQUIREMENTS — PROFESSIONAL SERVICES
1.1 Provision of Insurance. Without limiting Consultant's indemnification of
City, and prior to commencement of Work, Consultant shall obtain, provide and maintain
at its own expense during the term of this Agreement, policies of insurance of the type
and amounts described below and in a form satisfactory to City. Consultant agrees to
provide insurance in accordance with requirements set forth here. If Consultant uses
existing coverage to comply and that coverage does not meet these requirements,
Consultant agrees to amend, supplement or endorse the existing coverage.
1.2 Acceptable Insurers. All insurance policies shall be issued by an
insurance company currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California, with an assigned policyholders' Rating
of A- (or higher) and Financial Size Category Class VII (or larger) in accordance with the
latest edition of Best's Key Rating Guide, unless otherwise approved by the City's Risk
Manager.
1.3 Coverage Requirements.
1.3.1 Workers' Compensation Insurance. Consultant shall maintain
Workers' Compensation Insurance, statutory limits, and Employer's Liability Insurance
with limits of at least one million dollars ($1,000,000) each accident for bodily injury by
accident and each employee for bodily injury by disease in accordance with the laws of
the State of California, Section 3700 of the Labor Code.
1.3.1.1 Consultant shall submit to City, along with the certificate
of insurance, a Waiver of Subrogation endorsement in favor of City, its officers, agents,
employees and volunteers.
1.3.2 General Liability Insurance. Consultant shall maintain commercial
general liability insurance, and if necessary umbrella liability insurance, with coverage at
least as broad as provided by Insurance Services Office form CG 00 01, in an amount
not less than one million dollars ($1,000,000) per occurrence, two million dollars
($2,000,000) general aggregate. The policy shall cover liability arising from premises,
operations, products -completed operations, personal and advertising injury, and liability
assumed under an insured contract (including the tort liability of another assumed in a
business contract) with no endorsement or modification limiting the scope of coverage
for liability assumed under a contract.
1.3.3 Automobile Liability Insurance. Consultant shall maintain
automobile insurance at least as broad as Insurance Services Office form CA 00 01
covering bodily injury and property damage for all activities of the Consultant arising out
of or in connection with Work to be performed under this Agreement, including coverage
for any owned, hired, non -owned or rented vehicles, in an amount not less than one
million dollars ($1,000,000) combined single limit each accident.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page C-1
1.3.4 Professional Liability (Errors & Omissions) Insurance. Consultant
shall maintain professional liability insurance that covers the Services to be performed
in connection with this Agreement, in the minimum amount of one million dollars
($1,000,000) per claim and in the aggregate. Any policy inception date, continuity date,
or retroactive date must be before the effective date of this agreement and Consultant
agrees to maintain continuous coverage through a period no less than three years after
completion of the services required by this agreement.
1.4 Other Insurance Requirements. The policies are to contain, or be
endorsed to contain, the following provisions:
1.4.1 Waiver of Subrogation. All insurance coverage maintained or
procured pursuant to this agreement shall be endorsed to waive subrogation against
City, its elected or appointed officers, agents, officials, employees and volunteers or
shall specifically allow Consultant or others providing insurance evidence in compliance
with these requirements to waive their right of recovery prior to a loss. Consultant
hereby waives its own right of recovery against City, and shall require similar written
express waivers from each of its subconsultants.
1.4.2 Additional Insured Status. All liability policies including general
liability, excess liability, pollution liability, and automobile liability, but not including
professional liability, shall provide or be endorsed to provide that City and its officers,
officials, employees, and agents shall be included as insureds under such policies.
1.4.3 Primary and Non Contributory. All liability coverage shall apply on
a primary basis and shall not require contribution from any insurance or self-insurance
maintained by City.
1.4.4 Notice of Cancellation. All policies shall provide City with thirty (30)
days notice of cancellation (except for nonpayment for which ten (10) days notice is
required) or nonrenewal of coverage for each required coverage.
1.5 Additional Agreements Between the Parties The parties hereby agree to
the following:
1.5.1 Evidence of Insurance Consultant shall provide certificates of
insurance to City as evidence of the insurance coverage required herein, along with a
waiver of subrogation endorsement for workers' compensation and other endorsements
as specified herein for each coverage. Insurance certificates and endorsement must be
approved by City's Risk Manager prior to commencement of performance. Current
certification of insurance shall be kept on file with City at all times during the term of this
Agreement. City reserves the right to require complete, certified copies of all required
insurance policies, at any time.
1.5.2 City's Right to Revise Requirements. The City reserves the right at
any time during the term of the Agreement to change the amounts and types of
insurance required by giving the Consultant sixty (60) days advance written notice of
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page C-2
such change. If such change results in substantial additional cost to the Consultant, the
City and Consultant may renegotiate Consultant's compensation.
1.5.3 Enforcement of Agreement Provisions. Consultant acknowledges
and agrees that any actual or alleged failure on the part of the City to inform Consultant
of non-compliance with any requirement imposes no additional obligations on the City
nor does it waive any rights hereunder.
1.5.4 Requirements not Limiting. Requirements of specific coverage
features or limits contained in this Section are not intended as a limitation on coverage,
limits or other requirements, or a waiver of any coverage normally provided by any
insurance. Specific reference to a given coverage feature is for purposes of clarification
only as it pertains to a given issue and is not intended by any party or insured to be all
inclusive, or to the exclusion of other coverage, or a waiver of any type.
1.5.5 Self-insured Retentions. Any self-insured retentions must be
declared to and approved by City. City reserves the right to require that self-insured
retentions be eliminated, lowered, or replaced by a deductible. Self-insurance will not be
considered to comply with these requirements unless approved by City.
1.5.6 City Remedies for Non Compliance If Consultant or any
subconsultant fails to provide and maintain insurance as required herein, then City shall
have the right but not the obligation, to purchase such insurance, to terminate this
agreement, or to suspend Consultant's right to proceed until proper evidence of
insurance is provided. Any amounts paid by City shall, at City's sole option, be
deducted from amounts payable to Consultant or reimbursed by Consultant upon
demand.
1.5.7 Timely Notice of Claims. Consultant shall give City prompt and
timely notice of claims made or suits instituted that arise out of or result from
Consultant's performance under this Agreement, and that involve or may involve
coverage under any of the required liability policies.
1.5.8 Consultant's Insurance. Consultant shall also procure and
maintain, at its own cost and expense, any additional kinds of insurance, which in its
own judgment may be necessary for its proper protection and prosecution of the Work.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page C-3
CITY OF
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Item No. 18
a NEWPORT
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Agenda
9July 10, 2012
TO: HONORABLE MAYOR AN9 MEMBERS OF THE CITY COUNCIL
OpId
FROM: City Manager's Office
Dana Smith, Assistant City Manager
949-644-3002, dsmith@newportbeachca,gov
PREPARED BY: Teerrri L. Cassidy, Human Resources Director
APPROVED: �&
TITLE: Professional Services Agreement with Fox Lawson and Associates
to Conduct a City-wide Classification and Compensation Study
ABSTRACT:
The City of Newport Beach has never undertaken a city-wide comprehensive
classification and compensation study that we know of. The City Manager and City
Council have directed significant organizational change over the past several years and
further change is anticipated. To provide a framework for classifying and compensating
employees appropriately within a solid structure, it is proposed the City execute an
agreement with Fox Lawson and Associates to conduct this classification and
compensation study and make recommendations to be brought forward to City Council.
RECOMMENDATION:
Approve and execute the Professional Services Agreement with Fox Lawson and
Associates (Attachment A), a Division of Gallagher Benefit Services, Inc. (FLA) to
conduct a comprehensive city-wide classification and compensation study, not to
exceed $115,000.
FUNDING REQUtREiVKM:
The current adopted budget includes sufficient funding for this purchase. It will be
expensed to the Professional Services account in the Human Resources Department,
0410-8080.
DISCUSSION:
All large corporations, private and public, utilize a systematic way to assess and
compensate employees. Classification and compensation structures are developed
partly in response to state labor laws, partly to stay competitive in the market to attract
and retain qualified staff. Job classifications, to which every employee is assigned,
Professional Services Agreement with
Fox Lawson and Associates to Conduct a City-
wide Classification and Compensation Study
July 10, 2012
Page 2
define job duties and the parameters by which they are to be performed. Ideally, pay
assigned to each classification is based on comparisons with the labor market (external
equity) and the value of the job with respect to other positions within the organization
(internal equity). For large organizations internal equity is particularly critical to ensuring
jobs with similar responsibilities and duties across departments are consistently
compensated and create appropriate vertical separation within job series to avoid
compaction.
