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City Council Agenda Packet 11-09-2015 SpecialAGENDA SPECIALWORKSHOPMEETING–MONTICELLOCITYCOUNCIL Monday,November9,2015–4:00p.m. MississippiRoom Mayor:BrianStumpf CouncilMembers:CharlotteGabler,LloydHilgart,TomPerrault,GlenPosusta Others:JeffO’Neill,TracyErgen,ShibaniBisson,WayneOberg,Other DepartmentHeads 1.CalltoOrder 2.(4:00p.m.)UpdateonCity’sPaidTimeOff(PTO)Plan 3.(5:00p.m.)Presentationonthe2016StreetandUtilityImprovementReconstruction Project 4.Adjournment Paid Time Off (PTO) Proposal Summary Advantages:  Employees have the same number of days to use at their discretion.  Employees have flexibility to use at their discretion; work - life balance.  Managers are not put in the position of policing sick time usage.  Attractive to new hires; recruitment tool Disadvantages:  Fewer overall days for employees to use than under a sick/vacation plan.  Employees tend to view all PTO as vacation time and come to work when they are sick. ******************************************************************* Proposal: Paid time off (PTO) will replace sick and vacation time. All new employees will be placed on the PTO plan. Employees with 25+ years of service will have the choice to be grandfathered in under the vacation/sick plan or opt for PTO. Schedule Current Vacation: Years of Service Full-Time Eligible Part-Time 0 thru 5 years 80 hours per yr/10 days 40 hours per yr 6 thru 10 years 120 hours per yr/15 days 60 hours per yr Year 11 128 hours per yr/16 days 64 hours per yr Year 12 136 hours per yr/17 days 68 hours per yr Year 13 144 hours per yr/18 days 72 hours per yr Year 14 152 hours per yr/19 days 76 hours per yr Year 15 160 hours per yr/20 days 80 hours per yr Year 16 168 hours per yr/21 days 84 hours per yr Year 17 and beyond 176 hours per yr/22 days 88 hours per yr Proposed PTO: Non-Exempt (Hourly): Exempt (Salaried): 0 thru 5 years 128 hrs/16 days 0-7 years 168 hrs/21 days 6 thru 10 years 168 hrs/21 days 8+ years 224 hrs/28 days 11 + years 224 hrs/28 days Extended Medical Benefit (EMB) - Employees hired prior to 12/31/15 Current sick time balances will be placed in an extended medical benefit bank which will provides income protection insurance for employees in case of a serious illness. EMB may be used after the first forty (40) consecutive work hours of an absence for a serious health condition. This benefit is meant as insurance and not paid ou t upon termination. Sick Time Transition Examples: Example 1: Jack has been with the City for 15 years and has 800 hours of sick time on the books. Per current policy, 50% of his sick time (400 hrs.) would be paid into the MN State HCSP and the remaining 400 hours would be kept in an EMB bank. Example 2: Betsy has been with the City for 2 years and has 160 hours of sick time on the books. Per current policy, 0% of her sick time would be paid into the MN State HCSP and 160 hours would be kept in an EMB bank. Year 1 PTO Examples: Example 1: Jack has been with the City for 15 years. On January 1st his current vacation balance of 240 hours carries over and is combined with 224 hours of PTO giving Jack 464 hours to use in 2016. Per City Policy, Jack must use 50% of his annual accrual each year (112 hours; 2.8 weeks). As December 31st Jack has used 120 hours of PTO (3 weeks) and has a balance of 344 hours. Because Jack’s PTO balance is over 320 hours and he did not use bereavement leave 44 hours is paid into the MN State Healthcare Savings plan. As of December 31st Jack has used at least 50% of his annual accrual and has and will not lose any PTO time. Example 2: Betsy is a non-exempt employee who has been with the City for 2 years. On January 1st her vacation balance of 16 hours carries over and is combined with 128 hours of PTO giving Betsy 144 hour to use in 2016. Per City Policy, Betsy must use 50% of her annul accrual each year (64 hrs; 1.6 weeks). As of the December 31st Betsy has used 40 hours of PTO (1 week) and has a balance of 104 hours. Since Betsy’s balance is under 320 hours as December 31st she will not have a payout into the MN State HCSP in 2016. As of December 31st Betsy has used 40 hours of PTO. The City Policy is that she must use at least 50% of her annual accrual each year which is 64 hours. Betsy loses 24 hours