Loading...
HomeMy WebLinkAbout1997-02-04; City Council; 14014; Watson Wyatt & Company- CITY F CARLSBAD - AGEN APPROVAL OF CONTRACT BETWEEN THE CITY OF CARLSBAD AND WATSON WYATT & COMPANY I I IECOMMENDED ACTION: Adopt Resolution No. 97 -3X approving a contract for professional services between the City of Carlsbad and Watson Wyatt & Company. ITEM EXPLANATION: The management group in the City of Carlsbad consists of a broad group of 100 “unrepresented” employees (approximately 20% of the workforce) working in a broad range of classifications. The group includes department heads, program managers, superintendents, supervisors, professional sta, and a few key secretarial positions. Compensation for these management employees is governed by Council Policy Statement No. 36, which calls for a periodic review of the management compensation structure. As part of the most recent review, staff worked with a council subcommittee on a preliminary draft of a revised Management Compensation and Benefits Plan; however, implementation of this plan was suspended until a comprehensive review of the management performance appraisal and the management compensation systems could be conducted. Staff requires the services of a qualified consulting firm with expertise in performance appraisal and compensation systems development to assist in developing and successfully implementing a revised performance-based compensation plan. Specifically, the new systems will focus on the following goals: connecting the vision, mission, and values of the organization to the work of individuals and teams; enhancing organizational and individual performance; appraising performance effectively; and creating a greater link between the pay and performance systems. A request for proposal for consulting services for this project was prepared by staff and distributed to eight firms. After conducting in-depth interviews with two firms, staff is recommending that Council adopt the attached resolution which will authorize staff to enter into a contract with Watson Wyatt & Company to help the City develop and implement these important systems. The contract with Watson Wyatt would be divided into two phases, the systems design phase (Phase I) and the training and implementation phase (Phase 11). Phase I is scheduled to commence in January 1997 and continue through June 1997. This phase would include overall project planning and management, a review of the preliminary work already completed by staff and the council subcommittee, development of the performance appraisal system, development of the linkage of the pay and performance systems, and development of a communication strategy to introduce the new systems to the employees. Page 2 of Agenda Bill # f 4: 0 1 Phase I1 is expected to begin in fiscal year 1997/98 and would include the communication plan roll-out, and training for affected managers and employees in the areas of 1) performance planning and goal setting, 2) feedback and coaching, 3) conducting annual performance reviews, and 4) compensation program administration. In addition, this phase would also include training for City stafftasked with administration of these systems. The goal of this training is to develop a cadre of internal st& members as trained trainers so that they will be able to train other employees throughout the organization in effectively using the performance appraisal and management compensation systems. This ensures that there will be someone on staff with the expertise to assist other managers and supervisors after the program is initiated and on an ongoing basis. It is expected that administration and tracking of the new performance appraisal system would be inaugurated in January 1998. FISCAL IMPACT: With approval of this contract, the Council will be authorizing staffto proceed with the design, training, and implementation of this project, the total cost of which is approximately $100,000. Estimated costs for each phase of the project are shown below. Phase I: Program Design Project Management $ 5,000 Audit Current Compensation Plan $10,000 Develop Performance Appraisal System $30,000 Develop Management Pay Plan $15,000 Develop Communication Strategy $ 5,000 Total $65,000 Phase 11: Imulementation Performance Planning/Goal Setting Training $ 8,000 Annual Performance Review Training $ 8,000 Compensation Program Introductory Training $ 5,000 Train the Trainer (7 sessions @ $2000) $14,000 Total $35,000 Staff recommends that Council fund this program through a transfer of funds from the General Contingency Fund to the Human Resources Department miscellaneous professional services account. Page 3 of Agenda Bill # / 4; 0 1 EXHIBITS: 1. Resolution No. 9 7 -32 2. Contract 3 1 2 3 4 5 6 7 a 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION NO. 9 7 - 32 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVMG AN AGREEMENT FOR CONSULTING SERVICES. WHEREAS, Council Policy Statement No. 36 calls for a periodic review of the management compensation structure; and WHEREAS, staff requires the services of a qualified consulting firm with expertise in performance appraisal and compensation systems development to assist in developing and implementing a revised performance-based compensation plan; and WHEREAS, staff received proposals from two vendors in response to the City’s Request for Proposal for consultant services required; and WHEREAS, staff selected Watson Wyatt & Company as the consulting firm best able to meet the City’s needs. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as follows: 1. That the above recitation is true and correct. 2. That the Mayor of the City of Carlsbad is authorized to sign the contract between the City of Carlsbad and Watson Wyatt & Company. I// //I /I/ //I 1 2 3 4 5 6 7 a 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 2a 3. That $100,000 in funds be transferred from the Council's General Contingency Fund to cover the expense of developing and implementing a revised performance-based management compensation plan. PASSED, APPROVED, AND ADOPTED at a regular meeting of the City Council of the City of Carlsbad, California, on the 4th day of February , 1997, by the following vote, to wit: AYES: Council Members Lewis, Finnila, Nygaard, and Hall NOES: None ABSENT: Council Member Kulchin A ATTEST: 3LXL R.Qwz="- ALETHA L. RAUTENKRANZ, City Clerk\ (SEAL) AGREEMENT THIS AGREEMENT, made and entered into as of the 24th day of FEBRUARY , 195, by and between the CITY OF CARLSBAD, a municipal corporation, hereinafter referred to as "City", and WATSON WYATT & COMPANY, hereinafter referred to as "Contractor." RECITALS City requires the services of a human resources consulting firm with expertise in performance appraisal and compensation systems development to assist in developing and implementing a revised performance-based management compensation plan; and Contractor possesses the necessary skills and qualifications to provide the services required by the City; NOW, THEREFORE, in consideration of these recitals and the mutual covenants contained herein, City and Contractor agree as follows: 1. CONTRACTORS OBLIGATIONS Contractor's obligations will be divided into two phases: the systems design phase (Phase I) and the training and implementation phase (Phase 11). Phase I will include overall project planning and management, a review of the work already completed by staff and the Council subcommittee, development of the linkage of the pay and performance systems, and development of a communication strategy to introduce the new systems to City management employees. 1 rev. 8/26/96 .. Phase II will include the communication plan roll-out and training for affected employees in the areas of 1) performance planning and goal setting, 2) feedback and coaching, 3) conducting annual performance reviews, and 4) compensation program administration. Also included in Phase II will be training for City staff tasked with the administration of these systems. 2. CITY OBLIGATIONS The City shall provide any documents, access to personnel and interim reviews and approvals that are necessary for Contractor to complete their scope of work. 3. PROGRESS AND.COMPLETlON The work under this contract will begin within ten (IO) days after receipt of notification to proceed by the City. If notification to proceed is given prior to February 5, 1997, Phase I of the project will be completed by June 30, 1997; Phase II will be completed by December 31, 1997. Extensions of time may be granted if requested by the Contractor and agreed to in writing by the Human Resources Director. The Human Resources Director will give allowance for documented and substantiated unforeseeable and unavoidable delays not caused by a lack of foresight on the part of the Contractor, or delays caused by City inaction or other agencies' lack of timely action. 4. FEES TO BE PAID TO CONTRACTOR The total fee payable for the services to be performed pursuant to Section I shall be $100,000. No other compensation for services will be allowed except those items 2 rev. 8/26/96 covered by supplemental agreements per Paragraph 8, "Changes in Work." The City reserves the right to withhold a ten percent (10%) retention until the project has been accepted by the City. Incremental payments, if applicable, should be made as outlined in attached Exhibit "A," 5. DURATION OF CONTRACT This agreement shall extend for a period of one year from date thereof. The contract may be extended by the City Manager for an additional one (1) year period or parts thereof, based upon a review of satisfactory performance and the City's needs. The parties shall prepare extensions in writing indicating effective date and length of the extended contract. 6. PAYMENT OF FEES Payment of approved items on the invoice shall be mailed to the Contractor within 30 days of receipt of the invoice. 