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HomeMy WebLinkAbout2020-11-17; City Council; ; Side Letter Agreement with the Carlsbad Firefighters’ Association, Inc., re: Modifications to the City’s Calculation of Overtime as required by the Fair Labor Standards AMeeting Date: Nov. 17, 2020 To: Mayor and City Council From: Scott Chadwick, City Manager Staff Contact: Debbie Porter, Sr. Management Analyst debbie.porter@carlsbadca.gov, 760-621-1221 Judy von Kalinowski, Human Resources Director judy.vonkalinowski@carlsbadca.gov, 760-473-4670 Subject: Side Letter Agreement with the Carlsbad Firefighters’ Association, Inc., re: Modifications to the City’s Calculation of Overtime as required by the Fair Labor Standards Act Recommended Action Adopt a resolution approving a side letter agreement with the Carlsbad Firefighters’ Association, Inc. to modify the city’s calculation of overtime under the federal Fair Labor Standards Act and authorizing the City Manager to address any related past underpayments. Executive Summary The federal Fair Labor Standards Act is the primary wage and hour law that governs public employees. Recent clarifications to this law require the city to adjust the way it calculates overtime to remain in accordance with the law. Representatives of the city and the Carlsbad Firefighters’ Association, Inc., have met and conferred in good faith and have reached an agreement to modify articles 4, 15, 16, 19 and 20 of the memorandum of understanding to clarify the city’s calculation and payment of overtime as required by law. The term of the current memorandum of understanding between the City and the Carlsbad Firefighters’ Association is from Jan. 1, 2020, to Dec. 31, 2022. Discussion The 2016 Ninth Circuit U.S. Court of Appeals decision in the case of Flores v. City of San Gabriel (824 F.3d 890) clarified that all cash an employee receives back as taxable income from the employer’s contribution to the employee’s healthcare plan benefit must be included in the regular rate of pay for purposes of calculating the employee’s overtime pay in accordance with the Fair Labor Standards Act. Before this ruling, the prevailing view among all cities was that these cash payments made in lieu of health benefits were not to be included in the regular rate of pay for overtime calculations under the terms of the Fair Labor Standards Act. In October Nov. 17, 2020 Item #6 Page 1 of 22 2019, the City of Carlsbad began including these payments in its overtime calculations. This side letter agreement will modify the current memorandum of understanding to reflect this. In December 2019, the U.S. Department of Labor clarified its regulation regarding when holiday-in-lieu pay needs to be included in the regular rate of pay for purposes of calculating overtime under the Fair Labor Standards Act. An employer that does not guarantee employees a paid holiday off and, instead provides holiday pay in an amount less than the approximate equivalent of a full shift must include the holiday pay in the regular rate of pay for overtime along with the pay the employee received for working the holiday shift. Employees represented by the Carlsbad Firefighters’ Association, Inc., who are on 24-hour shifts receive 12 hours of holiday pay in lieu of having the holiday off. This 12 hours of holiday in-lieu pay must be included in the employees’ regular rate of pay for overtime calculations under the Fair Labor Standards Act because it is less that the approximate equivalent of their 24-hour shift. The change will be fully implemented in January 2021. Fiscal Analysis The estimated annual cost of the changes to the city’s calculation of overtime based on the Fair Labor Standards Act for employees represented by the Carlsbad Firefighters’ Association, Inc., is $115,000. The impact to fiscal year 2020-21 (from January 2021 to June 2021) is $57,500 which will be appropriated from the available fund balance in the General Fund. The estimated cost of providing retroactive payments to individual firefighters for any underpayments of overtime is not expected to exceed $500,000 and will be appropriated from General Fund reserves. Next Steps With the council’s approval, staff will implement the changes outlined in the side letter agreement. Staff will also seek to obtain settlement agreements to provide retroactive payments to individual firefighters for any underpayments of overtime. Environmental Evaluation (CEQA) This action does not constitute a “project” within the meaning of the California Environmental Quality Act under California Public Resources Code Section 21065 in that it has no potential to cause either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment and therefore does not require environmental review. Public Notification and Outreach Public notice of this item was posted in keeping with the Ralph M. Brown Act and it was available for public viewing and review at least 72 hours before the scheduled meeting date. Exhibits 1. City Council Resolution 2. Revisions of articles in the memorandum of understanding between the city and the Carlsbad Firefighters’ Association, Inc. Nov. 17, 2020 Item #6 Page 2 of 22 Nov. 17, 2020 Item #6 Page 3 of 22 RESOLUTION NO. 2020-220 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING A SIDE LETTER AGREEMENT WITH THE CARLSBAD FIREFIGHTERS' ASSOCIATION, INC. TO MODIFY ARTICLES 4, 15, 16, 19 AND 20 OF THE MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY AND THE ASSOCIATION RELATING TO THE CALCULATION OF OVERTIME UNDER THE FAIR LABOR STANDARDS ACT AND AUTHORIZING THE CITY MANAGER TO ADDRESS ANY RELATED PAST UNDERPAYMENTS WHEREAS, recent clarifications to the Fair Labor Standards Act require the city to adjust the way it calculates Fair Labor Standards Act overtime; and WHEREAS, representatives of the City of Carlsbad and. the Carlsbad Firefighters' Association, Inc. have met and conferred in good faith pursuant to the Meyers-Milias-Brown Act (Cal. Government Code,§ 3500 et seq.) regarding the way the city calculates Fair Labor Standards Act overtime; and WHEREAS, the representatives have reached agreement which they desire to submit to the City Council for consideration and approval; and WHEREAS, the City Council of the City of Carlsbad, California has determined the need to approve the agreement in the form of a Side Letter Agreement (Attachment A); and WHEREAS, the City Council has further determined the need to resolve any individual claims of underpaid overtime related to the adjustments in the Side Letter Agreement. