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HomeMy WebLinkAbout2013-08-27; City Council; 21348; Revising Management Compensation Benefits PlanCITY OF CARLSBAD AND CARLSBAD IVIUNICIPAL WATER DISTRICT - AGENDA BILL 23 AB# 21,348 REVISING THE MANAGEMENT COMPENSATION AND BENEFITS PLAN DEPT. HEAD '-^ MTG. 8/27/13 REVISING THE MANAGEMENT COMPENSATION AND BENEFITS PLAN CA/GEN. COUNSEU^^:^^^.^ DEPT. HR REVISING THE MANAGEMENT COMPENSATION AND BENEFITS PLAN CITY MGR. TT^ RECOMMENDED ACTION: City Council adopt Resolution No. 2013-217 . and Municipal Water District Board adopt Resolution No. 1476 revising sections ofthe Management Compensation and Benefits Plan (Exhibit A) and making an appropriation therefor. ITEM EXPLANATION: In accordance with City Council's desire to maintain competitive levels of compensation and benefits, staff recommends the following changes to the Management Compensation and Benefits Plan. Pav for Performance/Compensation A formal Performance Management and Compensation System for management employees was established in 1997 and defined in Administrative Order No. 66. This pay for performance system has been used to reward employee performance (when funding is authorized by the City Council) for the demonstration of competencies and the achievement of goals. On June 18, 2013, City Council approved a Memorandum of Understanding (MOU) with employees represented by the Carlsbad City Employees' Association (CCEA) wherein a pay for performance system, similar to the one that has been used for management employees, was defined for this non- management employee group. Staff recommends revising the management employee pay for performance system so that both unrepresented management and CCEA-represented employees are subject to the same pay for performance cycle and system effective January 1, 2014. The proposed amended Management Compensation and Benefits Plan (Exhibit A) reflects the changes that would apply to unrepresented management employees and replaces Administrative Order No. 66 effective January 1, 2014. Staff recommends implementing the following compensation components during the conversion from a fiscal year performance review cycle to a calendar year performance review cycle for unrepresented management employees. DEPARTMENT CONTACT: Debbie Porter 760-602-2441 Debbie.porterOcarisbadca.gov FOR CITY CLERKS USE ONLY. COUNCIL ACTION: APPROVED CONTINUEDTO DATE SPECIFIC • DENIED a CONTINUEDTO DATE UNKNOWN • CONTINUED • RETURNED TO STAFF • WITHDRAWN • OTHER-SEE MINUTES • AMENDED • Page 2 1. Effective July 1, 2013, a three percent (3%) base pay matrix will be utilized to calculate merit increases for all eligible unrepresented management employees, using the current pay for performance system. An eligible employee whose salary is close to their salary range maximum (such that the designated pay increase would cause their salary to exceed the salary range maximum) will receive a base pay increase up to the salary range maximum and will receive the remaining portion ofthe designated pay increase as a lump sum cash reward. The lump sum cash reward (either received in addition to a base pay increase that brought an employee's salary up to the range maximum or in lieu of a base pay increase for an employee who was already at the range maximum) is not reportable to CalPERS for purposes of calculating retirement benefits. 2. All unrepresented management employees will receive a $1,600 taxable cash stipend in the pay period that includes January 1, 2014. This stipend is not reportable to CalPERS for purposes of calculating retirement benefits. 3. Effective December 31, 2014, a four percent (4%) base pay matrix will be utilized to calculate merit increases for all eligible management employees using the revised pay for performance system that becomes effective on January 1, 2014. Benefits Credits On an annual basis, the City Council reviews the monthly amount the city will contribute on behalf of each active unrepresented management employee, elected official and appointed official in the form of "Benefits Credits". As of January 1, 2014, CalPERS HMO health insurance premiums are decreasing by an average of eight point one percent (8.1%). Staff recommends a decrease to the monthly Benefits Credits effective January 1, 2014 by the following amounts: 1) $23 for employees with "employee only" coverage, 2) $44 for employees with "employee plus one dependent" coverage, 3) $58 for employees with "employee plus two or more dependents" coverage and 4) $13 for employees who do not wish to participate in the CalPERS Health Program and, therefore, exercise the "Opt Out Provision." Cafeteria Plan In order to allow employees to select the benefits that meet their needs, it is recommended that the following benefit changes are made. 1. Prospectively, as of the first full pay period following City Council approval, if an employee does not use all of their benefit credits to pay for their health insurance, any unused benefit credits will be paid to the employee as taxable cash. 2. As of January 1, 2014, management employees will no longer be required to select dental insurance at the same coverage level as their medical insurance. In addition, they will be allowed to apply their benefit credits towards the optional purchase of Accidental Death 8i Dismemberment insurance. Other Revisions to Reflect Current Practice The remaining language changes outlined in Exhibit 3 reflect other current administrative practices. Page 3 FISCAL IMPACT: The estimated annual cost ofthe three percent (3%) base pay matrix effective July 1, 2013 is $445,000, which includes salary and salary-related benefits. The estimated cost associated with the $1,600 per employee cash stipend effective January 1, 2014 is $182,000. The cost ofthe December 31, 2014 base pay matrix funded at four percent (4%) will be reflected in the FY 2014/15 budget. The General Fund impact in FY 2013-14 ofthe increase to base salary, salary related benefits, and cash stipend is approximately $498,000 and is requested to be funded from Council Contingency. The impact in FY 2013-14 ofthe increase to base salary, salary related benefits and cash stipend to Non General Fund is approximately $129,000 and is requested to be funded from their respective fund balances. Finance will appropriate this amount from the related funds reserves. The reduction ofthe Health Benefit Credits effective the pay period that includes January 1, 2014 for unrepresented management employees, elected officials and appointed officials will save the city approximately $67,000. There is no fiscal impact associated with the other revisions outlined in Exhibit 3. ENVIRONMENTAL IMPACT: The proposed action does not qualify as a "project" under the California Environmental Quality Act (CEQA) per State CEQA Guidelines Section 15378 as it does not result in a direct or reasonably foreseeable indirect physical change in the environment. EXHIBITS: 1. Resolution No. 2013-21 TWith its Exhibit A: Management Compensation and Benefits Plan 2. Resolution No. i47fi appropriating funds to support the revisions to the Management Compensation and Benefits Plan 3. Strikeout copy ofthe Management Compensation and Benefits Plan 4. Management Salary Schedule effective January 1, 2014 5. Strikeout copy of the Management Salary Schedule 1 RESOLUTION NO. 2013-217 2 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, 3 CALIFORNIA, REVISING SECTIONS OF THE MANAGEMENT COMPENSATION AND BENEFITS PLAN AND MAKING AN 4 APPROPRIATION THEREFOR. ^ WHEREAS, City Council has authorized the City Manager to administer a Performance 6 Management and Compensation Plan for employees in unrepresented management 7 classifications; and 8 WHEREAS, City Council desires to amend the Management Compensation and Benefits IQ Plan as outlined in Exhibit 3; and 11 WHEREAS, the City Council wishes to fund a base pay program for management 12 employees which rewards the development and demonstration of competencies on the job; and 13 WHEREAS, the City Council has the authority to determine the provisions of a Health 14 Benefits Program and to set the amount of Health "Benefits Credits" that the City will contribute 15 on behalf of each active unrepresented management employee, elected official and appointed 17 official; and WHEREAS, in order to reflect current practice, the Management Compensation and Benefits Plan requires modification NOW, THEREFORE, BE IT RESOLVED by the City Council ofthe City of Carlsbad, California, as follows: 18 19 20 21 22 23 1. That the above recitations are true and correct. 24 2. That the City Council hereby authorizes the Human Resources Director to implement base 25 26 27 28 pay increases for unrepresented management employees effective July 1, 2013, based on performance during the previous fiscal year and a base pay matrix funded at three percent (3%) of base salaries, to be paid in accordance with the Management 4 1 Compensation Plan, and with the provision that those eligible employees whose salary is close to their salary range maximum (such that the designated pay increase would cause 3 their salary to exceed the salary range maximum) will receive a base pay increase up to 4 the salary range maximum and will receive the remaining portion of the designated pay 5 increase as a lump sum cash reward. 6 7 3. That the City Council hereby authorizes the Human Resources Director to implement a ^ $1,600 cash stipend for each unrepresented management employee active on payroll in 9 the pay period that includes January 1, 2014. 10 4. That the City Council hereby authorizes the Human Resources Director to implement base 11 j2 pay increases for unrepresented management employees effective December 31, 2014, 13 based on performance during the previous calendar year and a base pay matrix funded at 14 four percent (4%) of base salaries, to be paid in accordance with the Management Compensation Plan 16 5. That the City Council authorizes the Administrative Services Director to transfer $498,000 17 from Council Contingency to the respective General Fund departments to be used for the 1 o 19 cost of the July 1, 2013 base pay increases and the January 1, 2014 cash stipend for 20 unrepresented management employees. 6. That the City Council hereby authorizes the Administrative Services Director to adjust the Fiscal Year 2013-14 budgets for the Non-General Funds by appropriating a total of $129,000 in the affected funds to be used for the cost of the July 1, 2013 base pay 21 22 23 24 25 increases and the January 1, 2014 cash stipend for unrepresented management 26 employees 27 28 1 2 3 4 5 6 7 8 9 10 11 12 // 13 // 14 // 15 // 16 // 17 // 18 19 // 20 // 21 // 22 // 23 // 24 25 26 27 28 7. That the Fiscal Year 2013-14 budgets will be adjusted to reflect the budgetary savings that results from the decrease to the health benefit credits. 8. That funding for the December 31, 2014, four percent (4%) base pay matrix will be included in the Fiscal Year 2014-15 budget. 9. That Exhibit A, the Management Compensation and Benefits Plan, as approved, contains revisions to the Performance Management and Compensation, Health Benefits, and other provisions, and supersedes Resolution No. 2012-256 adopted November 27, 2012. 10. That Administrative Order No. 66 will no longer apply to unrepresented management employees as of January 1, 2014. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 PASSED, APPROVED AND ADOPTED at a Joint Special Meeting of the Carlsbad City Council and Carlsbad Municipal Water District Board of Directors, held on the 27*^ day of August, 2013, by the following vote: AYES: NOES: ABSENT: Council Members Hall, Packard, Wood, Blackburn and Douglas. None. None. MATT HALL; Mayor ATTEST: BARBARA ENGLESON, CitfClerk Exhibit A MANAGEMENT COMPENSATION AND BENEFITS PLAN TABLE OF CONTENTS Section 1 Introduction Page 1 Section 2 Performance Management and Compensation Page 1 Purpose Page 2 Background Page 3 Guidance Page 3 Procedures Page 11 Compensation Plan Page 13 Training Page 14 Glossary Page 14 Section 3 Schedule of Benefits Page 15 Life Insurance and Voluntary Benefits Page 15 Retirement Page 15 Employee Retirement Contribution Page 16 Management Leave Page 16 Health Insurance for Retirees Page 22 Sick Leave Conversion Page 23 Separation Compensation Page 23 Holidays Page 23 Health Benefits Page 24 Annual Physical Examination and/or Physical Page 26 Fitness Testing Long-Term Disability Insurance (LTD) Page 27 Deferred Compensation Page 27 Drug and Alcohol Policy Page 27 Reporting the Value of Uniforms to CalPERS Page 28 Post-Retirement Healthcare Trust Page 28 S Management Compensation and Benefits Plan SECTION 1: INTRODUCTION This attachment constitutes the Management Compensation and Benefits Plan, which contains three parts: 1) an introduction, 2) a brief overview of how management performance will be evaluated and how compensation levels will be determined, and 3) a schedule of management benefits. A. Definitions 1. Management Employees - Management employees are defined as those employees whose classifications are listed on the Management Salary Structure. Except as to those management employees subject to an applicable law, all management employees are considered "at-v^U" and have no property rights to their position. At will employment v^th the City may be terminated at any time by either party, with or v^thout cause, for any reason or no reason whatsoever, and v^th or v^thout advance notice. At will employees do not have the right to appeal. 2. City Council Appointed Employees - The City Manager and City Attomey are hired by and responsible directly to the City Council. The salaries for these positions shall be set by the City Council. The City Manager and City Attomey will not be subject to the provisions of the Performance Management and Compensation program as outlined in Section 2 of this attachment. The schedule of management benefits (as outlined in Section 3 of this attachment) will apply to these positions, except as othenvise provided by the City Council. SECTION 2: PERFORMANCE MANAGEMENT AND COMPENSATION SYSTEM The City Council has delegated its authority to the City Manager (and City Attomey, for management employees in the City Attomey's Office)^ to administer a Performance Management and Compensation System for management employees under the general guidelines set forth in this section. The City Manager will periodically provide the City Council v^th progress reports on the operation of the Performance Management and Compensation System. I. PURPOSE: Pay for Performance at the City of Carlsbad is based on the concept of a supervisor providing regular coaching/feedback to the employee. The purpose is to: > create an environment that rewards high performers; > link financial rewards to accomplishing City business objectives; > create a consistent City-wide approach for managers to link performance and rewards; and > create a meaningful/fair reward system. ^ Hereafter, all references to the City Manager include, with regard to management employees in the City Attomey's Office, the City Attomey. Revised 8/27/13 7 Management Compensation and Benefits Plan IL BACKGROUND: Consistent v^th the direction of the City Council, city staff have developed a compensation program that establishes competitive pay through regular and consistent compensation surveys. The Human Resources Department will maintain the highest possible number of benchmarks vwthin the survey market and make recommendations to City Council regarding maintaining competitive salary ranges. The components of the compensation plan include: > a performance management program based on the concepts of performance planning and regular coaching/feedback; > a market based salary stmcture; and > a Pay for Performance reward system that includes merit mcreases* (base pay increases and/or cash rewards for employees who are at the maximum of their salary range) based on the demonstration of competencies and achievements. * Eligibility for a merit pay increase is determined by an employee's performance and where his/her salary is relative to the midpoint of his/her salary range. Eligible employees who are at the salary range maximum receive a cash reward in lieu of a base pay increase. IIL GUIDANCE: A. Annual Review Cycle The Performance Management Cycle is aligned with the calendar year. Below is a summary of the aimual cycle. Revised 8/27/13 10 Management Compensation and Benefits Plan Council determines funding for merit lerit increases delivered HR determines base pay matrix that complies with approved merit pool funding Supervisors conduct year end reviews Supervisors select competencies and define priorities Supervisors conduct mid-year reviews (after Dept. Director approves mid-year ratings) Supervisors submit proposed year end performance ratings to Department Director Department Directors calibrate and finalize performance ratings 1/ B. Performance Management The performance management process consists of four important, interrelated steps. Step 1- Performance Planning Supervisors and employees vsdll have an initial discussion to determine which functional competencies v^ll be used to evaluate the employee in the upcoming year. The supervisor explains and sets performance level expectations. The supervisor and employee v^ll also establish specific priorities, contributions or development plans that are aligned vdth the departmental and organizational strategic direction. Step 2 - Performance Coaching and Feedback Throughout the year, at least on a quarterly basis, the supervisor and employee review and discuss the employee's work performance, including significant accomplishments and/or shortfalls. Generally, these coaching and feedback sessions will be informal and may be initiated by either the supervisor or employee. It will be the supervisor's responsibility to ensure these discussions take place and are appropriately documented. Revised 8/27/13 Management Compensation and Benefits Plan Step 3- Mid-Year Performance Review Prior to the mid-year review meeting with the employee, the supervisor proposes mid-year ratings for the employee based on the employee's demonstrated competencies and accomplishments related to priorities. The Department Director reviews all proposed mid-year ratings in his/her department and validates that Pay for Performance (P4P) guidelines are followed consistently vydthin his/her department. The goal of the mid-year performance review is to encourage open communication between supervisors and employees and ensure that there are "no surprises" during the annual performance evaluation session at the end of the year. The supervisor and employee v^U assess and discuss the employee's progress and the status of specific priorities. As organizational and department directions and priorities shift throughout the year, this