7. FINAL SUBMISSIONS Within 10 days of completion and approval of the Human Resources Director the Contractor shall deliver to the City the following items: 1) a revised performance appraisal system for management employees 2) a revised pay plan for management employees 3 8. CHANGES IN WORK If, in the course of the contract, changes seem merited by the Contractor or the city, and informal consultations with the other party indicate that a change in the conditions of the contract is warranted, the Contractor or the City may request a change in contract. Such changes shall be processed by the City in the following manner: A letter outlining the required changes shall be forwarded to the City by Contractor to inform them of the proposed changes along with a statement of estimated changes in charges or time schedule. A Standard Amendment to Agreement shall be prepared by the City and approved by the City according to the procedures described in Carlsbad Municipal Code Section 3.28.172. Such Amendment to Agreement shall not render ineffective or invalidate unaffected portions of the agreement. 9. COVENANTS AGAINST CONTINGENT FEES The Contractor warrants that their firm has not employed or retained any company or person, other than a.bona fide employee working for the Contractor, to solicit or secure this agreement, and that Contractor has not paid or agreed to pay any company or person, other than a bona fide employee, any fee, commission, percentage, brokerage fee, gift, or any other consideration contingent upon, or resulting from, the award or making of this agreement. For breach or violation of this warranty, the City shall have the right to annul this agreement without liability, or, in its discretion, to deduct from the agreement price or consideration, or otherwise recover, the full amount of such fee, commission, percentage, brokerage fees, gift, or contingent fee. 4 rev. 8/26/96 ‘I $0. NONDISCRIMINATION CLAUSE The Contractor shall comply with the state and federal laws regarding nondiscrimination. 11. TERMINATION OF CONTRACT In the event of the Contractor's failure to prosecute, deliver, or perform the work as provided for in this contract, the City Manager may terminate this contract for nonperformance by notifying the Contractor by certified mail of the alleged non- performance. Contractor shall have ten (IO) days following receipt of notice to cure any default or non-performance. If Contractor fails to cure, then the City may give written notice of the termination of the Contractor. The Contractor, thereupon, has five (5) working days to deliver said documents owned by the City and all work in progress to the Human Resources Director. The Human Resources Director shall make a determination of fact based upon the documents delivered to City of the percentage of work which the Contractor has performed which is usable and of worth to the City in having the contract completed. ' Based upon that finding as reported to the City Manager, the Manager shall determine the final payment of the contract. This agreement may be terminated by either party upon tendering thirty (30) days written notice to the other party. In the event of such suspension or termination, upon request of the City, the Contractor shall assemble the work product and put same in order for proper filing and closing and deliver said product to City. In the event of termination, the Contractor shall be paid for work performed to the termination date; 5 rev. 8/26/96 however, the total shall not exceed the lump sum fee payable under paragraph 4. The City Manager shall determine the portions of tasks completed and the compensation to be made. 12. DISPUTES If a dispute should arise regarding the performance of work under this agreement, the following procedure shall be used to resolve any question of fact or interpretation not otherwise settled by agreement between parties. Such questions, if they become identified as a part of a dispute among persons operating under the provisions of this contract, shall be reduced to writing by the principal of the Contractor or the Human Resources Director. A copy of such documented dispute shall be forwarded to both parties involved along with recommended methods of resolution. The Human Resources Director or principal receiving the letter shall reply to the letter along with a recommended method of resolution within ten (IO) days. If the resolution thus obtained is unsatisfactory to the aggrieved party, a letter outlining the dispute shall be forwarded to the City Council for their consideration through the Office of the City Manager. The City Council may then opt to consider the directed solution to the problem. Nothing in this procedure shall prohibit the parties seeking remedies available to them at law or equity. 