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as follows: 1. That the above recitations are true and correct. Nov. 17, 2020 Item #6 Page 4 of 22 II II II II II II II II II 2. That the Side Letter Agreement between the Carlsbad Firefighters' Association, Inc. and the City of Carlsbad (Attachment A) is approved and the city manager is directed to execute it. 3. That the deputy city manager, administrative services is authorized to appropriate $57,500 from the available fund balance in the General Fund to implement the Side Letter Agreement. 4. That the City Manager or designee, in consultation with the City Attorney, is authorized to resolve any individual claims of underpaid overtime related to the adjustments in the Side Letter Agreement, including executing any settlement agreements with the claimants. 5. That the deputy city manager, administrative services is authorized to appropriate the amount necessary to fund the underpaid overtime claims from General Fund reserves, not to exceed $500,000. Nov. 17, 2020 Item #6 Page 5 of 22 PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of Carlsbad on the 17th day of November, 2020, by the following vote, to wit: AYES: Hall, Blackburn, Bhat-Patel, Schumacher. NAYS: None. ABSENT: None. MATT HALL, Mayor BARBARA ENGLESON, Cit (SEAL) Nov. 17, 2020 Item #6 Page 6 of 22 SIDE LETTER AGREEMENT BETWEEN THE THE CARLSBAD FIREFIGHTERS' ASSOCIATION, INC. AND THE CITY OF CARLSBAD RELATING TO FLSA OVERTIME Attachment A The City of Carlsbad (hereinafter referred to as "city") and the Carlsbad Firefighters' Association, Inc. (hereinafter referred to as the "CF A") entered into a Memorandum of Understanding ("MOU") with a term beginning on January 1, 2020 and terminating on December 31, 2022. The city and the CF A are collectively referred to herein as the "Parties." Background and Overview This Agreement relates to modifications to the city's payment of Fair Labor Standards Act ("FLSA") overtime for unused benefit credits received as taxable income in accordance with Flores v. San Gabriel (2016) 824 F.3d 890. Pursuant to the Flores decision, the city began including unused benefit credits received as taxable income into the regular rate of pay for FLSA overtime on October 7, 2019. The amendn:ients to the MOU set forth below conform with this decision and the FLSA. This Agreement also relates to modifications to the city's payment of FLSA overtime for holiday pay. On December 16, 2019, the Department of Labor (DOL) issued a Final Rule, revising 29 C.F.R., section 778.219(a), to clarify when "holiday-in-lieu pay" is required to be included in the regular rate of pay. The city intends to include holiday pay for certain represented members into FLSA overtime effective the first pay period after Council approves this Agreement in open session. The amendments to the MOU set forth below conform with this DOL Final Rule and the FLSA. The specific provisions contained in this Agreement are intended to supersede any previous agreements, whether oral or written, regarding the matters contained in this Agreement. The Parties have satisfied their obligations to meet and confer in good faith in accordance with the Meyers-Milias-Brown Act ("MMBA") in response to the city's determination. Except as provided here, all wages, hours, and other terms and conditions of employment presently in the city's MOU with the CF A remain in full force and effect. This Agreement will become effective the first day of the first full pay period following Council approval in open session. The Parties mutually agree to replace Articles 4, 15, 16, 19 and 20 in their entirety with the following: ARTICLE 4. RENEGOTIATION In the event either party desires to meet and confer in good faith on the terms of a successor Memorandum, that party shall serve upon the other a notice of such intent. During the term of this Memorandum, the parties agree to meet and confer upon request of the other party to discuss Nov. 17, 2020 Item #6 Page 7 of 22 Attachment A additional changes to this Memorandum in accordance with the Meyers-Milias-Brown Act (MMBA). In addition, the parties may meet and confer on the items listed below. • • • • • Health insurance benefits in order to reduce or eliminate penalties under the ACA. Any changes shall be by mutual agreement only. Employee cost sharing toward the City's required contribution to CalPERS for CF A members if the CalPERS actual rate of return is less than CalPERS' expected rate of return (the expected rate of return or "discount rate" in effect during that same prior fiscal year). Any changes shall be by mutual agreement only. Eligibility for 4850 benefits for classifications in the Fire Prevention Bureau. Any changes shall be by mutual agreement only. Establishment of an Association Leave Bank. Any changes shall be by mutual agreement only. Options for employees to increase contributions to the Post-Retirement Healthcare Trust and options for establishment of individual accounts. Any changes shall be by mutual agreement only. 4.1 If there is a Ninth Circuit ruling between any parties under the Fair Labor Standards Act (FLSA) that determines the city's current calculation of the regular rate of pay and overtime premium ( e.g., the divisor and multiplier used) is below the FLSA minimum, then the parties will reopen negotiations