session also provides the opportunity to re-evaluate and, if necessary, revise employee's priorities, achievement expectations or development plans. The performance evaluation form, including mid-year performance ratings, v^U be submitted to Human Resources and included in the employee's personnel file. The employee will be entitled to provide a written rebuttal to any rating and comments. However, only the final year end performance ratings v^U be used to determine eligibility for merit pay increases. The final year end performance ratings may differ fi'om mid- year performance ratings. Step 4- Year End Performance Review Prior to the year-end review meeting with the employee, the supervisor proposes ratings for the employee based on the employee's demonstrated competencies and accomplishments related to priorities. The Department Director reviews all proposed ratings in his/her department and works with Human Resources staff to validate that Pay for Performance (P4P) guidelines are followed consistently within and across City departments. Next, the supervisor meets with the employee. The employee v^U come to the year-end review meeting with his/her own thoughts and notes as to how well he/she performed during the evaluation period. The two-way discussion focuses on accomplishments, areas for growth and improvement, job accoimtabilities and defined competencies. This meeting v^U also include the perfonnance planning for the upcoming year as outlined in Step 1 above. C. Govemance of the Plan Human Resources will be responsible for the administration and maintenance of the performance management system, including forms, guidelines and related policies subject to City Council approval. Human Resources will periodically review the effectiveness of the performance management system. D. Major Roles and Responsibilities Citv Council - The City Council is initially responsible for approving the pay for performance management system and for annually approving the merit pool/funding amount in order to tie rewards to performance. Revised 8/27/13 Management Compensation and Benefits Plan Human Resources - The role of Human Resources will be to monitor the activities ofthe process, ensure compliance v^th City processes and procedures, and ensure that the employee receives a fair, accurate, and timely evaluation. This v^U be done by ensuring that appropriate results-oriented goals and measures are established for the upcoming calendar year and by revievdng proposed performance and development plans and evaluation forms for accuracy and completeness. Human Resources will track performance ratings over time to encourage accountability and ensure that there is consistency among the distribution of performance ratings across departments. Human Resources will provide on-going guidance and training to supervisors regarding conducting performance reviews and understanding the purpose and design ofthe pay for performance system. Himian Resources uses data from all employee performance ratings and Council's authorized funding amount to determine the percentages in the base pay matrix. Human Resources will process merit increases for eligible employees. Department Director - Department Directors v^U be responsible for reviewing performance ratings vwthin their departments to ensure that accurate evaluation ratings are given and that supervisors are held responsible for effectively rating their staff In the event of tumover of an employee's supervisor, the Department Director will be responsible for ensuring that an employee is equitably and adequately reviewed and rated. Supervisor - The supervisor will carry out the steps in the performance management process in a fair, accurate, consistent, and timely manner. This includes guiding the development of performance plans, monitoring and recording employee accomplishments, providing timely coaching and feedback, conducting accurate performance evaluations, and ensuring the employee has the opportunity to participate in the process. In the event that an employee has more than one supervisor during a rating period, each supervisor will submit an assessment and the supervisors will mutually agree on a rating for the review period. A newly assigned supervisor v^U not be responsible for reviewing a rating period of less than three months. Employee - The employee v^U actively contribute m the process of defining priorities and performance measures, initiating coaching and feedback sessions as needed. Requests for feedback by the employee shall be responded to within 14 calendar days of the request, although actual feedback can be written or oral and can be provided more than 14 calendar days after the request. Employees v^U complete a self-assessment prior to the year-end performance evaluation, and will be prepared to contribute in the mid-year and end of year performance evaluations. Revised 8/27/13 / ^ Management Compensation and Benefits Plan E. Performance Management Components Essential Functions Essential functions are the job duties/tasks that an employee was hired to perform. These functions are the permanent features of the employee's job. The essential functions are outlined in the employee's job description. Essential fimctions are job-based rather than employee-based. At the beginning of the performance year, the employee's job description v^U be reviewed by the supervisor and employee. Any significant changes in the qualifications or job tasks will be noted and submitted to Human Resources. Essential functions v^U determine which functional competencies may be appropriate for a specific position. At the end of the plan year, the employee v^Il be rated on their performance related to the essential functions of the job as described in the job description. Employees serving in out of class assignments will be reviewed in accordance with their regular position unless the employee served out of class for more than one-half of the review period. In that case, the employee v^II be reviewed based on their out of class assignment. If, at the outset of the out of class assignment, it is anticipated that the employee will spend more than one-half of the review period in that out of class assignment, the employee and supervisor shall have a Performance Planning Meeting as described in Step 1 above. Core and Functional Competencies All employees v^U be reviewed and evaluated based on how well they can demonstrate specific competencies. Competencies are essential to the success of each employee in their job. There are two types of competencies: 1) Core - describes the required competencies for all employees and 2) Functional - describes competencies specific to the essential functions of the job performed by the employee. All employees v^U be evaluated on the five core management competencies and only two ofthe seven functional management competencies. Each year, during the Performance Planning step, the supervisor and the employee v^ll talk about which functional competencies are the most appropriate to use in the upcoming year based on the employee's specific job, priorities and work plan. Each year, the supervisor and the employee will select the two functional competencies that will be used to evaluate the employee that year. Setting Priorities Individual priorities indicate specific results to be achieved by an employee for the coming review period. Priorities often change from year to year because they are intended to focus on a significant outcome identified by the department. The City v^U support the employee in their development and aim to create an environment of engagement, innovation and excellence. Supervisors will determine three priorities for an employee and v^U link each priority to a core or functional competency. Priorities must be related to a significant component ofthe employee's job and the needs of the City and individual department or division. Supervisors will Revised 8/27/13 Management Compensation and Benefits Plan communicate orally and in writing how each priority is linked to the mission ofthe City/department and to the development of the employee. Individual priority setting is to be done in light of organizational goals and departmental goals and priorities. That is, goals are to cascade down based on the City's strategic plan and initiatives from senior management, to mid-level managers, to supervisors and to line employees. A well-written performance priority has these basic components: > it is action oriented (e.g., includes phrases such as 'to make', 'to complete', 'to adjust'); > it includes a measurable indicator (e.g., quantity, rate, expense, quality, degree of accuracy, timeliness); > there are constraints, such as time limitations; and > it follows the SMART criteria (see below). Using S.M.A.R.T. Criteria Specific Priorities must express the action and results required so that both the employee and supervisor can see clearly whether the priority has been acWeved. What is the achievement or result that is expected? Measurable When setting priorities, there must be some way of measuring and verifying whether the priority has been achieved and to what level. How will the employee and supervisor know if the objective has been met? Achievable Although they should provide challenge and development to the individual, priorities also must be achieved. Is it reasonable that the priority be achieved? Relevant The priorities must be relevant to the level at which the individual is at in their career and to the workload of their particular area. Does the priority contribute to the department, division, or overall organization's success? Time-bound Priorities need to have clearly defined time periods. What is the completion date of each milestone? Rating Process and Criteria The supervisor is responsible for rating the employee on all five core competencies, the two selected functional competencies and the priorities, and for providing written narrative to explain these ratings. Revised 8/27/13 Management Compensation and Benefits Plan The rating system shown below will be used in evaluating employee performance. 1. Unsatisfactory 2. Improvement Needed 3. Competent 4. Commendable 5. Exemplary Performance does Performance does Performance Performance Performance not meet not consistently consistently meets exceeds significantly exceeds requirements. meet requirements. all requirements. requirements and requirements. Performance is Performance Employee is fully demonstrates the Employee has made consistently and deficiencies are proficient and ability to handle contributions and seriously such that adequately assignments of achievements well inadequate. This improvement is demonstrates the greater complexity beyond those employee must needed for the desired and responsibility. required by their make immediate employee to competency This employee assigned and sustained satisfactorily meet behaviors for the shows initiative and responsibilities. In improvements. requirements. level of the job. seeks opportunities many cases. to enhance their job performance related skills and demonstrates new competencies. areas of productivity and innovation far beyond position requirements. Employee Comments Employees shall be advised that they are encouraged but not required to provide comments that they would like documented for the evaluation period. Employee comments will be part ofthe performance evaluation documentation. Signatures The employee's signature acknowledges that the performance evaluation has been reviewed and discussed with them. This does not mean the employee agrees, or disagrees, v^th statements made or contained therein. When the evaluation session is completed, the employee and supervisor sign the form and appropriate levels of signatures are obtained: • Immediate Supervisor • Mid-level Manager (if applicable) • Department Director • Human Resources Employee Outlets Employees who disagree with their rating may request a meeting with their Department Director. If, after this meetmg, this matter is not resolved, the employee may then request a meeting v^th Revised 8/27/13 Management Compensation and Benefits Plan the City Manager or his/her designee and this meeting shall occur vsdthin 30 days at the employee's request. If the employee's performance rating is changed as a result of this process, any resulting merit pay adjustment shall be paid retroactively. F. Linking Pay and Performance Eligibility for a merit increase is determined by an employee's overall performance rating and where his/her current salary is relative to the midpoint of their salary range. Eligibilitv Employees must receive an overall rating of "Competenf or better to be eligible for performance-based merit increases. Those employees receiving an overall "Improvement Needed" or an "Unsatisfactory" performance rating are not eligible for performance based merit increases. An employee whose salary is at their salary range maximum is not eligible for a base pay increase. In lieu of a base pay increase, eligible employees will receive a cash reward that is paid out in a lump sum equivalent to the amount of the base pay increase that they would have received if they were not at the salary range maximum. An eligible employee whose salary is close to their salary range maximum (such that the designated pay increase would cause their salary to exceed the salary range maximum) will receive a base pay increase up to the salary range maximum and will receive the remaining portion of the designated pay increase as a lump sum cash reward as described above. Base Pay Matrix A base pay matrix v^U be used to reward performance. The City Council determines the merit pool or budget for the annual pay increase. After all of the performance reviews have been completed, merit increase percentages will be determined by Human Resources based on the size of the Council approved base pay matrix funding, distribution of all employees' performance ratings and distribution of employees in their salary range (i.e. above or below the salary range midpoint). The goal is to assign merit increase percentages that will use substantially all ofthe funding approved by the City Coimcil for merit increases for that performance cycle. An employee's overall performance rating (sum of individual competency ratings) and position in the range put them in one ofthe cells "A," "B," "C," "D," "E," or "F" as shovm in the sample Base Pay Matrix below. Each employee's merit increase is determined using the base pay matrix. 10 Revised 8/27/13 Management Compensation and Benefits Plan SAMPLE BASE PAY MATRIX Overall Performance Rating 7-10 11-17 18-24 25-31 32-35 Salary Range Improvement Placement Unsatisfactory Needed Competent Commendable Exemplary At or above salary range 0.0% 0.0% A% C% E% midpoint Below salary range 0.0% 0.0% B% D% F% midpoint IV. PROCEDURES: 1. All employees will be reviewed at mid-year and at the end of the calendar year. After both of these review meetings are completed, the performance evaluation form, including performance ratings, will be submitted to Human Resources and be made a part of the employee's personnel file. 2. The immediate supervisor most familiar with the employee's performance during the rating period shall be the rater. If the employee has had more than one supervisor during the evaluation period, the other supervisor(s) will be consulted and only one evaluation form/overall rating will be submitted. 3. Electronic performance evaluations forms will be made available by the Human Resources Department. 4. Ratings shall be based upon the competent performance of the full range of skills indicated by the class specification covering the employee's position. In the event that the class specification is not representative of the employee's current responsibilities. Human Resources will be notified and asked to review and make recommendations. Deviations from the class specification should be noted on the performance evaluation form. 5. Every eligible employee's performance evaluation is due to Human Resources by January 31. Any overdue evaluations will be reported to the Department Director and the City Manager. Exceptions may be made for extenuating circumstances, such as employees out on leaves of absence (see section 7). The Human Resources Department will review all of the performance ratings and calculate the base pay salary increases and/or cash rewards to be awarded for each rating level based on the base pay matrix funding established by the City Council. 11 Revised 8/27/13 7. Management Compensation and Benefits Plan Merit increases shall be distributed within 30 calendar days of receiving the last performance review or no later than the first fiill pay period in March. Merit increases v^U be effective retroactive to the last day of the performance review cycle. Employees are eligible for a base pay salary increase or cash reward if the following requirements are met: • the employee receives a rating of "Competenf or higher on his/her year-end performance review; • the employee has been in a full time or time position for a minimum of 6 months*; and • the employee is active on payroll at the time that merit increases are processed in the payroll system. *Merit increases for employees hired into a full time or VA time position during the review cycle will be prorated as follows: Start Date Prorated Merit Increase Percent January 1- March 31 100% April 1 - June 30 75% July 1 - December 31 0% 8. Any employee may be advanced in the pay range during the performance review period regardless of the length of time served at the employee's present pay rate. This advancement requires the written recommendation of the employee's department head and approval ofthe City Manager. 9. Employees who were promoted during the performance cycle will receive a year end performance-related pay increase based on their salary as of the last day ofthe performance cycle. 10. Eligible employees who are in an out of class assignment vsdll receive a merit increase calculated using salary information from their regular position. 11. If, as a resuh of a salary range adjustment, an employee's base salary falls below the minimum of the salary range, the employee's salary vsdll be increased to the new range minimum as of the date City Council approves the salary range adjustment. 