The City of Newport Beach has over 250 job classifications for 750 full-time employees,
with too many single classifications that are similar in scope and duties This structure
is burdensome and lacks a broad, comprehensive approach. Additionally, it represents
old ways of doing business, where one employee is assigned one major function,
limiting the City's ability to adjust job assignments in an environment when adaptability
and flexibility are critical to promoting change.
In the past three years the City has undergone significant organizational restructuring.
The Early Retirement Incentive Program in 2010 and layoffs/department mergers in
2011 resulted in shifting duties to a smaller workforce (from 833 positions in 2009 to 750
positions in 2012 (an 11% reduction)). With the downturn in the economy, many private
and public organizations have similarly downsized and reassigned job duties to
maximize productivity with fewer employees. These actions, coupled with the fact that
the City has never undertaken a complete review necessitate that a comprehensive
study be conducted. This has been discussed previously with City Council in the course
of two prior FY budgets, as well as during several meet and confer briefings.
In August 2011, Fox Lawson and Associates was hired to assess the strengths and
weaknesses of the City's classification and compensation structure. This assessment
was a potential precursor to a full study and was used to determine whether it would be
feasible for the City to adopt an entirely new classification structure, based on FLA's
proprietary Decision Band"m Methodology (DBM). The DBM tool is a more objective,
quantifiable, and comprehensive approach toward classification and compensation. in
very simple terms, the DBM method assigns job classifications into one of six bands (A
— F) based on the classification's level of decision-making. Each classification is
analyzed further and sub -banded based on other measurable factors, such as
complexity of work, supervisory authority, and consequences of error. Staff reviewed
the merits of the DBM methodology and its applicability to the City's existing system and
believe it to be the best approach toward establishing a new classification and
compensation system.
Concurrent with the preliminary assessment, FLA conducted a review of executive
compensation. Executive recruitments for key director level positions conducted within
the past three years revealed possible structural inconsistencies in compensation and
benefits for that group. To create a valid and defensible classification and
compensation system, the City hired FLA to establish the new structure and assign all
executive level positions (department directors) a DBM rating. DBM ratings not only
Professional Services Agreement with Fox Lawson and Associates to Conduct a City-
wide Classification and Compensation Study
July 10, 2012
Page 3
ensure an objective evaluation that addresses the compensation inconsistencies, but
establishes the framework for applying DBM methodology city-wide. It is anticipated the
FLA executive compensation report will be presented for City Council consideration at
the first meeting in August.
Study Process and Outcomes
Given the broad scope and size of the study, it is estimated to take in excess of six
months to complete. Since the study will examine nearly all of the City's job
classifications, the City's bargaining units will be engaged in the process. Any resulting
outcomes that impact classification or compensation (increases or reductions) are
subject to meet and confer and will follow the provisions of the Meyers-Milias Brown Act
(MMBA).
Phase I of the study will include informational meetings to explain the study process and
DBM method. During Phase II consultants will meet with employees via occupational
panels (small group of employees from certain job classifications to discuss duties and
responsibilities), assess job classifications, develop new classification structures, and
revise or create new job descriptions. Phase III of the study analyzes the internal
alignment and assigns each classification a DBM rating, while Phase IV includes an
analysis of pay and benefits through a study of the labor market. Though the study is
designed to establish a system of classification and compensation for the City's full-time
positions, part-time positions will also be reviewed and any proposed changes in how
the City assigns or compensates part-time positions shall be incorporated.
Consistent with elements of the City's Council's Compensation Philosophy, Resolution
No. 2011-55, the study will include the following outcomes:
m A job evaluation system with a reliable and objective methodology that is
internally equitable and consistent across all departments (philosophy #3)
m Market competitiveness that includes examination of public and private sector
data, as appropriate, and that generally compensates at market median (or within
the second and third quartile) (philosophies #1 and #2)
® A simplified job classification and pay structure that provides greater
management flexibility in job assignments and employee cross training, which
will be essential as the City continues to move to a smaller, more efficient
organization (philosophy #6)
o Job descriptions that are current, reflective of duties performed, and follow best
practice guidelines to include descriptive factors that conform to the Americans
with Disabilities Act (ADA)
Professional Services Agreement with Fox Lawson and Associates to Conduct a City-
wide Classification and Compensation Study
July 10, 2012
Page 4
Firm Qualifications
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc., is
experienced in conducting comprehensive classification and compensation studies for
both the private and public sector. Public sector clients include a host of California
cities, counties and special districts, and private sector clients include large and small
businesses in a variety of industries (Attachment B).
The attached FLA proposal (Exhibit A) outlines the objectives, process and anticipated
outcomes of the study. If the Professional Services Agreement with Fox Lawson and
Associates is approved, City Manager's Office and Human Resources staff will proceed
with implementing the city-wide study as soon as practicable. Upon study conclusion
the City Council will be presented with a final report and any corresponding
recommendations for their consideration, which staff anticipates to occur prior to FY13-
14.
ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this action is not subject to the California
Environmental Quality Act ("CEQA") pursuant to Sections 15060(c)(2) (the activity will
not result in a direct or reasonably foreseeable indirect physical change in the
environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378)
of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it
has no potential for resulting in physical change to the environment, directly or
indirectly.
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:
W,:4_V_z_z
Dana Smith
Assistant City Manager
Attachments: A. Professional Services Agreement with Fox Lawson and
Associates
B. Fox Lawson and Associates Client List
ATTACHMENT A
PROFESSIONAL SERVICES AGREEMENT
WITH FOX LAWSON AND ASSOCIATES, A DIVISION OF GALLAGHER
BENEFITS SERVICES, INC. FOR
A CITY-WIDE CLASSIFICATION AND COMPENSATION STUDY
THIS AGREEMENT FOR PROFESSIONAL SERVICES ("Agreement") is made
and entered into as of this day of July, 2012 ("Effective Date') by and between the
CITY OF NEWPORT BEACH, a California Municipal Corporation ("City"), and Fox
Lawson and Associates, a Division of Gallagher Benefits Services, Inc., a Delaware
corporation ("Consultant'), whose address is P.O. Box 32985, Phoenix, AZ 85064-2985
and is made with reference to the following:
RECITALS
A. City is a municipal corporation duly organized and validly existing under the laws
of the State of California with the power to carry on its business as it is now being
conducted under the statutes of the State of California and the Charter of City.
B. City desires to engage Consultant to conduct a comprehensive city-wide
classification and compensation study ("Project').
C. Consultant possesses the skill, experience, ability, background, certification and
knowledge to provide the. professional services described in this Agreement.
D. The principal member of Consultant for purposes of Project shall be Bruce G.
Lawson.
E. City has solicited and received a proposal from Consultant, has reviewed the
previous experience and evaluated the expertise of Consultant, and desires to
retain Consultant to render professional services under the terms and conditions
set forth in this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
1. TERM
The term of this Agreement shall commence on the Effective Date, and shall
terminate on December 31, 2013 unless terminated earlier as set forth herein.
2. SERVICES TO BE PERFORMED
City and Consultant acknowledge that the above Recitals are true and correct
and are hereby incorporated by reference into this Agreement. Consultant shall
diligently perform all the services described in the Scope of Services attached hereto as
Exhibit A and incorporated herein by reference ("Services" or "Work'). The City may
elect to delete certain Services within the Scope of Services at its sole discretion.
3. TIME OF PERFORMANCE
3.1 Time is of the essence in the performance of Services under this
Agreement and Consultant shall perform the Services in accordance with the schedule
included in Exhibit A. In the absence of a specific schedule, the Services shall be
performed to completion in a diligent and timely manner. The failure by Consultant to
strictly adhere to the schedule set forth in Exhibit A, if any, or perform the Services in a
diligent and timely manner may result in termination of this Agreement by City.
3.1.1 Notwithstanding the foregoing, Consultant shall not be responsible
for delays due to causes beyond Consultant's reasonable control. However, in the case
of any such delay in the Services to be provided for the Project, each party hereby
agrees to provide notice within two (2) days of the occurrence causing the delay to the
other party so that all delays can be addressed.
3.2 Consultant shall submit all requests for extensions of time for performance
in writing to the Project Administrator (as defined in Section 6 below) not later than ten
(10)calendar days after the start of the condition that purportedly causes a delay. The
Project Administrator shall review all such requests and may grant reasonable time
extensions for unforeseeable delays that are beyond Consultant's control.