to determine a remedy and any applicable changes to the MOU re: the calculation of the regular rate of pay and overtime premium. In addition, if there is a published Ninth Circuit decision that provides a revision or clarification to the FLSA that requires add-on pays not currently included in the city's calculation of the regular rate of pay, the parties will reopen negotiations re: inclusion of those add-on pays in the FLSA calculation. The foregoing notwithstanding, if there is a published Ninth Circuit decision that add-on pays currently included in the city's calculation of the FLSA regular rate are not to be included in the city's calculation of the FLSA regular rate, this Agreement shall not reopen for negotiations. ARTICLE 15. FLEXIBLE BENEFITS PROGRAM Employees represented by the CF A, Inc. will participate in a flexible benefits program which includes medical insurance, dental insurance, vision insurance, accidental death and dismemberment insurance (AD&D) and flexible spending accounts (FSAs). Each of these components is outlined below. A. Benefits Credits and Medical Insurance During the term of this Agreement, represented employees will be covered by the Public Employees' Medical and Hospital Care Act (PEMHCA) and will be eligible to participate in the CalPERS Health Program. The city will pay on behalf of all employees covered by this agreement and their eligible dependents and those retirees designated in this Article, the minimum amount per month required under Government Code Section 22892 of the PEMHCA for medical insurance through the California Public Employees' Retirement System (CalPERS). If electing to emoll for medical benefits, the employee must select one medical plan from the variety of medical plans offered through CalPERS. The city shall contribute monthly amounts ( called Benefits Credits) on behalf of each active employee and eligible dependents toward the payment of medical premiums under Nov. 17, 2020 Item #6 Page 8 of 22 Attachment A the CalPERS health program for all FLSA eligible hours paid in the pay period. The city contribution shall be based on the employee's medical coverage level and shall include the mandatory payments to CalPERS. If the actual total premiums exceed the city's total contributions, the employee will pay the difference. Waiver Provision: CF A-represented employees who do not wish to participate in the CalPERS Health Program will have the choice of waiving the city's medical insurance progmm, provided they can show that they are covered under another group insurance program. The benefits credits associated with waiving medical coverage will be set equal to 50% of the benefit credits associated with Employee Only medical coverage level. If this results in a situation where the unused benefit credits associated with any medical plan exceed the benefit credits associated with waiving medical coverage, the benefit credits associated with waiving medical coverage will be set equal to one dollar ($1) above the unused benefit credits associated with that medical plan. Excess and Unused Benefits Credits: If the Benefits Credits exceeds the cost of the medical insurance purchased by the employee, the employee will have the option of using any "excess credits" to purchase city-sponsored dental insurance, vision insurance, accidental death and dismemberment (AD&D) insurance or to contribute to a healthcare or dependent care flexible spending account (FSA). Unused Benefits Credits will be paid to the employee in cash and reported as taxable income and included in the calculation of the regular rate of pay and overtime premium under the FLSA. The Benefits Credits for calendar year 2020 shall increase as shown in the table below. Medical Prior Monthly 2020 Monthly Monthly Coverage Level Benefits Credits Benefits Credits Increase Employee $577.00 $609.00 $32.00 Employee+ 1 $1,158.00 $1,216.00 $58.00 Family $1,528.00 $1,607.00 $79.00 Waive Medical $416.68 $477.64 $60.96 To provide CFA represented employees with the value of the increase in 2020 Benefits Credits retroactive to the first full pay period in 2020, with the payroll for the first full pay period after ratification of this Memorandum by the City Council, the city shall make a one-time taxable (non-PERSable) cash payment equal to the increase in benefits credits for CF A members employed by the city on that date. The increase in Benefits Credits shall be given to each employee based on the employee's medical coverage level in the pay period in which the cash amount is paid and pro-rated based on the employee's benefit-eligibility date (i.e., the date they became eligible for city benefits). Effective the pay periods that include January 1, 2021 and January 1, 2022 and December 31, 2022 the city monthly benefit credits associated with each medical coverage level will Nov. 17, 2020 Item #6 Page 9 of 22 Attachment A be set to dollar amounts that equate to 80% of the average health (medical, dental and vision) premium for Employee, Employee Plus One and Family coverage levels, rounded to the nearest whole dollar based on the premiums that will take effect on January 1 of the respective calendar year. B. Dental Insurance, Vision Insurance and Accidental Death & Dismemberment (AD&D) Insurance Employees may choose to enroll in or opt out of the city-sponsored dental, vision or AD&D insurance plans at any coverage level. C. Retirees Each retired employee who was a member of this bargaining unit is covered by the Public Employees' Medical and Hospital Care Act and is eligible to participate in the California Public Employees' Retirement System (CalPERS) Health Program. Represented 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 Government 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 elect, upon retirement, to participate in the city's dental and/or vision insurance programs as a retiree. The cost of such dental and/or vision insurance for the retiree and eligible dependents shall be borne solely by the retiree. An individual who does not choose continued coverage upon retirement, or who chooses coverage and later drops it, is not eligible to return to the city's dental and vision insurance programs. 