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Home My WebLink AboutStaff Report 5.A 07/16/2012 Age*i4w Itevw#5.A LULt 4 Quit' zass DATE: July 16, 2012 TO: Honorable Mayor and Members of the City Council through City M nager FROM: Pamala Stephens, Human Resources Manager SUBJECT: Ratification of the Memorandum of Understanding executed by the City and the International Association of Firefighters, Local I415, for Employees of Unit 7 RECOMMENDATION It is recommended that the City Council adopt the Resolution ratifying the Memorandum of Understanding (MOU) executed by the duly authorized representatives of the City and the International Association of Firefighters, Local 1415, for Employees of Unit 7. BACKGROUND The International Association;of Firefighters, Local 1415, Unit 7–MOU expired on June 30, 2009. The City met and conferred with union representatives.and.has reached agreement with the Association over the terms and conditions of employment for the contract period of July 1, 2009.through June 30, 2013. DISCUSSION The main changes to the MOU negotiated by representatives of the City and.Unit 7 is a second- tier retirement formula for newly hired safety employees and a contract period through June 30, 2013. Second- tier safety employees will receive a retirement benefit that provides a 3% at 55 formula retirement;plan, and a three-year final average compensation, instead of the current benefit of 3% at 50 formula retirement plan and one-year final average compensation. After adoption of the Unit 8—Department Directions Compensation Plan that includes Safety employees, the City will amend its contract with CaIPERS. The reduced retirement benefit becomes effective upon an amendment to the CaIPERS''contract. City of Petaluma safety employees will continue to make an employee paid contribution of 9% towards their retirement. The,City'and Unit;7 also negotiated an increase in the minimum pay for a recall to work to four hours instead„of two hours. Other negotiated terms include language that places in writing the current practice of providing employees with an hour of physical training when time permits, clarifies that the existing limit of twenty (20) shift trades does not apply to trades used to Agenda Review. City Attorne, Finance Director City Mana 1 maintain or advance education. It further clarifies that when the City fills a shift trade the responsible employee will be debited his or her leave:at the rate of one and one-half times for each hour filled. This is because the City must pay overtime to fill a position and any shift trade is to be cost neutral to the City. The parties also agreed,to conduct labor management meetings quarterly or when needed rather than monthly. Also agreed upon was a change in Exhibit B of the MOU that deletes the City of Vallejo and adds the City of Vacaville to survey jurisdictions used in total compensation surveys. FINANCIAL IMPACTS There will be no immediate savings to the City when the second-tier is implemented. Ultimately, it is expected that City costs will decrease as the mix of first tier employees decreases and second tier employees increase. When the mix of all first and second tier employees reaches a 50-50% ratio, employer costs for all safety employees is estimated by Ca1PERS to decrease by 1.55%. In current dollars a decrease of 1.55% would reduce the City's annual employer contribution for safety members by $182;490. The Unit 7- MOU includes a_maintenance of benefit provision for health care that is calculated as follows: the cost of the monthly CaIPERS Health Premium for Kaiser— Bay Area/Sacrarnento less the City's Public Employees' Medical and Hospital Care Act(PEMHCA) contribution times ninety- five percent(95%) for each employee and his or her family members (see chart below). For example, effective January 1, 2010, the monthly premium at the Kaiser rate for single health benefit coverage is $532.56. The additional benefit would be calculated at $532.56 less $105.00 times 95% =$406.18. The total benefit contributed by the City is $511.18. The employee pays the difference between the cost of his or her health plan premium and the City's PEMHCA contribution and additional benefit amount. Additional Benefit—Effective January 