3.3 For all time periods not specifically set forth herein, Consultant shall
respond in the most expedient and appropriate manner under the circumstances, by
fax, hand -delivery or mail.
4. COMPENSATION TO CONSULTANT
4.1 City shall pay Consultant for the Services on a time and expense not -to -
exceed basis in accordance with the provisions of this Section and the Schedule of
Billing Rates or Progress Payments Schedule attached hereto .as Exhibit B and
incorporated herein by reference. Consultant's compensation for all Work performed in
accordance with this Agreement, including all reimbursable items and subconsultant
fees, shall not exceed One Hundred Fifteen Thousand Dollars and 00 /100
($115,000.00) without prior written authorization from City. No billing rate changes shall
be made during the term of this Agreement without the prior written approval of City.
4.2 Consultant shall submit monthly invoices to City describing the Work
performed the preceding month. Consultant's bills shall include the name of the person
who performed the Work, a brief description of the Services performed and/or the
specific task in the Scope of Services to which it relates, the date the Services were
performed, the number of hours spent on all Work billed on an hourly basis, and a
description of any reimbursable expenditures. City shall pay Consultant no later than
thirty (30) days after approval of the monthly invoice by City staff.
4.3 City shall reimburse Consultant only for those costs or expenses
specifically identified in Exhibit B to this Agreement, or specifically approved in writing in
advance by City.
4.4 Consultant shall not receive any compensation for Extra Work performed
without the prior written authorization of City. As used herein, "Extra Work" means any
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 2
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 and which the parties did
not reasonably anticipate would be necessary at the execution of this Agreement.
Compensation for any authorized Extra Work shall be paid in accordance with the
Schedule of Billing Rates as set forth in Exhibit B.
5. PROJECT MANAGER
5.1 Consultant shall designate a Project Manager, who shall coordinate all
phases of the Project. This Project Manager shall be available to City at all reasonable
times during the Agreement term. Consultant has designated Bruce G. Lawson to be its
Project Manager. Consultant shall not remove or reassign the Project Manager or any
personnel listed in Exhibit A or assign any new or replacement personnel to the Project
without the prior written consent of City. City's approval shall not be unreasonably
withheld with respect to the removal or assignment of non -key personnel.
5.2 Consultant, at the sole discretion of City, shall remove from the Project
any of its personnel assigned to the performance of Services upon written request of
City. Consultant warrants that it will continuously furnish the necessary personnel to
complete the Project on a timely basis as contemplated by this Agreement.
5.3 If Consultant is performing inspection services for City, the Project
Manager and any other assigned staff shall be equipped with a cellular phone to
communicate with City staff. The Project Manager's cellular phone number shall be
provided to the City.
6. ADMINISTRATION
This Agreement will be administered by the City Manager's Office. Dana
Smith, Assistant City Manager or his/her designee, shall be the Project Administrator
and shall have the authority to act for City under this Agreement. The Project
Administrator or his/her designee shall represent City in all matters pertaining to the
Services to be rendered pursuant to this Agreement.
7. CITY'S RESPONSIBILITIES
To assist Consultant in the execution of its responsibilities under this Agreement,
City agrees to provide access to and upon request of Consultant, one copy of all
existing relevant information on file at City. City will provide all such materials in a
timely manner so as not to cause delays in Consultant's Work schedule.
8. STANDARD OF CARE
8.1 All of the Services shall be performed by Consultant or under Consultant's
supervision. Consultant represents that it possesses the professional and technical
personnel required to perform the Services required by this Agreement, and that it will
perform all Services in a manner commensurate with the highest professional
standards. For purposes of this Agreement, the phrase "highest professional
standards" shall mean those standards of practice recognized by one (1) or more first-
class firms performing similar work under similar circumstances.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 3
8.2 All Services shall be performed by qualified and experienced personnel
who are not employed by City. By delivery of completed Work, Consultant certifies that
the Work conforms to the requirements of this Agreement; all applicable federal, state
and local laws; and the highest professional standard.
8.3 Consultant represents and warrants to City that it has, shall obtain, and
shall keep in full force and effect during the term hereof, at its sole cost and expense, all
licenses, permits, qualifications, insurance and approvals of whatsoever nature that is
legally required of Consultant to practice its profession. Consultant shall maintain a City
of Newport Beach business license during the term of this Agreement.
8.4 Consultant shall not be responsible for delay, nor shall Consultant be
responsible for damages or be in default or deemed to be in default by reason of strikes,
lockouts, accidents, acts of God, or the failure of City to furnish timely information or to
approve or disapprove Consultant's Work promptly, or delay or faulty performance by
City, contractors, or governmental agencies.
9. HOLD HARMLESS
9.1 To the fullest extent permitted by law, Consultant shall indemnify, defend
and hold harmless City, its City Council, boards and commissions, officers, agents and
employees (collectively, the "Indemnified Parties') from and against any and all claims
(including, without limitation, claims for bodily injury, death or damage to property),
demands, obligations, damages, actions, causes of action, suits, losses, judgments,
fines, penalties, liabilities, costs and expenses (including, without limitation, attorney's
fees, disbursements and court costs) of every kind and nature whatsoever (individually,
a Claim; collectively, "Claims'), which may arise from or in any manner relate (directly or
indirectly) to any breach of the terms and conditions of this Agreement, any Work
performed or Services provided under this Agreement including, without limitation,
defects in workmanship or materials or Consultant's presence or activities conducted on
the Project (including the negligent and/or willful acts, errors and/or omissions of
Consultant, its principals, officers, agents, employees, vendors, suppliers, consultants,
subcontractors, anyone employed directly or indirectly by any of them or for whose acts
they may be liable or any or all of them).
9.2 Notwithstanding the foregoing, nothing herein shall be construed to
require Consultant to indemnify the Indemnified Parties from any Claim arising from the
sole negligence or willful misconduct of the Indemnified Parties. Nothing in this
indemnity shall be construed as authorizing any award of attorney's fees in any action
on or to enforce the terms of this Agreement. This indemnity shall apply to all claims
and liability regardless of whether any insurance policies are applicable. The policy
limits do not act as a limitation upon the amount of indemnification to be provided by the
Consultant.
10. INDEPENDENT CONTRACTOR
It is understood that City retains Consultant on an independent contractor basis
and Consultant is not an agent or employee of City. The manner and means of
conducting the Work are under the control of Consultant, except to the extent they are
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 4
limited by statute, rule or regulation and the expressed terms of this Agreement. No
civil service status or other right of employment shall accrue to Contractor or its
employees. Nothing in this Agreement shall be deemed to constitute approval for
Consultant or any of Consultant's employees or agents, to be the agents or employees
of City. Consultant shall have the responsibility for and control over the means of
performing the Work, provided that Consultant is in compliance with the terms of this
Agreement. Anything in this Agreement that may appear to give City the right to direct
Consultant as to the details of the performance of the Work or to exercise a measure of
control over Consultant shall mean only that Consultant shall follow the desires of City
with respect to the results of the Services.
11. COOPERATION
Consultant agrees to work closely and cooperate fully with City's designated
Project Administrator and any other agencies that may have jurisdiction or interest in the
Work to be performed. City agrees to cooperate with the Consultant on the Project.
12. CITY POLICY
Consultant shall discuss and review all matters relating to policy and Project
direction with City's Project Administrator in advance of all critical decision points in
order to ensure the Project proceeds in a manner consistent with City goals and
policies.
13. PROGRESS
Consultant is responsible for keeping the Project Administrator and/or his/her
duly authorized designee informed on a regular basis regarding the status and progress
of the Project, activities performed and planned, and any meetings that have been
scheduled or are desired.
14. INSURANCE
Without limiting Consultant's indemnification of City, and prior to commencement
of Work, Consultant shall obtain, provide and maintain at its own expense during the
term of this Agreement or for other periods as specified in this Agreement, policies of
insurance of the type, amounts, terms and conditions described in the Insurance
Requirements attached hereto as Exhibit C, and incorporated herein by reference.
