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HomeMy WebLinkAbout#25 - Personnel Policies STAFF REPORT DATE: December 5, 2023 REGULAR TO: Mayor and City Council FROM: Karissa Goers, Administrative Services Director AGENDA ITEM: Adopt ESST policy and approve amendments to Payroll Policy and Annual Leave Policy BACKGROUND: In May of 2023, Governor Walz passed the Omnibus Jobs Act which introduced a new Minnesota Sick and Safe Time law. ISSUE BEFORE COUNCIL: Should the City Council adopt the new ESST policy and amendments to the Annual Leave Policy and Payroll Policy as attached? PROPOSAL DETAILS/ANALYSIS: The ESST law requires employers to provide each employee with at least one (1) hour of paid sick and safe time for every thirty (30) hours worked. This includes non-benefit eligible staff such as interns, seasonal and temporary employees and paid on call firefighters. The law does not include elected officials. Attached is a new Earned Sick and Safe Time Policy to be added to the Personnel Policies. Our current Annual leave policy exceeds the requirements of the law and as such no additional ESST will be accrued by full time staff. The redlined updates in the attached Annual Leave Policy are minor edits clarifying language and procedures. We updated our Payroll and Compensation Policy in August to offer our career firefighters a Holiday Leave Bank in lieu of Holiday Pay on observed city holidays. Since implementing that policy in September, we have determined that it would be a better practice to allow holiday leave hours accrued in the 4th quarter (up to 32 hours) to carry over into the following year if needed. Currently the policy is written that firefighter holiday leave hours do not carry over from year to year, if employees are unable to use them, they lose them. Because the Thanksgiving and Christmas holidays are so close to the end of the year, we risk offering a benefit that cannot be used and/or enjoyed by employees. Without this update, the Fire Department will encounter significant scheduling challenges towards the end of the year. Supervisors will be trying to maintain staffing minimums as employees use accrued Holiday Leave hours before they lose them at the end of the year. Attached is a redlined version of this policy with the minor edits updating the carryover section. FISCAL IMPACT: None OPTIONS: 1. Approve and adopt the ESST policy and amendments to the Annual Leave and Payroll Policies. 2. Approve some but not all policies, pull specific policies to amend and approve at a later meeting. RECOMMENDATION: Motion to adopt the ESST policy and amendments to the Annual Leave and Payroll Policies. ATTACHMENTS: • Earned Sick and Safe Time (ESST) Policy • Redlined version of Annual Leave Policy • Redlined version of Payroll Policy Earned Sick and Safe Time (ESST) Effective January 1, 2024 Earned Sick and Safe Time (ESST) is paid time off earned at one (1) hour of Earned Sick and Safe Time for every thirty (30) hours worked by an employee, up to a maximum of forty-eight (48) hours of sick and safe time per year. The hourly rate of Earned Sick and Safe Time is the same hourly rate an employee earns from employment with the city. This specific leave applies to all employees (including part-time, seasonal, interns, and temporary employees) performing work for at least 80 hours in a year. For purposes of this policy, a year is a calendar year – January 1 to December 31. ESST may only be used for days when the employee would otherwise have been at work. Accrual of Earned Sick and Safe Time Full-time regular employees will not accrue additional ESST hours in excess of current PTO accrual as the Annual Leave Policy exceeds the requirements of the ESST law. Part-time non-benefited employees, seasonal and temporary employees, interns, and paid-on-call firefighters, who work for the city at least eighty (80) hours in a year, will accrue ESST at a rate of one (1) hour per thirty (30) hours worked, up to a maximum of 48 hours of ESST per year. Earned Sick and Safe Time Use The leave may be used as it is accrued in the smallest increment of time tracked by the city’s payroll system which is fifteen (15) minute increments, for the following circumstances: • An employee’s own: o Mental or physical illness, injury, or other health condition o Need for medical diagnosis, care or treatment, of a mental or physical illness o Injury or health condition o Need for preventative care o Closure of the employee's place of business due to weather or other public emergency o The employee's inability to work or telework because the employee is prohibited from working by the city due to health concerns related to the potential transmission of a communicable illness related to a public emergency, or seeking or awaiting the results of a diagnostic test for, or a medical diagnosis of, a communicable disease related to a public emergency and the employee has been exposed to a communicable disease or the city has requested a test or diagnosis. o Absence due to domestic abuse, sexual