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. ARTICLE 16. HOLIDAYS The city shall observe the following scheduled paid holidays, consistent with the annual holiday schedule published by the Human Resources Department: New Year's Day Martin Luther King Jr.'s Birthday President's Birthday Memorial Day Independence Day Labor Day Columbus Day Veterans Day Thanksgiving Thanksgiving Friday Christmas Day Nov. 17, 2020 Item #6 Page 10 of 22 Attachment A Effective January 27, 2020, the following provisions will be in effect: 1) Suppression personnel assigned as a Lifeguard Supervisor or on an administrative assignment are ineligible for the holiday pay listed above. These personnel will receive straight time pay when they are regularly scheduled to work on the holidays listed above. 2) Fire Prevention personnel, personnel on a non-occupational injury light/modified duty assignment and Suppression personnel in the new hire academy will be eligible to have the day off with pay on the holidays listed above. 3) Suppression personnel working a 112 hour/pay period schedule, personnel on an occupational injury light/modified duty assignment and Paramedic Lifeguard Lieutenants shall be credited with an additional twelve (12) hours of holiday pay (using a base salary rate that excludes additional pays) on the day the holiday occurs based on all FLSA eligible hours paid in the pay period during the calendar year that the holiday occurs. Employees scheduled to work on a holiday who desire the day off will utilize their own leave balances. See Article 33 for the effect of an extended leave of absence on holiday pay. Only employees who are on paid status on their scheduled work day immediately before a holiday shall be entitled to the paid holiday. ARTICLE 19. OVERTIME FOR EMPLOYEES WORKING A 112 HOUR/PAY PERIOD SCHEDULE A. In determining an employee's eligibility for overtime, paid leaves shall be included in the total hours worked. Excluded from the total hours worked are duty free lunches, travel time to and from work (except for emergency call-back), and time spent conducting bona fide volunteer activities. Time worked shall be computed by rounding to the nearest quarter of an hour. B. Sworn personnel who are assigned to fire suppression shall work a 112 hour/pay period on a Kelly schedule or other shift schedule as approved at the discretion of the Fire Chief or his/her designee. Suppression employees temporarily assigned to light/modified duty will be assigned a traditional 5/40 work schedule or alternative work schedule as approved at the discretion of the Fire Chief or his/her designee. In this situation, the employee's hourly rate will be converted from a 112 hour/pay period schedule rate to an 80 hour/pay period schedule rate. C. The City of Carlsbad will use a 24-day work cycle for fire suppression employees under the 7(k) exemptions contained in the Fair Labor Standards Act. The "work period" shall be twenty-four (24) days in length. The "work schedule" is to be based on a fifty-six (56) hour average workweek. Each fire suppression employee on a 112 hour/pay period Nov. 17, 2020 Item #6 Page 11 of 22 Attachment A schedule (or on a light/modified duty !OD-related work schedule) will earn six (6) hours of premium pay in each biweekly pay period. In addition, any employee required to perform in excess of an employee's normal scheduled shift shall receive overtime compensation. For FLSA overtime, the calculation of the regular rate of pay and overtime premium shall be calculated in conformance with the FLSA as required by this Agreement. ARTICLE 20. OVERTIME AND COMP TIME FOR EMPLOYEES WORKING AN 80 HOUR/PAY PERIOD SCHEDULE A. SCOPE 1. This article shall apply to employees working in the classifications listed below or who work an 80 hour/pay period on a 5/40 schedule or alternative schedule as approved by the Fire Chief or his/her designee: o Paramedic Lifeguard Lieutenants o Fire Prevention Personnel o Suppression personnel in the new hire academy o Any classification working on an administrative assignment as approved by the Fire Chief or his/her designee ( e.g., Training Captain) 2. However, this article does not apply to any suppression employee who is assigned to administrative assignment due to temporary light duty status. 3. In determining an employee's eligibility for overtime, under this agreement, paid leaves shall be included in the total hours worked. Excluded from the total hours worked are duty free lunches, travel time to and from work (except for emergency call-back), and time spent conducting bona fide volunteer activities. There shall be no pyramiding of overtime. Hours worked by an employee in any workday or workweek on which premium rates have once been allowed shall not be used again in any other overtime calculation other than computing total actual hours worked. Time worked shall be computed by rounding to the nearest quarter of an hour. B. COMPENSATION FOR ADMINISTRATIVE ASSIGNMENTS The employee's hourly rate will be converted from a 112 hour/pay period schedule rate to an 80 hour/pay period schedule rate. Beginning with the first full pay period following Council ratification of this MOU, while appointed or assigned to an administrative position, the employee shall receive an additional 15 percent (15%) above their base hourly pay rate. C. HOURS OF WORK 1. Overtime Nov. 17, 2020 Item #6 Page 12 of 22 Attachment A The official 7-day FLSA work week for employees on a 9/80 Friday to Friday shift begins four (4) hours after the regularly scheduled starting time for their Friday shift and ends one hundred sixty-eight (168) hours later (at four (4) hours after the