HomeMy WebLinkAboutItem 11b - Establishing Minimum Wage in Accordance with SB 3
DATE: December 17, 2019
TO: Honorable Mayor and City Council
FROM: Hue C. Quach, Administrative Services Director
By: Shama P. Curian, Human Resources Administrator
SUBJECT: RESOLUTION NO. 7288 APPROVING WAGE ADJUSTMENTS FOR
UNREPRESENTED, NON-BENEFITED PART-TIME EMPLOYEES IN
ACCORDANCE WITH CALIFORNIA’S MINIMUM WAGE INCREASE
EFFECTIVE JANUARY 1, 2020
Recommendation: Adopt
SUMMARY
On April 4, 2016, Governor Jerry Brown signed Senate Bill 3 (“SB 3”), incrementally
increasing California’s minimum wage over a period of six years to reach $15 per hour
by January 1, 2022. In order to continue to comply with SB 3, it is recommended that
the City Council adopt Resolution No. 7288 approving wage adjustments for
unrepresented, non-benefited part-time employees to meet the expected minimum
wage increase of $13.00 per hour effective January 1, 2020. The recommended
adjustments are projected to increase the City’s Operating Budget by approximately
$34,000 for the remainder of Fiscal Year 2019-20.
BACKGROUND
SB 3 signed by Governor Jerry Brown on April 4, 2016, increasing California’s minimum
wage in increments of $1.00 per hour annually to reach $15.00 per hour in January 1,
2022. The minimum wage has been set as follows:
Effective Date Minimum Hourly
Wage
January 1, 2017 $10.50
January 1, 2018 $11.00
January 1, 2019 $12.00
January 1, 2020 $13.00
January 1, 2021 $14.00
January 1, 2022 $15.00
Resolution 7288 Establishing Minimum Wage In Accordance with SB 3
December 17, 2019
Page 2 of 3
In previous years, the City Council has adopted resolutions establishing wage
adjustments for part-time (unrepresented) employees to comply with the State’s set
minimum wage; however, Charter Cities such as Arcadia may exempt themselves from
these standards. The implementation of these new schedules has started to create
compaction to related part-time classifications within the same job family as well as pay
ranges to some full-time positions. As such, the Human Resources Division conducted
a comprehensive analysis to determine a viable solution to address the compaction
concerns.
DISCUSSION
The Human Resources Division surveyed surrounding cities and their comparable part-
time positions. Cities who responded, confirmed that they have not yet needed to adjust
their full-time positions because of the minimum wage mandate. Similarly, they have
only adjusted the pay rates for their part-time positions that were below the minimum
wage threshold, although they are facing similar internal compaction issues as the rates
increase.
A comparative wage study from the nine cities concluded that the City’s part-time
positions were equitable amongst surrounding cities for positions with similar duties. All
but one of Arcadia’s 11 part-time positions are currently within competitive scales at
80% or above the median pay. One additional position did not have a comparable
position in the cities surveyed.
After internal review and discussion of possible alternative, the consensus of the City’s
Executive Team is to adjust the start of the full salary range to the minimum of $13 per
hour, and apply a 2.5% incremental increase between each step instead of the current
5%. This has the effect of meeting the minimum wage requirements but slows the cost
increases over time as employees move through the steps. Additionally, the schedule
would end at PT22 and the positions of Volunteer Services Coordinator and Reserve
Police Officer (Level II) would be removed from the part-time wage schedule. The
recommendation is to place these positions at a set hourly rate (their current maximum
step) and adjust the compensation when a job audit deems necessary. Removing these
positions from the wage schedule would not require that the adjustment be applied to
these positions simply as a result of being on the same part-time wage schedule. Both
of these positions are housed in the Police Department and the one entry-level position
of Police Cadet would not be considered in the same job family or create compaction
concerns. These adjustments to the salary table will also simplify the increases that will
be necessary in future years as the minimum wage moves to $15.00 per hour.
The proposed unrepresented, part-time wage schedules are attached as Exhibit “A” and
Exhibit “B” within Resolution No. 7288. Exhibit “A” illustrates part-time positions with
Non-CalPERS Retirement, while Exhibit “B” is for part-time positions enrolled in
Resolution 7288 Establishing Minimum Wage In Accordance with SB 3
December 17, 2019
Page 3 of 3
CalPERS due to mandatory guidelines based on hours worked or having been vested in
CalPERS from prior employment. Exhibit “A” reflects the same wage adjustments made
to Exhibit “B”; however, Exhibit “B” includes a 7% increase that is currently in place to
offset the employee pension contributions as a result of past labor negotiations and as
adopted in Resolution No. 6795.
ENVIRONMENTAL IMPACT
The proposed action does not constitute a project under the California Environmental
Quality Act (“CEQA”), and it can be seen with certainty that it will have no impact on the
environment. As such, this matter is exempt under CEQA.
FISCAL IMPACT
The recommended adjustments are projected to increase the City’s Operating Budget
cost by approximately $34,000 for the remainder of Fiscal Year 2019-20. The
anticipated increase is a conservative projection as it is based on actual hours worked
during the summer season of the affected part-time employees. At this time, no
additional budget appropriation is requested as the projected increase can be absorbed
in the Fiscal Year 2019-20 General Fund Operating Budget.
RECOMMENDATION
It is recommended that the City Council determines that this project is exempt under the
California Environmental Quality Act (“CEQA”); adopt Resolution No. 7288 approving
wage adjustments for unrepresented, non-benefited part-time employees in accordance
with California’s minimum wage increase effective January 1, 2020.
Attachment: Resolution No. 7288