assault, or stalking of the employee provided the absence is to: - Seek medical attention related to physical or psychological injury or disability caused by domestic abuse, sexual assault, or stalking - Obtain services from a victim services organization - Obtain psychological or other counseling - Seek relocation or take steps to secure an existing home due to domestic abuse, sexual assault or stalking - Seek legal advice or take legal action, including preparing for or participating in any civil or criminal legal proceeding related to or resulting from domestic abuse, sexual assault, or stalking • Care of a family member: o With mental or physical illness, injury or other health condition o Who needs medical diagnosis, care or treatment of a mental or physical illness, injury or other health condition o Who needs preventative medical or health care o Whose school or place of care has been closed due to weather or other public emergency o When it has been determined by health authority or a health care professional that the presence of the family member of the employee in the community would jeopardize the health of others because of the exposure of the family member of the employee to a communicable disease, whether or not the family member has actually contracted the communicable disease o Absence due to domestic abuse, sexual assault or stalking of the employee’s family member provided the absence is to: - Seek medical attention related to physical or psychological injury or disability caused by domestic abuse, sexual assault, or stalking - Obtain services from a victim services organization - Obtain psychological or other counseling - Seek relocation or take steps to secure an existing home due to domestic abuse, sexual assault or stalking - Seek legal advice or take legal action, including preparing for or participating in any civil or criminal legal proceeding related to or resulting from domestic abuse, sexual assault, or stalking For Earned Sick and Safe Time purposes, family member includes an employee’s: • Spouse or registered domestic partner • Child, foster child, adult child, legal ward, child for whom the employee is legal guardian, or child to whom the employee stands or stood in local parentis • Sibling, step sibling or foster sibling • Biological, adoptive or foster parent, stepparent or a person who stood in loco parentis when the employee was a minor child • Grandchild, foster grandchild or step grandchild • Grandparent or step grandparent • A child of a sibling of the employee • A sibling of the parent of the employee or • A child-in-law or sibling-in-law • Any of the above family members of a spouse or registered domestic partner • Any other individual related by blood or whose close association with the employee is the equivalent of a family relationship • Up to one individual annually designated by the employee Advance Notice for use of Earned Sick and Safe Time If the need for sick and safe leave is foreseeable, the city requires seven (7) days’ advance notice. However, if the need is unforeseeable, employees must provide notice of the need for Earned Sick and Safe time as soon as practicable. When an employee uses Earned Sick and Safe time for more than three (3) consecutive days, the city may require appropriate supporting documentation (such as medical documentation supporting medical leave, court records or related documentation to support safety leave). However, if the employee or employee's family member did not receive services from a health care professional, or if documentation cannot be obtained from a health care professional in a reasonable time or without added expense, then reasonable documentation may include a written statement from the employee indicating that the employee is using, or used, Earned Sick and Safe Leave for a qualifying purpose. The city will not require an employee to disclose details related to domestic abuse, sexual assault, or stalking or the details of the employee’s or the employee’s family member’s medical condition. In accordance with state law, the city will not require an employee using Earned Sick and Safe leave to find a replacement worker to cover the hours the employee will be absent. Carry Over of Earned Sick and Safe Time Employees are eligible to carry over accrued but unused Earned Sick and Safe time into the following year, but the total balance of Earned Sick and Safe Leave hours shall not exceed 80 hours. Retaliation prohibited The city shall not discharge, discipline, penalize, interfere with, or otherwise retaliate or discriminate against an employee for asserting Earned Sick and Safe Leave rights, requesting an Earned Sick and Safe Leave absence, or pursuing remedies. Further, use of Earned Sick and Safe Leave will not be factored into any attendance point system the city may use. Additionally, it is unlawful to report or threaten to report a person or a family member’s immigration status for exercising a right under Earned Sick and Safe Leave. Benefits and return to work protections