1,2009—Increase of 7.99%in Kaiser Rate .City PEMHCA Maximum Additional Total Coverage 2009 Kaiser Rate Contribution Benefit Contributed Benefit Contributed by the City by the City Single $508.30 $101.00 $386.94 $487.94 2-Party $1,01-6.60 $101.00 $869.82 $970.82 Family $1,321.74 $101.00 $1,159.55 $1,260.55 Additional Benefit—Effective January 1,2010—Increase of 4.56%in Kaiser Rate 2010 CityPEMHCA Maximum Additional Total Coverage Benefit Contributed Benefit Contributed Kaiser Rate Contribution by the City by the City Single $532.56 $105.00 $406.18 $511.18 2-Party $1,065.12 $105.00 $912.11 $1,017.11 Family $1,384.66 $105.00 $1,215.68 $1,320.68 C>2-- Additional Benefit—Effective January I,2011 —Increase of 6.8%.in Kaiser Rate. 2011 City PEMHCA Maximum'Additional Total Coverage Kaiser Rate Contribution Benefit Contributed Benefit Contributed by the City by the City Single $568.99 $108.00 $437.94 $545.94 2-Party, $1,137.98 $108.00 $978.48 $1,086.48 Family $1,479.37 $108.00 $1,302,80 $1,410.80 Additional Benefit—Effective January 1,2012—Increase of 7.3%in Kaiser Rate 2012 City PEMFICA Maximum Additional Total Coverage Kaiser Rate Conuribution Benefit Contributed Benefit Contributed by the City by the City Single $610.44. $112.00 $473.52 $585.52 2-Party $1,220.88' $112.00 $1,053.44 $1,165.44 Family $1,587.14 $112.00 $1,401.38 $1,513.38 Additional Benefit—Effective January 1,2013—Increase of 9.53%in Kaiser Rate 2013 City PEMHCA Maximum Additional Total Coverage Kaiser Rate Contribution Benefit Contributed Benefit Contributed by the City by the City Single $668.63 $115.00 $525.95 $640.95 2-Party $1,337.26 $115.00 $1,161.15 $1,276.15 Family $1,738.44 $115.00 $1,542.27 $1,657.27 The Unit 7 MOU is on a fiscal year basis from July 1 to June 30. CaIPERS health plan rate increases are on a calendar year basis. The City provides a cash-in-lieu program for employees who do not enroll in the health plan.. That program provides eligible employees with a benefit amount of half or fifty percent-of the benefit that the City would otherwise contribute towards the health plan. The total cost of health benefits for Unit'7 employees on a fiscal year basis, including the cash- in-lieu program is estimatedto be as follows: FY 2008-2009 $ 552,975 FY 2009-2010 $ 579,428 FY 2010-2011 $ 562,096 FY 2011-2012 $ 641,993 FY'20f2-2013 $'713;908 In FY 2010-2041, there was an increase in the number of employees that in the cash-in- lieu program which reduced the City's cost of health benefits. The increase in the minimum pay for a recall to work to four hours instead of two hours is not expected to have a financial impact. Recall to work is used infrequently and when recalled to work employees:typically work more than four hours. S • ATTACHMENTS 1. Resolution.Ratifying the Memorandum of Understanding'Executed by the Duly Authorized Representatives of the City and the International Associations of Firefighters, Local 1415, for Employees of Unit 7. 2. Attachment A— Summary of Changes to the Memorandum of Understanding between the City and the International Association of Firefighters, Local 1415, for Employees of Unit 7 for Fiscal Year 2009 —2013 ® Items listed below are large in volume and are not attached to this report, but may be viewed in the City Clerk's office. Unit 7 MOU FY 2009—2013 Resolution No. 2012-XX N.C.S. of the City of Petaluma, California RESOLUTION RATIFYING MEMORANDUM OF UNDERSTANDING EXECUTED BY THE DULY AUTHORIZED REPRESENTATIVES OF THE CITY AND THEINTERNATIONAL ASSOCIATION OF FIREFIGHTERS LOCAL 1415 FOR EMPLOYEES OF UNIT 7 WHEREAS, the City,through its duly authorized representatives, and the International Association of Firefighters, through,its duly authorized representatives, have concluded their. mutual obligation to meet and confer in good faith with respect to terms and conditions of employment for the employees in Unit 7, in accordance with the Meyers-Milias-Brown Act and the City's Employer-Employee Relations, Rules, and Regulations(Resolution No. 5512 N.C.S.); and, WHEREAS, the duly authorized representatives of the City and the International Association of Firefighters have executed a Memorandum of Understanding pursuant to Section 15, Resolution No. 5512 N.C.S. and recommend its approval by the City