12. An employee who is on a leave of absence during the year-end review process will meet vsdth his/her supervisor upon retum to work and complete a year-end review. If the employee was on a leave of absence (other than a statutorily protected leave of absence) for a portion ofthe review period he/she will be eligible for a prorated merit increase for that review period according to the following schedule: 12 Revised 8/27/13 Management Compensation and Benefits Plan Length of leave* Percent of merit increase eligible < 91 calendar days 100% 91-180 calendar days 75% > 180 calendar days 0% *not inclusive of statutory leave time 13. Employees who terminate employment after the last day of the review cycle will not be eligible for merit increases. V. COMPENSATION PLAN: The key element of the employee pay for performance program is the base pay stmcture. Covering all management jobs, the base pay stmcture reflects competitive pay levels for jobs assigned to each pay grade and provides the basis for equitable pay decisions. The Management Salary Stmcture contains multiple salary ranges. Each salary range has a minimum, midpoint and maximum. Employees who are inexperienced or newly hired may be paid below the midpoint of the salary grade. In keeping with the City Council's philosophy of surveying the total compensation of local agencies, the agencies listed below vsdll be considered in the survey market for management classifications. City of Chula Vista City of Coronado City of Del Mar City of El Cajon City of Encinitas City of Escondido City of Imperial Beach City of La Mesa City of National City City of Oceanside City of Poway City of San Marcos City of Solana Beach City of San Diego City of Santee City of Vista County of San Diego The Human Resources Department will compare salary and benefits information on each City of Carlsbad benchmark classification vsdth appropriate classifications in the comparator group. Those classifications that are considered benchmarks are those in which there was a substantial match between the competencies and duties required for jobs at the City of Carlsbad and those 13 Revised 8/27/13 Management Compensation and Benefits Plan for the comparator group. A benchmark requires a minimum of three comparators. The job matching is conducted by the Human Resources Department. From time to time the City Council may also request that private sector salary and benefits data be reviewed and compared to benchmark positions at the City of Carlsbad. Each City of Carlsbad job classification is assigned to a specific salary range. The non- benchmark positions are assigned to the salary stmcture based on intemal relationships, responsibility and/or knowledge, skills and abilities of jobs. The benchmark salary data will be surveyed regularly and the benchmark comparisons vsdll be modified when the classifications change within the organization. Periodically the Human Resources Department will bring forth salary range movement recommendations to City Council that are based on market and economic conditions, and may include one or more salary ranges. The City Council delegates to the City Manager the authority to assign job classifications to a specific salary grade, based on both benchmark salary information and intemal relationships vsdthin the organization. VI. TRAINING An extensive training program vsdll be designed to enhance the evaluation and feedback skills of supervisors. Skills training will include: • Performance Planning - Competencies • Conducting Performance Evaluations • Coaching, Counseling and Feedback • Compensation Administration • Performance Planning - Goal Setting The Human Resources Department vsdll offer periodic review sessions to reinforce managerial and supervisory skills and to train employees. VIL GLOSSARY 1. Base Pav increase - A prospective pay increase to an employee's base salary, as calculated to exclude any additional pays. 2. Base pav matrix - Matrix that determines the base pay increases and cash rewards to be given to eligible employees. 3. Cash reward -A one-time "lump sum" payment equivalent to the amount of the base pay increase that an employee would have received if he/she were not at the salary range maximum. 4. Merit increase - Either a base pay increase or cash reward as determined by the base pay matrix. 5. Survev market - List of Council approved agencies to be used when reviewing market competitiveness. 14 Revised 8/27/13 Management Compensation and Benefits Plan SECTIONS: SCHEDULE OF BENEFITS Life Insurance and Voluntary Benefits All management employees shall receive City paid life insurance in an amount equal to two times the basic yearly eamings. To determine benefits, the amount of insurance is rounded to the next higher $1,000 multiple, unless the amount equals a $1,000 multiple. The City provides various voluntary benefits available at the employee's cost. Employees may select among various levels of coverage. For information regarding these benefits, contact the Human Resources Department at 760-602-2440. Former CMWD management employees shall receive Group Term Life Insurance, Accidental Death and Dismemberment, and Dependent Life Insurance as contained in their Individual Agreement. Retirement All management employees shall participate in the Califomia Public Employees' Retirement System (CalPERS). The specific retirement formula applied will be determined based on whether the position is deemed safety or miscellaneous. All positions not deemed eligible for safety returement will be deemed miscellaneous under the CalPERS system. Optional benefits unique to the City of Carlsbad's contract vsdth CalPERS are outlined in the contract between the city and CalPERS. A copy of this contract is kept on file in the Human Resources Department. Management employees who are considered fire safety employees are eligible for the same retirement benefit formula and are subject to the same optional retirement benefits described in the City of Carlsbad CalPERS safety contract as those provided to employees represented by the Carlsbad Firefighters' Association, Inc. Unrepresented swom police management employees are eligible for the same retirement benefit formula and are subject to the same optional retirement benefits described in the City of Carlsbad CalPERS safety contract as those provided to employees represented by the Carlsbad Police Officers'Association. The Citv has contracted with CalPERS for the foUovsdng retirement benefits: a) Miscellaneous Tier 1 (employees entering miscellaneous membership for the first time prior to November 28, 2011) - retirement formula shall be 3%) @ 60; single highest year final compensation. b) Miscellaneous Tier 2 (employees entering miscellaneous membership for the first time on or after November 28,2011) - retirement formula shall be IVo @ 60; three year average final compensation. c) Safetv Tier 1 (employees entering safety membership for the first time prior to October 4, 2010) - retirement formula shall be 3% @ 50; single highest year final compensation. d) Safetv Tier 2 (employees entering safety membership for the first time on or after October 4,2010) - retirement formula shall be 2% @ 50; three year average final compensation. 15 Revised 8/27/13 2 Management Compensation and Benefits Plan Employees entering membership on or after January 1,2013 and who are subject to the Califomia Public Employees' Pension Reform Act of 2013 (PEPRA) will have the following retirement benefits: a) Miscellaneous employees - retirement formula shall be 2% @ 62; three year average final compensation. b) Safetv employees - retirement formula shall be 2.7%o @ 57; three year average final compensation. Employee Retirement Contribution The employee retirement contribution will be made on a pre-tax basis by implementing provisions of section 414(h)(2) of the Intemal Revenue Code (IRC). Effective with the first payroll period including December 1,2012, the Employee Paid Member Contribution (EPMC) shail be reduced from 3.5%> to 0%o for all unrepresented management employees. Employees shall make the following employee retirement contributions through payroll deductions: • First tier miscellaneous employees shall pay 8%, • Second tier miscellaneous employees shall pay 7% and • First and Second tier safety employees shall pay 9Vo. Employee contributions for employees entering membership on or after January 1,2013 and subject to the Califomia Public Employees' Pension Reform Act of 2013 (PEPRA) vsdll be determined by CalPERS. Management Leave Management employees are exempt from overtime requirements under the Fair Labor Standards Act. Fire Battalion Chiefs are exempt from overtime requirements under FLSA, however. Fire Battalion Chiefs that are required to work a 24-hour shift/112 hours per bi-weekly pay period schedule are paid straight time for overtime when they are covering the duty for a Battalion Chief on leave. Management employees in the City are paid on a salary basis versus an hourly basis. Pursuant to FLSA regulation 29 CFR Section 541.5d, the City can make deductions from salary or leave accounts for partial day absences for personal reasons or sickness because the City has a policy and practice of requiring its employees to be accountable to the public that they have eamed their salaries. A partial day absence is an absence of less than the employee's regular work day. Pursuant to FLSA regulation 29 CFR Section 541.118 (a)(2) and (a)(3), the City may make salary or leave reductions based upon full day absences. Partial day or full day absences shall be first charged against the exempt employee's vacation, sick, or executive leave account. In the event the exempt employee does not have sufficient time in his/her leave account to cover the absence, deductions without pay will be made on full days only. 16 Revised 8/27/13 Management Compensation and Benefits Plan Vacation Every management employee shall accme vacation leave for each calendar year of actual continuous service dating from the commencement of said service, vsdth such time to be accmed on a daily (calendar day) basis. Vacation leave can be used in 15 minute increments. All management employees (except Fire Battalion Chiefs that work 112 hours per bi-weekly pay period) shall eam vacation on the foUovsdng basis: Beginning vsdth the first (1 st) working day through the completion of five (5) full calendar years of continuous service -13 minutes/day. Beginning the sixth (6th) year of employment through the completion of ten (10) full calendar years of continuous service - 20 minutes/day. Beginning the eleventh (11th) year of employment through the completion of eleven (11) full calendar years of continuous service - 21 minutes/day. Beginning the twelfth (12th) year of employment through the completion of twelve (12) full calendar years of continuous service - 22 minutes/day. Beginning the thirteenth (13th) year of employment through the completion of thirteen (13) full calendar years of continuous service - 24 minutes/day. Beginning the fourteenth (14th) year of employment through the completion of fifteen (15) full calendar years of continuous service - 25 minutes/day. Beginning the sixteenth (16th) year of continuous employment, vacation time shall be accmed, and remain at a rate of 26 minutes/day for every full calendar year of continuous employment thereafter. Management employees vsdth comparable service in local govemment agencies may be granted credit for such service for the purpose of computing vacation at the discretion of the City Manager. All management employees shall be permitted to eam and accme up to and including three hundred and twenty (320) hours of vacation, and no employee will be allowed to eam and accme vacation hours in excess of the three hundred and twenty (320) hour maximum.* The City Manager shall be responsible for the granting of vacation to all management personnel, except in the case of the City Attomey's Office, where the City Attomey shall be responsible for granting vacation. * If there are unusual circiraistances that would require an employee to exceed the vacation accmal maximum, he/she must submit a request in writing to the Department Head and the City 17 Revised 8/27/13 Management Compensation and Benefits Plan Manager or Designee. The Department Head and the City Manager or Designee may grant such a request if it is in the best interest ofthe City. Requests will be handled on a case-by-case basis and will be considered only in extreme circumstances. Former CMWD management employees shall eam and accme vacation up to and including the maximum as contained in their Individual Agreement. Fire Battalion Chiefs that work 112 hours per bi -weekly pay period shall eam and accme vacation up to and including the maximum commensurate with Carlsbad Firefighters' Association (CFA) represented employees that work 112 hours per bi-weekly pay period. Vacation Conversion Each Febmary, management employees vsdll be allowed to voluntarily convert up to 80 hours of accmed vacation to cash, provided that they have used 80 hours of vacation during the prior calendar year. Fire Battalion Chiefs that work 112 hours per bi-weekly pay period vsdll be allowed to voluntarily convert up to 112 hours of accmed vacation to cash, provided that they have used 112 hours of vacation during the prior calendar year. Executive Leave All management personnel, except former CMWD management employees, shall receive 56 hours per fiscal year for executive leave. The 56 hours will be credited at the beginning of each fiscal year to individual leave balances. This leave must be used vsdthin the same fiscal year. The City Manager is authorized to provide ten (10) additional hours of executive leave per year to any management employee who is required to work extended hours due to emergencies such as fires, storms, floods, or other emergencies. Sick Leave Sick leave can be used in 15 minute increments. Sixteen (16) minutes of sick leave are accmed per calendar day. Accumulation is unlimited (employees cannot receive payment for unused sick leave). Fire Battalion Chiefs that work 112 hours per bi-weekly pay period shall accme sick leave commensurate vsdth CFA represented employees that work at 112 hours per bi-weekly pay period. Bereavement Leave An employee may use up to an equivalent of three work days of paid leave if required to be absent from duty due to the death of a member of the employee's immediate family. Additional time off may be authorized by the Department 18 Revised 8/27/13 Management Compensation and Benefits Plan Head and charged to accmed vacation or sick leave or, when no accmed leave is available, treated as leave vsdthout pay. The "immediate family" shall be defined in the personnel mles and regulations. The employee may be required to submit proof of relative's death before final approval of bereavement leave is granted. Leave of Absence 1. Leave of Absence Without Pay A. General Policv Any employee may be granted a leave of absence without pay pursuant to the approval of his/her Department Head for less than two calendar weeks. If the duration of the leave of absence vsdll be longer, the approval of the City Manager or his/her designee is required. An employee shall utilize all his/her vacation, e-time and/or sick leave (if applicable) prior to taking an authorized leave of absence vsdthout pay. A leave without pay may be granted for any of the following reasons: 1. Illness or disability. 2. To take a course of study which vsdll increase the employee's usefulness on retum to his/her position in the City service. 3. For personal reasons acceptable to the City Manager and Department Head. B. Authorization Procedure Requests for leave of absence without pay shall be made in writing and shall state specifically the reason for the request, the date when the leave is desired to begin, the probable date of retum, and the agreement to reimburse the City for any benefit premiums paid by the City during the leave of absence. The request shall normally be initiated by the employee, but may be initiated by his/her Department Head, and, if applicable, shall be promptly transmitted to the City Manager or his^er designee for approval. A copy of 19 Revised 8/27/13 Management Compensation and Benefits Plan any approved request for leave of absence without pay with a duration equal to or greater than two calendar weeks shall be delivered promptly to the Directors of Finance and Human Resources. C. Length of Leave and Extension A leave of absence vsdthout pay may be made for a period not to exceed six months, unless otherwise approved by the City Manager. The procedure for granting extensions shall be the same as that in granting the original leave provided that the request for extension is made no later than fourteen (14) calendar days prior to the expiration of the original leave. D. Retum From Leave When an employee intends to retum from an authorized leave of absence vsdthout pay either before or upon the expiration of such leave, he/she shall contact his/her Department Head at least fourteen (14) calendar days prior to the day he/she plans to retum. The Department Head shall promptly notify the Human Resources Department of the employee's intention. The employee shall retum at a rate of pay not less than the rate at the time the leave of absence began. E. Effect of Leave Witiiout Pav A prorata reduction of normal annual vacation and sick leave accmals shall be applicable to an approved absence without pay. Any absence without pay constitutes a break of continuous service with the City. The granting of any leave without pay exceeding two full scheduled pay periods shall cause the employee's salary anniversary date and calculation of full-time continuous service to be extended by the number of calendar days for which such leave has been granted less the first two full pay periods of such leave. An employee's accumulation of sick leave and vacation leave vsdll cease after the completion of two (2) full scheduled pay periods in which the employee has not received compensation due to a leave of absence without pay. Accmal will be reinstituted beginning the first day after the employee has retumed to work. 20 Revised 8/27/13 Management Compensation and Benefits Plan F. Leave Without Pav - Insurance Payments and Privileges An employee on leave vsdthout pay may continue his/her City insurance benefits by reimbursing the City for the employee's costs of insurance on a monthly basis during the period of the leave. Failure to reimburse the City for such benefits during the term of a leave of absence will result in the employee's coverage terminating on the first day following the month in which the last payment was received. Upon the employee's retum to paid status, any sums due to the City shall be repaid through payroll deductions. This applies to sums due for insurance as well as other payment plans entered into between the City and the employee (e.g., computer loan). Upon eligibility for COBRA, the employee vsdll be notified of the opportunity to continue benefit coverage via the COBRA process. An employee on leave of absence vsdthout pay shall not have all of the privileges granted to regular employees (e.g., holiday pay), unless required by law. Pregnancy Disability Leave Pregnancy Disability Leave shall be authorized and/or administered in accordance with the provisions