During an employee’s use of Earned Sick and Safe Leave, an employee will continue to receive the city’s employer insurance contribution as if they were working, and the employee will be responsible for any share of their insurance premiums. An employee returning from time off using accrued Earned Sick and Safe Leave is entitled to return to their city employment at the same rate of pay received when their leave began, plus any automatic pay adjustments that may have occurred during the employee’s time off. Seniority during Earned Sick and Safe Leave absences will continue to accrue as if the employee has been continually employed. Separation from Employment Upon separation from employment, Earned Sick and Safe Leave previously accrued but not used will not be paid out. When there is a separation from employment with the city and the employee is rehired again within 180 days of separation, previously accrued Earned Sick and Safe Leave that had not been used will be reinstated. An employee is entitled to use and accrue Earned Sick and Safe Leave at the commencement of reemployment. ANNUAL LEAVE - PAID TIME OFF (PTO) The city believes that time away from work is important to the health and well-being of our employees and as such, provides paid time off (PTO) for eligible employees. This policy meets the requirements of the Earned Sick and Safe Time (ESST) Law. Employees can designate up to 48 hours of PTO per year as ESST. Annual leave can be used for any reason, subject to existing request and approval procedures. As with all paid time off programs, the city needs to ensure that service to the public and work requirements are not adversely impacted. Paid time off (PTO) should be taken in fifteen (15) minute increments. Career firefighters should take paid time off in twenty-four (24) hour increments. PTO hours are calculated and updated each biweekly pay period. An employee may not borrow against future PTO accruals or carry a negative PTO balance. Employees may use PTO in the same pay period in which it is earned. Accrual Rates for Annual Leave Years of Service Annual Accrual Rates / Per Pay Period Accrual Rates 0-2 Years 123.50 hours/4.75 hours bi-weekly 3-5 years 156 hours /6.0 hours bi-weekly 6-10 Years 195 hours /7.50 hours bi-weekly 11-15 Years 221 hours/8.50 hours bi-weekly 16-24 Years 247 hours/9.5 hours bi-weekly 25 Years or More 260 hours/10 hours bi-weekly Full-time employees will earn paid time off in accordance with the above schedule. Part-time employees who work at least 18 hours per week on a regular basis will accrue paid time off on a prorated basis of the full-time employee schedule. Part-time employees who work less than 18 hours per week on a regular basis, temporary, seasonal employees, and interns will not earn or accrue paid time off. Career firefighters (who work 24-hour shifts and must take 24 hours of leave to take a shift off) will earn paid time off in accordance with the schedule below: Accrual Rates for Career Firefighter Annual Leave Years of Service Annual/ Per Pay Period Accrual Rates 0-2 Years 156 hour/6 hours bi-weekly 3-5 years 208 hours/8 hours bi-weekly 6-10 Years 260 hours/10 hours bi-weekly 11-15 Years 286 hours/11 hours bi-weekly 16-24 Years 312 hours/12 hours bi-weekly 25 Years or More 338 hours/13 hours bi-weekly Annual leave will not accrue during unpaid leaves of absences. For the purpose of determining an employee’s PTO accrual rate, years of service will include all continuous time that the employee has worked at the city (including authorized leave, but excluding time worked in a temporary, seasonal position or internship). No more than 240 hours of annual leave may be carried over into the following year. Any amount above the maximum 240 hours shall be converted to a contribution to the MSRS Health Care Savings Plan. Such conversion shall be capped at 40 hours per year. The conversion shall take place in conjunction with issuing the calendar year’s final paychecks. Employees leaving the city in good standing will receive 100 percent of their annual leave balance as compensation (applicable taxes will be withheld) with their final pay. Employees have the option of directing those dollars into a 457 deferred compensation plan (subject to IRS maximum deferral regulations and Minnesota law). PAYROLL & COMPENSATION (wages) Definitions Direct Deposit – As permitted by state law, all city employees are required to participate in direct deposit. FICA (Federal Insurance Contributions Act) – FICA is the federal requirement that a certain amount be automatically withheld from employees’ earnings. Specifically, FICA requires an employee contribution of 6.2 percent for Social Security and 1.45 percent for Medicare. The city contributes a matching 7.65 percent on behalf of each employee. Certain employees are exempt or partially exempt from these withholdings (e.g., firefighters). Pay Period – A fourteen (14) day period beginning at 12:01 a.m. on Saturday through midnight on Friday, fourteen (14) days later. Holiday Pay – Compensation (8 hours) received when City offices are closed for an observed holiday. Firefighter Holiday Leave Bank – In lieu of holiday pay, career firefighters will accrue leave (8 hours) when City offices are closed for an observed holiday. The eight (8) hours of leave will be earned in the pay period in which the observed holiday falls and can be used at a time mutually agreed upon by the employee and the employee’s supervisor. Up to thirty-two (32) hours of firefighter holiday leave hours may be carried over into the following year. Firefighter Holiday Leave Bank Accrued hours do not carry over from year to year and are not paid out upon separation of employment. Full-time employees of the city will be compensated as determined by the City Council. Unless approved by the Council, employees will not receive any amount from the city in addition to the pay authorized for the positions to which they have been appointed. Expense reimbursement or travel expenses may be authorized in addition to regular pay. Compensation for seasonal and temporary employees will be set by the City Council at the time of hire, or on an annual basis. Under the Minnesota Wage Disclosure Protection Law, employees have the right to tell any person the amount of their own wages. While the Minnesota Government Data Practices Act (Minn. Stat. §13.43), specifically lists an employee’s actual gross salary and salary range as public personnel data, Minnesota law also requires wage disclosure protection rights and remedies to be included in employer personnel handbooks. To that end, and in accordance with Minn. Stat. §181.172, employers may not: • Require nondisclosure by an employee of his or her wages as a condition of employment. • Require an employee to sign a waiver or other document which purports to deny an employee the right to disclose the employee’s wages. • Take any adverse employment action against an employee for disclosing the employee’s own wages or discussing another employee’s wages which have been disclosed voluntarily. • Retaliate against an employee for asserting rights or remedies under Minn. Stat. §181.172, subd. 3. The city cannot retaliate against an employee for disclosing his/her own wages. An employee’s remedies under the Wage Disclosure Protection Law are to bring a civil action against the city and/or file a complaint with the Minnesota Department of Labor and Industry at (651) 284-5070 or (800) 342-5354. Direct Deposit As provided for in Minnesota law, all employees are required to participate in direct deposit. Employees are responsible for notifying the administrative services director of any change in status, including changes in address, phone number, names of beneficiaries, marital status, etc. When paydays fall on a holiday, deposits will be made the day before the holiday. Improper Deduction and Overpayment Policy If an employee believes that an improper deduction or overpayment, or another type of error, has been made, they should immediately contact their supervisor. If the city determines it has made an improper deduction from a paycheck, it will reimburse the employee for the improper amount deducted and take good faith measures to prevent improper deductions from being made in the future. In cases of improper overpayments, employees are required to promptly repay the city in the amount of the overpayment. The employee can write a personal check or authorize a reduction in pay to cover the repayment. The city will not reduce an employee’s pay without written authorization by the employee. Once the overpayment has been recovered in full, the employee’s year to date earnings and taxes will be adjusted (so that the year’s Form W-2 is correct) and the paying department will receive the corresponding credit. When an overpayment occurs, the repayment must be made within the same tax year. In the exceptional situation where the overpayment occurs in one tax year and is not discovered until the next year, the overpayment must be repaid in the year it is discovered, but there will be additional steps and paperwork required. Any overpayments not repaid in full within the calendar year of the overpayment are considered “prior year overpayments” and the employee must repay not only for the net amount of the overpayment, but also the federal and state taxes the city has paid on their behalf. The city is able to recover the overpaid Social Security and Medicare taxes. Accordingly, the city will not require the employee to repay those taxes provided the employee provides a written statement that he/she will not request a refund of the taxes. The overpayment amount will remain taxable in the year of the overpayment since the employee had access to the funds. The employee is not entitled to file an amended tax return for the year but may be entitled to a deduction or credit with respect to the repayment in the year of repayment. Employees should contact their tax advisors for additional information. Time Reporting Full-time, non-exempt employees are expected to work the number