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<br /> <br />Item 07D <br />May 24, 2010 <br />Page 2 <br /> <br /> <br /> <br />Discussion: <br /> <br />The City’s current compensation policy consists of three (3) phases: <br /> <br /> Phase 1: The Five-Step Compensation Plan <br /> Phase 2: The Annual Compensation Adjustment; and <br /> Phase 3: Pay Equity Act <br /> <br />Phase 1 of the Compensation Policy covers progression through the five (5) step <br />compensation program, annual market adjustments using DCA Stanton Mean. <br /> <br />Phase 2 covers Cost of Living Adjustments (COLA), and how COLA should be factored <br />into the total Compensation Policy. <br /> <br />Phase 3 covers Pay Equity. Pay Equity is a state mandated program, which requires a <br />compliant pay equity report to the Department of Employee Relations every three (3) <br />years. The City must follow this policy in accordance with Minnesota state law. <br /> <br />During the May Work Session, the City Council reviewed the present policy and directed <br />Staff to draft a general compensation policy for City Council consideration. It was City <br />Council consensus to maintain the present five-step policy, and to review salary market <br />compensation in conjunction with Pay Equity, only if the Council feels it is necessary to <br />conduct such a study. The revised policy only gives the option for the Council to conduct a <br />salary compensation study. It does not mandate the Council to conduct a salary <br />compensation study. <br /> <br /> <br />Recommendation: <br /> <br />Attached is revised Section 3.01 of the Personnel Manual pertaining to Compensation. If <br />the revised policy meets the City Council’s expectations, then Resolution 7616 will need to <br />be approved allowing Staff to revise this section of the Personnel Manual. <br /> <br />Respectfully submitted, <br /> <br /> <br /> <br />________________________ <br />Desaree Crane <br />Assistant City Administrator <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />