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02-28-2024 WS City Council Agenda
W O R K S E S S IO N R IC H F IE L D MU N IC IPAL C E N TE R, B AR TH O LO ME W R O O M F E B R U ARY 28, 2024 5:45 P M C all to order 1.Review the results and explore options to implement the findings of the compensation and class study from B aker Tilly. A djournment Auxiliary aids for individuals with disabilities are available upon request. Requests must be made at least 96 hours in advance to the City Clerk at 612-861-9739. AGENDA SECTION:Work Session Items AGENDA ITEM #1. STAFF RE P ORT NO. 06 WORK SESSION 2/28/2024 RE P O RT P RE PA RE D B Y: S ack Thongvanh, A ssistant C ity Manager D E PA RTME NT D IRE C TO R RE V IE W: O THE R D E PA RTM E NT RE V IE W: C ITY MA NA G E R RE V IE W: K atie Rodriguez, C ity Manager 2/28/2024 I T E M F O R WO RK S E S S IO N: Review the results and explore options to implement the findings of the compensation and class study from Baker Tilly. E X E C UT IV E S UM M ARY: I n 2023, the City established a committee tasked with selecting a firm to conduct a comprehensive compensation and class study and help manage the project. The purpose of this study is to evaluate and analyze the current compensation and classification structure within the City's workforce. T he City initiated a selection process, which included a presentation and interview phase. Multiple firms were invited to present their proposals and engage in interviews with the committee. T he Committee ultimately selected Baker Tilly as the firm to conduct the compensation and class study. Baker Tilly was chosen based on their demonstrated capability, experience, and proposed methodology, which aligns closely with the City's needs and expectations. T he compensation and class study represents a significant milestone in the City's efforts to ensure equitable and effective compensation practices for its workforce. It has been over 20 years since the City has contracted for a comprehensive review of their compensation and class practices. T he study conducted by Baker Tilly provides valuable analysis and recommendations to inform future decisions regarding employee compensation and classification for the City. Baker Tilly's presentation tonight will focus on: 1. Project Overview 2. Market Assessment 3. Pay Plan Development 4. Grade Assignment 5. I mplementation Scenarios Finally, Baker Tilly will provide recommendations for Council consideration and approval at later meetings. D IRE C T I O N NE E D E D: Staff would like direction on next steps. The Council should provide direction to proceed with one of the compensation implementation options outlined in the Baker Tilly study or direct the consultant and staff to present information on additional options at a future meeting. B AC K G RO UND INF O RM AT I O N: A .H IS TOR IC AL C ON T E X T W hile the C ity has not conducted a comprehensive review of its entire compensation structure in over two decades, it has regularly conducted targeted market analyses for specific positions. Recent adjustments for liquor store associates and seasonal recreation staff demonstrate the C ity's responsiveness to evolving market conditions. In addition, negotiations with represented employees include compensation comparisons to peer cities which are then implemented via collective bargaining agreements. The C ity also regularly researches market comparisons when there is turnover in non-represented positions. B .E QU ITAB L E OR S T R AT E GIC C ON S ID E R AT ION S OR IMPAC T S The compensation and class study plays an important role in ensuring that the C ity maintains competitiveness in the marketplace by aligning with the strategic priority for a high-quality workforce. This study evaluates the compensation structure of positions within the organization to ensure that they are in line with industry standards and comparable to those offered by other peer employers in the market. The development of the proposed pay plan is based in S A F E scores for each position. The S A F E scores provide a more objective and consistent method to evaluate how positions are assigned to pay grades. This ensures better pay equity and will allow the C ity a better system to use for future job evaluations so that pay equity is maintained. In sum, investing in a high-quality workforce through competitive and equitable compensation and classification practices is essential for the C ity to achieve its strategic priorities and deliver high-quality services to its residents. C .P OL IC IE S (resolutions, ordinances, regulations, statutes, exc): D .C R IT IC AL T IMIN G IS S U E S: S taff need time to implement any of the options and employees are eager to learn the impact on their individual compensation. In addition, the compensation and class findings and implementation will inform negotiations. E .F IN AN C IAL IMPAC T: The financial impact will depend on which implementation option is chosen by the C ity C ouncil. The current options provided by B aker Tilly do calculate the impact on salaries for all staff, including those employees who are represented by unions, in order to provide high-level estimates. However, the final compensation for these employees will be determined by their collective bargaining agreements which are currently being negotiated or will be soon. In addition, B aker Tilly and staff will not be able to thoroughly review and refine the financial impacts until C ouncil provides further direction. B aker Tilly's estimated annual impact does not include additional C ity F IC A and P E RA costs. The estimates for these costs are below: Option 1 F IC A and P E RA : $45,000 , C ombined Total $328,000 Option 2a F IC A and P E RA : $71,000, C ombined Total $520,000 Option 2b F IC A and P E RA : $76,000, C ombined Total $548,000 The 2024 budget allocated just under $400,000 to implement the findings of the compensation and class study. One option is to implement the study starting in the second quarter, A pril 1, which lessens the budget shortfall for 2024 and allows staff time to thoroughly review the impact on individual employees and process the changes in HR and payroll. If the options were implemented on A pril 1, the estimated F Y2024 impact is as follows: Option 1 Total A pril 1 Implementation: $246,000 Option 2a Total A pril 1 Implementation: $390,000 Option 2b Total A pril 1 Implementation: $411,000 B aker Tilly and staff are still calculating the impact on the specialized pay plans which includes seasonal recreation staff and liquor store associates. B ecause the C ity made market adjustments last year, we believe these impacts will be minimal. The full impact to the F Y2024 budget will depend on the final pay structures, including with the represented employees. There are also savings