of PTO unless there are extenuating circumstances that prevented her from using. Accrual of PTO PTO hours will be placed in the employee’s PTO bank on January 1st based on time with the City as of January 1st of each year. Anyone hired mid- year will receive a pro-rated amount for the remainder of the year. Mid-year terminations will be adjusted at the time of termination. MN State HCSP PTO balances over 320 hours as of December 31st will paid into the MN State HCSP (maximum of 48 hours) based on their current hourly rate of pay. Any remaining hours over 320 will be lost. Employees who use bereavement leave during the previous 12 months are not allowed to roll hours into the MN State HCSP. Carry Over Employees must use at least 50% of their annual PTO accrual each year. A maximum of 320 hours can carry over to the next year. If extenuating circumstances prevent the usage of PTO, the City Administrator can approve cash payment to avoid a loss of PTO time. Unpaid Leave Employees must normally use all accrued PTO prior to taking an unpaid leave. If the leave qualifies under the Parenting Leave or FMLA, the employee may retain a balance of 40 hours when going on an unpaid leave. Any exceptions to this policy must be approved by the City Administrator. Severance Employees leaving the City would good standing will receive 100% of their PTO balance paid as cash. EMB is not paid out at termination. PTO and Compensation PTO will not count as time worked for the purpose of calculating overtime. Bereavement Leave Current Policy: Sick leave up to five (5) days may be granted for absences related to the death of an immediate family member. Immediate family includes: spouse, child or foster child, parents, step-parents, step- children, siblings, siblings in-law, grandparents, grandchildren, mother and father in-law. Recommended Policy: Funeral leave is equivalent to 100% of the employee’s wage. Up to five (5) days may be granted with the approval of the Department Head for absences related to the death of an immediate family member. Immediate family includes: spouse, child or foster child, parents, grandparents, step-parents, step-children, and siblings. Three (3) days will be granted for the death of an aunt, uncle, step-brother, step-sister, and in- laws including mother, father, sister and brother. Employees who use bereavement leave will not be allowed to roll hours into the MN State HCSP in the year for that year. PTO Donation- (Identical to current vacation donation policy) Employees may transfer their PTO hours from one employee to another under the following conditions: A. Such transfers can be made only after the showing of unique or special circumstances and only upon the approval of the City Administrator. Before such transfer will be approved, the proposed recipient of the transfer must have used all of his/her PTO. B Vacation transfer shall be limited to forty (40) hours per donor. Such transfer shall be made on a dollar for dollar basis. The worth of the leave shall be adjusted to the pay level of the donor. Therefore, if the salary of the donor is greater than the recipient, one day of leave from the donor shall result in more than one full day to the recipient. Conversely, if the salary of the donor is less than the recipient, the one-day of leave from the donor shall result in less than one full day. C. Requests for such transfer of PTO must be submitted in writing, to the Human Resources Manager or designee, who shall handle all communications between recipient and donor. When a donor volunteers such transfer, he/she must first execute a release document for such transfer that will be kept on file in the Human Resource Department. D. When a transfer has been finalized in accordance with the rules and approved by the Human Resources Manager and City Administrator, the Finance Department shall take the necessary accounting action to reflect such transfer. Anticipated Cost to Implement Current sick time liability as of 10/30/15 (All employees) $541,197 Sick time payout liability (Per current policy) as of 10/30/15 (All employees) $219,798  Anticipated cost of transition • All employees: $219,798 (including union) • All non-union employees: $162,447 • All non-union with 25+ year grandfathering option: $109,251 - $162,447.