15. PROHIBITION AGAINST ASSIGNMENTS ARID TRANSFERS
Except as specifically authorized under this Agreement, the Services to be
provided under this Agreement shall not be assigned, transferred contracted or
subcontracted out without the prior written approval of City. Any of the following shall
be construed as an assignment: The sale, assignment, transfer or other disposition of.
any of the issued and outstanding capital stock of Consultant, or of the interest of any
general partner or joint venturer or syndicate member or cotenant if Consultant is a
partnership or joint -venture or syndicate or cotenancy, which shall result in changing the
control of Consultant. Control means fifty percent (50%) or more of the voting power, or
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 5
twenty-five percent (25%) or more of the assets of the corporation, partnership or joint -
venture.
16. SUBCONTRACTING
The subcontractors authorized by City, if any, to perform Work on this Project are
identified in Exhibit A. Consultant shall be fully responsible to City for all acts and
omissions of any subcontractor. Nothing in this Agreement shall create any contractual
relationship between City and any subcontractor nor shall it create any obligation on the
part of City to pay or to see to the payment of any monies due to any such
subcontractor other than as otherwise required by law. The City is an intended
beneficiary of any Work performed by the subcontractor for purposes of establishing a
duty of care between the subcontractor and the City. Except as specifically authorized
herein, the Services to be provided under this Agreement shall not be otherwise
assigned, transferred, contracted or subcontracted out without the prior written approval
of City.
17. OWNERSHIP OF DOCUMENTS
17.1 Each and every report, draft, map, record, plan, document and other
writing produced (hereinafter "Documents"), prepared or caused to be prepared by
Consultant, its officers, employees, agents and subcontractors, in the course of
implementing this Agreement, shall become the exclusive property of City, and City
shall have the sole right to use such materials in its discretion without further
compensation to Consultant or any other party. Consultant shall, at Consultant's
expense, provide such Documents to City upon prior written request.
17.2 Documents, including drawings and specifications, prepared by
Consultant pursuant to this Agreement are not intended or represented to be suitable
for reuse by City or others on any other project. Any use of completed Documents for
other projects and any use of incomplete Documents without specific written
authorization from Consultant will be at City's sole risk and without liability to
Consultant. Further, any and all liability arising out of changes made to Consultant's
deliverables under this Agreement by City or persons other than Consultant is waived
against Consultant and City assumes full responsibility for such changes unless City
has given Consultant prior notice and has received from Consultant written consent for
such changes.
18. COMPUTER DELIVERABLES
All written documents shall be transmitted to City in formats compatible with
Microsoft Office and/or viewable with Adobe Acrobat.
19. CONFIDENTIALITY
All Documents, including drafts, preliminary drawings or plans, notes and
communications that result from the Services in this Agreement, shall be kept
confidential unless City expressly authorizes in writing the release of information.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 6
20. INTELLECTUAL PROPERTY INDEMNITY
The Consultant shall defend and indemnify City, its agents, officers,
representatives and employees against any and all liability, including costs, for
infringement or alleged infringement of any United States' letters patent, trademark, or
copyright, including costs, contained in Consultant's Documents provided under this
Agreement.
21. RECORDS
Consultant shall keep records and invoices in connection with the Services to be
performed under this Agreement. Consultant shall maintain complete and accurate
records with respect to the costs incurred under this Agreement and any Services,
expenditures and disbursements charged to City, for minimum period of three (3)
years, or for any longer period required by law, from the date of final payment to
Consultant under this Agreement. All such records and invoices shall be clearly
identifiable. Consultant shall allow a representative of City to examine, audit and make
transcripts or copies of such records and invoices during regular business hours.
Consultant shall allow inspection of all Work, data, Documents, proceedings and
activities related to the Agreement for a period of three (3) years from the date of final
payment to Consultant under this Agreement.
22. WITHHOLDINGS
City may withhold payment to Consultant of any disputed sums until satisfaction
of the dispute with respect to such payment. Such withholding shall not be deemed to
constitute a failure to pay according to the terms of this Agreement. Consultant shall
not discontinue Work as a result of such withholding. Consultant shall have an
immediate right to appeal to the City Manager or his/her designee with respect to such
disputed sums. Consultant shall be entitled to receive interest on any withheld sums at
the rate of return that City earned on its investments during the time period, from the
date of withholding of any amounts found to have been improperly withheld.
23. ERRORS AND OMISSIONS
In the event of errors or omissions that are due to the negligence or professional
inexperience of Consultant which result in expense to City greater than what would
have resulted if there were not errors or omissions in the Work accomplished by
Consultant, the additional design, construction and/or restoration expense shall be
borne by Consultant. Nothing in this Section is intended to limit City's rights under the
law or any other sections of this Agreement.
24. CITY'S RIGHT TO EMPLOY OTHER CONSULTANTS
City reserves the right to employ other Consultants in connection with the
Project.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 7
25. CONFLICTS OF INTEREST
25.1 The Consultant or its employees may be subject to the provisions of the
California Political Reform Act of 1974 (the "Act"), which (1) requires such persons to
disclose any financial interest that may foreseeably be materially affected by the Work
performed under this Agreement, and (2) prohibits such persons from making, or
participating in making, decisions that will foreseeably financially affect such interest.
25.2 If subject to the Act, Consultant shall conform to all requirements of the
Act. Failure to do so constitutes a material breach and is grounds for immediate
termination of this Agreement by City. Consultant shall indemnify and hold harmless
City for any and all claims for damages resulting from Consultant's violation of this
Section.
26. NOTICES
26.1 All notices, demands, requests or approvals, including any change in
mailing address, to be given under the terns of this Agreement shall be given in writing,
and conclusively shall be deemed served when delivered personally, or on the third
business day after the deposit thereof in the United States mail, postage prepaid, first-
class mail, addressed as hereinafter provided. All notices, demands, requests or
approvals from Consultant to City shall be addressed to City at:
Attn: Dana Smith, Assistant City Manager
City Manager's Office
City of Newport Beach
3300 Newport Boulevard
PO Box 1768
Newport Beach, CA 92658
Phone: 949-644-3003
Fax: 949-644-3020
26.2 All notices, demands, requests or approvals from City to Consultant shall
be addressed to Consultant at:
Attn: Bruce G. Lawson
Fox Lawson and Associates, a Division of Gallagher Benefits
Services, Inc.
P.O. Box 32985
Phoenix, AZ 85064-2985
Phone: 602-840-1070
Fax: 602-840-1071
27. CLAIMS
Unless a shorter time is specified elsewhere in this Agreement, before making its
final request for payment under this Agreement, Consultant shall submit to City, in
writing, all claims for compensation under or arising out of this Agreement.
Consultant's acceptance of the final payment shall constitute a waiver of all claims for
compensation under or arising out of this Agreement except those previously made in
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 8
writing and identified by Consultant in writing as unsettled at the time of its final request
for payment. The Consultant and the City expressly agree that in addition to any claims
filing requirements set forth in the Agreement, the Consultant shall be required to file
any claim the Consultant may have against the City in strict conformance with the Tort
Claims Act (Government Code sections 900 et seq.).
28. TERMINATION
28.1 In the event that either party fails or refuses to perform any of the
provisions of this Agreement at the time and in the manner required, that party shall be
deemed in default in the performance of this Agreement. If such default is not cured
within a period of two (2) calendar days, or if more than two (2) calendar days are
reasonably required to cure the default and the defaulting party fails to give adequate
assurance of due performance within two (2) calendar days after receipt of written
notice of default, specifying the nature of such default and the steps necessary to cure
such default, and thereafter diligently take steps to cure the default, the non -defaulting
party may terminate the Agreement forthwith by giving to the defaulting party written
notice thereof.
28.2 Notwithstanding the above provisions, City shall have the right, at its sole
and absolute discretion -and without cause, of terminating this Agreement at any by
giving no less than seven (7) calendar days prior written notice to Consultant. In the
event of termination under this Section, City shall pay Consultant for Services
satisfactorily performed and costs incurred up to the effective date of termination for
which Consultant has not been previously paid. On the effective date of termination,
Consultant shall deliver to City all reports, Documents and other information developed
or accumulated in the performance of this Agreement, whether in draft or final form.
29. STANDARD PROVISIONS
29.1 Compliance with all Laws. Consultant shall at its own cost and expense
comply with all statutes, ordinances, regulations and requirements of all governmental
entities, including federal, state, county or municipal, whether now in force or hereinafter
enacted. In addition, all Work prepared by Consultant shall conform to applicable City,
county, state and federal laws, rules, regulations and permit requirements and be
subject to approval of the Project Administrator and City.
29.2 Waiver. A waiver by either party of any breach, of any term, covenant or
condition contained herein shall not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant or condition contained herein, whether
of the same or a different character.