due to vacancies and turnover each year. These details will be determined as part of the F Y2024 Revised B udget process. The high level projected impact to the F Y2025 levy is approximately 1.25% for Option 1 to 2.25% for Option 2b. We estimate that will push levy increases to 6.5% to 7% for the next couple years. It also limits flexibility for future staff additions. We have contracted with our financial advisors, E hlers, to provide a more comprehensive long-term forecast as part of the 2024 Revised/2025 P roposed budget process. F.L E GAL C ON S ID E R AT ION: ALTE R N AT IV E(S): Council can direct Baker Tilly and staff to research additional implementation scenarios to present at a later meeting date. P R IN C IPAL PAR TIE S E X P E C TE D AT ME E TIN G: J amie Haefner, Human Resources Manager Sack Thongvanh, Assistant City Manager/Administrative Service Director Lexi Scholten, Senior Consultant for Baker Tilly AT TAC H ME N T S: D escription Type 2024 P roposed P ay Grades Non-Union F INA L _2-23-24 (General P ay Grades)E xhibit 2024 P ay P lan (General)E xhibit 2024 P roposed P ay Grades Non-Union 2.23.24(S pecialized P ay P lan)E xhibit 2024 P ay P lan (S pecialized)E xhibit F INA L - Richfield B enefits Report - 2.23.24 B ackup Material C ity of Richfield, M N - F inal P resentation 2.28.24 P resentation DepartmentDivisionTitleProposed TitleGradeEXECUTIVECity ManagerCITY MANAGER22ADMINISTRATIVE SERVICESAdministrationASSISTANT CITY MANAGER20COMMUNITY DEVELOPMENT Community Development COMMUNITY DEVELOPMENT DIRECTOR20FIREFireFIRE SERVICES DIRECTOR20POLICEPolice OperationsPUBLIC SAFETY DIRECTOR20PUBLIC WORKSPublic Works AdminPUBLIC WORKS DIRECTOR20RECREATIONRecreationRECREATION SERVICES DIRECTOR20FINANCEFinanceFINANCE DIRECTOR20POLICEPolice OperationsDEPUTY PUBLIC SAFETY DIRECTOR18PUBLIC WORKSStreetDEPUTY PW DIRECTOR18ADMINISTRATIVE SERVICES Human ResourcesHUMAN RESOURCES MANAGER17COMMUNITY DEVELOPMENT Community DevelopmentHOUSING/REDEVELOPMENT MANAGER/ASSISTANT COMMUNITY DEVELOPMENT DIRECTORASSISTANT CD DIRECTOR17FIREFireASST FIRE CHIEF17PUBLIC WORKSEngineeringCITY ENGINEER17ADMINISTRATIVE SERVICES Information Technology IT MANAGER16ADMINISTRATIVE SERVICES Liquor OperationsLIQUOR OPERATIONS MANAGER16PUBLIC WORKSWaterUTILITY SUPERINTENDENT16COMMUNITY DEVELOPMENT Community Development CHIEF BUILDING OFFICIAL16ADMINISTRATIVE SERVICES Building ServicesGOVERNMENT BLDGS SUPERINTENDNT16ADMINISTRATIVE SERVICES CommunicationCOMMUNICATIONS MANAGER15COMMUNITY DEVELOPMENT Community Development CITY PLANNER15COMMUNITY DEVELOPMENT Community Development ECONOMIC DEVELOPMENT MANAGER15RECREATIONRecreationFACILITY/PROGRAM MANAGER ‐ POOL/ARENA15PUBLIC WORKSWaterASSISTANT UTILITIES SUPERINTD15PUBLIC WORKSEngineeringTRANSPORTATION ENGINEER15FINANCEFinanceASSISTANT FINANCE DIRECTOR15ADMINISTRATIVE SERVICES Information Technology ASST IT MANAGER/BUS ANALYST14ADMINISTRATIVE SERVICES Deputy RegistrarCITY CLERK14PUBLIC WORKSCentral GarageOPERATIONS SUPERVISOR14PUBLIC WORKSWaterUTILITIES SUPERVISOR142024 Proposed Pay PlanGENERAL PAY PLAN 2024 Proposed Pay PlanGENERAL PAY PLANRECREATIONRecreationFACILITY/PROGRAM MANAGER14POLICESupport ServicesSUPPORT SERVICES SUPERVISOR14COMMUNITY DEVELOPMENT Community Development MULTI FAMILY HOUSING PRGM ADMN14ADMINISTRATIVE SERVICES Liquor OperationsLIQUOR STORE MANAGER13FINANCEFinanceACCOUNTANT13FINANCEFinancePAYROLL ACCOUNTANT13RECREATIONRecreationRECREATION SUPERVISOR ‐ FACILITIES13COMMUNITY DEVELOPMENT Community Development SENIOR BUILDING TRADE INSPECTOR13EXECUTIVECity ManagerMANAGEMENT ANALYSTSR. ANALYST13PUBLIC WORKSPublic Works AdminMANAGEMENT ANALYSTSR. ANALYST13PUBLIC WORKSEngineeringCIVIL ENGINEER13PUBLIC WORKSPublic Works Admim GIS COORDINATOR12ADMINISTRATIVE SERVICES Deputy RegistrarMOTOR VEHICLE/LIC SUPERVISOR12COMMUNITY DEVELOPMENT Community Development PLANNER II12EXECUTIVECity ManagerEQUITY COORDINATOR12POLICEPolice OperationsEXECUTIVE AIDE/ANALYSTANALYST12RECREATIONRecreationEXECUTIVE AIDE/ANALYSTANALYST12PUBLIC WORKSWaterWATER RESOURCE ENGINEER12RECREATIONWood Lake Nature Center NATURALIST12RECREATIONRecreationRECREATION SUPERVISOR12COMMUNITY DEVELOPMENT Community Development BUILDING/TRADE INSPECTOR12POLICEPolice OperationsRECORDS SUPERVISOR12RECREATIONWood Lake Nature Center SUSTAINABILITY SPECIALIST12COMMUNITY DEVELOPMENT Community Development MECHANICAL/PLUMBING INSPECTOR12ADMINISTRATIVE SERVICES Human ResourcesHUMAN RESOURCES SPECIALIST11ADMINISTRATIVE SERVICES Information Technology IT TECH/HELP DESK11POLICESupport ServicesCODE COMPLIANCE OFFICER11ADMINISTRATIVE SERVICES Information Technology IT TECHNICIAN11PUBLIC WORKSEngineeringENGINEERING TECHNICIAN11POLICEPolice OperationsCRIME PREVENTION SPECIALIST10PUBLIC WORKSStreetFORESTER10ADMINISTRATIVE SERVICES CommunicationCOMMUNICATIONS SPECIALIST10COMMUNITY DEVELOPMENT Community Development HOUSING SPECIALIST 10COMMUNITY DEVELOPMENT Community Development PLANNER I10 2024 Proposed Pay PlanGENERAL PAY PLANPOLICE Police Operations POLICE DATA & MEDIA SPECIALIST10POLICE Police Operations RECORDS TECHNICIAN10PUBLIC WORKS Engineering ENGINEERING ASSISTANT10ADMINISTRATIVE SERVICES Deputy Registrar LEAD LICENSING CLERK LEAD LICENSING TECHNICIAN9COMMUNITY DEVELOPMENT Community Development ASSISTANT PLANNER PLANNING TECHNICIAN9COMMUNITY DEVELOPMENT Community Development PERMIT TECHNICIAN9EXECUTIVE City Manager ADMINISTRATIVE ASSISTANT9POLICE Support Services HEALTH/LICENSING SPECIALIST9ADMINISTRATIVE SERVICES Deputy Registrar LICENSING CLERK LICENSING TECHNICIAN8COMMUNITY DEVELOPMENT Community Development HOUSING INSPECTIONS CLERK8FINANCE Finance ACCOUNTING CLERK ACCOUNTING TECHNICIAN8POLICE Support Services COMMUNITY SERVICE OFFICER 8POLICE Support Services LICENSING CLERK BUSINESS LICENSING TECHNICIAN8POLICE Police Operations SENIOR OFFICE ASST 8PUBLIC WORKS Water UTILITY BILLING CLERK UTILITY BILLING TECHNICIAN8RECREATION Wood Lake Nature Center SENIOR OFFICE ASST 8ADMINISTRATIVE SERVICES Liquor Operations LIQUOR OPERATIONS SHIFT LEADER7COMMUNITY DEVELOPMENT Community Development COMMUNITY DEVELOPMENT TECH 7ADMINISTRATIVE SERVICES Building Services CUSTODIAN 6ADMINISTRATIVE SERVICES Deputy Registrar CITY SERVICES RECEPTIONIST4 Pay Plan - GeneralMinimum Midpoint Maximum2.75% 2.75% 2.75% 2.75% 2.75% 2.75% 2.75% 2.75% 2.75% 2.75%Grade1234567891011Midpoint Differential Step DiffActual Range Spread1 $34,053.01 $34,989.46 $35,951.67 $36,940.34 $37,956.20 $39,000.00 $40,072.50 $41,174.49 $42,306.79 $43,470.23 $44,665.66 7.0% 2.75% 31.2%2 $36,436.72 $37,438.73 $38,468.29 $39,526.17 $40,613.14 $41,730.00 $42,877.58 $44,056.71 $45,268.27 $46,513.15 $47,792.26 7.0% 2.75% 31.2%3 $38,987.20 $40,059.35 $41,160.98 $42,292.91 $43,455.96 $44,651.00 $45,878.90 $47,140.57 $48,436.94 $49,768.95 $51,137.60 7.0% 2.75% 31.2%4 $41,716.68 $42,863.89 $44,042.64 $45,253.82 $46,498.30 $47,777.00 $49,090.87 $50,440.87 $51,827.99 $53,253.26 $54,717.72 7.0% 2.75% 31.2%5 $44,845.19 $46,078.43 $47,345.59 $48,647.59 $49,985.40 $51,360.00 $52,772.40 $54,223.64 $55,714.79 $57,246.95 $58,821.24 7.5% 2.75% 31.2%6 $48,208.58 $49,534.31 $50,896.51 $52,296.16 $53,734.31 $55,212.00 $56,730.33 $58,290.41 $59,893.40 $61,540.47 $63,232.83 7.5% 2.75% 31.2%7 $51,824.31 $53,249.48 $54,713.84 $56,218.47 $57,764.48 $59,353.00 $60,985.21 $62,662.30 $64,385.51 $66,156.12 $67,975.41 7.5% 2.75% 31.2%8 $55,710.72 $57,242.76 $58,816.94 $60,434.40 $62,096.35 $63,804.00 $65,558.61 $67,361.47 $69,213.91 $71,117.29 $73,073.02 7.5% 2.75% 31.2%9 $59,888.76 $61,535.70 $63,227.93 $64,966.70 $66,753.28 $68,589.00 $70,475.20 $72,413.27 $74,404.63 $76,450.76 $78,553.15 7.5% 2.75% 31.2%10 $64,380.26 $66,150.72 $67,969.87 $69,839.04 $71,759.61 $73,733.00 $75,760.66 $77,844.08 $79,984.79 $82,184.37 $84,444.44 7.5% 2.75% 31.2%11 $69,208.81 $71,112.05 $73,067.63 $75,076.99 $77,141.61 $79,263.00 $81,442.73 $83,682.41 $85,983.67 $88,348.22 $90,777.80 7.5% 2.75% 31.2%12 $74,399.71 $76,445.70 $78,547.95 $80,708.02 $82,927.49 $85,208.00 $87,551.22 $89,958.88 $92,432.75 $94,974.65 $97,586.45 7.5% 2.75% 31.2%13 $81,095.92 $92,877.00 $106,369.55 9.0% 31.2%14 $88,394.62 $101,236.00 $115,942.89 9.0% 31.2%15 $99,001.69 $113,384.00 $129,855.67 12.0% 31.2%16 $107,912.23 $123,589.00 $141,543.19 9.0% 31.2%17 $116,005.49 $132,858.00 $152,158.73 7.5% 31.2%18 $121,805.86 $139,501.00 $159,766.78 5.0% 31.2%19 $127,896.11 $146,476.00 $167,755.06 5.0% 31.2%20 $134,291.09 $153,800.00 $176,143.04 5.0% 31.2%21 $141,005.64 $161,490.00 $184,950.19 5.0% 31.2%22 $148,056.36 $169,565.00 $194,198.27 5.0% 31.2%City of Richfield, MN Department Division Title Proposed Title GradeRECREATION Swimming Pool POOL SUPERVISOR105RECREATION Recreation PLAYGROUND COORDINATOR105RECREATION Recreation ADAPTIVE COORDINATOR105RECREATION Recreation FARMERS MARKET COORDINATOR105RECREATION Recreation TENNIS COORDINATOR105RECREATION Ice Arena ICE RESURFACER OPERATOR104RECREATION Swimming Pool HEAD LIFEGUARD104RECREATION Wood Lake Nature Center NATURALIST I SEASONAL NATURALIST104ADMINISTRATIVE SERVICES Communication VIDEO PRODUCTION ASSISTANT103RECREATION Ice Arena AUDIO TECHNICIAN103RECREATION Wood Lake Nature Center CLERK TYPIST OFFICE ASSISTANT103RECREATION Wood Lake Nature Center OFFICE AIDE OFFICE ASSISTANT103PUBLIC WORKS Park Maintenance MAINTENANCE LABORER103ADMINISTRATIVE SERVICES Liquor Operations LIQUOR SALES ASSOCIATE103RECREATION Recreation RECREATION ATTENDANT103RECREATION Recreation ADAPTIVE LEADER/SPECIALIST103RECREATION Swimming Pool LIFEGUARD103RECREATION Recreation PLAYGROUND LEADER102RECREATION Ice Arena ARENA EVENT ATTENDANT102RECREATION Recreation CONCESSION I102RECREATION Recreation INCLUSION FACILITATOR102RECREATION Swimming Pool POOL LEAD CASHIER/CONCESSION102RECREATION Recreation WINTER SPORTS ATTENDANT102RECREATION Ice Arena FACILITY CASHIER1012024 Proposed Pay PlanSPECIALIZED PAY PLAN Pay Plan - SpecializedMinimum Midpoint Maximum2.75% 2.75% 2.75% 2.75%Grade 1 2 6 10 11Midpoint DifferentialActual Range Spread 1 2 3 4 5101 $29,783.39 $30,602.43 $31,444.00 $32,308.71 $33,197.20 7.5% 11.5% $14.32 $14.71 $15.12 $15.53 $15.96102 $32,016.86 $32,897.32 $33,802.00 $34,731.56 $35,686.67 7.5% 11.5% $15.39 $15.82 $16.25 $16.70 $17.16103 $34,417.98 $35,364.48 $36,337.00 $37,336.27 $38,363.01 7.5% 11.5% $16.55 $17.00 $17.47 $17.95 $18.44104 $36,999.07 $38,016.55 $39,062.00 $40,136.21 $41,239.95 7.5% 11.5% $17.79 $18.28 $18.78 $19.30 $19.83105 $39,774.33 $40,868.13 $41,992.00 $43,146.78 $44,333.32 7.5% 11.5% $19.12 $19.65 $20.19 $20.74 $21.31City of Richfield, MN P a g e | 1 Pay Plan and Benefits Practices Executive Summary Peer organizations identified for the market study were also asked to provide information related to their pay plan, paid tim e off, health benefits, and retirement benefits. Baker Tilly collected data from twelve (12) peer organizations. Six (6) peer organizations completed the benefits portion of the market survey, and the other peer organizations’ benefit and personnel data were located online. The peer data located on line was matched by Baker Tilly. Participating organizations include: • City of Brooklyn Center* • City of Lino Lakes* • City of Cottage Grove* • City of Maplewood* • City of Eagan • City of Oakdale* • City of Fridley • City of Roseville • City of Hopkins • City of Savage* • City of Inver Grove Heights • City of Shakopee * Indicates organization data was matched by Baker Tilly Pay Plan Design • Ten (10) peers have adopted a formal pay plan and eight (8) peers use multiple pay plans. • Ten (10) peers utilize a grade and step pay plan. Time Off • Nine (9) peers’ average number of annual paid holidays is 12.22 days, which is higher than the City of Richfield’s 11 annual holidays – these are not inclusive of any floating holiday amounts. • Like the City of Richfield, five (5) peers utilize a vacation-sick/personal model. • Eight (8) peers allow employees to accrue an average maximum accrual of 33.33 days, which is comparable to City of Richfield’s 31 maximum accrual of vacation days. Health Benefits • Six (6) peers responded to having high deductible health plans (HDHP). • Twelve (12) peers provide life insurance policies to their employees at no cost, with varying benefit amounts. Other Benefits • Five (5) peers provide pay increases to part-time and/or intermittent employees. • Three (3) peers do not assign Public Works on-call based on seniority, while two (2) peers do. One (1) peer reported having a rotating overtime list. • Five (5) peers provide an average of 3.4 weeks of paid parental leave, whereas City of Richfield provides 2 weeks of paid par ental leave. P a g e | 2 Pay Plan and Benefits Practices Pay Plan Design Organizations using an adopted pay plan Number of Responses Responses 10 All responding peers use an adopted pay plan City of Richfield uses adopted pay plans Year current pay plan was adopted Number of Responses Responses 9 2018 or Before (3), 2022 (5), 2023 (1) Organizations using single or multiple pay plans Number of Responses Responses 9 Single (1) , Multiple (8) City of Richfield uses multiple pay plans due to bargaining contracts Type of system for the pay plan Number of Responses Responses 10 All responding peers use a grade and step system. City of Richfield uses an open pay plan for management positions and grade and step pay plans for all other positions Pay Plan and Benefits practices Peer organizations identified for the market study were asked to provide information related to their pay plan, paid time off, health benefits, and retirement benefits. Peer Pay Plan Design Like City of Richfield, ten (10) peers have adopted a formal pay plan. Most peers have