regularly scheduled starting time for their Friday shift). For all other employees, except suppression employees on an administrative assignment as Lifeguard Supervisors, who work an 80 hour/pay period schedule the 7-day FLSA work week is from Monday at 12:00 a.m. to Sunday at 11 :59 p.m. For suppression employees on an administrative assignment as Lifeguard Supervisors, the city will use a 14-day work cycle for employees under the 7(k) exemptions contained in the FLSA. The "work period" shall be fourteen (14) days in length. The "work schedule" will be variable based on seasonal needs with a base of forty ( 40) hour average workweek. Peak season staffing will be set at a 3/12 and 4/12 schedule with a forty-two (42) hour average workweek. The FLSA work period is from 12:00 am Sunday and concludes on the 14th day on the Saturday at 11 :59 pm. (Based on the FLSA 7(k) guidelines, hours worked in excess of 106 in the 14-day work period will be paid out as FLSA overtime.) Any employee who is not 7k exempt that is required to perform in excess of forty ( 40) hours in their 7 day work week or any employee who works in excess of an employee's normal scheduled day shall receive overtime compensation. For FLSA overtime, the calculation of the regular rate of pay and overtime premium shall be calculated in conformance with the FLSA as required by this Agreement. Employees regularly assigned to a 112 hour/pay period schedule who are assigned to an 80 hour/pay period schedule administrative assignment, will not be available to work shift overtime on days they are assigned to an administrative assignment unless authorized by the Duty Battalion Chief. Employees are authorized to work suppression overtime during hours they are not assigned to administration. Employees working an 80 hour/pay period schedule who work a suppression overtime shift will have their pay rate converted to the 112 hour/pay period rate while on the suppression overtime shift. This rate shall not include the 15% administrative assignment pay. Suppression members that are on an administrative assignment will not remain subject to force hires for suppression assignments. 2. Compensatory Time In lieu of receiving overtime pay pursuant to Section 1 above, an employee working an 80 hour/pay period schedule may elect, subject to department approval, to receive compensatory time off. No employee shall accrue more than 80 hours of such compensatory time. When an employee has accumulated the maximum Nov. 17, 2020 Item #6 Page 13 of 22 Attachment A number of hours of compensatory time off, he/she shall receive all overtime compensation in cash. An employee may use such compensatory time within a reasonable period after making the request if the use of compensatory time does not unduly disrupt the operations of the department. Any accrued and unused compensatory time through December 31, 2019 will be cashed out on the last pay date in June 2020. Effective January 1, 2020, all accrued and unused compensatory time during the calendar year will be cashed out on the last pay date of the calendar year. No compensatory time may be accrued beginning on the last pay period of the calendar year through the end of the calendar year. At the time an employee switches from an 80 hour/pay period schedule to a 112 hour/pay period schedule, all accrued and unused compensatory time will be cashed out. An employee may elect to "cash out" any portion of his/her accrued compensatory time at his/her regular rate of pay in any pay period. The employee shall indicate the number of hours to be cashed out on his/her timesheet. 3. Request for Temporary Shift Adjustment (Flex Time) An employee may request that the employee's normal workday be temporarily altered in order to accumulate a credit of work hours that may be used to take time off during the employee's FLSA work week without loss of pay. If the request is approved by management, pay for hours worked during this temporary shift adjustment shall be paid at the straight time rate even if the employee's hours worked exceed his/her normal scheduled shift on that day. 4. Employees hired by divisions or bureaus currently operating on an alternative work schedule shall be subject to having their daily work schedule changed at the sole discretion of the department. Such changes include, but are not limited to, a) number of days/hours to be worked on a daily basis and in a payroll period; b) normal days off; and c) starting/ending times of assigned shifts. This article shall not be subject to the grievance procedure. D. RETURN TO SUPPRESSION DUTIES Upon completion of the administrative assignment, the employee will return to his /her previous rank held at the time of accepting the appointment unless the employee has been promoted to another position/rank. The duration of an appointment or assignment to administrative duties will normally be for a minimum of two years but may be extended one year at the discretion of the Fire Chief or his/her designee. Nov. 17, 2020 Item #6 Page 14 of 22 CITY OF CARLSBAD: Date: l l ( '2-3 / ~ Attachment A fl ~I Q \, ~ \--_/- LI SCOTT CHADWICK, CITY MANAGER, CITY ( j OF CARLSBAD CARLSBAD FIREFIGHTERS' ASSOCIATION, INC.: Date: ____ _ JOSHUA CLARK, PRESIDENT, CARLSBAD FIREFIGHTERS' ASSOCIATION, INC. ARTICLE 4. RENEGOTIATION In the event either party desires to meet and confer in good faith on the terms of a successor Memorandum, that party shall serve upon the other a notice of such intent. During the term of this Memorandum, the parties agree to meet and confer upon request of the other party to discuss additional changes to this Memorandum in accordance with the Meyers-Milias-Brown Act (MMBA). In addition, the parties may meet and confer on the items listed below. • Health insurance benefits in order to reduce or eliminate penalties under the ACA. Any changes shall be by mutual agreement only. • Employee cost sharing toward the City’s required