29.3 Integrated Contract. This Agreement represents the full and complete
understanding of every kind or nature whatsoever between the parties hereto, and all
preliminary negotiations and agreements of whatsoever kind or nature are merged
herein. No verbal agreement or implied covenant shall be held to vary the provisions
herein.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 9
29.4 Conflicts or Inconsistencies. In the event there are any conflicts or
inconsistencies between this Agreement and the Scope of Services or any other
attachments attached hereto, the terms of this Agreement shall govern.
29.5 Interpretation. The terms of this Agreement shall be construed in
accordance with the meaning of the language used and shall not be construed for or
against either party by reason of the authorship of the Agreement or any other rule of
construction which might otherwise apply.
29.6 Amendments. This Agreement may be modified or amended only by a
written document executed by both Consultant and City and approved as to form by the
City Attorney.
29.7 Severabilitv. If any term or portion of this Agreement is held to be invalid,
illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining
provisions of this Agreement shall continue in full force and effect.
29.8 Controlling Law and Venue. The laws of the State of California shall
govern this Agreement and all matters relating to it and any action brought relating to
this Agreement shall be adjudicated in a court of competent jurisdiction in the County of
Orange, State of California.
29.9 Equal Opportunity Employment. Consultant represents that it is an equal
opportunity employer and it shall not discriminate against any subcontractor, employee
or applicant for employment because of race, religion, color, national origin, handicap,
ancestry, sex, age or any other impermissible basis under law.
29.10 No Attorney's Fees. In the event of any dispute or legal action arising
under this Agreement, the prevailing party shall not be entitled to attorney's fees.
29.11 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which shall be deemed an original and all of which together shall
constitute one (1) and the same instrument.
[SIGNATURES ON NEXT PAGE]
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 10
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEYJ OFFIC
Date: 6 -
BY
: f i__
Aaron HC ra p
City Attorney
ATTEST:
Date:
in
Leilani I. Brown
City Clerk
CITY OF NEWPORT BEACH,
A California municipal corporation
Date:
By:
INancy Gardner
pk- Mayor
CONSULTANT: Fox
Associates, a Division
Benefits Services, Inc.,
Corporation
Bruce G. Lawson
Managing Director
[END OF SIGNATURES]
Attachments: Exhibit A — Scope of Services
Exhibit B — Schedule of Billing Rates
Exhibit C — Insurance Requirements
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Lawson and
of Gallagher
a Delaware
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 11
EXHIBIT A
SCOPE OF SERVICES
[Contractor Firm Name] Page A-1
Fox Lawson & Associates
a Division of Gallagher Benefit Services, Inc.
Compensation and Human Resources Specialists
June 22, 2012
Sent via e-mail to: dsmith@newportbeachca.gov
Ms. Dana Smith
Assistant City Manager
City of Newport Beach, CA
3300 Newport Blvd.
Newport Beach, CA 92663
P.O. Box 3298.5
Phoenix, AZ 85064.2985
Phone 607,840-1070
Fax 602.840-1071
ss�w.foxlawsonxom
Re: proposal to Conduct a job Classification and Compensation Study
Ladies and Gentlemen:
In response to your request, Fox Lawson & Associates, a Division of Gallagher
Benefit Services, Inc. (FLA), is pleased to provide the following approach and cost
estimate to conduct a job classification and compensation study covering all City
positions in approximately 200 current job classifications. The objective of this study
will be develop a new job classification structure that is simpler and broader in
order to provide both greater flexibility in terms of organizational change and
greater opportunity for employees to grow and develop.. The study will also include
assessment of total compensation through a market compensation and benefits
study. Ultimately, the new system should be easier to manage than the current
system, as well as provide for appropriate internal alignment of positions and jobs
throughout the City organization.
The City Council has recently adopted a compensation philosophy. Subsequently,
we conducted an executive compensation study, and also assessed the current job
classifications to identify potential opportunities to simplify the job classification
system. Based on that review, it is clear that there are numerous opportunities to
simplify and streamline the job classification system. To accomplish the stated
objectives, the project will have three components: Classification, Job Evaluation,
and Total Compensation, as follows:
Classification is the process of understanding, verifying, and describing the nature
and level of work of each job in the organization. This is done by asking employees
to describe their work, including the duties, responsibilities, knowledge, skills,
physical requirements, and working conditions required for their job. During phase
I of the study, classification data will be collected from existing job descriptions,
employee Position Description Questionnaires (PDAs), and individual or group
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employee interviews to assess the type and level of work performance. This will
allow us to outline a proposed classification structure for the City that is consistent
with the Compensation Philosophy that has been adopted by the Council. In
addition, the classification system will help the City define career progressions for
current and future employees.
Internal Equity Gob Evaluation) - The purpose of job evaluation is to establish the
internal worth of all job classes. The basic premise of job evaluation dictates that the
more a job is valued internally, the more it should be compensated. Furthermore, it
is a valuable tool for slotting classifications into appropriate salary grades when
market data are not available for certain classifications, or for classifications that are
not benchmarked.
Internal equity is established with a formal job evaluation methodology, such as
banding, point factoring or whole job ranking. Having implemented a variety of job
evaluation methods in hundreds of organizations over the past 30 years, we
understand the desire some organization may have to examine alternative job
evaluation methods when faced with general classification and compensation
challenges. We will work with the City in Phase II to develop and implement a job
evaluation methodology such as the Decision BandTA9 Method that we believe is well
suited to the broad job classification concept that the City is seeking.
Market Parity (Total Compensation) - The purpose of the compensation study is to
ensure that your pay structure and benefits offerings are competitive with the
relevant labor markets in which you compete for qualified personnel. We will work
with you to identify benchmark organizations and job classifications on which to
collect comparable market salary data.
We will collect market data through data mining from web -sites, utilizing either
currently available data or via a data collection form customized to meet the needs of
the City, as necessary to obtain the needed information. If a custom survey is used,
our data collection form follows standard compensation guidelines and is an
effective and efficient form of collecting salary information. Our questions are posed
in a fashion that is easy for participants to answer, as well as being easy to quantify
and analyze. Participants can complete our data collection forms in either hardcopy
or electronic formats.
FLA abides by WorldatWork guidelines in the collection and analysis of pay and
benefits data. In order to encourage responses from organizations, we pledge that
data provided will be treated as confidential and that only summary or aggregate
results will be made public. Consequently, specific responses identified by
participants will not be provided to the City. This policy abides by the guidelines
set forth by the Federal Trade Commission and the United States Department of
Justice relative to the Sherman Antitrust Act in regards to the sharing of salary data.
'6b Fox Lawson & Associates
a o oorciiaehea<<iaser<�,i<. 2
While we use proven procedures to maximize participation, we ultimately have no
control over other organizations' work schedules, and/or their desire or ability to
participate in a salary survey. We make no guarantee that we will obtain good data
for all jobs from each of the organizations that we invite to participate in the survey.
In our experience, we have found that private organizations do not typically
participate in smaller, customized surveys sponsored by government organizations.
Therefore, with the City's approval, we will draw information from published data in
order to provide a representation of the private market. This will assure that
accurate and valid private sector data is utilized in a cost efficient manner.
If we are able to use available published data, we will use data from our extensive
database including published data sources such as Mercer, Towers Watson and
other commercially available surveys of public and private sector jobs to obtain
market information for the City. For local agencies, we will obtain as much of the
information as possible from information provided on their web -sites.
We will analyze the market data using standard analytical tools such as regression
analysis. In addition, we will integrate the job evaluation results with the labor
market survey analysis to develop a salary structure that reflects the proper balance
of internal and external equity.
During this Phase, the City will be responsible for assisting FLA in selecting
organizations to survey and benchmark jobs to include in the survey.
in order to accomplish your stated objectives for this compensation system review,
we will need to do at least the following:
® Review of class structures for discussion within a series of occupational focus
groups comprised of employees and managers regarding type and level of
work performed by employees within the occupational group.
• Synthesis of best practices, current City structures and occupational panel
feedback to result in recommendations for the new class structure.
® Development of new or revised job descriptions, including identification of the
essential duties for the class, appropriate minimum qualifications, distinguishing
characteristics between class levels within a job family or series, and physical
requirements in order to comply with the American's with Disabilities Act.
® Determination of the appropriate FLSA exemption status for each job
classification.