13. CLAIMS AND LAWSUITS The Contractor agrees that any contract claim submitted to the City must be asserted as part of the contract process as set forth in this agreement and not in 6 rev. 8/26/96 anticipation of litigation or in conjunction with litigation. The Contractor acknowledges that if a false claim is submitted to the City, it may be considered fraud and the Contractor may be subject to criminal prosecution. The Contractor acknowledges that California Government Code sections 12650 et sea., the False Claims Act, provides for civil penalties where a person knowingly submits a false claim to a public entity. These provisions include false claims made with deliberate ignorance of the false information or in reckless disregard of the truth or falsity of information. If the City of Carlsbad seeks to recover penalties pursuant to the False Claims Act, it is entitled to recover its litigation costs, including attorney's fees. The Contractor acknowledges that the filing of a false claim may subject the Contractor to an administrative debarment proceeding wherein the Contractor may be prevented to act as a Contractor on any public work or improvement for a period of up to five years. The Contractor acknowledges debarment by another jurisdiction is grounds for the City of Carlsbad to disqualify the Contractor from the selection process. LL /A (Initial) L-4 The provisions of Carlsbad Municipal Code sections 3.32.025, 3.32.026, 3. 2.027 and 3.32.028 pertaining to false claims are incorporated herein by reference. nitial) 14. STATUS OF THE CONTRACTOR The Contractor shall perform the services provided for herein in Contractor's own way as an independent Contractor and in pursuit of Contractor's independent calling, and not as an employee of the City. Contractor shall be under control of the City only rev. 8/26/96 7 as to the result to be accomplished, but shall consult with the City as provided for in the request for proposal. The persons used by the Contractor to provide services under this agreement shall not be considered employees of the City for any purposes whatsoever. The Contractor is an independent Contractor of the City. The payment made to the Contractor pursuant to the contract shall be the full and complete compensation to which the Contractor is entitled. The City shall not make any federal or state tax withholdings on behalf of the Contractor or hidher employees or subcontractors. The City shall not be required to pay any workers' compensation insurance or unemployment contributions on behalf of the Contractor or hislher employees or subcontractors. The Contractor agrees to indemnify the City within 30 days for any tax, retirement contribution, social security, overtime payment, unemployment payment or workers' compensation payment which the City may be required to make on behalf of the Contractor or any employee or subcontractor of the Contractor for work done under this agreement or such indemnification amount may be deducted by the City from any balance owing to the Contractor. The Contractor shall be aware of the requirements of the Immigration Reform and Control Act of 1986 and shall comply with those requirements, including, but not limited to, verifying the eligibility for employment of all agents, employees, subcontractors and Consultants that are included in this agreement. rev. 8/26/96 8 15. CONFORMITY TO LEGAL REQUIREMENTS The Contractor shall cause all drawings and specifications to conform to all applicable requirements of law: federal, state and local. Contractor shall provide all necessary supporting documents, to be filed with any agencies whose approval is necessary. The City will provide copies of the approved plans to any other agencies. 16. OWNERSHIP OF DOCUMENTS All final reports delivered under this contract will be the property of the City. In the event this contract is terminated, all completed deliverables shall be delivered forthwith to the City. Contractor shall have the right to make one (1) copy of the plans for hislher records. 17. REPRODUCTION RIGHTS The Contractor agrees that the City shall have the right to make unlimited copies of any delivered report for the City:s use. 18. HOLD HARMLESS AGREEMENT Contractor agrees to indemnify and hold harmless the City of Carlsbad and its officers, officials, employees and volunteers from and against all claims, damages, losses and expenses including attorney fees arising out of the performance of the work described herein caused in whole or in part by any willful misconduct or negligent act or omission of the Contractor, any subcontractor, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable, except where caused 9 rev. 8126196 by the active negligence, sole negligence, or willful misconduct of the City of Carlsbad. Contractor shall at its own expense, upon written request by the City, defend any such suit or action brought against the City, its officers, officials, employees and volunteers. Contractors indemnification of City shall not be limited by any prior or subsequent declaration by the Contractor. In the event of any third party claim against the City, in which Contractor is not a party, Contractor will make available its documents and personnel for testimony, or to assist the City in the preparation of its defense. Such services shall be provided at Consultant's normal hourly rates and without regard to the limit set forth in Section 4 of this Agreement, unless agreed in writing by the parties. 