contribution to CalPERS for CFA members if the CalPERS actual rate of return is less than CalPERS’ expected rate of return (the expected rate of return or “discount rate” in effect during that same prior fiscal year). Any changes shall be by mutual agreement only. • Eligibility for 4850 benefits for classifications in the Fire Prevention Bureau. Any changes shall be by mutual agreement only. • Establishment of an Association Leave Bank. Any changes shall be by mutual agreement only. • Options for employees to increase contributions to the Post-Retirement Healthcare Trust and options for establishment of individual accounts. Any changes shall be by mutual agreement only. 4.1 If there is a Ninth Circuit ruling between any parties under the Fair Labor Standards Act (FLSA) that determines the city’s current calculation of the regular rate of pay and overtime premium (e.g., the divisor and multiplier used) is below the FLSA minimum, then the parties will reopen negotiations to determine a remedy and any applicable changes to the MOU re: the calculation of the regular rate of pay and overtime premium. In addition, if there is a published Ninth Circuit decision that provides a revision or clarification to the FLSA that requires add-on pays not currently included in the city’s calculation of the regular rate of pay, the parties will reopen negotiations re: inclusion of those add-on pays in the FLSA calculation. The foregoing notwithstanding, if there is a published Ninth Circuit decision that add-on pays currently included in the city’s calculation of the FLSA regular rate are not to be included in the city’s calculation of the FLSA regular rate, this Agreement shall not reopen for negotiations. ARTICLE 15. FLEXIBLE BENEFITS PROGRAM Employees represented by the CFA, Inc. will participate in a flexible benefits program which includes medical insurance, dental insurance, vision insurance, accidental death and dismemberment insurance (AD&D) and flexible spending accounts (FSAs). Each of these components is outlined below. A. Benefits Credits and Medical Insurance During the term of this Agreement, represented employees will be covered by the Public Employees’ Medical and Hospital Care Act (PEMHCA) and will be eligible to participate in the CalPERS Health Program. The city will pay on behalf of all employees covered by this agreement and their eligible dependents and those retirees designated in this Article, the minimum amount per month required under Government Code Section 22892 of the Nov. 17, 2020 Item #6 Page 15 of 22 PEMHCA for medical insurance through the California 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 through CalPERS. The city shall contribute monthly amounts (called Benefits Credits) on behalf of each active employee and eligible dependents toward the payment of medical premiums under the CalPERS health program for all FLSA eligible hours paid in the pay period. The city contribution shall be based on the employee’s medical coverage level and shall include the mandatory payments to CalPERS. If the actual total premiums exceed the city’s total contributions, the employee will pay the difference. Waiver Provision: CFA-represented employees who do not wish to participate in the CalPERS Health Program will have the choice of waiving the city’s medical insurance program, provided they can show that they are covered under another group insurance program. The benefits credits associated with waiving medical coverage will be set equal to 50% of the benefit credits associated with Employee Only medical coverage level. If this results in a situation where the unused benefit credits associated with any medical plan exceed the benefit credits associated with waiving medical coverage, the benefit credits associated with waiving medical coverage will be set equal to one dollar ($1) above the unused benefit credits associated with that medical plan. Excess and Unused Benefits Credits: If the Benefits Credits exceeds the cost of the medical insurance purchased by the employee, the employee will have the option of using any “excess credits” to purchase city-sponsored dental insurance, vision insurance, accidental death and dismemberment (AD&D) insurance or to contribute to a healthcare or dependent care flexible spending account (FSA). Unused Benefits Credits will be paid to the employee in cash and reported as taxable income and included in the calculation of the regular rate of pay and overtime premium under the FLSA. The Benefits Credits for calendar year 2020 shall increase as shown in the table below. Medical Coverage Level Prior Monthly Benefits Credits 2020 Monthly Benefits Credits Monthly Increase Employee $577.00 $609.00 $32.00 Employee + 1 $1,158.00 $1,216.00 $58.00 Family $1,528.00 $1,607.00 $79.00 Waive Medical $416.68 $477.64 $60.96 To provide CFA represented employees with the value of the increase in 2020 Benefits Credits retroactive to the first full pay period in 2020, with the payroll for the first full pay period after ratification of this Memorandum by the City Council, the city shall make a one-time taxable (non-PERSable) cash payment equal to the increase in benefits credits for CFA members employed by the city on that date. The increase in Benefits Credits shall be given to each employee based on the employee’s medical coverage level in the Nov. 17, 2020 Item #6 Page 16 of 22 pay period in which the cash amount is paid and pro-rated based on the employee’s benefit-eligibility date (i.e., the date they became eligible for city benefits). Effective the pay periods that include January 1, 2021 and January 1, 2022 and December 31, 2022 the city monthly benefit credits associated with each medical coverage level will be set to dollar amounts that equate to 80% of the average health (medical, dental and vision) premium for Employee, Employee Plus One and Family coverage levels, rounded to the nearest whole dollar based on the premiums