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I��L��T F�� N�IL ��"�I�N Date: X 01 � 3/OS Item #: 7. Department Approval: Manager Approved: Agenda Section: �� Item Description: Staff Compensation Plan & Merit Pay Policy Background: Staff presented to Council, in September, a revised compensation plan for non-union employees currently in the exempt and non-exempt groups. This pay plan allowed for Roseville lo increase the pay schedule for this Staff from 95% of the �tanton Group 5 average to 97% of the Stanton Group 5 average. Thus, employees would work under a pay schedule that is, on average, 3% less than comparable cities rather than the current 5% less than comparable cities. In addition, the merit pay component in the plan would allow for a maximum pay cap not to exceed 112% of the Stanton 5 Group average. Council provided 2 directives during this meeting which needed to be met in order to implement this plan: 1. A Policy showing how the merit pay component of the plan would be derived and administered. This is found below. 2. An implementation plan allowing for a 5% levy rather than 7.5% if necessary. 9 Remember from our last conversation, to implement the recommended version of adjusting all of those that are below the recommended new starting pay to starting pay and to bring everyone else into the system at the closest step to their current pay without a decrease and without bringing staff in at a step above their years of service would cost approximately $72,171. 9 For all the reasons set forth in staffs report on the City's insurance program, staff was able to cut City budgeted expenses for 2006 City Staff insurances by 50% or $50,000, $25,000 of which is in the tax-supported programs. 9 Therefore, $50,000 of the funding needed to implement this could come from the savings in the benefits program and the final $22,000 would come from the contingency fund. 9 Implementing this plan would allow for a more competitive and well-rounded total compensation package bringing the City to 97% of the market in compensation and approximately average for benefits. Dona Bacon Page 1 lui�''!'��5