19. ASSIGNMENT OF CONTRACT The Contractor shall not assign this contract or any part thereof or any monies due thereunder without the prior written consent of the City. 20. SUBCONTRACTING If the Contractor shall subcontract any of the work to be performed under this contract by the Contractor, Contractor shall be fully responsible to the City for the acts and omissions of Contractor's subcontractor and of the persons either directly or indirectly employed by the subcontractor, as Contractor is for the acts and omissions of persons directly employed by Contractor. Nothing contained in this contract shall create any contractual relationship between any subcontractor of Contractor and the City. The Contractor shall bind every subcontractor and every subcontractor of a 10 rev. 8/26/96 subcontractor by the terms of this contract applicable to Contractor's work unless specifically noted to the contrary in the subcontract in question approved in writing by the City. 21. PROHIBITED INTEREST No official of the City who is authorized in such capacity on behalf of the City to negotiate, make, accept, or approve, or take part in negotiating, making, accepting, or approving of this agreement, shall become directly or indirectly interested personally in this contract or in any part thereof. No officer or employee of the City who is authorized in such capacity and on behalf of the City to exercise any executive, supervisory, or similar functions in connection with the performance of this contract shall become directly or indirectly interested personally in this contract or any part thereof. 22. VERBAL AGREEMENT OR CONVERSATION No verbal agreement or conversation with any officer, agent, or employee of the City, either before, during or after;.the execution of this contract, shall affect or modify any of the terms or obligations herein contained nor entitle the Contractor to any additional payment whatsoever under the terms of this contract. 23. SUCCESSORS OR ASSIGNS Subject to the provisions of Paragraph 18, "Hold Harmless Agreement," all terms, conditions, and provisions hereof shall inure to and shall bind each of the parties hereto, and each of their respective heirs, executors, administrators, successors, and assigns. 11 rev. 8/26/96 24. EFFECTIVE DATE This agreement shall be effective on and from the day and year first written above. 25. CONFLICT OF INTEREST The City has determined, using the guidelines of the Political Reform Act and the City’s conflict of interest code, that the Contractor will not be required to file a conflict of interest statement as a requirement of this agreement. However, Contractor hereby acknowledges that Contractor has the legal responsibility for complying with the Political Reform Act and nothing in this agreement releases Contractor from this responsibility. 26. INSURANCE The Contractor shall obtain and maintain for the duration of the contract and any and all amendments insurance against claims for injuries to persons or damage to property which may arise out qf or in connection with performance of the work hereunder by the Contractor, his agents, representatives, employees or subcontractors. Said insurance shall be obtained from an insurance carrier admitted and authorized to do business in the State of California. The insurance carrier other than professional indemnity insurance is required to have a current Best‘s Key Rating of not less than “A- :V and shall meet the City’s policy for insurance as stated in Resolution No. 91-403. A. Coveraqes and Limits. Contractor shall maintain the types of coverages and minimum limits 12 rev. 8/26/96 indicated herein, unless a lower amount is approved by the City Attorney or City Manager: 1. Comprehensive General Liability Insurance. $1,000,000 combined single-limit per occurrence for bodily injury, personal injury and property damage. If the submitted policies contain aggregate limits, general aggregate limits shall apply separately to the work under this contract or the general aggregate shall be twice the required per occurrence limit. 2. Automobile Liability (if the use of an automobile is involved for Contractor's work for the City). $1,000,000 combined single-limit per accident for bodily injury and property damage. 3. Workers' Compensation and Employer's Liability. Workers' Compensation limits as required by the Labor Code of the State of California and Employer's Liability limits of $1,000,000 per accident for bodily injury. 4. Professional Liability. Errors and omissions liability appropriate to the contractor's profession with limits of not less than $5,000,000 per claim (annual aggregate), subject to self-insured retention of $1,000,000 per occurrence. Coverage shall be maintained for a period of three years following the date of completion of the work. B. Additional Provisions. Contractor shall ensure that the policies of insurance required under this agreement contain, or are endorsed to contain, the following provisions. 