that will take effect on January 1 of the respective calendar year. B. Dental Insurance, Vision Insurance and Accidental Death & Dismemberment (AD&D) Insurance Employees may choose to enroll in or opt out of the city-sponsored dental, vision or AD&D insurance plans at any coverage level. C. Retirees Each retired employee who was a member of this bargaining unit is covered by the Public Employees’ Medical and Hospital Care Act and is eligible to participate in the California Public Employees’ Retirement System (CalPERS) Health Program. Represented 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 Government 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 elect, upon retirement, to participate in the city’s dental and/or vision insurance programs as a retiree. The cost of such dental and/or vision insurance for the retiree and eligible dependents shall be borne solely by the retiree. An individual who does not choose continued coverage upon retirement, or who chooses coverage and later drops it, is not eligible to return to the city’s dental and vision insurance programs. 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. ARTICLE 16. HOLIDAYS The city shall observe the following scheduled paid holidays, consistent with the annual holiday schedule published by the Human Resources Department: New Year’s Day Martin Luther King Jr.’s Birthday President’s Birthday Memorial Day Independence Day Nov. 17, 2020 Item #6 Page 17 of 22 Labor Day Columbus Day Veterans Day Thanksgiving Thanksgiving Friday Christmas Day Effective January 27, 2020, Tthe following provisions will be in effect: beginning with the first full pay period following Council ratification of this MOU. 1) Suppression personnel assigned as a Lifeguard Supervisor or on an administrative assignment are ineligible for the holiday pay listed above. These personnel will receive straight time pay when they are regularly scheduled to work on the holidays listed above. 2) Fire Prevention personnel, personnel on a non-occupational injury light/modified duty assignment and Suppression personnel in the new hire academy will be eligible to have the day off with pay on the holidays listed above. 3) Suppression personnel working a 112 hour/pay period schedule, personnel on an occupational injury light/modified duty assignment and Paramedic Lifeguard Lieutenants shall be compensated credited with for an additional twelve (12) hours of holiday pay (using a base salary rate that excludes additional pays) on the day the holiday occurs based on all FLSA eligible hours paid in the pay period during the calendar year that the holiday occurs. Employees scheduled to work on a holiday who desire the day off will utilize their own leave balances. See Article 33 for the effect of an extended leave of absence on holiday pay. Only employees who are on paid status on their scheduled work day immediately before a holiday shall be entitled to the paid holiday. ARTICLE 19. OVERTIME FOR EMPLOYEES WORKING A 112 HOUR/PAY PERIOD SCHEDULE A. In determining an employee’s eligibility for overtime, paid leaves shall be included in the total hours worked. Excluded from the total hours worked are duty free lunches, travel time to and from work (except for emergency call-back), and time spent conducting bona fide volunteer activities. Time worked shall be computed by rounding to the nearest quarter of an hour. B. Sworn personnel who are assigned to fire suppression shall work a 112 hour/pay period on a Kelly schedule or other shift schedule as approved at the discretion of the Fire Chief or his/her designee. Suppression employees temporarily assigned to light/modified duty will be assigned a traditional 5/40 work schedule or alternative work schedule as approved at the discretion of the Fire Chief or his/her designee. In this situation, the employee's hourly Nov. 17, 2020 Item #6 Page 18 of 22 rate will be converted from a 112 hour/pay period schedule rate to an 80 hour/pay period schedule rate. C. The City of Carlsbad will use a 24-day work cycle for fire suppression employees under the 7(k) exemptions contained in the Fair Labor Standards Act. The "work period" shall be twenty-four (24) days in length. The "work schedule" is to be based on a fifty-six (56) hour average workweek. Each fire suppression employee on a 112 hour/pay period schedule (or on a light/modified duty IOD-related work schedule) will earn six (6) hours of premium pay in each biweekly pay period. In addition, any employee required to perform in excess of an employee’s normal scheduled shift shall receive overtime compensation. For FLSA overtime, the calculation of the regular rate of pay and overtime premium shall be calculated in conformance with the FLSA as required by this Agreement. ARTICLE 20. OVERTIME AND COMP TIME FOR EMPLOYEES WORKING AN 80 HOUR/PAY PERIOD SCHEDULE A. SCOPE 1. This article shall apply to employees working in the classifications listed below or who work an 80 hour/pay period on a 5/40 schedule or alternative schedule as approved by the Fire Chief or his/her designee: o Paramedic Lifeguard Lieutenants o Fire Prevention Personnel o Suppression personnel in the new hire academy o Any classification working on an administrative assignment as approved by the Fire Chief or his/her designee (e.g., Training Captain) 2. However, this article does not apply to any suppression employee who is assigned to administrative assignment due to temporary light duty status. 