HomeMy WebLinkAboutItem 11d - Wage Adjustments in accordance with California's Minimun Wage Increase
STAFF REPORT
Administrative Services Department
DATE: December 1, 2020
TO: Honorable Mayor and City Council
FROM: Hue C. Quach, Administrative Services Director
By: Cecilia Todd, Senior Human Resources Analyst
SUBJECT: RESOLUTION NO. 7344 APPROVING WAGE ADJUSTMENTS FOR
UNREPRESENTED, NON-BENEFITED PART-TIME EMPLOYEES IN
ACCORDANCE WITH CALIFORNIA’S MINIMUM WAGE INCREASE
EFFECTIVE JANUARY 1, 2021
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. 7344 approving wage adjustments for
unrepresented, non-benefited part-time employees to meet the expected minimum
wage increase of $14.00 per hour effective January 1, 2021. The recommended
adjustments are projected to increase the City’s Operating Budget by approximately
$12,000 for the remainder of Fiscal Year 2020-21.
BACKGROUND
Governor Jerry Brown signed SB 3 on April 4, 2016, increasing California’s minimum
wage in increments 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 No. 7344 Approving a Wage Increase in Accordance to
California’s Minimum Wage Law Effective January 1, 2021
December 1, 2020
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. 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. In late 2019, Human Resources conducted a
comprehensive analysis to determine a solution to address these possible compaction
concerns. As a result of the analysis, the wage schedules were modified for the 2020
year to address the internal compaction to the full-time positions while still maintaining
competitiveness in the labor market. Modifications included reducing the percentage
increments between steps to 2.5% from 5% which allows for some differential from the
highest step in a part-time position to the pay for an entry level full-time position.
DISCUSSION
For the upcoming 2021 minimum wage increase, another review was conducted to
determine if additional modifications needed to be made. Keeping in mind that
significant changes were previously made, Human Resources presented a few options
for review and discussion to the City’s Executive Management Team. The Executive
Management Team agreed that the best option to implement the minimum wage
increase is to adjust the start of the full salary range to the minimum of $14 per hour and
maintain the 2.5% incremental increase between each step. This has the effect of
meeting the minimum wage requirement now but slows the cost increases over time as
employees move through the steps. These adjustments to the salary table will also
simplify the increases that will be necessary next year 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. 7344. Exhibit “A” illustrates part-time positions with
Non-CalPERS Retirement, while Exhibit “B” is for part-time positions enrolled in
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 $12,000 for the remainder of Fiscal Year 2020-21. The
Resolution No. 7344 Approving a Wage Increase in Accordance to
California’s Minimum Wage Law Effective January 1, 2021
December 1, 2020
Page 3 of 3
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 2020-21 Operating Budget.
RECOMMENDATION
It is recommended that the City Council determine that this action does not constitute a
project and is, therefore, exempt under the California Environmental Quality Act; and
adopt Resolution No. 7344 approving wage adjustments for unrepresented, non-
benefited part-time employees in accordance with California’s minimum wage increase
effective January 1, 2021.
Attachment: Resolution No. 7344