13 rev. 8/26/96 1. The City shall be named as an additional insured on all policies excluding Workers’ Compensation and Professional Liability. 2. The Contractor shall furnish certificates of insurance to the City before commencement of work. 3. The Contractor shall obtain occurrence coverage, excluding Professional Liability which shall be written as claims-made coverage. 4. This insurance shall be in force during the life of the agreement and any extension thereof and shall not be canceled without 30 days prior written notice to the City sent by certified mail. 5. If the Contractor fails to maintain any of the insurance coverages required herein, then the City will have the option to declare the Contractor in breach, or may purchase replacement insurance or pay the premiums that are due on existing policies in order that the required coverages may be maintained. The Contractor is responsible for any payments mqde by the City to obtain or maintain such insurance and the City may collect the same from the Contractor or deduct the amount paid from any sums due the Contractor under this agreement. 14 rev. 8/26/96 27. RESPONSIBLE PARTIES The name of the persons who are authorized to give written notices or to receive written notice on behalf of the City and on behalf of the Contractor in connection with the foregoing are as follows: For City: Title HUMAN RESOURCES DIRECTOR Name Address 1200 CARLSBALI VILLAGE DRIVE ANN JENSEN CARLSBAD, CA 92008 For Contractor: ~~ ~ Title STRATEGTC. Name LUELLEN LUCID/ PAUL MEE Address 15303 VENTURA BLVD. SUITE 700 SHERMAN OAKS, CA 91403-3197 ArchitectlLicense Number: NOT APPLICABLE ArchitectlLicense Number: NOT APPLICABLE 28. BUSINESS LICENSE Contractor shall obtain and maintain a City of Carlsbad Business License for the duration of the contract. 29. ENTIRE AGREEMENT This agreement, together with any other written document referred to or rev. 8/26/96 15 1’ .. contemplated herein, embody the entire agreement and understanding between the parties relating to the subject matter hereof. Neither this agreement nor any provision hereof may be amended, modified, waived or discharged except by an instrument in writing executed by the party against which enforcement of such amendment, waiver or discharge is sought, Executed by Contractor this 3 Id day of G 13u C(, -y ,IS%. CONTRACTOR: WC*.I3 b&Q* By: CITY OF CARLSBAD, a municipal ATTEST: By: (sign here) (print namehitle) City Clerk By: - (sign here) (print namehitle) City Clerk (Proper notarial acknowledgment of execution by Contractor must be attached.) (President or vice-president and secretary or assistant secretary must sign for corporations. If only one officer signs, the corporation must attach a resolution certified by the secretary or assistant Secretary under corporate seal empowering that officer to bind the corporation.) APPROVED AS TO FORM: RONALD R. BALL City Attorney BY eputy City Attorney 16 rev. 8/26/96 * CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of GAlifLrnia County of LO5 AnQdes On kb. 3,1997 before me, Maida C. ?’;rich personally appeared Paul v. Mee d personally known to me - OR - 0 proved to me on the basis of satisfactory evidence to be the personw whose name(@ isle subscribed to the within instrument and ac- knowledged to me that he/sheftkey. executed the same in his/k&#w authorized capacity(les), and that by hiskn” signature@) on the instrument the personw, or the entity upon behalf of which the personw) acted, executed the instrument. WITNESS my hand and official seal. DATE NAME, TITLE OF OFFICER - E.G.. ‘JANE DOE. NOTARY PUBLIC? NAME(SIOFSIGNER(S) SIGNATURE OF NOTARY CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT TITLEIS) TITLE OR TYPE OF DOCUMENT NUMBER OF PAGES .. . DATE OF DOCUMENT SIGNER IS REPRESENTING: NAME OF PERSONISI OR ENTITY(IES1 ~~ SIGNER(S) OTHER THAN NAMED ABOVE - ~~~ 01993 NATIONAL NOTARY ASSOCIATION. H236 Rernrnel Auc , PO Box I184 . Carioga I’xh, CA 91309-71114 EXHIBIT A City agrees to compensate Contractor for services according to the following schedule: Upon completion of Phase I: Program Design Phase I: Program Design Project Planning/Management Audit Current Compensation Plan Develop Performance Appraisal System Develop Management Pay Plan Develop Communication Strategy (Includes executive interviews and two executive meetings) (Includes incentive plan design) Incremental payment Upon completion of Phase 11: Implementation Phase 11: Implementation Performance Planning/Goal Setting Training Annual Performance Review Training Compensation Program Introductory Training Train the Trainer (7 sessions @ $2000) Incremental payment $ 5,000 $10,000 $30,000 $15,000 $ 5.000 $65,000 $ 8,000 $ 8,000 $ 5,000 $14,000 $35,000