• Provision of an appropriate job evaluation methodology to assess and maintain
internal equity for all job classifications within a broad classification concept,
including training for City HR staff so that the City can maintain the system once
implemented.
• Recommendation of an appeal process regarding classification allocation and, if
requested, administration of the appeals process (Optional Activity).
Fox Lawson a Associates
a Deis... dGallagher He.ekt S,,ica, Inc.
• Recommendations for methods to implement the findings of the study and
options and direction, given current and recommended personnel policies and
procedures.
• Transition plans for implementing the findings of the study. Our
recommendations will take into consideration the culture and financial resources
of the City.
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interviews of a sarnpie of
[Includes 15 days of
employees/managersto assess type and level +
occupational panels":and/or
of current work performed'within each
interviews.]
occupational grouping
a Review of:current organization material and
job descriptions;ii concert with
interinewloccirpational panel outcomes and:
best practices_to recommend xevised class
structures-
a" Based otn management feedback, development'
of updated class structure recommendations
for City review
®Development of new or'updated job
descriptions as desired by the City to conform
to approved structure changes; including
appropria4e'competencies, for. eaeh job
classification.
a Recomrnendation of employee allocations. :.
Analysis of employee appeals as appropriate;
this is an optional cask and is priced`
sepazately.
Fox Lawson & Associates -
x Division of Gallagher 9=61 Services, Inc. 4
M. ]job ]E®aluatioan 501dly
F.gplicarion of DBTM'M or aiYernative:tob
evaluation tool in use or oti erwise selected 20 .'
the City's jobs
--Discussion of the internal hierarchy resulting
and development of modifcations.to finalize
the lohevalnatwn ratings for use in
determirungsuitemal equity withiri,the class .
and pay systems I
Training for HR and management personnel an
site or by webinarrm the use of the DBTYM
,system,`, s
Iif: Total Compesasatiost
�' Labor a ket confirmed and survey -
Study -
to
participants identified
® Benchmark lobs identified and summarized',
Data collected through a custom survey and';
fom published sources, as°appropriate; and
venfied -�
Identification of hard to recnut positions and
assessment of the relevance of compensation `
for recruiting
T. Competihne analysis performed of City
compensation and benefits
® Diagnostic reviewof current salarystructure to
identify op}iortunities for simplification:
® Recommended pay structure or, update of
existing "stricture.
ol Best practices reviewed .
Transition, -options; next steps/costs.outlined
WCompensation guidelines developed.
® Draft report
m Quality assurance reviews.
® City revtew,and feedback '. -
•Final report andpresentation.
J
Deliverables
Deliverables include:
• New/Revised job classification structure.
• New/Revised job descriptions.
® Recommended position allocations.
• New job evaluation system to address issues related to internal equity.
• Recommended salary structure.
• Recommended changes to the City's benefits program and pay practices
fox Lawson & Associates
a Division of Gallagher Bcnefic Services, Inc.
J
• Recommended salary scales.
• Summary report including recommended implementation and maintenance costs
and options.
In conducting salary studies, we follow professionally accepted compensation
principles and practices as outlined by WorldatWork, SHRM, the U.S. Department of
Justice and the Federal Trade Commission. We have also authored many articles on
various aspects of conducting salary studies; please refer to our website
www.foxlawson.com for these specific articles.
FLA has comprehensive quality and performance standards. Each deliverable is
reviewed by two individuals in the firm for quality control. If clients have issues that
need to be addressed, the first contact is the project manager who will attempt to
resolve the issues with, as necessary, the assistance of one of the Managing
Directors.
Project Schedule
The schedule following is predicated on an effective start date in later August with
completion in approximately five to six months.
Project Cost
We understand the importance of this study as one of many strategies to address
current human resource issues and realize the delicate nature of City spending.
Therefore, we have proposed a sensible fee schedule that generates project results
destined to add value to the City. It will provide the flexibility necessary to attract,
retain, and motivate employees to provide quality services and ensure the system is
not an administrative and/or costly burden to the City, now or in the future.
We would not like fees to be the major impediment to acquiring the most
experienced provider to address these important needs during this unprecedented
time period. We would be pleased to explore options that may reduce the fees to fit
your budget.
Our fees to conduct the project outlined (including out of pocket expenses) will not
exceed $115,000.
G:; Fox Lawson & Associates
6 Pa D..isi.. of Gallagher 6
FOX LAWSON AND ASSOCIATES
QUALIFIED CONSULTANTS
BRUCE G. LAWSON, MPA, CCP, IPMA-CP — PROJECT DIRECTOR
Mr. Lawson is a Managing Director of the firm. In this capacity, Mr. Lawson serves as the project
director and/or technical advisor, providing technical direction and quality assurance. He is responsible
for all consulting activities in the areas of job evaluation and compensation, organization analysis,
personnel systems and policy development. Mr. Lawson has been directing classification and
compensation studies for more than 30 years. Prior to forming Fox Lawson, he spent 15 years with the
firm of Ernst & Young LLP where he served as the national director of their public sector compensation
consulting practice. He also served as City Manager in two California cities (Los Altos Hills and
Belvedere), was the County Administrative Officer in Multnomah County (Portland) Oregon, Assistant
City Manager/Personnel Director in Corvallis, Oregon, and Assistant to the City Administrator/Personnel
Director in Placentia, CA. Mr. Lawson served on the City of Phoenix (AZ) Public Safety Employees
Retirement Board for 12 years. Mr. Lawson has a Master's Degree in Public Administration from the
California State University at Fullerton and is a.b.d. in Public Administration from Golden Gate University
in San Francisco, and has earned his CCP certification from WorldatWork. He is also an active member .
of several professional associations including the College & University Professional Association for
Human Resources, the International City & County Management Association, International Public
Management Association for Human Resources, the Society for Human Resources Management, and
WorldatWork.. Mr. Lawson co-authors a monthly compensation article called the CompDoctorTM. Bruce
is located in Phoenix, AZ.
JAMES C. FOX, Ph.D., IPMA-CP —TECHNICAL ADVISOR AND ALTERNATE PROJECT DIRECTOR
Dr. Fox is a Managing Director of the firm. In this capacity, he serves as project director and/or technical
advisor on all projects, providing technical direction and quality assurance. He is responsible for all
consulting activities in the areas of personnel management, job evaluation and compensation,
organization and management analysis, executive compensation, and survey research. Dr. Fox has been
directing classification and compensation studies for more than 25 years. Prior to forming the firm, he
was a Partner in the firm of Ernst & Young LLP and headed up the firm's regional compensation practice,
with national responsibility for the public sector compensation practice. Dr. Fox holds both M.A. and
Ph.D. Degrees in Sociology from the University of Minnesota. He has been an instructor at Metropolitan
State University and the University of Minnesota, and has been a guest lecturer at regional conferences
and meetings. He is a member of the Society of Human Resource Management, WorldotWork,where he
is on the faculty, and was the Professional Development Coordinator of the Compensation Council of the
Twin Cities Personnel Association. He is the Chairman of the Human Resources Committee of the Board
of the Northern Star Council of the Boy Scouts, the past Chairman of the Board of Project Pathfinder and
is a member of the Ramsey County Personnel Review Board, Dr. Fox co-authors a monthly
compensation article called the CompDoctor TM. Jim is located in St. Paul, MN.
HEIDI NELSON, CCP, CBP, IPMA-CP— SENIOR CONSULTANT
Ms. Nelson is a Senior Consultant of the firm. She is responsible for leading and conducting
compensation consulting projects. She has been conducting compensation studies for our firm for over
20 years andspecializes in base pay compensation, total compensation, survey research, pay
administration planning, and executive compensation. Ms. Nelson has worked with all types of
organizations, including states, cities, counties, colleges, school districts, universities, special districts,
and private sector organizations includingconducting two prior studies for the City of Kansas City. Prior
to joining the firm, Ms. Nelson spent 6 years serving in a similar capacity with Ernst & Young. Ms.
Nelson attended the University of Minnesota specializing in Business Management and has completed
FOX LAWSON AND ASSOCIATES
QUALIFIED CONSULTANTS
continuing education coursework from the same institution in Industrial Relations, Methodology and
Design of Salary Surveys, and Compensation Administration, and has earned her CCP and CBP
certifications from WorldotWork. She is a member of the International Public Management Association
for Human Resources, and WorldatWork. Heidi is located in St. Paul, MN.