of hours per week as established for their position. They will be paid according to the time reported on their time sheets. To comply with the provisions of the federal and state Fair Labor Standards Act, hours worked, and any leave time used by non-exempt employees are to be recorded daily and submitted to payroll on a bi-weekly basis. This is done electronically through the City’s payroll software. Time sheets should be entered and approved by the employee and approved by the employee’s immediate supervisor. Approving and submitting electronic time sheets acts as a signature. Reporting false information on a time sheet may be cause for immediate termination. Overtime / Compensatory Time The City of Lake Elmo has established this overtime policy to comply with applicable state and federal laws governing accrual and use of overtime. The city administrator will determine whether each employee is designated as “exempt” or “non-exempt” from earning overtime. In general, employees in executive and professional job classes are exempt; all others are non-exempt. Non-Exempt (Overtime-Eligible) Employees Overtime-eligible employees will be compensated at the rate of time-and-one-half for all hours worked over 40 in one workweek. Paid holidays do count toward “hours worked.” Career firefighters will be compensated at the rate of time-and-one-half for all hours worked over 159 in the designated 21-day cycle. Firefighter Holiday Leave hours do not count towards “hours worked.” Employees may earn compensatory time at the rate of one- and one-half times in lieu of overtime pay, upon mutual agreement between the employe and the employer. For most employees the workweek begins at 12:01 a.m. on Saturday and runs until the following Friday night at midnight. Supervisors may establish a different workweek based on the needs of the department, subject to the approval of the city administrator. The employee’s supervisor must approve overtime hours in advance. An employee who works overtime without prior approval may be subject to disciplinary action. Overtime earned will be paid at the rate of time-and-one-half on the next regularly scheduled payroll date, unless the employee indicates on his/her timesheet that the overtime earned is to be recorded as compensatory time in lieu of payment, upon supervisor approval. Compensatory time balances should not exceed fifty (50) hours with a maximum carryover of forty (40) hours per year. Once an employee has accrued a balance of fifty (50) hours of compensatory time no further compensatory time may accrue. All further overtime will be paid. Employees may request and use compensatory time off in the same manner as other leave requests. All compensatory time will be marked as such on official time sheets, both when it is earned and when it is used. The Finance Department will maintain compensatory time records. As of the last pay period in November of each year, all accumulated compensatory time above the maximum carryover amount of forty (40) hours shall be paid to the employee at the hourly pay rate the employee is earning at that time. All compensatory time accrued will be paid when the employee leaves city employment at the hourly pay rate the employee is earning at that time. Exempt (Non-Overtime-Eligible) Employees Exempt employees are expected to work the hours necessary to meet the performance expectations outlined by their supervisors. Generally, to meet these expectations, and for reasons of public accountancy, an exempt employee will need to work 40 or more hours per week. Exempt employees do not receive extra pay for the hours worked over 40 in one workweek. Exempt employees are paid on a salary basis. This means they receive a predetermined amount of pay each pay period and are not paid by the hour. Their pay does not vary based on the quality or quantity of work performed, and they receive their full weekly salary for any week in which any work is performed. The City of Lake Elmo will only make deductions from the weekly salary of an exempt employee in the following situations: • The employee is in a position that does not earn vacation or personal leave and is absent for a day or more for personal reasons other than sickness or accident. • To offset compensation received for military pay. If an employee works part of the week in military service, the city must pay the entire week’s salary to the employee, but the city shall offset the amount of the military pay for the week against the employee’s salary. • The employee is in a position that earns sick leave, receives a short-term disability benefit or workers’ compensation wage loss benefits, and is absent for a full day due to sickness or disability, but he/she is either not yet qualified to use the paid leave or he/she has exhausted all of his/her paid leave. • The employee is absent for a full workweek, and for whatever reason, the absence is not charged to paid leave (for example, a situation where the employee has exhausted all of his/her paid leave or a situation where