of State and Federal law. An employee disabled by pregnancy shall be allowed to utilize a combination of accmed sick leave and vacation time and leave without pay to take a leave for a reasonable period of time, not to exceed four months. An employee shall utilize all accmed leave prior to taking leave vsdthout pay. Reasonable period of time means that period during which the employee is disabled on accoimt of pregnancy, childbirth, or related conditions. An employee who plans to take a leave pursuant to this article shall give the City reasonable notice of the date the leave shall commence and the estimated duration of the leave. Familv and Medical Leave of Absence (FMLA) An employee may be granted a FMLA of up to 12 weeks ina 12 month period for one or more of the foUovsdng reasons: - for the birth/placement of a child for adoption or foster care, - to care for an immediate family member with a serious health condition, or 21 Revised 8/27/13 0 Management Compensation and Benefits Plan - to take medical leave when the employee is unable to work because of a serious condition. FMLA may be paid or unpaid and may be granted concurrently and in conjunction vsdth other leave and benefit provisions. Specific details regarding the provisions of this leave are available by contacting the Human Resources Department. • Military Leave Military leave shall be authorized in accordance with the provisions of State and Federal law. The employee must fiimish satisfactory proof to his/her Department Head, as far in advance as possible, that he/she must report to military duty. • Jury Duty When called to jury duty, an employee shall be entitled to his/her regular compensation. Employees released early from jury duty shall report to their supervisor for assignment for the duration of the shift. Employees shall be entitled to keep mileage reimbursement paid while on jury duty. A Department Head may, at his/her sole discretion, contact the court and request an exemption and/or postponement of jury service on behalf of an employee. Employees released early from jury duty shall report to their supervisor for assignment for the duration of the work day. At the discretion of the supervisor, an employee may be released from reporting back to work if an unreasonable amount of the work day remains in light of travel time to the job site after release. Health Insurance for Retirees Effective January 1, 2001, management employees will be covered by the Public Employees' Medical and Hospital Care Act and vsdll be eligible to participate in the Califomia Public Employees' Retirement System (CalPERS) Health Program. Management employees who retire from the City, either service or disability, shall be eligible to continue their enrollment in the CalPERS Health Program when they retire, provided that the individual is enrolled or eligible to enroll in a CalPERS medical plan at the time of separation from employment and their effective date of retirement is within 120 days of separation. The City vsdll contribute the minimum amount per month required under Govemment Code Section 22892 of the PEMHCA toward the cost of each retiree's enrollment in the CalPERS Health Program. Employees who retire from the City, either service or disability, shall be eligible to continue to participate in the City's dental and/or vision insurance programs. The cost of such dental and/or vision insurance for the retiree and eligible dependents shall be bome solely by the retiree. The City shall not charge the COBRA administrative cost to the retirees. A retiree who does not 22 Revised 8/27/13 Management Compensation and Benefits Plan choose continued coverage upon retirement, or drops coverage, is only eligible to retum to the City's dental and vision insurance program during open enrollment periods. The City vsdll invoice the retiree for his/her monthly premiums for dental and/or vision insurance and the retiree must keep such payments current to ensure continued coverage. Sick Leave Conversion Any management employee who has accmed and maintains a minimum of one hundred (100) hours of sick leave shall be permitted to convert up to twelve (12) days of sick leave and uncompensated sick leave to vacation at a ratio of three (3) sick leave days per one (1) day of vacation. The sick leave conversion option will be provided during the first week of each fiscal year. Conversion can only be made in increments of full day vacation days. Employees will not be allowed to convert sick leave to vacation if such conversion would put them over the vacation accmal maximum. Former CMWD management employees per their Individual Agreement, have the option to sell back 100%) of accumulated sick leave in excess of 250 hours at their current rate. The City, at its discretion, may purchase any accumulated sick leave from any of these referenced management employees at tiie current rate. Separation Compensation All management employees involuntarily separated from the City service due to budget cutbacks, layoffs, contracting out of service or for other reasons not due to misconduct which would justify involuntary separation shall receive one month's salary computed at the employee's actual salary at the time of separation. Holidays All management employees shall be paid holidays in accordance with the schedule of eleven (11) holidays as established by the City Council. Fire Battalion Chiefs are subject to the same holiday schedule that is outlined for management employees. However, they are compensated for holidays in the same manner as CFA represented employees that work 112 hours per bi- weekly pay period. The scheduled paid holidays that will be official City holidays shall be as follows: New Year's Day Columbus Day Martin Luther King's Birthday Veteran's Day Presidents' Day Thanksgiving Day Memorial Day Thanksgiving Friday Independence Day Christmas Day Labor Day 23 Revised 8/27/13 Management Compensation and Benefits Plan Only employees who are on paid status on their last scheduled work day before a holiday shall be entitled to the paid holiday except where otherwise required by law. Health Benefits Management employees vsdll participate in a flexible benefits program which includes medical insurance, dental insurance, vision insurance and flexible spending accounts (FSAs). Each of these components is outlined below. Medical Insurance Management employees vsdll be covered by the Public Employees' Medical and Hospital Care Act (PEMHCA) and vsdll be eligible to participate in the Califomia Public Employees' Retirement System (CalPERS) Health Program. The City vsdll pay on behalf of all management employees and their eligible dependents and those retirees mentioned in the section of this document titled, "Health Insurance for Retirees," the minimum amount per month required under Govemment Code Section 22892 of the PEMHCA for medical insurance through the Califomia Public Employees' Retirement System (CalPERS). If electing to enroll for medical benefits, the employee must select one medical plan from the variety of medical plans offered. Effective January 1,2013, the City vsdll contribute the followuig monthly amounts (called "Benefits Credits") on behalf of each active management employee and eligible dependents toward the payment of 1) medical premiums under the CalPERS Health Program, 2) contributions in the name of the employee to the City's flexible spending account(s), 3) contributions of some or all of the premium for dental coverage or vision coverage: (a) For employees with "employee only" coverage, the City shall contribute five hundred sixty-seven ($567) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee vsdll pay the difference. (b) For employees vsdth "employee plus one dependenf coverage, the City shall contribute one thousand eighty-two dollars ($1,082) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee will pay the difference. (c) For employees vsdth "employee plus two or more dependents" coverage, the City shall contribute one thousand four hundred twenty-one dollars ($1,421) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee vsdll pay the difference. Effective the first full pay period following City Council approval of this revised Management Compensation and Benefits Plan, prospectively only, any unused Benefits Credits vsdll be paid to the employee in cash and reported as taxable income. 24 Revised 8/27/13 Management Compensation and Benefits Plan Effective January 1,2014, the City will contribute the foUovsdng monthly amounts (called "Benefits Credits") on behalf of each active management employee and eligible dependents toward the payment of 1) medical premiums under the CalPERS Health Program, 2) contributions in the name of the employee to the City's flexible spending account(s), 3) dental premiums 4) vision premiums and/or 5) accidental death and dismemberment (AD&D) premiums: (a) For employees vsdth "employee only" coverage, the City shall contribute five hundred forty-four ($544) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee vsdll pay the difference. (b) For employees with "employee plus one dependenf coverage, the City shall contribute one thousand thirty-eight dollars ($1,038) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee vsdll pay the difference. (c) For employees vsdth "employee plus two or more dependents" coverage, the City shall contribute one thousand three hundred sixty-three dollars ($1,363) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee will pay the difference. Dental Insurance Management employees will be eligible to enroll in a City-sponsored dental plan. Should an employee elect to enroll for medical benefits, he/she must also enroll in dental coverage at the same coverage level (employee only, employee plus one dependent, employee plus two or more dependents) as medical insurance. Effective January 1,2014, the employee will have the option of selecting any dental coverage level regardless of the employee's selected medical coverage. Vision Insurance Management employees will be eligible to enroll in a City-sponsored vision insurance plan. Employees may elect to purchase vision insurance or to opt out of the vision insurance program. If the decision is made to purchase vision insurance, a management employee may purchase vision insurance at any level of coverage (employee only, employee plus one dependent, employee plus two or more dependents). Opt Out Provision Management employees who do not vsdsh to participate in the CalPERS Health Program vsdll have the choice of opting out of the City's medical insurance program, provided they can show that they are covered under another insurance program. 25 Revised 8/27/13 3- Management Compensation and Benefits Plan Effective January 1,2013, employees who elect this option will be given a reduced City contribution amount (Benefits Credits) of three hundred eight dollars ($308) per month, that shall include the mandatory payments to CalPERS, to be used toward the purchase of dental insurance, vision insurance, or as a contribution to a flexible spending account. The City contribution amount of three hundred eight dollars ($308) per month vsdll be granted to any employee who elects to opt out of the CalPERS Health Program, regardless of the employee's level of coverage (employee only, employee plus one dependent, employee plus two or more dependents). Effective January 1,2014, employees who elect this option vsdll be given a reduced City contribution amount (Benefits Credits) of two hundred ninety-five dollars ($295) per month, that shall include the mandatory payments to CalPERS, to be used toward the purchase of dental insurance, vision insurance, accidental death and dismemberment (AD&D) insurance or as a contribution to a flexible spending account. The City contribution amount of two hundred ninety-five dollars ($295) per month will be granted to any employee who elects to opt out of the CalPERS Health Program, regardless of the employee's level of coverage (employee only, employee plus one dependent, employee plus two or more dependents). All active management employees who work three quarter-time or less vsdll receive prorated benefit credits. Effective the first full pay period following City Council approval of this revised Management Compensation and Benefits Plan, prospectively only, unused Benefits Credits as outlined above vsdll be paid to the employee in cash and reported as taxable income. Former CMWD management employees shall receive Medical, Dental and Vision, and Retiree Medical as contained in their Individual Agreement. Annual Physical Examination and/or Physical Fitness Testing All management employees, excluding former CMWD management employees, shall be eligible for reimbursement of up to the amount of four himdred fiffy dollars ($450) during each fiscal year to pay the cost of an employee's annual physical examination and/or physical fitness testing. The aimual physical examination may be completed by a physician of the employee's choice. Each employee claiming reimbursement shall be required to submit original receipts to the Human Resources Department in lieu of submitting them to the insurance company for payment. The annual physical examination offered to management employees provides physical fitness testing and information regarding lifestyle changes that promote optimum health. Program components include, but are not limited to: Computerized Heart Risk Profile, Complete Blood Profile, Nutritional Assessment, Diet Program, Body Measurements, Lung Assessment, Consultations, etc. 26 Revised 8/27/13 :3 Management Compensation and Benefits Plan Long-Term Disability Insurance (LTD) Long-term disability is available for all management personnel (except management personnel who are considered fire safety employees) after 30 days of disability. The LTD premium cost is paid by the City. Employees shall be entitled to combme accumulated vacation leave or e-time vsdth LTD payments for the purpose of achieving the equivalent of their pre-disability salary to the extent allowed by law during any period of nonindustrial disability. Accumulated sick leave may not be combined vsdth LTD payments. Under no circumstances shall the combination of accumulated leave and LTD payments exceed the employee's pre-disability salary. Former CMWD management employees shall receive LTD benefits as contained in their Individual Agreement. Deferred Compensation The City shall provide deferred compensation plan(s) which may be utilized by any management employee. The City reserves the right to accept or reject any particular plan and to impose specific conditions upon the use of any plan. The City agrees to work vsdth the City's deferred compensation provider (currently ICMA Retirement Corporation) to maintain a personal loan provision for all management employees. It is acknowledged that the City vsdll assist in the administration of this benefit but that the City has no liability if an employee should default on the repayment of such a loan. Former CMWD management employees may voluntarily participate in the Deferred Compensation Plan as contained in their Individual Agreement. The City matches former CMWD employee contributions up to a maxunum of 7.5% of the employee's eamings. Drug and Alcohol Policy It is the policy of the City of Carlsbad to provide a work environment free from the effects of dmgs and alcohol consistent with the directives of the Dmg Free Workplace Act. This policy is applicable to all employees covered by the Management Compensation and Benefits Plan. A copy of this policy is available in the Human Resources Department. As a provision of this policy, the City provides a voluntary Employee Assistance Program (EAP) to assist employees who seek help for substance abuse or other personal problems affecting work or family life. This program is available to employees and their family members and offers 24- hour access to confidential professional EAP assistance for emergency or urgent situations. For more specific information, contact the Human Resources Department or visit the City's intranet site. 27 Revised 8/27/13 Management Compensation and Benefits Plan Reporting the Value of Uniforms to CalPERS Effective May 31, 2010, all fire management employees who are required to wear City-provided uniforms will have the amount of $17.31 reported to CalPERS bi-weekly as special compensation related to the monetary value of the required uniforms, excluding boots. Under PEPRA, this benefit does not apply to new members. Post-Retirement Healthcare Trust Employees who were promoted into a management classification after May 28, 2013 from a position that was represented by CFA, Inc. will continue to contribute into the post-retirement healthcare tmst established by C^FA, Inc. via payroll deductions until participation by CFA, Inc., in this type of tmst is terminated. The contribution amount will be equal to the amount established for employees represented by CFA, Inc. The City has no administrative responsibilities or liabilities related to this benefit, other than processing of payroll deductions as described above. The City will not make any contributions to the post-retirement healthcare trust. 28 Revised 8/27/13 1 RESOLUTION NO. 1476 2 A RESOLUTION OF THE BOARD OF DIRECTORS OF CARLSBAD MUNICIPAL WATER DISTRICT (CMWD) APPROPRIATING FUNDS TO SUPPORT THE REVISIONS TO THE MANAGEMENT COMPENSATION AND BENEFITS PLAN. 5 WHEREAS, the Municipal Water District Board desires to amend the Management 6 Compensation and Benefits Plan as outlined in Exhibit 3; and 7 WHEREAS, the Municipal Water District Board wishes to fund a base pay program for 8 management employees which rewards the development and demonstration of competencies 9 on the job; and 10 11 WHEREAS, the Municipal Water District Board has the authority to determine the 12 provisions of a Health Benefits Program and to set the amount of Health "Benefits Credits" that 13 the City will contribute on behalf of each active unrepresented management employee, elected 14 official and appointed official; and 15 WHEREAS, the Management Compensation and Benefits Plan covers management 16 employees whose salaries and benefits are paid for by non-General Funds . 17 18 NOW, THEREFORE, BE IT RESOLVED by the Carisbad Municipal Water District Board of the City of Carisbad, California, as follows that: 1. The above recitations are true and correct. 2. That the Board authorizes the Administrative Services Director to appropriate 19 20 21 22 23 funds from the related fund reserves to be used to provide for the Carisbad Municipal Water 24 District portion ofthe Increase to salary and/or the cash stipends that occur In Fiscal Year 2013 14. 25 26 27 28 // 3/. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 PASSED, APPROVED AND ADOPTED at a Joint Special Meeting ofthe Carisbad Municipal Water District Board of Directors and the Carisbad City Council, held on the 27**^ day of August, 2013, by the following vote to wit: AYES: NOES: ABSENT: Board Members Hall, Packard, Wood, Blackburn and Douglas. None. None. MATT HALL, President ATTEST: BARBARA ENGLESON, - O • o z : - ' — • LU fy- . ~ Exhibit 3 MANAGEMENT COMPENSATION AND BENEFITS PLAN SECTION 1: INTRODUCTION This attachment constitutes the Management Compensation and Benefits Plan, which contains three parts: 1) an introduction, 2) a brief overview of how management performance vsdll be evaluated and how compensation levels vsdll be determined, and 3) a schedule of management benefits. A. Definitions 1. Management Employees - Management employees are defined as those employees whose classifications are listed on the Management Salary Stmcture. Except as to those management employees subject to an applicable law, all management employees are considered "at-will" and have no property rights to their position. At will employment vsdth the City may be terminated at any time by either party, vsdth or without cause, for any reason or no reason whatsoever, and with or vsdthout advance notice. At vsdll employees do not have the right to appeal. 2. Carlsbad Police Managemont Association—The City of Carlsbad recognizes the Carlsbad Police Management Association (CPMA) as the exclusive majority representative for the classifications of Police Lieutenant and Police Captain, pursuant to the petition for formal recognition submitted on Januar>^ 21, 1983 and approved April 22, 1983, in accordance with the Carlsbad Municipal Code. ^2. Citv Council Appointed Employees - The City Manager and City Attomey are hired by and responsible directly to the City Council. The salaries for these positions shaU be set by the City Council. The City Manager and City Attomey will not be subject to the provisions of the Performance Management and Compensation program as outlined in Section 2 of this attachment. The schedule of management benefits (as outlined in Section 3 of this attachment) will apply to these positions, except as otherwise provided by the City Council. SECTION 2: PERFORMANCE MANAGEMENT AND COMPENSATION SYSTEM OVERVIEW The City Council has delegated its authority to the City Manager (and City Attomey, for management employees in the City Attomey's Office)^ to administer a Performance Management and Compensation System for management employees, including CPMA roproGonted employees, under the following general guidelines set forth in this section. The City ^ Hereafter, all references to the City Manager include, with regard to management employees in the City Attomey's Office, the City Attomey. 1 Revised 11/27/128/27/13 3^: Manager will periodically provide the City Council vsdth progress reports on the operation of the Performance Management and Compensation System. The system is comprised of two major components: Performance Management emphasizing an employee development approach to performance appraisal, comprised of: => Alignment of individual contributions with organizational direction, ^ Development and demonstration of competencies in the job, and ^ Measurement of levels of accomplishment of goals Compensation—based on a market driven approach to compensation, comprised of: ^ Market based salary stmcture => Base pay ^ Incentive Pay PERFORMANCE MANAGEMENT Thc Performance Management Cycle The Performance Management Cycle coincides with the fiscal year and includes three separate phases: Performance Planning, Performance Update, and Performance Review. Maior Components of Performance Management The two major components upon which a management employee's performance is based cli C • the development and demonstration of specific competencies, and the accomplishment of goals. Management Competencies— All management employees are reviewed and evaluated based on how well they can develop and demonstrate specific competencies. Competencies are the Imowledge, skills, abilities, and behaviors that are essential to the success of each management employee. Goals— Goals describe how thc individual's contribution linlcs and aligns with their department's goals and objectives and ultimately with those of the City Council. Goals are set at the beginning of tho performance management cycle, and employees are evaluated at the end of the cycle as to how well they accomplished their assigned tasks for the year. Revised 11/27/128/27/13 Link to Compensation An employee's performance, as evaluated against the selected competencies, is rewarded by a base pay adjustment. Base pay adjustments are ongoing and are added to the employee's annual salary. An employee's performance, as evaluated against the achievement of annual goals, is rewarded by an incentive award. Incentive payouts are one time cash payments to an employee which do not recur automatically from time to time. Both the base pay increases and the incentive payments comprise the cash compensation available to management employees. COMPENSATION The Performance Management and Compensation System is based upon a market based approach to compensation, comprised of: A market based salary structure •—A base pay program based on the development and demonstration of competencies •—An incentive pay program based on the measurable achievement of specific goals Market Based Salary Structure Base Pay Program The Management Salary Schedule, attached hereto as Attachment A, establishes a salary grade for each management classification. The City Manager is delegated authority to place employees at any salary within the range, as determined by the appointee's Imowledge, skills and abilities. The area of the salary grade between the minimum and the bottom of the market range is intended for inexperienced new hires. The Human ReGources Department will conduct an annual surv^ey of a roasonable number of comparable agencies in San Diego County. Job content, job classification and salary information on each City of Carlsbad claGsification will be compared with appropriate classifications in the comparator group. Tho City Coimcil dclcgatco to thc City Manager tho authority to aooign job olaooifioationo to a opocific salary grado, baood on both bonohmark oalary information and internal rolationohipo within tho organization. Changes to the "minimum" and "market range" of each salary grade within this stmcture shall be approved by the City Council. The City Council determines the budget amount to be spent on management base pay increases for each fiscal year, and the base pay increase percentages will be determined after all of the performance ratings have been determined. All base pay increases are prospective. Management employees whose current salary is above the maximum of the market range for their assigned salary grade shall continue to be paid at that base rate until their salary falls within the market range, and until such time shall not be eligible for base pay increases- Revised 11/27/128/27/13 INCENTIVE PAY PLAN The Incentive Pay plan is provided in addition to the Base Pay plan. All management employees are eligible for incentive pay, regardless of thoir position in the salary range. All management employees' salary above base pay is unfixed and uncertain until completion of the evaluation and award process annually, in which the incentive portion, if any, is determined for each management employee. Employees earn the incentive based on their achievement of goals established during the performance management process. For each goal, achievement is determined by the supervisor. Unlike base pay increases which are determined at the end of the performance management cycle, the potential incentive percentages will be made public at the beginning of the performance review cycle. Incentive awards are expressed as a percentage of base pay. The City Council will determine the annual amount to be budgeted for management incentive pay, and an Incentive Pay matrix will be distributed to all management employees. This matrix will change from time to time based on the City's economics, market data, and demographics. At the end of the fiscal year and upon completion of the review process, incentive awards will be granted to employees based on their goal accomplishment during the performance management cycle. No management employee shall be awarded incentive compensation in an amount greater than 10% of that employee's base salary. 1. PURPOSE: Pay for Performance at the City of Carlsbad is based on the concept of a supervisor providing regular coaching/feedback to the employee. The purpose is to: > create an environment that rewards high performers; > link financial rewards to accomplishing City business obiectives: > create a consistent Citv-wide approach for managers to link performance and rewards; and > create a meaningful/fair reward system. IL BACKGROUND: Consistent with the direction of the City Council, city staff have developed a compensation program that establishes competitive pay through regular and consistent compensation surveys. The Human Resources Department will maintain the highest possible number of benchmarks within the survey market and make recommendations to City Council regarding maintaining competitive salary ranges. The components of the compensation plan include: Revised 11/27/128/27/13 > a performance management program based on the concepts of performance planning and regular coaching/feedback; > a market based salary structure: and > a Pay for Performance reward svstem that includes merit increases* (base pay increases and/or cash rewards for employees who are at the maximum of their salary range) based on the demonstration of competencies and achievements. * Eligibility for a merit pay increase is determined by an employee's performance and where his/her salary is relative to the midpoint of his/her salary range. Eligible employees who are at the salary range maximum receive a cash reward in lieu of a base pay increase. III. GUIDANCE: A. Annual Review Cycle The Performance Management Cycle is aligned with the calendar year. Below is a summary of the annual cycle. Council determines funding for merit pool Merit increases delivered Supervisors select competencies and define priorities HR determines base pay matrix that complies with approved merit pool funding Supervisors conduct year end reviews Supervisors conduct mid-year reviews (after Dept. Director approves mid-year ratings) Supervisors submit proposed year end performance ratings to Department Director Department Directors calibrate and finalize performance ratings Revised 11/27/128/27/13 B. Performance Management The performance management process consists of four important, interrelated steps. Step 1- Performance Planning Supervisors and employees will have an initial discussion to determine which functional competencies will be used to evaluate the employee in the upcoming year. The supervisor explains and sets performance level expectations. The supervisor and employee will also establish specific priorities, contributions or development plans that are aligned with the departmental and organizational strategic direction. Step 2 - Performance Coaching and Feedback Throughout the vear, at least on a quarterly basis, the supervisor and employee review and discuss the employee's work performance, including significant accomplishments and/or shortfalls. Generally, these coaching and feedback sessions will be informal and may be initiated by either the supervisor or employee. It will be the supervisor's responsibility to ensure these discussions take place and are appropriately documented. Step 3- Mid-Year Performance Review Prior to the mid-year review meeting with the employee, the supervisor proposes mid-year ratings for the employee based on the employee's demonstrated competencies and accomplishments related to priorities. The Department Director reviews all proposed mid-vear ratings in his/her department and validates that Pay for Performance (P4P) guidelines are followed consistently within his/her department. The goal of the mid-year performance review is to encourage open communication between supervisors and employees and ensure that there are "no surprises" during the annual performance evaluation session at the end of the year. The supervisor and employee will assess and discuss the employee's progress and the status of specific priorities. As organizational and department directions and priorities shift throughout the vear, this session also provides the opportunity to re-evaluate and, if necessary, revise employee's priorities, achievement expectations or development plans. The performance evaluation form, including mid-year performance ratings, will be submitted to Human Resources and included in the employee's personnel file. The employee will be entitled to provide a written rebuttal to any rating and comments. However, onlv the final year end performance ratings will be used to determine eligibility for merit pay increases. The final year end performance ratings may differ from mid- year performance ratings. Step 4- Year End Performance Review Prior to the year-end review meeting with the employee, the supervisor proposes ratings for the employee based on the employee's demonstrated competencies and accomplishments related to Revised 11/27/128/27/13 (/3 priorities. The Department Director reviews all proposed ratings in his/her department and works with Human Resources staff to validate that Pav for Performance (P4P) guidelines are followed consistently within and across City departments. Next, the supervisor meets with the employee. The employee will come to the year-end review meeting with his/her own thoughts and notes as to how well he/she performed during the evaluation period. The two-way discussion focuses on accomplishments, areas for growth and improvement, job accountabilities and defined competencies. This meeting will also include the performance planning for the upcoming year as outlined in Step 1 above. C. Governance of the Plan Human Resources will be responsible for the administration and maintenance of the performance management system, including forms, guidelines and related policies subiect to Citv Council approval. Human Resources will periodically review the effectiveness ofthe performance management system. D. Maior Roles and Responsibilities Citv Council - The City Council is initially responsible for approving the pay for performance management svstem and for annually approving the merit pool/funding amount in order to tie rewards to performance. Human Resources - The role of Human Resources will be to monitor the activities ofthe process, ensure compliance with City processes and procedures, and ensure that the employee receives a fair, accurate, and timely evaluation. This will be done by ensuring that appropriate results-oriented goals and measures are established for the upcoming calendar year and by reviewing proposed performance and development plans and evaluation forms for accuracy and completeness. Human Resources will track performance ratings over time to encourage accountability and ensure that there is consistency among the distribution of performance ratings across departments. Human Resources will provide on-going guidance and training to supervisors regarding conducting performance reviews and understanding the purpose and design ofthe pay for performance system. Human Resources uses data from all employee performance ratings and Council's authorized funding amount to determine the percentages in the base pay matrix. Human Resources will process merit increases for eligible employees. Department Director - Department Directors will be responsible for reviewing performance ratings within their departments to ensure that accurate evaluation ratings are given and that supervisors are held responsible for effectively rating their staff In the event of tumover of an employee's supervisor, the Department Director will be responsible for ensuring that an employee is equitably and adequately reviewed and rated. Revised 11/27/128/27/13 Supervisor - The supervisor will carry out the steps in the performance management process in a fair, accurate, consistent, and timely manner. This includes guiding the development of performance plans, monitoring and recording employee accomplishments, providing timely coaching and feedback, conducting accurate performance evaluations, and ensuring the employee has the opportunity to participate in the process. In the event that an employee has more than one supervisor during a rating period, each supervisor will submit an assessment and the supervisors will mutually agree on a rating for the review period. A newly assigned supervisor will not be responsible for reviewing a rating period of less than three months. Employee - The employee will actively contribute in the process of defining priorities and performance measures, initiating coaching and feedback sessions as needed. Requests for feedback by the employee shall be responded to within 14 calendar days of the request, although actual feedback can be written or oral and can be provided more than 14 calendar days after the request. Employees will complete a self-assessment prior to the year-end performance evaluation, and will be prepared to contribute in the mid-year and end of year performance evaluations. Revised 11/27/128/27/13 E. Performance Management Components Essential Functions Essential functions are the job duties/tasks that an employee was hired to perform. These functions are the permanent features of the employee's iob. The essential functions are outlined in the employee's iob description. Essential fimctions are iob-based rather than employee-based. At the beginning of the performance year, the employee's iob description will be reviewed by the supervisor and employee. Any significant changes in the qualifications or job tasks will be noted and submitted to Human Resources. Essential functions will determine which functional competencies may be appropriate for a specific position. At the end of the plan year, the employee will be rated on their performance related to the essential functions of the iob as described in the job description. Employees serving in out of class assignments will be reviewed in accordance with their regular position unless the employee served out of class for more than one-half of the review period. In that case, the employee will be reviewed based on their out of class assignment. If, at the outset of the out of class assignment, it is anticipated that the employee will spend more than one-half of the review period in that out of class assignment, the employee and supervisor shall have a Performance Planning Meeting as described in Step 1 above. Core and Functional Competencies All employees will be reviewed and evaluated based on how well they can demonstrate specific