multiple pay plans due to bargaining contracts. Ten (10) peers use a grade and step system within their pay plans. P a g e | 3 Pay Plan and Benefits Practices Step Plans (Grades and Steps) Number of Responses Least Most Average # of grades 9 7 30 15.28 % between grades 9 1% 9% 6% # of steps 10 5 13 8.2 % between steps 10 1% 5% 3.2% City of Richfield’s Grade and Step plans vary How pay increases are administered Average Organization-wide & Cost of Living Adjustments (COLA) – (8 responses) 2.00% 2.20% 2.40% 2.60% 2.80% 3.00% 3.20% 3.40% 3.60% 3.80% FY 2021 FY 2022 FY 2023 FY 2024 COLA Organization Wide Number of Responses Responses 9 All responding peers administer pay increases through automatic annual wage or step increases Pay plans On average, peers have 15 grades and 6% between grades. Reporting peers also have an average of 8 steps per grade with an average of 3.2% between steps. The City of Richfield’s grades and steps vary by pay plan. Annual Pay Adjustments Eight (8) reporting peers provide organization-wide and cost of living compensation adjustments. The peer average anticipated cost of living adjustment for 2024 is 3%. P a g e | 4 Pay Plan and Benefits Practices How organizations adjust pay structure Number of Responses Responses 9 Collective bargaining agreement (1) Compensation Study (4) Multiple factors (4) Frequency organizations adjust their pay structure Number of Responses Responses 8 Annually (4) Every 5 years (2) Sporadically (2) Organizations providing longevity pay Adjusting pay structure Nine (9) responding peers adjust their pay structures. Four (4) responding peers adjust their pay structures using a compensation study and four (4) peers adjust their pay structures using multiple factors, like budget process, financial ability, collective bargaining agreements, annual internal reviews, and compensation studies. P a g e | 5 Pay Plan and Benefits Practices Pay Practices On-Call and Standby pay Public Works on-call assigned by seniority Number of Responses Responses 6 Yes (2), No (3), Other (1) City of Richfield on-call assignments are designated by the skills required for specific work that comes up On-Call – (4 responses) Standby – (4 responses) Holidays Overtime rate (1.5x straight time) (2) Double time (2x straight time) (1) Other (please explain) (2) Overtime rate (1.5x straight time) (2) Double time (2x straight time) (1) Other (please explain) (2) Saturdays & Sundays Overtime rate (1.5x straight time) (3) Other (please explain) (1) Overtime rate (1.5x straight time) (3) Other (please explain) (2) Regularly scheduled day off Overtime rate (1.5x straight time) (3) Other (please explain) (1) Overtime rate (1.5x straight time) (2) Other (please explain) (3) City of Richfield provides call-back pay to their employees at straight time On-Call pay Two (2) peers reported other – one (1) pays a minimum of 2 hours at 1.5x straight time and one (1) peer pays a minimum of 3 hours at straight time. Standby pay Three (3) peers reported other – one (1) peer pays $50 per day on a weekday and $100 per day on a holiday or weekend, one (1) peer pays a minimum of 2.5 hours of pay at 1.5x straight time, and one (1) peer pays a minimum of 4 hours at straight time. Public Works On-Call Three (3) peers do not assign Public Works on-call based on seniority, while two (2) peers do. One (1) peer reported having a rotating overtime list. Promotional pay increases One (1) peer selected other - stating longevity steps given at 7, 12, 15 and 20 years in position. P a g e | 6 Pay Plan and Benefits Practices Advancing between pay ranges New hire and employee compensation Number of Responses Responses City of Richfield Minimum % increase with promotion 6 Yes (3) No (3) No Vacancy required prior to promotion 6 Yes (5) No (1) Yes Minimum % increase with reclass to higher grade 5 Yes (1) No (4) No Allow employees to negotiate salary upon promotion 6 Yes (3) No (3) Yes Promotional pay increases automatic upon specific achievement 6 Yes (4) No (2) No Number of Responses Responses City of Richfield New hire employees receive pay rate above starting minimum 6 All responding peers reported new hire employees can receive pay above starting minimum Yes Determination of starting rate above minimum 6 Management Discretion (1) Additional experience OR education (3) Other (please explain) (2) Education & Experience New hire employees allowed to negotiate paid time off accruals 6 Yes (4) No (2) Yes Provide pay increases to part-time and/or intermittent employees 5 Yes (5) Yes Eligibility criteria for part- time/intermittent employee pay increase 5 Dependent on recruitment & retention (1) Based on years of service (2) Fixed annual increase (2) Determination of starting rate Two (2) peers reported using other factors outside of management discretion, education, and experience when determining starting rate for new hires. One (1) peer allows new hires to be paid as high as what is advertised for the hiring range. The peer reported they consider management discretion, education, experience, and current pay. One (1) peer reported starting rates can be negotiated, but council approval is required if the starting rate is beyond midpoint for the specific pay grade. P a g e | 7 Pay Plan and Benefits Practices Calculating overtime for Public Works employees Number of Responses Responses 6 Calculated after 40 hours per week (3) Calculated after 8 hours each day (2) Calculated daily OR weekly (1) City of Richfield provides overtime pay to employees in the following circumstances: working more than 8 hours a day, call-backs, holidays, and unscheduled shifts Time off Number of paid holidays per year (holiday excludes any separate floating holiday) Holidays Nine (9) responding peers provide employees with an average of 12.22 annual paid holidays, which is greater than the City of Richfield’s 11 annual paid holidays. P a g e | 8 Pay Plan and Benefits Practices Offer Vacation – Sick/Personal or Paid Time-Off (PTO) Number of Responses Responses 9 Vacation – Sick/Personal (6) Paid Time Off (3) City of Richfield provides employees with Vacation time, Personal Leave, and Short- Term Disability Floating holidays Eight (8) responding peers provide employees with and average of 1 annual floating holiday, which is less than the City of Richfield’s 2 annual floating holidays. Vacation - Sick or PTO Like the City of Richfield, six (6) peers provide employees with vacation – sick/personal leave, and three (3) peers provide paid time off. One (1) peer offers personal time off in lieu of sick time, like the City of Richfield. P a g e | 9 Pay Plan and Benefits Practices Total Annual Time Off Comparison (in days) (8 responses) Years of Service City of Richfield Least Reported Most Reported Average Reported 0 to 1 year 21.75 18 27 20.25 1 year 21.75 18 