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Item No.07I Meeting Date: December 11, 2006 Type of Business: CB City Administrator Review: ______ City of Mounds View Staff Report To: Honorable Mayor and City Council From: Desaree M. Crane, Assistant to the City Administrator Item Title/Subject: Resolution 6985 Approving Non-Union Cost of Living Adjustment, Benefit Contribution and Pay Equity Adjustment Background The City Council approved the AFSCME, Police Officers and Police Sergeant Union Contracts, which included a 3% cost of living adjustment, and a monthly health insurance contribution of $732.20 for the year 2007. Traditionally, the City Council has approved similar adjustments for non-union personnel. This proposal was discussed at the December 4, 2006, City Council Work Session, and based upon the anticipated approved of the 2007 budget, the Council approved Staff’s recommendation of a 3% cost of living adjustment, and a monthly insurance contribution of $732.20 for 2007. In addition to these adjustments stated above, it was also discussed that pay equity adjustments will need to be made in order to be compliant with Minnesota State Pay Equity Law. In order to become compliant with state law, all female job classifications will need a 5% increase in pay compensation, effective December 31, 2006. The Mounds View Pay Equity Report is due to the Minnesota Department of Employee Relations (DOER) by January 31, 2007, and must reflect 2006 compensation numbers. There are two non-union members affected, Assistant to the City Administrator and the Utility Payroll Clerk. All Pay Equity Proposals have been agreed upon with the Human Resources Committee. Discussion: If the City Council approves this 3% increase to non-union personnel, then the two non-union female classifications would get a 5% increase effective December 31, 2006, and an additional 3% increase effective January 1, 2007. Most male job classifications (i.e., Police Officers, Police Sergeants), have a 3% cost of living adjustment already in their contract, and if the same increases are not given to female classifications it could alter the pay equity repot as non-compliant. The penalties for non-compliance with the Minnesota Pay Equity Law are as follows: “If a jurisdiction is found not in compliance, a notice will be issued to the jurisdiction. The jurisdiction, if it disagrees with the notice, may notify the commission of DOER and will be given a defined period of time during which additional information may be submitted for reconsideration of the finding. Should compliance not be achieved within the defined period set by the commissioner, the commissioner will notify the jurisdiction and the commissioner of revenue that the jurisdiction is subject to a five percent reduction in the aid that would otherwise by payable to the jurisdiction, or to a fine of $100 per day, whichever is greatest. The imposition of a penalty may be appealed with the commissioner within 30 days of the commissioner’s notification to the jurisdiction of the penalty. No penalty may be imposed while an appeal is pending.” Recommendation: Consider Resolution 6985 Approving the 2007 Non-Union 3% Cost of Living Adjustment, $732.20 Health Insurance Contribution and Pay Equity Adjustments for Non-Union Personnel. Respectfully Submitted, Desaree Crane