competencies. Competencies are essential to the success of each employee in their iob. There are two types of competencies: 1) Core - describes the required competencies for all employees and 2) Functional - describes competencies specific to the essential functions ofthe iob performed by the employee. All employees will be evaluated on the five core management competencies and only two ofthe seven functional management competencies. Each year, during the Performance Planning step, the supervisor and the employee will talk about which functional competencies are the most appropriate to use in the upcoming year based on the employee's specific job, priorities and work plan. Each year, the supervisor and the employee will select the two functional competencies that will be used to evaluate the employee that year. Setting Priorities Individual priorities indicate specific results to be achieved by an employee for the coming review period. Priorities often change from year to vear because they are intended to focus on a significant outcome identified by the department. The City will support the employee in their development and aim to create an environment of engagement, innovation and excellence. Supervisors will determine three priorities for an employee and will link each prioritv to a core or functional competency. Priorities must be related to a significant component of the employee's iob and the needs of the City and individual department or division. Supervisors will Revised 11/27/128/27/13 communicate orally and in writing how each priority is linked to the mission ofthe City/department and to the development of the employee. Individual priority setting is to be done in light of organizational goals and departmental goals and priorities. That is, goals are to cascade dovs^ based on the City's strategic plan and initiatives from senior management, to mid-level managers, to supervisors and to line employees. A well-written performance priority has these basic components: > it is action oriented (e.g., includes phrases such as 'to make', 'to complete', 'to adjust'); > it includes a measurable indicator (e.g., quantity, rate, expense, quality, degree of accuracy, timeliness); > there are constraints, such as time limitations; and > it follows the SMART criteria (see below). Using S.M.A.R.T. Criteria Specific Priorities must express the action and results required so that both the Specific emplovee and supervisor can see clearly whether the priority has been achieved. What is the achievement or result that is expected? Measurable When setting priorities, there must be some way of measuring and Measurable verifying whether the prioritv has been achieved and to what level. How will the emplovee and supervisor know if the obiective has been met? Achievable Although thev should provide challenge and development to the Achievable individual, priorities also must be achieved. Is it reasonable that the priority be achieved? Relevant The priorities must be relevant to the level at which the individual is at in Relevant their career and to the workload of their particular area. Does the prioritv contribute to the department, division, or overall organization's success? Time-bound Priorities need to have clearly defined time periods. What is the Time-bound completion date of each milestone? Rating Process and Criteria The supervisor is responsible for rating the employee on all five core competencies, the two selected functional competencies and the priorities, and for providing written narrative to explain these ratings. 10 Revised 11/27/128/27/13 The rating system shown below will be used in evaluating emplovee performance. 1. Unsatisfactory 2. Improvement Needed 3. Competent 4. Commendable 5. Exemplary Performance does Performance does Performance Performance Performance not meet not consistently consistentiv meets exceeds significantly exceeds requirements. meet requirements. all requirements. requirements and requirements. Performance is Performance Employee is fully demonstrates the Emplovee has made consistently and deficiencies are proficient and ability to handle contributions and seriously such that adequately assignments of achievements well inadequate. This improvement is demonstrates the greater complexity bevond those employee must needed for the desired and responsibility. required by their make immediate employee to competency This employee assigned and sustained satisfactorily meet behaviors for the shows initiative and responsibilities. In improvements. requirements. level of the iob. seeks opportunities many cases. to enhance their iob performance related skills and demonstrates new competencies. areas of productivity and innovation far bevond position requirements. Emplovee Comments Employees shall be advised that they are encouraged but not required to provide comments that they would like documented for the evaluation period. Emplovee comments will be part of the performance evaluation documentation. Signatures The employee's signature acknowledges that the performance evaluation has been reviewed and discussed with them. This does not mean the employee agrees, or disagrees, with statements made or contained therein. When the evaluation session is completed, the employee and supervisor sign the form and appropriate levels of signatures are obtained: • Immediate Supervisor • Mid-level Manager (if applicable) • Department Director • Human Resources Employee Outlets Employees who disagree with their rating may request a meeting with their Department Director. If after this meeting this matter is not resolved, the employee may then request a meeting with 11 Revised 11/27/128/27/13 the Citv Manager or his/her designee and this meeting shall occur within 30 days at the employee's request. If the employee's performance rating is changed as a resuh ofthis process, any resulting merit pay adiustment shall be paid retroactively. F. Linking Pay and Performance Eligibility for a merit increase is determined by an employee's overall performance rating and where his/her current salary is relative to the midpoint of their salary range. Eligibility Employees must receive an overall rating of "Competenf or better to be eligible for performance-based merit increases. Those employees receiving an overall "Improvement Needed" or an "Unsatisfactory" performance rating are not eligible for performance based merit increases. An emplovee whose salary is at their salary range maximum is not eligible for a base pay increase. In lieu of a base pav increase, eligible employees will receive a cash reward that is paid out in a lump sum equivalent to the amount of the base pay increase that they would have received if they were not at the salary range maximum. An eligible employee whose salary is close to their salary range maximum (such that the designated pay increase would cause their salary to exceed the salary range maximum) will receive a base pay increase up to the salary range maximum and will receive the remaining portion of the designated pay increase as a lump sum cash reward as described above. Base Pay Matrix A base pay matrix will be used to reward performance. The City Council determines the merit pool or budget for the annual pay increase. After all of the performance reviews have been completed, merit increase percentages will be determined by Human Resources based on the size ofthe Council approved base pay matrix funding, distribution of all employees' performance ratings and distribution of employees in their salary range (i.e. above or below the salary range midpoint). The goal is to assign merit increase percentages that will use substantially all ofthe funding approved by the City Council for merit increases for that performance cycle. An employee's overall performance rating (sum of individual competency ratings) and position in the range put them in one ofthe cells "A," "B." "C," "D." "E," or "F" as shown in the sample Base Pay Matrix below. Each employee's merit increase is determined using the base pay matrix. 12 Revised 11/27/128/27/13 • I SAMPLE BASE PAY MATRIX Overall Performance Rating 7-10 11-17 18-24 25-31 32-35 Salary Range Unsatisfactory Improvement Competent Commendable Exemplary Placement Unsatisfactory Needed Competent Commendable Exemplary At or above salary range midpoint 0.0% 0.0% A% C% E% Below salary midpoint 0.0% 0.0% B% F% IV. PROCEDURES: 1. All employees will be reviewed at mid-year and at the end of the calendar year. After both of these review meetings are completed, the performance evaluation form, including performance ratings, will be submitted to Human Resources and be made a part of the employee's personnel file. 2. The immediate supervisor most familiar with the employee's performance during the rating period shall be the rater. If the employee has had more than one supervisor during the evaluation period, the other supervisor(s) will be consulted and only one evaluation form/overall rating will be submitted. 3. Electronic performance evaluations forms will be made available by the Human Resources Department. 4. Ratings shall be based upon the competent performance of the full range of skills indicated by the class specification covering the employee's position. In the event that the class specification is not representative of the employee's current responsibilities. Human Resources will be notified and asked to review and make recommendations. Deviations from the class specification should be noted on the performance evaluation form. 5. Every eligible employee's performance evaluation is due to Human Resources by January 31. Any overdue evaluations will be reported to the Department Director and the City Manager. Exceptions may be made for extenuating circumstances, such as employees out on leaves of absence (see section 7). The Human Resources Department will review all of the performance ratings and calculate the base pay salary increases and/or cash rewards to be awarded for each rating level based on the base pay matrix funding established by the City Council. 13 Revised 11/27/128/27/1: 6. Merit increases shall be distributed within 30 calendar days of receiving the last performance review or no later than the first full pay period in March. Merit increases will be effective retroactive to the last day of the performance review cycle. 7. Employees are eligible for a base pay salary increase or cash reward if the following requirements are met: • the employee receives a rating of "Competenf or higher on his/her year-end performance review: • the employee has been in a full time or % time position for a minimum of 6 months*; and • the emplovee is active on payroll at the time that merit increases are processed in the payroll system. *Merit increases for employees hired into a full time or time position during the review cycle will be prorated as follows: Start Date Prorated Merit Increase Percent January 1- March 31 100% April 1 - June 30 75% Julv 1 - December 31 0% 8. Any emplovee mav be advanced in the pay range during the performance review period regardless of the length of time served at the employee's present pav rate. This advancement requires the written recommendation of the employee's department head and approval of the City Manager. 9. Employees who were promoted during the performance cycle will receive a year end performance-related pay increase based on their salary as of the last day of the performance cycle. 10. Eligible employees who are in an out of class assignment will receive a merit increase calculated using salary information from their regular position. 11. If, as a result of a salary range adiustment, an employee's base salary falls below the minimum of the salary range, the employee's salary will be increased to the new range minimum as of the date City Council approves the salary range adiustment. 12. An employee who is on a leave of absence during the year-end review process will meet with his/her supervisor upon retum to work and complete a year-end review. If the emplovee was on a leave of absence (other than a statutorily protected leave of absence) for a portion of the review period he/she will be eligible for a prorated merit increase for that review period according to the following schedule: 14 Revised 11/27/128/27/13 Length of leave* Percent of merit increase eligible < 91 calendar davs 100% 91-180 calendar days 75% > 180 calendar days 0% *not inclusive of statutory leave time 13. Employees who terminate employment after the last day of the review cycle will not be eligible for merit increases. V. COMPENSATION PLAN: The kev element of the employee pay for performance program is the base pav structure. Covering all management iobs, the base pay stmcture reflects competitive pay levels for iobs assigned to each pay grade and provides the basis for equitable pay decisions. The Management Salary Schedule contains multiple salary ranges. Each salary range has a minimum, midpoint and maximum. Employees who are inexperienced or newly hired may be paid below the midpoint of the salary grade. In keeping with the City Council's philosophy of surveying the total compensation of local agencies, the agencies listed below will be considered in the survey market for management. City of Chula Vista City of Coronado Citv of Del Mar City of El Caion City of Encinitas City of Escondido City of Imperial Beach City of La Mesa City of National City City of Oceanside City of Powav City of San Marcos City of Solana Beach City of San Diego City of Santee City of Vista County of San Diego The Human Resources Department will compare salary and benefits information on each City of Carlsbad benchmark classification with appropriate classifications in the comparator group. Those classifications that are considered benchmarks are those in which there was a substantial match between the competencies and duties required for iobs at the City of Carlsbad and those for the comparator group. A benchmark requires a minimum of three comparators. The iob 15 Revised 11/27/128/27/13 matching is conducted by the Human Resources Department. From time to time the City Council may also request that private sector salary and benefits data be reviewed and compared to benchmark positions at the City of Carlsbad. Each City of Carlsbad iob classification is assigned to a specific salary range. The non- benchmark positions are assigned to the salary structure based on intemal relationships, responsibility and/or knowledge, skills and abilities of iobs. The benchmark salary data will be surveyed regularly and the benchmark comparisons will be modified when the classifications change within the organization. Periodically the Human Resources Department will bring forth salary range movement recommendations to City Council that are based on market and economic conditions, and may include one or more salary ranges. The Citv Council delegates to the Citv Manager the authoritv to assign iob classifications to a specific salary grade, based on both benchmark salary information and intemal relationships within the organization. VI. TRAINING An extensive training program will be designed to enhance the evaluation and feedback skills of supervisors. Skills training will include: • Performance Planning - Competencies • Conducting Performance Evaluations • Coaching, Counseling and Feedback • Compensation Administration • Performance Planning - Goal Setting The Human Resources Department will offer periodic review sessions to reinforce managerial and supervisory skills and to train employees. VII. GLOSSARY 1. Base Pay increase - A prospective pay increase to an employee's base salary, as calculated to exclude any additional pays. 2. Base pav matrix - Matrix that determines the base pay increases and cash rewards to be given to eligible employees. 3. Cash reward -A one-time "lump sum" payment equivalent to the amount of the base pay increase that an employee would have received if he/she were not at the salary range maximum. 4. Merit increase - Either a base pay increase or cash reward as determined by the base pay matrix. 5. Survey market - List of Council approved agencies to be used when reviewing market competitiveness. 16 Revised 11/27/128/27/13 SECTION 3: SCHEDULE OF BENEFITS Life Insurance and Voluntary Benefits All management employees shall receive City paid life insurance in an amount equal to two times the basic yearly earnings. To determine benefits, the amount of insurance is rounded to the next higher $ 1,000 multiple, unless the amount equals a $ 1,000 multiple. The City provides various voluntary benefits available at the employee's cost. Employees may select among various levels of coverage. For information regarding these benefits, contact the Human Resources Department at 760-602-2440. Former CMWD management employees shall receive Group Term Life Insurance, Accidental Death and Dismemberment, and Dependent Life Insurance as contamed in their Individual Agreement. Retirement All management employees shall participate in the Califomia Public Employees' Retirement System (CalPERS). The specific retirement formula applied will be determined based on whether the position is deemed safety or miscellaneous. All positions not deemed eligible for safety retirement vsdll be deemed miscellaneous under the CalPERS system. Optional benefits unique to the City of Carlsbad's contract with CalPERS are outlined in the contract between the city and CalPERS. A copy of this contract is kept on file in the Human Resources Department. Management employees who are considered fire safety employees are eligible for the same retirement benefit formula and are subject to the same optional retirement benefits described in the City ofCarlsbad CalPERS safety contract as those provided to employees represented by the Carlsbad Firefighters' Association, Inc. Unrepresented swom police management employees are eligible for the same retirement benefit formula and are subject to the same optional retirement benefits described in the City of Carlsbad CalPERS safety contract as those provided to employees represented by the Carlsbad Police Officers'Association. The Citv has contracted with CalPERS for the foUovsdng retirement benefits: a) Miscellaneous Tier 1 (employees entering miscellaneous membership for the first time prior to November 28, 2011) - retirement formula shall be 3%> @ 60; single highest year final compensation. b) Miscellaneous Tier 2 (employees entering miscellaneous membership for the first time on or after November 28,2011) - retirement formula shall be 2%) @ 60; three year average final compensation. c) Safetv Tier 1 (employees entering safety membership for the first time prior to October 4, 2010) - retirement formula shall be 3%) @ 50; single highest year final compensation. 