27 20.25 2 years 21.75 18 27 20.25 3 years 21.75 18 27 20.25 4 years 21.75 18 27 20.25 5 years 21.75 18 27 22.50 6 years 24.75 18 27 23.75 7 years 24.75 18 27 23.75 8 years 24.75 22 27 24.50 9 years 24.75 22 27 24.87 10 years 24.75 23 27 25.25 11 years 27.75 23 28 25.50 12 years 27.75 23 29 25.75 13 years 27.75 23 32 27.00 14 years 27.75 23 32 27.25 15 years 27.75 23 32 28.62 16 years 29.75 26 33 29.75 17 years 29.75 26 34 30.00 18 years 29.75 26 35 30.62 19 years 29.75 26 36 30.87 20 years 29.75 26 37 31.75 21 years 31.75 26 37 31.87 22 years 31.75 26 37 32.00 23 years 31.75 26 37 32.37 24 years 31.75 26 37 32.50 25 years 31.75 26 37 32.62 25+ years 32.75 26 37 32.62 Total time off comparison (vacation, sick, and personal leave combined together for those peers with vacation-sick/personal models) Vacation – Sick – Personal Leave City of Richfield’s annual vacation – personal leave accrual ranges from 21.75 days to 32.75 days, based on a years-of-service scale. When comparing to the peers that also utilize vacation – sick/personal or PTO accruals, City of Richfield’s vacation - personal accruals are, overall, comparable to market average. P a g e | 10 Pay Plan and Benefits Practices Maximum accrual of vacation or PTO days Number of Responses Least Most Average 8 23 46 33.33 City of Richfield allows a maximum accrual of 31 vacation days Organizations allowing vacation / PTO carryover Number of carryover days allowed Number of Responses Least Most Average City of Richfield 9 30 62.5 39.6 31 Organizations allowing cash-out of unused vacation / PTO days Number of Responses Responses 9 Yes (5), No (4) City of Richfield allows employees to cash-out unused vacation days Number of cash-out days allowed Number of Responses Least Most Average City of Richfield Year End 4 5 40 23.75 6 Termination Insufficient Responses 31 Retirement Insufficient Responses 31 Number of Responses Responses 9 All responding peers allow carryover of unused vacation days City of Richfield allows employees to carryover vacation days Vacation accruals Eight (8) responding peers allow an average maximum of 33.33 accrued vacation or PTO days, which is greater than City of Richfield’s annual allowed maximum of 31 accrued vacation days. Two (2) of the eight (8) reporting peers allow an unlimited number of accrued vacation or PTO days. Nine (9) responding peers allow an average of 39.6 days for annual vacation or PTO day carryover. One (1) of the reporting peers allows employees to carryover 2x the annual accrual rate. Cash-out days allowed Four (4) peers allow employees to cash-out the balance of their vacation bank at year end for an average of 23.75 days, which is greater than City of Richfield’s allowed year- end cash-out of 6 vacation days. P a g e | 11 Pay Plan and Benefits Practices Annual sick/personal days provided & annual sick/personal day accruals Maximum accrual of sick days Number of Responses Least Most Average 6 12 Unlimited Unlimited City of Richfield allows a maximum accrual of 25.5 personal days Organizations allowing carryover of sick days Number of Responses Responses 7 All responding peers allow unlimited carryover of unused sick days City of Richfield allows carryover of personal days Annual Sick/Personal Days Like City of Richfield, six (6) other peer organizations offer sick day or personal leave accruals and offer options for carryover or cash out policies for those accrued days. City of Richfield provides 12 annual sick / personal days to employees, which is greater than the peer market average of 10.67 days. Two (2) peers allow an unlimited number of accrued sick days. P a g e | 12 Pay Plan and Benefits Practices Maximum carryover of sick days Number of Responses Least Most Average 6 60 120 95 City of Richfield allows an annual maximum carryover of 25.5 personal days Organizations allowing cash-out of unused sick days Number of Responses Responses 7 Yes (2), No (5) City of Richfield allows employees to cash-out unused personal days Organizations providing a sick leave bank to employees Number of Responses Responses 7 None of the responding peers provide a sick leave bank to employees City of Richfield does not provide employees with a leave bank Sick days continued Number of Responses Least Most Average City of Richfield Allow employees to donate sick/personal leave 6 Yes (4), No (2) Yes Maximum # of days employees can give to other employees 4 2 40 15.67 Unlimited Maximum # of days employees can receive from sick/personal leave donations 4 37 50 43.5 Unlimited Cash-out of sick / personal leave The City of Richfield allows employees to cash- out their leave to a health care savings plan (HCSP) or as cash. Sick/personal days donation Like the City of Richfield, four (4) peers allow employees to donate sick/personal leave to other employees. Two (2) of the peers, like City of Richfield, allow an unlimited number of days to be given or donated to other employees, as well as an unlimited number of days employees may receive as sick/personal leave donations. P a g e | 13 Pay Plan and Benefits Practices Health Benefits Six (6) peers responded to having high deductible health plans (HDHP). Preferred Provider Organization (PPO) – insufficient responses Health Maintenance Organization (HMO) – insufficient responses High Deductible Health Plans (HDHP) Number of Responses Least Most Average City of Richfield Employee-only monthly premium 7 $493.81 $822.50 $669.98 % paid by employer 4 100% 100% 100% 100% Overall deductible 6 $2,500 $3,000 $2,833.33 Out-of-Pocket limit 6 $3,000 $6,000 $4,191.67 Employee + family monthly premium 7 $1,293.70 $2,422.70 $1,871.60 % paid by employer 6 70% 90% 81% 75% Overall deductible 6 $2,500 $6,000 $5,250 Out-of-Pocket limit 6 $5,000 $12,000 $7,550 PPO premiums The peer average monthly premium cost for employee only HDHP medical insurance is $669.98. Four (4) peers pay 100% of the premium. The peer average monthly premium cost for family HDHP medical insurance is $1,871.60. Six (6) peers pay an average of 81% of the premium. P a g e | 14 Pay Plan and Benefits Practices Participation policies Number of Responses Responses Organizations requiring 100% participation of all regular full-time employees 8 Yes (1), No 7) Organizations providing compensation to employees not participating 7 Yes (5), No (2) Prescription drug coverage Number of Responses Responses Organizations providing prescription drug coverage 4 Yes (3), No (1) Coverage separate from health insurance 3 Yes (3) Dental insurance coverage Number of Responses Least Most Average City of Richfield Organizations providing dental insurance coverage 12 All responding peers offer dental insurance coverage separate from health insurance Yes Employee-only monthly premium 7 $23.94 $56.80 $42.77 % paid by employer 7 0% 100% 42.9% 100% Employee + family monthly premium 8 $79.50 $166.75 $125.10 % paid by employer 7 0% 100% 33.3% 48% Dental premiums Three (3) peers pay 100% of the monthly employee dental premium and two (2) peers pay 100% of the employee + family dental premium. P a g e | 15 Pay Plan and Benefits Practices Vision Insurance Number of Responses Least Most Average City of Richfield Organizations providing vision insurance coverage 7 Yes (6), No (1) Yes Coverage is separate from health insurance 5 All respondents offer separate vision insurance coverage Employee-only monthly premium 6 $4.38 $8.51 $5.76 % paid by employer 5 None of the responding peers contribute to vision insurance premiums 0% Employee + family monthly premium 6 $11.40 $22.40 $16.11 % paid by employer 5 None of the responding peers contribute to vision insurance premiums 0% P a g e | 16 Pay Plan and Benefits Practices Other Health Benefits Life Insurance Accidental Death & Dismemberment (AD&D) Number of Responses Responses City of Richfield Organizations providing AD&D insurance? 6 All responding peers provide AD&D insurance to employees Yes % paid by employer 5 All responding peers pay 100% of the premium Number of Responses Responses City of Richfield Organizations providing life insurance 12 All responding respondents offer life insurance Yes Life insurance benefit provided by employer to employees 7 1x employee’s salary (3) $10,000 - $40,000 (4) $35,000 Total monthly premium cost 4 Least $0.70 Most $4.40 Average $2.80 Maximum life insurance policy available to employees 7 $25,000 $500,000 $230,714 Life Insurance Like City of Richfield, all responding peers offer life insurance. Three (3) peers offer 1x employee’s salary and four (4) peers provide a fixed amount with an option for employees to purchase more at their own expense. P a g e | 17 Pay Plan and Benefits Practices Short-Term, Long-Term Disability Insurance Number of Responses Responses City of Richfield Provide short-term disability 9 Yes (8), No (1) Yes % of employee base pay provided 4 Least 60% Most 80% Average 69% 100% % paid by employer 3 0% 100% 66.7% 100% Provide long-term disability 11 All responding peers provide LTD Yes % of employee base pay provided 6 Least 60% Most 67% Average 61.4% % paid by employer 6 0% 100% 83.3% 100% Parental leave (maternity, paternity, adoption, or foster leave) Number of Responses Responses City of Richfield Do you provide paid parental leave? 5 All responding peers provide paid parental leave Yes Paid parental leave separate from FMLA 5 Yes (3), No (2) Yes Time allowed for parental leave (maternity, paternity, & adoption/foster) 5 Least 2 weeks Most 6 weeks Average 3.4 weeks 2 weeks % of salary provided during leave 5 Responding peers provide 100% of salaries Short-Term Disability Like City of Richfield, eight (8) peers provide short-term disability. The City of Richfield’s short-term disability benefit provides a generous leave to employees, which pays 100% of regular base pay wages compared to peers who pay an average of 69% of base pay wages. P a g e | 18 Pay Plan and Benefits Practices FMLA Number of Responses Responses City of Richfield Offer Family Medical Leave Act (FMLA) benefits 8 All respondents offer FMLA benefits Yes Using paid vacation or sick leave concurrent to FMLA benefits 7 Required (6) Voluntary (1) Required Using short term disability concurrent to FMLA 7 Required (4) Voluntary (2) Not Applicable (1) Not Required Retirement Defined Benefit Pension Plans – all respondents use Public Employees Retirement Association (PERA) Deferred Compensation (401k & 457) Retirement Plans Number of Responses Responses Deferred Compensation (457) plans offered 7 Mission Square (5), MSRS (5), Other (3) Maximum employee contributions allowed 5 All respondents allow employees to contribute the IRS maximum Allow employer contributions to match more than one plan 6 None of the responding peers allow employer matches to more than one plan Deferred Compensation Seven (7) peers offer deferred compensation 457 plans to employees. Five (5) of the peers offer employees more than one plan. Six (6) peers off other insurance benefits to retirees. One (1) peer offers retiree benefits until individual is able to obtain Medicaid, five (5) peers offer dental, vision, life insurance and/or long-term care insurance to retirees, P a g e | 19 Pay Plan and Benefits Practices Retiree insurance Number of Responses Responses Group health insurance available to retirees 8 Yes (7), No (1) % paid by employer 4 One (1) peer contributes up to $500 per month depending on years of service and three (3) peers do not contribute to retiree insurance premiums Classification & Compensation Study City of Richfield, MN Determinants of Compensation Pay Philosophy •Lead, Lag, or Match External Competitiveness •Labor Markets •Peer Organizations Internal Equity •Job Content (job evaluation, comparable worth) •Equity Adjustment: Jobs adjusting to align with other similar jobs Individual Contribution •Personal allocation (seniority, merit pay, skill pay) 3 Project Overview Methodology Project Initiation •Planning meetings to establish goals and working relationships •Data collection o Pay structures o Policy handbook o Job descriptions o Organization charts o Union or collective bargaining contracts o Census file (names, salaries, hire dates, etc.) •Leadership and Employee presentations •Position Analysis Questionnaires (PAQs) to be completed for all position titles included in the study. •The PAQ is an online questionnaire that will be distributed via email address and routed directly to supervisors for review upon submission. Project Initiation Position Review Market Assessment Pay Plan Development Project Completion 4 Project Overview Methodology Position Review •Using PAQs, we reviewed titles and made recommendations for adjustments, as necessary •We conducted job evaluation using our point factor tool, called SAFE®. This process established a hierarchy of jobs within the City that is reflective of internal equity. •This is a measurement of the position, NOT the person in the position. •The 9 compensable factors: •Additionally, we reviewed exempt/non-exempt designations for each position based on guidelines within the Fair Labor Standards Act (FLSA). Project Initiation Position Review Market Assessment Pay Plan Development Project Completion 1.Education 2.Experience 3.Level of Work 4.Human Interaction 5.Physical Demands 6.Working Conditions 7.Independence of Actions 8.Impact on the Organization 9.Supervision Exercised 5 Project Overview Methodology Market Assessment •Peer Organizations (12): We partnered with the City to identify comparable and competitive peer organizations to include in the study. These are organizations that look like you and work like you relative to size (revenue, population served, or