MIKE VERDOORN, MA-HRIR, CCP, IPMA-CP— SENIOR CONSULTANT
Mr. Verdoorn is a Senior Consultant with the firm. He is responsible for conducting classification and
compensation consulting projects. He has been conducting classification and compensation studies for
our firm for 6 years and specializes in the areas of classification, job evaluation and compensation,
survey research, executivecompensation, and statistical analysis. Mr. Verdoorn has worked with various
types of organizations including states, cities, counties, school districts, colleges, universities,
specialdistricts, and private sector organizations. Prior to joining the firm Mr. Verdoorn was a
compensation analyst with Imation, a computer disk storage manufacturer. Mr. Verdoorn has a
Bachelor's Degree in History from the University of Minnesota and a Master's Degree in Human
Resources and Industrial Relations from the same institution, and has earned his CCP certification from
WorldotWork. He is a member of the International Public Management Association for Human
Resources, and WorldotWork. Mike is located in St. Paul, MN.
GAIL MERIWEATHER, MBA
Ms. Meriweather is an Area Vice President for Human Resources Consulting Services. She will
assist with the market analyses and salary structure design. Prior to joining Gallagher in
2001, she was a partner with Burgess & Associates, a consulting firm located in Lenexa,
Kansas. She has extensive training and experience in designing and implementing
compensation systems including executive compensation, incentives, traditional and
alternative rewards. She has assisted clients with job analysis, job evaluations, external
market analysis, and salary structure design and administration. Ms.,Meriweather provides
develops employee handbooks, affirmative action plans, job descriptions, performance
management systems and management training programs. She has BA in Business
Administration fromthe University of Missouri Kansas City and an MBA from the same
institution. Gail is based in our Kansas City, MO office.
ANNETTE HOEFER, MBA, CCP
Ms. Hoefer is a Senior Consultant. She is responsible for conducting classification and
compensation consulting projects. She has been conducting classification and compensation
studies for our firm for 5 years and specializes in the areas of classification, job evaluation and
compensation, personnel systems and policy development, performance management systems,
employee communications, strategy discussions, pay administration planning, and focus group
facilitation. Ms. Hoefer has worked with various types of organizations including states, cities,
counties, colleges, universities, special districts, and private sector organizations. Prior to
joining the firm, Ms. Hoefer worked for 9 years in the same capacity at Lee and Burgess
Associates, a'consulting firm based in Colorado, and prior to that, had held human resources
positions in energy and insurance companies. Ms. Hoefer has a Bachelor's Degree in Business
Administration from the University of Iowa and a Master's Degree in Business Administration
with an emphasis in Human Resources from same institution, and has earned her CCP
certificationfrom WorldatWork. Annette is located in Cedar Rapids, IA.
FOX LAWSON AND ASSOCIATES
QUALIFIED CONSULTANTS
LORI MESSER, MA, CCP
Ms. Messer is a Senior Consultant of the firm. She is responsible for conducting classification
and compensation consulting projects. Ms. Messer has worked with and for a variety of public
and private sector organizations, including states, cities, counties, school districts, colleges,
universities, and special districts. Prior to joining the firm, Ms. Messer held a variety of
consultative human resources and compensation positions in high tech, distribution, healthcare
and local government organizations. Ms. Messer has a Bachelor's Degree in Business
Administration from Arizona State University and a Master's Degree in Education from the
University of Phoenix. She is also a member of WorldotWork and has earned her CCP
certification. Lori is based in Phoenix, AZ.
SANDRA SPELLMAN, MPA, IPMA-CP
Ms. Spellman is a Senior Consultant with the firm. She is responsible for conducting classification, job
evaluation, and human resource process consulting projects. She has been conducting studies for our
firm for 4 years and specializes in the areas of classification, communications, human resource strategy
and process, and employee and management focus group meetings. Ms. Spellman has worked with
various types of organizations including states, cities, counties, colleges and universities, and the federal
government. Prior to joining the firm, Ms. Spellman spent 18 years with Ernst & Young's consulting
practices where she was responsible for client and internal change management, communications, and
training strategies. She has also held state executive and legislative positions addressing a wide range of
human resource and related issues. Ms. Spellman has a Bachelor's Degree in Sociology/Political Science
from Arizona State University and a Master's Degree in Public Administration with an emphasis in
Organizational Development from the same institution. She is a member of several professional
associations, including the College & University Professional Association for Human Resources,
International Public Management Association for Human Resources, and WorldotWork. Sandy is located
in Washington, DC.
CHELSEA CHRISTIE, BS-HRIR, CCP, GRP
Ms. Christie is a Consulting Associate with the firm. She is responsible for providing supportduring all
phases of classification and compensation studies. She has been supporting classification and
compensation studies for our firm for 2 years and specializes in the areas of classification, job evaluation
and compensation, survey research, and job description preparation. Ms. Christie has worked with
various types of organizations including states, cities, counties, school districts, colleges, universities,
and special districts. Prior to joining the firm Ms. Christie worked at Aramark as a Student Hiring
Manager and also completed a competitive internship with Cargill, Inc. Ms. Christie has a Bachelor's
Degree in Human Resources and Industrial Relations, and Insurance/Risk Management from the
University of Minnesota, and has earned her CCP certification from WorldatWork. She is a member of
the Twin Cities Compensation Network (TCCN) and WorldotWork. Chelsea is located in St. Paul, MN.
EXHIBIT B
SCHEDULE OF BILLING RATES
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page B-1
Fox Lawson & Associates
a DKsian a(CallaghcrBrnefnSmica, Irc.
EXHIBIT C
1. INSURANCE REQUIREMENTS — PROFESSIONAL SERVICE=S
1.1 Provision of Insurance. Without limiting Consultant's indemnification of
City, and prior to commencement of Work, Consultant shall obtain, provide and maintain
at its own expense during the term of this Agreement, policies of insurance of the type
and amounts described below and in a form satisfactory to City. Consultant agrees to
provide insurance in accordance with requirements set forth here. If Consultant uses
existing coverage to comply and that coverage does not meet these requirements,
Consultant agrees to amend, supplement or endorse the existing coverage.
1.2 Acceptable Insurers. All insurance policies shall be issued by an
insurance company currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California, with an assigned policyholders' Rating
of A- (or higher) and Financial Size Category Class VII (or larger) in accordance with the
latest edition of Best's Key Rating Guide, unless otherwise approved by the City's Risk
Manager.
1.3 Coverage Requirements.
1.3.1 Workers' Compensation Insurance. Consultant shall maintain
Workers' Compensation Insurance, statutory limits, and Employer's Liability Insurance
with limits of at least one million dollars ($1,000,000) each accident for bodily injury by
accident and each employee for bodily injury by disease in accordance with the laws of
the State of California, Section 3700 of the Labor Code.
1.3.1.1 Consultant shall submit to City, along with the certificate
of insurance, a Waiver of Subrogation endorsement in favor of City, its officers, agents,
employees and volunteers.
1.3.2 General Liability Insurance. Consultant shall maintain commercial
general liability insurance, and if necessary umbrella liability insurance, with coverage at
least as broad as provided by Insurance Services Office form CG 00 01, in an amount
not less than one million dollars ($1,000,000) per occurrence, two million dollars
($2,000,000) general aggregate. The policy shall cover liability arising from premises,
operations, products -completed operations, personal and advertising injury, and liability
assumed under an insured contract (including the tort liability of another assumed in a
business contract) with no endorsement or modification limiting the scope of coverage
for liability assumed under a contract.
1.3.3 Automobile Liability Insurance. Consultant shall maintain
automobile insurance at least as broad as Insurance Services Office form CA 00 01
covering bodily injury and property damage for all activities of the Consultant arising out
of or in connection with Work to be performed under this Agreement, including coverage
for any owned, hired, non -owned or rented vehicles, in an amount not less than one
million dollars ($1,000,000) combined single limit each accident.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page C-1
1.3.4 Professional Liability (Errors & Omissions) Insurance. Consultant
shall maintain professional liability insurance that covers the Services to be performed
in connection with this Agreement, in the minimum amount of one million dollars
($1,000,000) per claim and in the aggregate. Any policy inception date, continuity date,
or retroactive date must be before the effective date of this agreement and Consultant
agrees to maintain continuous coverage through a period no less than three years after
completion of the services required by this agreement.