17 Revised 11/27/128/27/13 s/ d) Safetv Tier 2 (employees entering safety membership for the first time on or after October 4,2010) - retirement formula shall be 2% @ 50; three year average final compensation. Employees entering membership on or after January 1,2013 and who are subject to the Califomia Public Employees' Pension Reform Act of 2013 (PEPRA) will have the following retirement benefits: a) Miscellaneous employees - retirement formula shall be 2% @ 62; three year average final compensation. b) Safetv employees - retirement formula shall be 2.7% @ 57; three year average final compensation. Employee Retirement Contribution The employee retirement contribution vsdll be made on a pre-tax basis by implementing provisions of section 414(h)(2) of the Intemal Revenue Code (IRC). Effective vsdth the first payroll period including December 1,2012, the Employee Paid Member Contribution (EPMC) shall be reduced from 3.5% to 0% for all unrepresented management employees. Employees shall make the foUovsdng employee retirement contributions through payroll deductions: • First tier miscellaneous employees shall pay 8%, • Second tier miscellaneous employees shall pay 7% and • First and Second tier safety employees shall pay 9%. Employee contributions for employees entering membership on or after January 1,2013 and subject to the Califomia Public Employees' Pension Reform Act of 2013 (PEPRA) vsdll be determined by CalPERS. Management Leave Management employees are exempt from overtime requirements under the Fair Labor Standards Act. Fire Battalion Chiefs are exempt from overtime requirements under FLSA, however. Fire Battalion Chiefs that are required to work a 24-hour shift/112 hours per bi-weekly pay period schedule are paid straight time for overtime when they are covering the duty for a Battalion Chief on leave. Management employees in the City are paid on a salary basis versus an hourly basis. Pursuant to FLSA regulation 29 CFR Section 541.5d, the City can make deductions from salary or leave accounts for partial day absences for personal reasons or sickness because the City has a policy and practice of requiring its employees to be accountable to the public that they have eamed their salaries. A partial day absence is an absence of less than the employee's regular work day. Pursuant to FLSA regulation 29 CFR Section 541.118 (a)(2) and (a)(3), tiie City may make salary or leave reductions based upon full day absences. Partial day or fliU day absences shall be first charged against the exempt employee's vacation, sick, or executive leave accoimt. In the event the exempt employee does not have sufficient time 18 Revised 11/27/128/27/13 in his/her leave account to cover the absence, deductions without pay will be made on full days only. • Vacation Every management employee shall accme vacation leave for each calendar year of actual continuous service dating from the commencement of said service, with such time to be accmed on a daily (calendar day) basis. Vacation leave can be used in 15 minute increments. All management employees (except Fire Battalion Chiefs that work 112 hours per bi-weekly pay period) shall eam vacation on the foUovsdng basis: Beginning with the first (1 st) working day through the completion of five (5) fiiU calendar years of continuous service -13 minutes/day. Beginning the sixth (6th) year of employment through the completion of ten (10) full calendar years of continuous service - 20 minutes/day. Beginning the eleventh (11th) year of employment through the completion of eleven (11) full calendar years of continuous service - 21 minutes/day. Beginning the twelfth (12th) year of employment through the completion of twelve (12) full calendar years of continuous service - 22 minutes/day. Beginning the thirteenth (13th) year of employment through the completion of thirteen (13) full calendar years of continuous service - 24 minutes/day. Beginning the fourteenth (14th) year of employment through the completion of fifteen (15) full calendar years of continuous service - 25 minutes/day. Beginning the sixteenth (16th) year of continuous employment, vacation time shall be accmed, and remain at a rate of 26 minutes/day for every full calendar year of continuous employment thereafter. Management employees with comparable service in local govemment agencies may be granted credit for such service for the purpose of computing vacation at the discretion of the City Manager. All management employees shall be permitted to eam and accme up to and including three hundred and twenty (320) hours of vacation, and no employee vsdll be allowed to eam and accme vacation hours in excess of the three hundred and twenty (320) hour maximum.* The City Manager shall be responsible for the granting of vacation to all management personnel, except in the case of the City Attomey's Office, where the City Attomey shall be responsible for granting vacation. 19 Revised 11/27/128/27/13 * If there are unusual circumstances that would require an employee to exceed the vacation accmal maximum, he/she must submit a request in writing to the Department Head and the City Manager or Designee. The Department Head and the City Manager or Designee may grant such a request if it is in the best interest of the City. Requests will be handled on a case-by-case basis and will be considered only in extreme circumstances. Former CMWD management employees shall eam and accme vacation up to and including the maximum as contained in their Individual Agreement. Fire Battalion Chiefs that work 112 hours per bi -weekly pay period shall eam and accme vacation up to and mcluding the maximum commensurate vsdth Carlsbad Firefighters' Association (CFA) represented employees that work 112 hours per bi-weekly pay period. • Vacation Conversion Each Febmary, management employees will be allowed to voluntarily convert up to 80 hours of accmed vacation to cash, provided that they have used 80 hours of vacation during the prior calendar year. Fire Battalion Chiefs that work 112 hours per bi-weekly pay period will be allowed to voluntarily convert up to 112 hours of accmed vacation to cash, provided that they have used 112 hours of vacation during the prior calendar year. • Executive Leave All management personnel, except former CMWD management employees, shall receive 56 hours per fiscal year for executive leave. The 56 hours vsdll be credited at the beginning of each fiscal year to individual leave balances. This leave must be used within the same fiscal year. The City Manager is authorized to provide ten (10) additional hours of executive leave per year to any management employee who is required to work extended hours due to emergencies such as fires, storms, floods, or other emergencies. • Sick Leave Sick leave can be used in 15 minute increments. Sixteen (16) minutes of sick leave are accmed per calendar day. Accumulation is unlimited (employees cannot receive payment for unused sick leave). Fire Battalion Chiefs that work 112 hours per bi-weekly pay period shall accme sick leave commensurate with CFA represented employees that work at 112 hours per bi-weekly pay period. • Bereavement Leave An employee may use up to an equivalent of three work days of paid leave if required to be absent from duty due to the death of a member of the employee's 20 Revised 11/27/128/27/13 immediate family. Additional time off may be authorized by the Department Head and charged to accmed vacation or sick leave or, when no accmed leave is available, treated as leave without pay. The "immediate family" shall be defined in the personnel rules and regulations. The employee may be required to submit proof of relative's death before final approval of bereavement leave is granted. Leave of Absence 1. Leave of Absence Without Pav A. General Policy Any employee may be granted a leave of absence vsdthout pay pursuant to the approval of his/her Department Head for less than two calendar weeks. If the duration of the leave of absence vsdll be longer, the approval of the City Manager or his/her designee is required. An employee shall utilize all his/her vacation, e-time and/or sick leave (if applicable) prior to taking an authorized leave of absence vsdthout pay. A leave without pay may be granted for any of the foUovsdng reasons: 1. Illness or disability. 2. To take a course of study which will increase the employee's usefulness on retum to his/her position in the City service. 3. For personal reasons acceptable to the City Manager and Department Head. B. Authorization Procedure Requests for leave of absence without pay shall be made in writing and shall state specifically the reason for the request, the date when the leave is desired to begin, the probable date of retum, and the agreement to reimburse the City for any benefit premiums paid by the City during the leave of absence. The request shall normally be initiated by the employee, but may be initiated by his/her Department Head, and, if applicable, shall be promptly transmitted 21 Revised 11/27/128/27/13 to the City Manager or his/her designee for approval. A copy of any approved request for leave of absence vsdthout pay vsdth a duration equal to or greater than two calendar weeks shall be delivered promptly to the Durectors of Finance and Human Resources. Length of Leave and Extension A leave of absence without pay may be made for a period not to exceed six months, unless otherwise approved by the City Manager. The procedure for granting extensions shall be the same as that in granting the original leave provided that the request for extension is made no later than fourteen (14) calendar days prior to the expiration of the original leave. D. Retum From Leave When an employee intends to retum from an authorized leave of absence vsdthout pay either before or upon the expiration of such leave, he/she shall contact his/her Department Head at least fourteen (14) calendar days prior to the day he/she plans to retum. The Department Head shall promptly notify the Human Resources Department of the employee's intention. The employee shall retum at a rate of pay not less than the rate at the time the leave of absence began. E. Effect of Leave Witiiout Pav A prorata reduction of normal annual vacation and sick leave accmals shall be applicable to an approved absence vsdthout pay. Any absence vsdthout pay constitutes a break of continuous service vsdth the City. The granting of any leave vsdthout pay exceeding two full scheduled pay periods shall cause the employee's salary anniversary date and calculation of full-time continuous service to be extended by the number of calendar days for which such leave has been granted less the first two full pay periods of such leave. An employee's accumulation of sick leave and vacation leave will cease after the completion of two (2) fiiU scheduled pay periods in which the employee has not received compensation due to a leave of absence without pay. Accmal vsdll be reinstituted beginning the first day after the employee has retumed to work. 22 Revised 11/27/128/27/13 F. Leave Without Pay - Insurance Payments and Privileges An employee on leave without pay may continue his/her City insurance benefits by reimbursing the City for the employee's costs of insurance on a monthly basis during the period of the leave. Failure to reimburse the City for such benefits during the term of a leave of absence will result in the employee's coverage terminating on the first day following the month in which the last payment was received. Upon the employee's retum to paid status, any sums due to the City shall be repaid through payroll deductions. This applies to sums due for insurance as well as other payment plans entered into between the City and the employee (e.g., computer loan). Upon eligibility for COBRA, the employee vsdll be notified of the opportunity to continue benefit coverage via the COBRA process. An employee on leave of absence vsdthout pay shall not have all of the privileges granted to regular employees (e.g., holiday pay), unless required by law. Pregnancy Disability Leave Pregnancy Disability Leave shall be authorized and/or administered in accordance with the provisions of State and Federal law. An employee disabled by pregnancy shall be allowed to utilize a combination of accmed sick leave and vacation time and leave without pay to take a leave for a reasonable period of time, not to exceed four months. An employee shall utilize all accmed leave prior to taking leave without pay. Reasonable period of time means that period during which the employee is disabled on account of pregnancy, childbirth, or related conditions. An employee who plans to take a leave pursuant to this article shall give the City reasonable notice of the date the leave shall commence and the estimated duration of the leave. Family and Medical Leave of Absence (FMLA) An employee may be granted a FMLA of up to 12 weeks ina 12 month period for one or more of the following reasons: - for the birth/placement of a child for adoption or foster care, - to care for an immediate family member with a serious health condition, or 23 Revised 11/27/128/27/13 (oO - to take medical leave when the employee is unable to work because of a serious condition. FMLA may be paid or unpaid and may be granted concurrently and in conjunction witii other leave and benefit provisions. Specific details regarding the provisions of this leave are available by contacting the Human Resources Department. • Military Leave Military leave shall be authorized in accordance with the provisions of State and Federal law. The employee must fumish satisfactory proof to his/her Department Head, as far in advance as possible, that he/she must report to military duty. • Jury Duty When called to jury duty, an employee shall be entitled to his/her regular compensation. Employees released early from jury duty shall report to their supervisor for assignment for the duration of the shift. Employees shall be entitled to keep mileage reimbursement paid while on jury duty. A Department Head may, at his/her sole discretion, contact the court and request an exemption and/or postponement of jury service on behalf of an employee. Employees released early from jury duty shall report to their supervisor for assignment for the duration of the work day. At the discretion of the supervisor, an employee may be released from reporting back to work if an unreasonable amount of the work day remains in light of travel time to the job site after release. Health Insurance for Retirees Effective January 1,2001, management employees will be covered by the Public Employees' Medical and Hospital Care Act and vsdll be eligible to participate in the Califomia Public Employees' Retirement System (CalPERS) Health Program. Management employees who retire from the City, either service or disability, shall be eligible to continue their enrollment in the CalPERS Health Program when they retire, provided that the individual is enrolled or eligible to enroll in a CalPERS medical plan at the time of separation from employment and their effective date of retirement is within 120 days of separation. The City will contribute the minimum amount per month required under Govemment Code Section 22892 of the PEMHCA toward the cost of each retiree's enrollment in the CalPERS Health Program. Employees who retire from the City, either service or disability, shall be eligible to continue to participate in the City's dental and/or vision insurance programs. The cost of such dental and/or vision insurance for the retiree and eligible dependents shall be bome solely by the retiree. The City shall not charge the COBRA administrative cost to the retirees. A retiree who does not 24 Revised 11/27/128/27/13 choose continued coverage upon retirement, or drops coverage, is only eligible to retum to the City's dental and vision insurance program during open enrollment periods. The City will invoice the retiree for his/her monthly premiums for dental and/or vision insurance and the retiree must keep such payments current to ensure continued coverage. Sick Leave Conversion Any management employee who has accmed and maintains a minimum of one hundred (100) hours of sick leave shall be permitted to convert up to twelve (12) days of sick leave and uncompensated sick leave to vacation at a ratio of three (3) sick leave days per one (1) day of vacation. The sick leave conversion option will be provided during the first week of each fiscal year. Conversion can only be made in increments of full day vacation days. Employees vsdll not be allowed to convert sick leave to vacation if such conversion would put them over the vacation accmal maximum. Former CMWD management employees per their Individual Agreement, have the option to sell back 100% of accumulated sick leave in excess of 250 hours at their current rate. The City, at its discretion, may purchase any accumulated sick leave from any of these referenced management employees at the current rate. Separation Compensation All management employees involuntarily separated from the City service due to budget cutbacks, layoffs, contracting out of service or for other reasons not due to misconduct which would justify involuntary separation shall receive one month's salary computed at the employee's actual salary at the time of separation. Holidays All management employees shall be paid holidays in accordance vsdth the schedule of eleven (11) holidays and one (1) floating holiday, as established by the City Council. Fire Battalion Chiefs are subject to the same holiday schedule that is outlined for management employees. However, they are compensated for holidays in the same manner as CFA represented employees that work 112 hours per bi-weekly pay period. The floating holiday may be used at the discretion of the employee with prior approval of the Department Head. As of July 1, 2013, the floating holiday shall be eliminated for all management employees. The scheduled paid holidays that vsdll be official City holidays shall be as follows: New Year's Day Columbus Day Martin Luther King's Birthday Veteran's Day Presidents' Day Thanksgiving Day Memorial Day Thanksgiving Friday Independence Day Christmas Day 25 Revised 11/27/128/27/13 4^ Labor Day Only employees who are on paid status on their last scheduled work day before a holiday shall be entitled to the paid holiday except where otherwise required by law. Health Benefits Management employees vsdll participate in a flexible benefits program which includes medical insurance, dental insurance, vision insurance and flexible spending accounts (FSAs). Each of these components is outlined below. Medical Insurance Management employees will be covered by the Public Employees' Medical and Hospital Care Act (PEMHCA) and vsdll be eligible to participate in the Califomia Public Employees' Retirement System (CalPERS) Health Program. The City will pay on behalf of all management employees and their eligible dependents and those retirees mentioned in the section