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6.2. ERMUSR 11-15-2011Elk River~:~ Municipal Utilities 13069 Orono Parkway • P.O. Box 430 Elk River, MN 55330-0430 UTILITIES COMMISSION MEETING POMERE6 B~ ~Q~V~ P p~,.ca ED T O S E0.V E Phone: 763.441.2020 Fax: 763.441.5099 TO: FROM: Elk River Municipal Utilities Commission Troy Adams, P.E. -Utilities Director John Dietz -Chair Daryl Thompson -Vice Chair Al Nadeau -Trustee MEETING DATE: AGENDA ITEM NUMBER: November 15, 201 I 6.2 SUBJECT: Wa a and Benefits Committee U date BACKGROUND: At the recommendation of staff during the October 2011 Utilities Commission meeting, the Commission formed a Wage and Benefits Committee. The Utilities Commission created the committee to be comprised of one Commissioner, John Dietz -Utilities Chair, and three Utilities managers, Troy Adams - Utilities Director, Theresa Slominski -Finance and Office Manager, and Mark Fuchs -Electric Superintendent. The intent for the creation was to have the committee review and analyze wage and benefits information, receive comments and questions from employees relating to wage and benefits, function as a forum for discussion, and ultimately present wage and benefit information to the Utilities Commission. The Wage and Benefits Committee would not have authority to awazd or change wages or benefits; this authority is that of the Utilities Commission. DISCUSSION: On October 26, the Committee held its fast meeting which was open to employees. The scope of this first meeting was to establish the function of the committee, review the preliminary metro-average wage survey, and engage dialogue with the employees over their concerns and/or comments. A follow-up Committee meeting was held on November 2. The following compensation items were discussed: Waees Because of the timing on wage negotiations for many of the metro utilities used in the metro-average survey, the information used included many conservative assumptions. The preliminary results from the survey indicate that the ERMU Journeyman Lineworker position will now be approximately 6.88% below the average and 12.80% below the top. These preliminary survey numbers indicate that without any increase the ERMU Journeyman Lineworker position would be the lowest paid on the survey. To not lose ground with the metro-average trend, the ERMLJ Journeyman Lineworker position would need an increase of approximately 2.06%. By comparison and excluding this 2.06%, an approximate increase of 2.43% would be needed to meet the average of the municipal utilities in the survey and an approximate increase of 4.66% would be needed to meet the top metro municipal in the survey. Again, these numbers aze preliminary because many of these utilities are still working through their labor negotiations. And, wages are only one component to the compensation package. Benefits Insurance, vacation, holidays, and other benefds also aze part of the complete compensation package. It was discussed in the Committee meeting that E1tMiJ has an excellent health insurance plan with a generous employer contribution. One of the other similar municipal utilities in the survey does have the exact same health insurance plan with a similar employer contribution; the others have HSAs or high deductible insurance plans. In 2010, staff conducted an extensive analysis of the metro-average survey utilities' of their benefits which including health insurance. This analysis was reviewed by the committee. For 2012, ERMU's health insurance plan renewal will recognize a 9.5% decrease in rates, or an approximate overall savings of $50,000. The Dental, Long Term Disability (LTD), and Life Insurance were also discussed because ERMLJ received notice of the substantial increase in the renewal rates approximating an overall increase of $10,000. An effort in negotiating these increases downward by our insurance broker was unsuccessful. We are currently out for bids on these insurance items. At the October Commission meeting, a presentation on Long Term Care was made. This insurance option was further discussed at the Committee meeting. Specific pricing was not yet made available and thus this topic needed further review. Other There were a number of items brought to the committee by the employees for committee consideration. There were also additional items identified for research by the committee. Some of these items were: Employees requested the Committee look into uniform laundry services. Preliminary numbers indicated there may be savings to the Utilities through a laundry service with uniform rental. There may be issues with the calorie ratings and uniform choices. The Committee is currently looking into the viability of this option. Employees also requested the Committee look into the On-Call Holiday Compensation, specifically, look at adding a compensatory day as compensation for being on-call over a holiday. This would be similaz to some other utilities. The Committee is currently reviewing this request. The Committee also discussed Utility rankings, budgeted margins, cost of turnover, the future of the metro-average survey, and potential 2012 purchase power increase. At the Commission request, additional detail from the Committee meeting discussion topics can be provided. The next scheduled meet for the Committee is November 30. At this meeting the Committee will review the data collected and decide on options to present to the Commission for a decision during the December Utilities Commission Meeting. ACTION REQUESTED: No Action is required at this time.