Council; and, WHEREAS, the City Manager, pursuant to Section 28; of the Charter of the City of Petaluma , and as the City's Municipal Employees' Relations Officer (Resolution No. 5375 N.C.S.) is required and empowered to make a recommendation to the City Council on matters related to employees' compensation; and, WHEREAS, the City Manager has reviewed and concurs with said Memorandum of Understanding for Unit 7 and does recommend that the City Council ratify said Memorandum,of Understanding. NOW, THEREFORE, BE IT RESOLVED that the Memorandum of Understanding, being in the best interests of the.City, is ratified and the terms and conditions of said Memorandum of Understanding shall be effective July 1, 2009 through June 30,2013. ATTACHMENT A Summary of Changes to the Memorandum.of Understanding Between The City of Petaluma and the International Association of Firefighters—Unit 7 A complete copy of the 2009 -2013 Memorandum of Understanding for Unit 7 is on file in the City Clerk's office. 1. Benefits 1. Second-tier Retirement in CaIPERS New MOU language that provides for a different level of benefits (two-tiered retirement) for newly hired Safety— Fire employees. Effective upon agreement with the City's.other Safety bargaining units, the City shall amend its contract with CaIPERS. The amended contract shall provide that Safety—Fire employees hired after the effective date of the amendment shall receive the 3% at 55 formula retirement plan and the three-year final average compensation; instead of the current benefit of 3% at 50 formula retirement plan and one-year final average compensation. 2. Health Benefits—Active Employees and Retired:Employees Revised language reflects that the additional benefit amount paid by the City shall be the CaIPERS Health Premium amount for Kaiser—Bay Area/Sacramento less the minimum required by PEMHCA times ninety-five percent (95%) for each employee and his or her family members. Unit 7, as in the past, has'opted not to have actual benefit schedules in the MOU rather just language which outlines the formula noted above. Prior to,2009 the PEMHCA contribution was set at $100 per month. Effective January 2009, the PEMHCA contribution was set by CaIPERS using a CIP index. The revised language reflects the change in the PEMHCA contribution. 11. Other Changes to the MOU 1. Overtime —Fire Recall and Special Recall Revised MOU language that provides for a minimum payment of four (4) hours of pay when called instead of two (2) hours. 2. Physical Training Time New MOU language that reflects the current practice which provides employees with 1 hour:of physical training time between the hours of 0800-1700 when time permits. 3. Shift Trades— Limit New MOU language which states that shift trades used to maintain or advance education shall not count towards the twenty (20) trade limit. 4. Shift Trades — Individual Responsibility—Leave New MOU language that clarifies if the City fills a"shift trade" position the responsible employee shall be debited at the rate of one and one-half times for each hour filled. 5. Communication Procedure— Labor/Mgmt Meetings RevisedMOU"language that indicates the parties shall conduct quarterly, or as needed labor/management meetings instead of monthly meetings. lL/ 6. Exhibit B of the MOU Revised MOU language that deletes the City of Vallejo and adds the City of Vacaville to survey jurisdictions used in total compensation surveys. III. Revised new language to reflect either change in policy, practice or law 1. Preamble 2. Term of agreement—July 1, 2009 through June 30, 2013 3. Shift Rotation Revised language to.reflect a shift rotation of 2 duty shifts assigned on a recurrent 6 day cycle that was implemented effective January 1, 2009. 4. Bilingual Pay— Spanish Revised language that incorporates a Side Letter of Agreement providing for a second level of Spanish bilingual pay of $100.00 a month for acceptable level proficiency or conversational. 5. Language deleted from MOU Effective date of Uniform.Allowance and prior Uniform Allowance language. Holiday Pay—Changer in Method of Payment 6. CaIPERS - Updated reference to CaIPERS sections to reflect CaIPERS changes. 7. Class B and C— Requirement Updated language to reflect changes in DMV requirements. • 7