of this document titled, "Health Insurance for Retirees," the minimum amount per month required under Govemment Code Section 22892 of the PEMHCA for medical insurance through the Califomia Public Employees' Retirement System (CalPERS). If electing to enroll for medical benefits, the employee must select one medical plan from the variety of medical plans offered. Effective January 1, 2012, the City will contribute the following monthly amounts (called "Benefits Credits") on behalf of each active management employee and eligible dependents toward the payment of 1) medical premiums under the CalPERS Health Program, 2) contributions in the name of tho employee to the City's flexible spending account(s), 3) contributions of some or all of the premium for dental coverage or vision coverage: (a) For employees with "employee only" coverage, the City shall contribute five hundred forty one ($511) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, tho employee will pay the difference. (b) For employees with "employee plus one dependent" coverage, the City shall contribute one thousand thirty two dollars ($1,032) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed tho City's total contributions, the employee will pay the difference. (e) For employees with "employee plus two or more dependents" coverage, the City shall contribute ono thousand three hundred fifty six dollars ($1,356) per month that shall include the mandator)^ payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee will pay the difference. Effective January 1,2013, the City will contribute the following monthly amoimts (called "Benefits Credits") on behalf of each active management employee and eligible dependents 26 Revised 11/27/128/27/13 toward the payment of 1) medical premiums under the CalPERS Health Program, 2) contributions in the name of the employee to the City's flexible spending account(s), 3) contributions of some or all of the premium for dental coverage or vision coverage: (a) For employees vsdth "employee only" coverage, the City shall contribute five hundred sixty-seven ($567) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee will pay the difference. (b) For employees vsdth "employee plus one dependenf coverage, the City shall contribute one thousand eighty-two dollars ($1,082) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee will pay the difference. (c) For employees with "employee plus two or more dependents" coverage, the City shall contribute one thousand four hundred twenty-one dollars ($1,421) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee will pay the difference. Effective the first full pay period following City Council approval of this revised Management Compensation and Benefits Plan, prospectively only, any unused Benefits Credits as outlined above will be paid to the employee in cash and reported as taxable income. Effective January 1, 2014, the City will contribute the following monthly amounts (called "Benefits Credits") on behalf of each active management employee and eligible dependents toward the pavment of 1) medical premiums under the CalPERS Health Program, 2) contributions in the name of the employee to the City's flexible spending account(s), 3) dental premiums 4) vision premiums and/or 5) Accidental Death and Dismemberment (AD&D) premiums: (a) For employees with "employee only" coverage, the City shall contribute five hundred forty-four ($544) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee will pay the difference. (b) For employees with "employee plus one dependenf coverage, the City shall contribute one thousand thirty-eight dollars ($1,038) per month that shall include the mandatory payments to CalPERS. If the actual total premiums exceed the City's total contributions, the employee will pay the difference. (c) For employees with "employee plus two or more dependents" coverage, the City shall contribute one thousand three hundred sixty-three dollars ($1,363) per month that shall include the mandatory payments to 27 Revised 11/27/128/27/13 CalPERS. If the actual total premiums exceed the City's total contributions, the employee will pay the difference. Under no circumstances will any unused Benefits Credits as outlined above be paid to the employee in cash. If the amount contributed by the City (Benefits Credits) exceeds the cost of the medical and dental insurance purchased by the employee, the employee will have the option of using any "excess credits" to purchase vision insurance or to contribute to a healthcare or dependent care flexible spending account (FSA). Dental Insurance Management employees will be eligible to enroll in a City-sponsored dental plan. Should an employee elect to enroll for medical benefits, he/she must also enroll in dental coverage at the same coverage level (employee only, employee plus one dependent, employee plus two or more dependents) as medical insurance. Effective January 1, 2014, the employee will have the option of selecting any dental coverage level regardless of the employee's selected medical coverage. Vision Insurance Management employees will be eligible to enroll in a City-sponsored vision insurance plan. Employees may elect to purchase vision insurance or to opt out of the vision msurance program. If the decision is made to purchase vision insurance, a management employee may purchase vision insurance at any level of coverage (employee only, employee plus one dependent, employee plus two or more dependents). Opt Out Provision Management employees who do not vsdsh to participate in the CalPERS Health Program vsdll have the choice of opting out of the City's medical insurance program, provided they can show that they are covered under another insurance program. Effective January 1, 2012, employees who elect this option will be given a reduced City contribution amount (Benefits Credits) of two hundred ninety four dollars ($291) per month, that shall include the mandatory payments to CalPERS, to be used toward the purchase of dental insurance, vision insurance, or as a contribution to a flexible spending account. The City contribution amount of two hundred ninety four dollars ($291) per month will be granted to any employee who elects to opt out of the CalPERS Health Program, regardless of the employee's level of coverage (employee only, employee plus one dependent, employee plus two or more dependents). Effective January 1,2013, employees who elect this option vsdll be given a reduced City contribution amount (Benefits Credits) of three hundred eight dollars ($308) per month, that shall include the mandatory payments to CalPERS, to be used toward the purchase of dental insurance, vision insurance, or as a contribution to a flexible spending account. The City contribution amount of three hundred eight dollars ($308) per month vsdll be granted to any employee who elects to opt out of the CalPERS Health Program, regardless of the employee's 28 Revised 44727A58/27/13 . level of coverage (employee only, employee plus one dependent, employee plus two or more dependents). Effective January 1, 2014, employees who elect this option will be given a reduced City contribution amount (Benefits Credits) of two hundred ninety-five dollars ($295) per month, that shall include the mandatory payments to CalPERS, to be used toward the purchase of dental insurance, vision insurance, accidental death and dismemberment (AD&D) insurance or as a contribution to a flexible spending account. The City contribution amount of two hundred ninety-five dollars ($295) per month will be granted to any employee who elects to opt out of the CalPERS Health Program, regardless of the employee's level of coverage (emplovee only, employee plus one dependent, emplovee plus two or more dependents). All active management employees who work three quarter-time or less will receive prorated benefit credits Effective the first full pav period following City Council approval of this revised Management Compensation and Benefits Plan, prospectively only. Under no circumstances will any unused Benefits Credits as outlined above will be paid to the employee in cash and reported as taxable income. Former CMWD management employees shall receive Medical, Dental and Vision, and Retiree Medical as contained in their Individual Agreement. Annual Physical Examination and/or Physical Fitness Testing All management employees, excluding former CMWD management employees, shall be eligible for reimbursement of up to the amount of four hundred fifty dollars ($450) during each fiscal year to pay the cost of an employee's annual physical examination and/or physical fitness testing. The annual physical examination may be completed by a physician of the employee's choice. Each employee claiming reimbursement shall be required to submit original receipts to the Human Resources Department in lieu of submitting them to the insurance company for payment. The aimual physical examination offered to management employees provides physical fitness testing and information regarding lifestyle changes that promote optimum health. Program components include, but are not limited to: Computerized Heart Risk Profile, Complete Blood Profile, Nutritional Assessment, Diet Program, Body Measurements, Lung Assessment, Consultations, etc. Long-Term Disability Insurance (LTD) Long-term disability is available for all management personnel (except management personnel who are considered fire safety employees) after 30 days of disability. The LTD premium cost is paid by the City. Employees shall be entitled to combine accumulated vacation leave or e-time vsdth LTD payments for the purpose of achieving the equivalent of their pre-disability salary to the extent allowed by law during any period of nonindustrial disability. Accumulated sick leave 29 Revised 11/27/128/27/13 may not be combined vsdth LTD payments. Under no circumstances shall the combination of accumulated leave and LTD payments exceed the employee's pre-disability salary. Former CMWD management employees shall receive LTD benefits as contained in their Individual Agreement. Deferred Compensation The City shall provide deferred compensation plan(s) which may be utilized by any management employee. The City reserves the right to accept or reject any particular plan and to impose specific conditions upon the use of any plan. The City agrees to work with the City's deferred compensation provider (currently ICMA Retirement Corporation) to maintain a personal loan provision for all management employees. It is acknowledged that the City vsdll assist in the administration of this benefit but that the City has no liability if an employee should default on the repayment of such a loan. Former CMWD management employees may voluntarily participate in the Deferred Compensation Plan as contained in their Individual Agreement. The City matches former CMWD employee contributions up to a maxunum of 7.5% of the employee's eamings. Drug and Alcohol Policy It is the policy of the City of Carlsbad to provide a work envnonment free from the effects of dmgs and alcohol consistent with the directives of the Dmg Free Workplace Act. This policy is applicable to all employees covered by the Management Compensation and Benefits Plan. A copy of this policy is available in the Human Resources Department. As a provision of this policy, the City provides a voluntary Employee Assistance Program (EAP) to assist employees who seek help for substance abuse or other personal problems affecting work or family life. This program is available to employees and their family members and offers 24- hour access to confidential professional EAP assistance for emergency or urgent situations. For more specific information, contact the Human Resources Department or visit the City's intranet site. Reporting the Value of Uniforms to CalPERS Effective May 31, 2010, all fire management employees who are required to wear City-provided uniforms vsdll have the amount of $17.31 reported to CalPERS bi-weekly as special compensation related to the monetary value of the required uniforms, excluding boots. Under PEPRA, this benefit does not apply to new members. Post-Retirement Healthcare Tmst 30 Revised 11/27/128/27/13 07 Employees who were promoted into a management classification after Mav 28, 2013 from a position that was represented by CFA, Inc. will continue to contribute into the post-retirement healthcare tmst established by CFA, Inc. via payroll deductions until participation by CFA, Inc., in this type of trust is terminated. The contribution amount will be equal to the amount established for employees represented by CFA, Inc. The City has no administrative responsibilities or liabilities related to this benefit, other than processing of payroll deductions as described above. The City will not make any contributions to the post-retirement healthcare tmst. 31 Revised 11/27/128/27/13 / ^ (OK Exhibit 4 Management Salary Structure (Base Pay) January 1, 2014 JOB TITLE GRADE MINIMUM MIDPOINT MAXIMUM Adminsitrative Services Director 8 $ 130,500 $ 159,900 $ 189,300 Assistant City Manager 8 Deputy City Manager 8 Fire Chief 8 Police Chief 8 Public Works Director 8 Assistant City Attorney 7 $ 113,500 $ 137,900 $ 162,300 Community 8i Economic Dev. Director 7 Finance Director 7 Fire Division Chief 7 Housing 8i Neighborhood Svcs Director 7 Human Resources Director 7 Information Technology Director 7 Library and Cultural Arts Director 7 Parl<s and Recreation Director 7 Property 8i Environmental Mgmt. Dir. 7 Transportation Director 7 Assistant Finance Director 6 $ 92,900 $ 113,800 $ 134,700 Assistant Utilities Director 6 Building &. Code Enforc. Manager 6 Business Intelligence Architect 6 City Communications Manager 6 City Traffic Engineer 6 City Planner 6 employees hired priorto 11/29/2011; y-rated due to reclassification $141,531.52 Deputy City Attorney 6 Economic Development Manager 6 Engineering Manager 6 Fire Battalion Chief 6 Fire Marshal 6 Information Technology Manager 6 Municipal Property Manager 6 Parks Superintendent 6 Project Portfolio Manager 6 Public Works Manager 6 Recreation Services Manager 6 Assistant to the City Manager 5 $ 84,700 $ 100,650 $ 116,600 Development Services Manager 5 Emergency Medical Services (EMS) Paramedic Nurse Coordinator 5 Environmental Programs Manager 5 Facilities Manager 5 Finance Manager 5 Finance Payroll Information Technology Mgr 5 Geographic Info. Systems Manager 5 Revised 8/27/13 Page 1 Exhibit 4 Management Salary Structure (Base Pay) January 1, 2014 JOB TITLE GRADE MINIMUM MIDPOINT MAXIMUM Human Resources Manager 5 $ 84,700 $ 100,650 $ 116,600 Municipal Projects Manager 5 Park Development Manager 5 Police Communications Manager 5 Principal Planner 5 Public Safety Info. Technogy Manager 5 Public Works Superintendent 5 Risk Manager 5 Senior Engineer 5 Utilities Superintendent 5 Cultural Arts Manager 4 $ 70,000 $ 83,100 $ 96,200 Construction Manager 4 Deputy Library Director 4 Emergency Preparedness Coordinator 4 Housing Program Manager 4 Public Information Officer 4 Records Manager 4 Senior Accountant 4 Senior Management Analyst 4 Video Production Manager 4 Community Relations Manager 3 $ 62,300 $ 73,850 $ 85,400 Management Analyst 3 Parks/Trees Supervisor 3 Principal Librarian 3 Public Works Supervisor 3 Utilities Supervisor 3 Aquatic Supervisor 2 $ 55,400 $ 65,800 $ 76,200 Assistant City Clerk 2 Associate Analyst 2 Benefits Administrator 2 Gallery Curator 2 Media Services Specialist 2 Recreation Area Manager 2 Secretary to City Attorney 2 Secretary to City Council 2 Secretary to City Manager 2 Communications Coordinator 1 $ 50,400 $ 59,800 $ 69,200 Community Arts Coordinator 1 Community Volunteer Coordinator 1 Management Assistant 1 Revised 8/27/13 Page 2 "7 /o Exhibit 5 JOB TITLE Management Salary Structure (Base Pay) FY 2012/13 January 1, 2014 GRADE MINIMUM MIDPOINT MARKET RANGE MAXIMUM Adminsitrative Services Director 8 $ 130,500 $ 159,900 $150,200 - $ 189,300 Assistant City Manager 8 Deputy City Manager 8 Fire Chief 8 Police Chief 8 Public Works Director 8 Assistant City Attorney 7 $ 113,500 $ 137,900 $130,000 - $ 162,300 Community 8i Economic Dev. Director 7 Finance Director 7 Fire Division Chief 7 Housing 8i Neighborhood Svcs Director 7 Human Resources Director 7 Information Technology Director 7 Library and Cultural Arts Director 7 Parks and Recreation Director 7 Property 8i Environmental Mgmt. Dir. 7 Transportation Director 7 Assistant Finance Director 6 $ 92,900 $ 113,800 $106,800 - $ 134,700 Assistant Utilities Director 6 Building 8i Code Enforc. Manager 6 Business Intelligence Architect 6 City Communications Manager 6 City Traffic Engineer 6 City Planner 6 employees hired prior to 11/29/2011; y-rated due to reclassification $141,531.52 Deputy City Attorney 6 Economic Development Manager 6 Engineering Manager 6 Fire Battalion Chief 6 Fire Marshal 6 Information Technology Manager 6 Municipal Property Manager 6 Parks Superintendent 6 Project Portfolio Manager 6 Public Works Manager 6 Recreation Services Manager 6 Assistant to the City Manager 5 $ 84,700 $ 100,650 $95,200 - $ 116,600 Development Services Manager 5 - Emergency Medical Services (EMS) Paramedic Nurse Coordinator 5 $ 84,700 $ 100,650 $ 95,200 - $ 116,600 Revised 08/27/2013 Exhibit 5 JOB TITLE Management Salary Structure (Base Pay) FY 2012/13 January 1, 2014 GRADE MINIMUM MIDPOINT MARKET RANGE MAXIMUM Environmental Programs Manager 5 Facilities Manager 5 Finance Manager 5 Finance Payroll Information Technology Mgr 5 Geographic Info. Systems Manager 5 Human Resources Manager 5 Municipal Projects Manager 5 - Park Development Manager 5 Police Communications Manager 5 Principal Planner 5 Public Safety Info. Technogy Manager 5 Public Works Superintendent 5 Risk Manager 5 Senior Engineer 5 Utilities Superintendent 5 Cultural Arts Manager 4 $ 70,000 $ 83,100 $78,800 - $ 96,200 Construction Manager 4 Deputy Library Director 4 Emergency Preparedness Coordinator 4 Housing Program Manager 4 Public Information Officer 4 Records Manager 4 Senior Accountant 4 Senior Management Analyst 4 Video Production Manager 4 Community Relations Manager 3 $ 62,300 $ 73,850 $69,900 - $ 85,400 Management Analyst 3 Parks/Trees Supervisor 3 Principal Librarian 3 Public Works Supervisor 3 Utilities Supervisor 3 Aquatic Supervisor 2 $ 55,400 $ 65,800 $62,500 - $ 76,200 Assistant City Clerk 2 Associate Analyst 2 Benefits Administrator 2 Gallery Curator 2 Media Services Specialist 2 Recreation Area Manager 2 Secretary to City Attorney 2 Revised 08/27/2013 Exi JOB TITLE Management Salary Structure (Base Pay) FY 2012/13 January 1, 2014 GRADE MINIMUM MIDPOINT MARKET RANGE MAXIML Secretary to City Council 2 $ 55,400 $ 65,800 $62,500 - $ 76,201 Secretary to City Manager 2 Communications Coordinator 1 $ 50,400 $ 59,800 $56,900 - $ 69,200 Community Arts Coordinator 1 Community Volunteer Coordinator 1 Management Assistant 1 Revised 08/27/2013