3. In determining an employee’s eligibility for overtime, under this agreement, paid leaves shall be included in the total hours worked. Excluded from the total hours worked are duty free lunches, travel time to and from work (except for emergency call-back), and time spent conducting bona fide volunteer activities. There shall be no pyramiding of overtime. Hours worked by an employee in any workday or workweek on which premium rates have once been allowed shall not be used again in any other overtime calculation other than computing total actual hours worked. Time worked shall be computed by rounding to the nearest quarter of an hour. B. COMPENSATION FOR ADMINISTRATIVE ASSIGNMENTS The employee' s hourly rate will be converted from a 112 hour/pay period schedule rate to an 80 hour/pay period schedule rate. Beginning with the first full pay period following Nov. 17, 2020 Item #6 Page 19 of 22 Council ratification of this MOU, while appointed or assigned to an administrative position, the employee shall receive an additional 15 percent (15%) above their base hourly pay rate. C. HOURS OF WORK 1. Overtime The official 7-day FLSA work week for employees on a 9/80 Friday to Friday shift begins four (4) hours after the regularly scheduled starting time for their Friday shift and ends one hundred sixty-eight (168) hours later (at four (4) hours after the regularly scheduled starting time for their Friday shift). For all other employees, except suppression employees on an administrative assignment as Lifeguard Supervisors, who work an 80 hour/pay period schedule the 7-day FLSA work week is from Monday at 12:00 a.m. to Sunday at 11:59 p.m. For suppression employees on an administrative assignment as Lifeguard Supervisors, the city will use a 14-day work cycle for employees under the 7(k) exemptions contained in the FLSA. The “work period” shall be fourteen (14) days in length. The “work schedule” will be variable based on seasonal needs with a base of forty (40) hour average workweek. Peak season staffing will be set at a 3/12 and 4/12 schedule with a forty-two (42) hour average workweek. The FLSA work period is from 12:00 am Sunday and concludes on the 14th day on the Saturday at 11:59 pm. (Based on the FLSA 7(k) guidelines, hours worked in excess of 106 in the 14-day work period will be paid out as FLSA overtime.) Any employee who is not 7k exempt that is required to perform in excess of forty (40) hours in their 7 day work week or any employee who works in excess of an employee’s normal scheduled day shall receive overtime compensation. For FLSA overtime,T the calculation of the regular rate of pay and overtime premium shall be calculated in conformance with the FLSA as required by this Agreement. Employees regularly assigned to a 112 hour/pay period schedule who are assigned to an 80 hour/pay period schedule administrative assignment, will not be available to work shift overtime on days they are assigned to an administrative assignment unless authorized by the Duty Battalion Chief. Employees are authorized to work suppression overtime during hours they are not assigned to administration. Employees working an 80 hour/pay period schedule who work a suppression overtime shift will have their pay rate converted to the 112 hour/pay period rate while on the suppression overtime shift. This rate shall not include the 15% administrative assignment pay. Suppression members that are on an administrative assignment will not remain subject to force hires for suppression assignments. Nov. 17, 2020 Item #6 Page 20 of 22 2. Compensatory Time In lieu of receiving overtime pay pursuant to Section 1 above, an employee working an 80 hour/pay period schedule may elect, subject to department approval, to receive compensatory time off. No employee shall accrue more than 80 hours of such compensatory time. When an employee has accumulated the maximum number of hours of compensatory time off, he/she shall receive all overtime compensation in cash. An employee may use such compensatory time within a reasonable period after making the request if the use of compensatory time does not unduly disrupt the operations of the department. Any accrued and unused compensatory time through December 31, 2019 will be cashed out on the last pay date in June 2020. Effective January 1, 2020, all accrued and unused compensatory time during the calendar year will be cashed out on the last pay date of the calendar year. No compensatory time may be accrued beginning on the last pay period of the calendar year through the end of the calendar year. At the time an employee switches from an 80 hour/pay period schedule to a 112 hour/pay period schedule, all accrued and unused compensatory time will be cashed out. An employee may elect to “cash out” any portion of his/her accrued compensatory time at his/her regular rate of pay in any pay period. The employee shall indicate the number of hours to be cashed out on his/her timesheet. 3. Request for Temporary Shift Adjustment (Flex Time) An employee may request that the employee’s normal workday be temporarily altered in order to accumulate a credit of work hours that may be used to take time off during the employee’s FLSA work week without loss of pay. If the request is approved by management, pay for hours worked during this temporary shift adjustment shall be paid at the straight time rate even if the employee’s hours worked exceed his/her normal scheduled shift on that day. 4. Employees hired by divisions or bureaus currently operating on an alternative work schedule shall be subject to having their daily work schedule changed at the sole discretion of the department. Such changes include, but are not limited to, a) number of days/hours to be worked on a daily basis and in a payroll period; b) normal days off; and c) starting/ending times of assigned shifts. This article shall not be subject to the grievance procedure. D. RETURN TO SUPPRESSION DUTIES Upon completion of the administrative assignment, the employee will return to his /her previous rank held at the time of accepting the appointment unless the employee has been promoted to another position/rank. The duration of an Nov. 17, 2020 Item #6 Page 21 of 22 appointment or assignment to administrative duties will normally be for a minimum of two years but may be extended one year at the discretion of the Fire Chief or his/her designee. Nov. 17, 2020 Item #6 Page 22 of 22