number of employees), service offerings, geography, growth, etc. ▪Published salary survey data was incorporated as a private sector comparison. •Benchmark Positions (100):The City selected benchmark positions from the full list of positions and reflected most levels and pay grades within the City. •Market Survey: A summary of work + minimum qualifications was included for each benchmark position to assist peers in providing an appropriate match. •Adjustments & Quality Control: Some adjustments were made to collected data to account for differences in work week, fiscal year, and geographic labor cost. We did not weight the data. •Benefits Comparison:We collected pay plan, pay policy, paid time off, medical premiums, retirement, and other pay and benefits program information as a comparison to the City’s offerings. Project Initiation Position Review Market Assessment Pay Plan Development Project Completion 6 Market Assessment: Peer Organizations •The City identified 12 public peer organizations to be included in the study •Data was collected or compiled from all 11 of those, shown in bold below. •Data from 3 published surveys included to represent the “private sector” 1.City of Brooklyn Center 2.City of Cottage Grove 3.City of Eagan 4.City of Fridley 5.City of Hopkins 6.City of Inver Grove Heights 7.City of Lino Lakes 8.City of Maplewood 9.City of Oakdale 10.City of Roseville 11.City of Savage 12.City of Shakopee 13.Bureau of Labor Statistics 14.Comp Analyst 15.Economic Research Institute 7 Market Assessment: Cost of Labor Differentials Where cost of living is a measurement of goods and services in each area, the cost of labor is a measurement of compensation paid. Cost of labor can be impacted by the cost of living but is mainly influenced by the supply and demand of labor in each area (rate of unemployment and number of qualified laborers). Cost of labor differentials collected from Economic Research Institutes Geographic Assessor tool which utilizes figures published by the Bureau of Labor Statistics. Date Pulled Client Name Location Geo Adjust Client Avg Base 10.06.2023 City of Richfield, MN City of Richfield, MN 105.7 91,314 Peer #Peer Organization Locality Used ERI Indicator GeoDiff % 1 City of Brooklyn Center City of Brooklyn Center 105.9 -0.2% 2 City of Cottage Grove City of Cottage Grove 105.6 0.1% 3 City of Eagan City of Eagan 105.8 -0.1% 4 City of Fridley City of Fridley 105.7 0.0% 5 City of Hopkins City of Hopkins 105.6 0.1% 6 City of Inver Grove Heights City of Inver Grove Heights 105.7 0.0% 7 City of Lino Lakes City of Lino Lakes 105.7 0.0% 8 City of Maplewood City of Maplewood 105.7 0.0% 9 City of Oakdale City of Oakdale 105.6 0.1% 10 City of Roseville City of Roseville 105.7 0.0% 11 City of Savage City of Savage 105.7 0.0% 12 City of Shakopee City of Shakopee 105.7 0.0% 13 Bureau of Labor Statistics Minnesota State Average 101.3 4.4% 14 Comp Analyst Minnesota State Average 101.3 4.4% 15 Economic Research Institute Minnesota State Average 101.3 4.4% 8 Market Assessment: Results External Equity •In total, 100 benchmark positions were included in the market survey, which is about 86% of all city positions. •These benchmarks had an average of 6.4 matches •Of those, 10 had insufficient data (less than 3 matches). •Overall, the study yielded market values for 90% of the City’s benchmark positions. •On average, the City is 1.9% below market at the midpoint. •Draft pay plans are aligned to the market at the midpoint. 9 Market Assessment: Pay Practices & Benefits Comparison Pay Plan Design -all responding peers use a grade and step system Average 6% between grades, 8.2 steps, 3.2% between steps Total Time Off – City of Richfield’s vacation / sick / personal leave accruals are comparable to market averages Health Plans – average percentage of premium covered by employer: Employee Family Medical 100% (100%)81% (75%) Dental 42.9% (100%)33.3% (48%) Vision 0% (0%)0% (0%) Short TD 66.7% (100%) Long TD 83.3% (100%) Parental Leave 100%, 3.4 weeks (0%) 10 Pay Plan Development Pay Plan •Baker Tilly led discussions with the City’s project team with regards to the number of pay plans, type of pay plans, and design of pay plans. •Determination for the number of pay plans an organization needs may be influenced by the diversity of jobs, diversity in grading procedures, internal equity versus external competitiveness, and even your organizational culture. •The City currently has eight pay structures: •Baker Tilly developed the following two pay structures: General 94 Positions Seasonal 23 Positions Management General Services Labor & Trades Police Lieutenants Police Sergeants Police Officers Fire Specialized 11 Current Pay Plans Pay Plan Design •Open plan (no defined steps), 8 grades •26 - 29% range spreads (distance from min to max) •4 - 16% midpoint differential (distance between each grade at the midpoint) Grade 2 3 4 5 6 Range Spread Midpoint Diff GS1 49,337.60 52,062.40 55,161.60 56,804.80 15% GS2 53,601.60 56,280.85 59,155.20 62,129.60 16% GS3 56,908.80 59,987.20 62,940.80 66,144.00 69,908.80 23%12% GS4 62,129.60 65,312.00 68,619.20 72,009.60 75,795.20 22%9% GS5 68,619.20 72,009.60 75,795.20 79,539.20 83,574.40 22%10% GS5E 73,694.40 77,355.20 81,307.20 85,384.00 93,808.00 27%7% GS6 75,795.20 79,539.20 83,574.40 87,838.40 96,488.80 27%3% GS6E 81,307.20 85,404.80 89,731.20 94,244.80 104,104.00 28%7% General Pay Plan '24 •Step Plan (4 – 5 steps, 8 grades) •15 - 28% range spreads (distance from min to max) •3 – 12% midpoint differential (distance between each grade at the midpoint) •Generally, 5% increase per step Grade Min Mid Max Range Spread Midpoint Diff M-L $76,232.00 $87,027.20 $97,760.00 28% M-1 $87,963.20 $100,609.60 $113,110.40 29%16% M-2 $99,174.40 $113,360.00 $127,524.80 29%13% M-3 $108,097.60 $123,552.00 $138,944.00 29%9% M-4L $114,046.40 $130,353.60 $146,556.80 29%6% M-4 $121,472.00 $136,115.20 $153,129.60 26%4% M-5A $128,710.40 $146,286.40 $164,403.20 28%7% M-5B $133,161.60 $152,131.20 $171,204.80 29%4% Management Pay Plan '24 12 Proposed General Pay Plan Pay Plan Design •Step & Open plan, 22 grades •31.2% range spreads •5-12% midpoint differentials •Aligned to 100% of market midpoints Minimum Midpoint Maximum 2.75%2.75%2.75%2.75%2.75%2.75%2.75%2.75%2.75%2.75% Grade 1 2 3 4 5 6 7 8 9 10 11 Midpoint Differential Step Diff Actual Range Spread 1 $34,053.01 $34,989.46 $35,951.67 $36,940.34 $37,956.20 $39,000.00 $40,072.50 $41,174.49 $42,306.79 $43,470.23 $44,665.66 7.0%2.75%31.2% 2 $36,436.72 $37,438.73 $38,468.29 $39,526.17 $40,613.14 $41,730.00 $42,877.58 $44,056.71 $45,268.27 $46,513.15 $47,792.26 7.0%2.75%31.2% 3 $38,987.20 $40,059.35 $41,160.98 $42,292.91 $43,455.96 $44,651.00 $45,878.90 $47,140.57 $48,436.94 $49,768.95 $51,137.60 7.0%2.75%31.2% 4 $41,716.68 $42,863.89 $44,042.64 $45,253.82 $46,498.30 $47,777.00 $49,090.87 $50,440.87 $51,827.99 $53,253.26 $54,717.72 7.0%2.75%31.2% 5 $44,845.19 $46,078.43 $47,345.59 $48,647.59 $49,985.40 $51,360.00 $52,772.40 $54,223.64 $55,714.79 $57,246.95 $58,821.24 7.5%2.75%31.2% 6 $48,208.58 $49,534.31 $50,896.51 $52,296.16 $53,734.31 $55,212.00 $56,730.33 $58,290.41 $59,893.40 $61,540.47 $63,232.83 7.5%2.75%31.2% 7 $51,824.31 $53,249.48 $54,713.84 $56,218.47 $57,764.48 $59,353.00 $60,985.21 $62,662.30 $64,385.51 $66,156.12 $67,975.41 7.5%2.75%31.2% 8 $55,710.72 $57,242.76 $58,816.94 $60,434.40 $62,096.35 $63,804.00 $65,558.61 $67,361.47 $69,213.91 $71,117.29 $73,073.02 7.5%2.75%31.2% 9 $59,888.76 $61,535.70 $63,227.93 $64,966.70 $66,753.28 $68,589.00 $70,475.20 $72,413.27 $74,404.63 $76,450.76 $78,553.15 7.5%2.75%31.2% 10 $64,380.26 $66,150.72 $67,969.87 $69,839.04 $71,759.61 $73,733.00 $75,760.66 $77,844.08 $79,984.79 $82,184.37 $84,444.44 7.5%2.75%31.2% 11 $69,208.81 $71,112.05 $73,067.63 $75,076.99 $77,141.61 $79,263.00 $81,442.73 $83,682.41 $85,983.67 $88,348.22 $90,777.80 7.5%2.75%31.2% 12 $74,399.71 $76,445.70 $78,547.95 $80,708.02 $82,927.49 $85,208.00 $87,551.22 $89,958.88 $92,432.75 $94,974.65 $97,586.45 7.5%2.75%31.2% 13 $81,095.92 $92,877.00 $106,369.55 9.0%31.2% 14 $88,394.62 $101,236.00 $115,942.89 9.0%31.2% 15 $99,001.69 $113,384.00 $129,855.67 12.0%31.2% 16 $107,912.23 $123,589.00 $141,543.19 9.0%31.2% 17 $116,005.49 $132,858.00 $152,158.73 7.5%31.2% 18 $121,805.86 $139,501.00 $159,766.78 5.0%31.2% 19 $127,896.11 $146,476.00 $167,755.06 5.0%31.2% 20 $134,291.09 $153,800.00 $176,143.04 5.0%31.2% 21 $141,005.64 $161,490.00 $184,950.19 5.0%31.2% 22 $148,056.36 $169,565.00 $194,198.27 5.0%31.2% 13 Proposed General Pay Plan Pay Plan Design 14 Proposed Seasonal Pay Plan Pay Plan Design •Step plan, 5 grades •11.5% range spreads •7.5% midpoint differentials •2.75% between steps Minimum Midpoint Maximum 2.75%2.75%2.75%2.75% Grade 1 2 3 4 5 Midpoint Differential Actual Range Spread 1 2 3 4 5 101 $29,783.39 $30,602.43 $31,444.00 $32,308.71 $33,197.20 7.5%11.5%$14.32 $14.71 $15.12 $15.53 $15.96 102 $32,016.86 $32,897.32 $33,802.00 $34,731.56 $35,686.67 7.5%11.5%$15.39 $15.82 $16.25 $16.70 $17.16 103 $34,417.98 $35,364.48 $36,337.00 $37,336.27 $38,363.01 7.5%11.5%$16.55 $17.00 $17.47 $17.95 $18.44 104 $36,999.07 $38,016.55 $39,062.00 $40,136.21 $41,239.95 7.5%11.5%$17.79 $18.28 $18.78 $19.30 $19.83 105 $39,774.33 $40,868.13 $41,992.00 $43,146.78 $44,333.32 7.5%11.5%$19.12 $19.65 $20.19 $20.74 $21.31 15 Grade Assignments Pay Plan Development Positions were assigned based on internal equity (job evaluation). ▪In accordance with Minnesota Local Government Pay Equity Act (LCPEA) The following information was NOT considered: ▪The person in the position ▪Performance ▪Length of service ▪Existing individual employee salary •Preliminary grade assignments were reviewed with the City’s project team to ensure positions were assigned to the correct grade and address any outliers. 16 Implementation Scenarios Calculations reflect base pay only. Baker Tilly does not recommend a pay decrease for any employee as a result of the study. Implementation Scenarios for Pay Plan: 1.Step:Employees move to the closest step without a decrease.Open:Employees move to the minimum of their assigned pay grade if their current salary is below. All other employees retain their existing salary. This is to get all employees onto the pay plan. 2.Step: Employees move to the step based on years in position. Open: Employees move to the minimum of their assigned pay grade, plus 3% x years in position, capped at 8 years. Any employees whose current salary is greater than that calculation would retain their existing salary.For example: if an employee has been in their position with the City of Richfield for 3 years, the employee’s new salary would be calculated by adding 9% to the minimum of their newly assigned pay grade. 2b. Compounded over years in position. 17 Implementation Scenarios -General Pay Plan Development # of Staff Current Salary Proposed Salary Difference % Increase Totals 239 $20,286,577.94 $20,568,960.64 $282,382.70 1.4% Employees Below Minimum 28 $1,810,953.36 $1,958,993.01 $148,039.65 8.2% Employees Within Range 175 $15,274,063.89 $15,408,406.95 $134,343.06 0.9% Employees Above Maximum 36 $3,201,560.69 $3,201,560.69 $0.00 0.0% # of Staff Current Salary Proposed Salary Difference % Increase Totals 239 $20,286,577.94 $20,735,698.94 $449,121.00 2.2% Employees Below Minimum 28 $1,810,953.36 $2,037,548.90 $226,595.53 12.5% Employees Within Range 175 $15,274,063.89 $15,496,589.36 $222,525.47 1.5% Employees Above Maximum 36 $3,201,560.69 $3,201,560.69 $0.00 0.0% # of Staff Current Salary Proposed Salary Difference % Increase Totals 239 $20,286,577.94 $20,758,826.82 $472,248.88 2.3% Employees Below Minimum 28 $1,810,953.36 $2,037,646.02 $226,692.65 12.5% Employees Within Range 175 $15,274,063.89 $15,519,620.12 $245,556.23 1.6% Employees Above Maximum 36 $3,201,560.69 $3,201,560.69 $0.00 0.0% Option 1 - Closest Step, without decrease or move to Min if below Option 2: Steps or in range based on Years in Position (capped at 8 years) Option 2b: Steps or in range based on Years in Position (compounded & capped at 8 years) 18 Implementation Scenarios -Seasonal Pay Plan Development # of Staff Current Salary Proposed Salary Difference % Increase Totals 171 $960,375.00 $1,000,703.07 $40,328.07 4.2% Employees Below Minimum 105 $437,828.26 $469,139.88 $31,311.62 7.2% Employees Within Range 53 $433,968.36 $442,984.80 $9,016.45 2.1% Employees Above Maximum 13 $88,578.38 $88,578.38 $0.00 0.0% # of Staff Current Salary Proposed Salary Difference % Increase Totals 171 $960,375.00 $1,014,592.04 $54,217.04 5.6% Employees Below Minimum 105 $437,828.26 $481,927.94 $44,099.68 10.1% Employees Within Range 53 $433,968.36 $444,085.72 $10,117.36 2.3% Employees Above Maximum 13 $88,578.38 $88,578.38 $0.00 0.0% Option 1 - Closest Step, without Decrease Option 2: Steps based on Years in Position (capped at 5 years) Baker Tilly US, LLP, trading as Baker Tilly, is a member of the global network of Baker Tilly International Ltd., the members of which are separate and independent legal entities. © 2022 Baker Tilly US, LLP. We urge City of Richfield to: ✓Approve the proposed pay plans and position grade assignments. ✓Approve an implementation scenario that addresses the City’s compensation philosophy, business goals, and that is fiscally attainable and sustainable. ✓Continue efforts to maintain the classification and compensation system: •Routinely review positions, job descriptions, and market conditions. •Adjust pay structures (and salaries), as needed, to maintain market competitiveness. •Commit to advancing employees through their assigned pay ranges based on the City’s policies. Baker Tilly Recommendations