the employee does not earn paid leave). • The very first workweek or the very last workweek of employment with the city in which the employee does not work a full week. In this case, the city will prorate the employee’s salary based on the time actually worked. • The employee is in a position that earns paid leave and is absent for a partial day due to personal reasons, illness, or injury, but: • Paid leave has not been requested or has been denied. • Paid leave is exhausted. • The employee has specifically requested unpaid leave. • The employee is suspended without pay for a full day or more for disciplinary reasons for violations of any written policy that is applied to all employees. • The employee takes unpaid leave under the FMLA. • The City of Lake Elmo may for budgetary reasons implement a voluntary or involuntary unpaid leave program and, under this program, make deductions from the salary of an exempt employee. In this case, the employee will be treated as non-exempt for any workweek in which the budget-related deductions are made. The City of Lake Elmo will not make deductions from pay due to exempt employees being absent for jury duty or attendance as a witness but will require the employee to pay back to the city any amounts received by the employee as jury fees or witness fees. If the city inadvertently makes an improper deduction to the salary of an exempt employee, the city will reimburse the employee and make appropriate changes to comply in the future. If an employee thinks that a wage deduction was made in error, please contact the administrative services director promptly. All employees, in all departments, are required to work overtime as requested by their supervisors as a condition of continued employment. Refusal to work overtime may result in disciplinary action. Supervisors will make reasonable efforts to balance the personal needs of their employees when assigning overtime work. Holiday Compensation Eligibility All benefit eligible employees who are on active status (not a leave of absence) the day preceding and the day following an observed City holiday are eligible to receive holiday compensation. Any employee on a leave of absence without pay from the city is not eligible for holiday pay. Full-time employees will receive eight (8) hours of Holiday Pay on the observed holiday. Part-time employees will be paid on a prorated basis determined by the number of hours they work per week. Career and POC firefighters, seasonal, and temporary employees will not receive Holiday Pay on observed City holidays. Career firefighters will not receive Holiday Pay on observed City holidays. Career firefighters will receive eight (8) hours of accrued time deposited to their Firefighter Holiday Leave (FFHL) Bank on the paycheck for the pay period in which the observed holiday falls. Firefighter Holiday Leave must be preapproved by a supervisor and be used in eight (8) hour increments. Firefighter Holiday Leave time does not count towards hours worked when determining overtime. Up to thirty-two (32) hours of firefighter holiday leave hours may be carried over into the following year. Firefighter Holiday Leave bank hours time does not carry over from year to year and it will not be paid out upon separation. Pay for Time Worked on a Holiday Non-exempt employees assigned to work on any City observed holiday are paid one-and-one-half times the employee’s regular straight time rate for all such hours worked. Leave Policy for Exempt Employees Exempt employees are required to work the number of hours necessary to fulfill their responsibilities including evening meetings and/or on-call hours. The normal hours of business for exempt staff are Monday through Friday, 8 a.m. to 4:30 p.m., plus evening meetings as necessary. Exempt employees are required to use paid leave when on personal business or away from the office for more than fifty (50) percent of their scheduled shift. For example, if they work eight (8) hour days and work 4.25 hours they do not need to take paid leave for the remaining 3.75 hours. If they work four (4) hours, then paid leave should be used for four (4) hours. Absences of less than fifty (50%) percent of a regular shift do not require use of paid leave as it is presumed that the staff member regularly puts in work hours above and beyond the normal 8 a.m. to 4:30 p.m. Monday through Friday requirement. Exempt employees must communicate their absence to the city administrator or his/her designee. If an exempt employee is regularly absent from work under this policy and it is found that there is excessive time away from work that is not justified, the situation will be handled as a performance issue. If it appears that less than forty (40) hours per week is needed to fulfill the position’s responsibilities, the position will be reviewed to determine whether a part-time position will meet the needs of the city. Additional notification and approval requirements may be adopted by the city administrator for specific situations as determined necessary.