1.4 Other Insurance Requirements. The policies are to contain, or be
endorsed to contain, the following provisions:
1.4.1 Waiver of Subrogation. All insurance coverage maintained or
procured pursuant to this agreement shall be endorsed to waive subrogation against
City, its elected or appointed officers, agents, officials, employees and volunteers or
shall specifically allow Consultant or others providing insurance evidence in compliance
with these requirements to waive their right of recovery prior to a loss. Consultant
hereby waives its own right of recovery against City, and shall require similar written
express waivers from each of its subconsultants.
1.4.2 Additional Insured Status. All liability policies including general
liability, excess liability, pollution liability, and automobile liability, but not including
professional liability, shall provide or be endorsed to provide that City and its officers,
officials, employees, and agents shall be included as insureds under such policies.
1.4.3 Primary and Non Contributory. All liability coverage shall apply on
a primary basis and shall not require contribution from any insurance or self-insurance
maintained by City.
1.4.4 Notice of Cancellation. All policies shall provide City with thirty (30)
days notice of cancellation (except for nonpayment for which ten (10) days notice is
required) or nonrenewal of coverage for each required coverage.
1.5 Additional Agreements Between the Parties. The parties hereby agree to
the following:
1.5.1 Evidence of Insurance. Consultant shall provide certificates of
insurance to City as evidence of the insurance coverage required herein, along with a
waiver of subrogation endorsement for workers' compensation and other endorsements
as specified herein for each coverage. Insurance certificates and endorsement must be
approved by City's Risk Manager prior to commencement of performance. Current
certification of insurance shall be kept on file with City at all times during the term of this
Agreement. City reserves the right to require complete, certified copies of all required
insurance policies, at any time.
1.5.2 City's Right to Revise Requirements. The City reserves the right at
any time during the term of the Agreement to change the amounts and types of
insurance required by giving the Consultant sixty (60) days advance written notice of
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page C-2
such change. If such change results in substantial additional cost to the Consultant, the
City and Consultant may renegotiate Consultant's compensation.
1.5.3 Enforcement of Agreement Provisions. Consultant acknowledges
and agrees that any actual or alleged failure on the part of the City to inform Consultant
of non-compliance with any requirement imposes no additional obligations on the City
nor does it waive any rights hereunder.
1.5.4 Requirements not Limiting. Requirements of specific coverage
features or limits contained in this Section are not intended as a limitation on coverage,
limits or other requirements, or a waiver of any coverage normally provided by any
insurance. Specific reference to a given coverage feature is for purposes of clarification
only as it pertains to a given issue and is not intended by any party or insured to be all
inclusive, or to the exclusion of other coverage, or a waiver of any type.
1.5.5 Self-insured Retentions. Any self-insured retentions must be
declared to and approved by City. City reserves the right to require that self-insured
retentions be eliminated, lowered, or replaced by a deductible. Self-insurance will not be
considered to comply with these requirements unless approved by City.
1.5.6 City Remedies for Non Compliance If Consultant or any
subconsultant fails to provide and maintain insurance as required herein, then City shall
have the right but not the obligation, to purchase such insurance, to terminate this
agreement, or to suspend Consultant's right to proceed until proper evidence of
insurance is provided. Any amounts paid by City shall, at City's sole option, be
deducted from amounts payable to Consultant or reimbursed by Consultant upon
demand.
1.5.7 Timely Notice of Claims. Consultant shall give City prompt and
timely notice of claims made or suits instituted that arise out of or result from
Consultant's performance under this Agreement, and that involve or may involve
coverage under any of the required liability policies.
1.5.8 Consultant's Insurance. Consultant shall also procure and
maintain, at its own cost and expense, any additional kinds of insurance, which in its
own judgment may be necessary for its proper protection and prosecution of the Work.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page C-3
ATTACHMENT B
Fox Lawson and Associations, a Division of Gallagher Benefits Services Inc.
Client List
Public Sector - California (partial list)
Cities
• City of Beverly Hills
• City of Carlsbad
• City of Carson
• City of Davis
• City of Desert Hot Springs
• City of Encinitas
City of Fremont
• City of Fresno
City of Hanford
• City of Healdsburg
• City of Hercules
• City of Larkspur
• City of Mountain View
• City of Newport Beach
® City of Oceanside
• City of Orinda
City of Palo Alto
• City of Rancho Cucamonga
• City of Sacramento
• City of San Clemente
• City of San Francisco
• City of San Jose
• City of San Jose Redevelopment
Agency
• City of San Ramon
• City of Santa Ana
• City of Santa Cruz
• City of Walnut Creek
• City of West Hollywood
• Town of Windsor
Counties
• Alameda County Office of Education -
Oakland
• California State Association of Counties
Contra Costa County
• EI Dorado County
• Kern County, CA - Bakersfield, CA
• Los Angeles County Department of
Health Services
• Los Angeles County Office of the Chief
Administrative Officer
• Los Angeles Free Clinic
• Marin County
• Monterey County
• Sacramento County
• San Francisco County
• Santa Cruz County
Colleges
• University of CA, Berkley
• University of California at Los Angeles
(UCLA)
Public Schools
• Beverly Hills Unified School District
• Coachella Valley Water District
® Compton Unified School District
• Elk Grove Unified School District
• Los Angeles Unified School District
• Orange Unified School District
• Sacramento City Unified School District
• Santa Clara Valley Transportation
Authority
• Santa Clara Valley Water District
• Yuba City Unified School District
Other
Association of Bay Area Governments -
Oakland, CA
• Contra Costa Retirement Assoc
• CSAC — Excess Insurance Authority
• Desert Hospital — Palm Springs
• Irvine Ranch Water District - Irvine, CA
• Law Firm of Carroll, Burdick, &
McDonough
Long Beach Transit
• Los Angeles City Housing Authority -
Los Angeles, CA
• Los Angeles Regional Family Planning
Council, Inc.
• The Law Office of Mark Merin
• Menlo Park Fire District
• North County Transit District
Orange County Fire Authority - Orange,
CA.
• Orange County Superior Court
Orange County Transit Authority
• Orange County Water District -
Fox Lawson and associations, a Division of Gallagher Benefits Services Inc.
Private Sector (partial list)
Advertising and Public Relations
Carmichael Lynch
• MIVA
Shark Radio
Young and Laramore
Business and Professional Services
•
Calence
•
CASHFLOW Technologies, Inc.
•
CAT Auctions
•
Corvu Technologies
•
Grant Thornton, LLP
•
Great Clips
•
IC Systems
•
JUUT Salonspa
•
Maxsys, Inc
•
Med Management
•
Meritex Enterprises
•
Nelson, Tietz & Hoye
•
PDW
•
PriceWaterhouseCoopers
•
Space Center Enterprises
•
Tesseract Group
•
The Registry
•
The Structure Group
•
Value Rx
Communication
Industrial Motion, Inc.
Construction
• Kraus -Anderson Companies
Engineers, Architects and Planners
Bonestroo, Rosene, Anderlik & Associates
• Moore Engineering
• Olsson Associates
• Schafer, Kline, and Warren, Inc.
• Willdan Associates
Finance,
Banking and Insurance
•
Anchor Bancorp
Appleton Paper
Blue Cross/Blue Shield of Minnesota
•
J.G. Kinnard & Co.
•
Little Six, Inc, MN
®
Mark Twain Bancshares
•
Midwest Security
Douglas Machine, Inc.
Olympic Financial
•
Tucson Federal Credit Union
•
United Healthcare Corporation
Client List
Food and Agriculture
• GFI America
• Michael Foods, Inc.
Gaming/Entertainment/Hospitality
• Black Angus Steakhouse
• Burke Williams Spa
Southwest Casino
• Sportsman's Recipes
• Win -River Casino
Manufacturing
•
Andersen Corporation
•
Appleton Paper
BMC Industries Inc.
•
Computype
•
Cretex
•
Dahlberg, Inc.
•
Douglas Machine, Inc.
•
Dura Supreme
•
Federal Mogul Corporation
Lake Region Manufacturing Co.
•
LubeTech
•
Magnequench International, Inc
Micro Dynamics
•
Mobile Mini
•
Prosthetic Laboratories
Tescom
•
Tioga, Inc
•
Valspar Corporation
Pharmaceuticals
• CIMA Labs
• Collagen Corporation
Retail and Wholesale Trade
• Kohl's Department Stores
• Marshall Field's
• Northern Hydraulics, Inc.
• Schneiderman's
• Target Stores
Transportation and Communication
• Badlands Power Fuels, Inc
• Frontier Communications
• Matanuska Telephone Association, AK
• Northwest Airlines
• Southwestern Bell Telephone Company
• Sprint