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4.1 ERMUSR 03-14-2023 UTILITIES COMMISSION MEETING TO: ERMU Commission FROM: Tony Mauren – Governance & Communications Manager MEETING DATE: March 14, 2023 AGENDA ITEM NUMBER: 4.1 SUBJECT: Annual Commissioner Orientation ACTION REQUESTED: None BACKGROUND: Commission Policy G.2d – Commission Member Role, Responsibilities, and Orientation describes the role and responsibilities of Commissioners operating as a governing body in accordance with applicable law. The Commission also establishes its expectations for the orientation of new commission members. As stated in the policy, “The ERMU Commission is committed to excellent governance. This requires that individual Commissioners be well-informed about ERMU, its customers and stakeholders, the utility business, prudent financial management, and the Commission’s own governance structure and processes.” Consistent with this commitment and commission policies, an annual orientation program for new and existing commission members was implemented in 2018. This year’s annual orientation will offer a respectful workplace training prior to the meeting as well as a review of the Commission Policy manual and reference guide updates from the previous year. COMMISSIONER ORIENTATION AGENDA: 1. Updates to Commission Policy Manual • Commission Policy Manual Index • G.2a2 – Streetlight Installation and Maintenance Agreement Between ERMU and The City of Elk River • G.2g1 – Wage & Benefits Committee Charter • G.2g3 – Information Security Committee Charter • G.2g4 – Dispute Resolution Committee Charter • G.4f1 – Employee Handbook • G.4g1 – Performance Metrics and Incentive Compensation • G.4j3 – Customer Deposits • G.4l4 – Third Party Attachment to Assets 65 • G.5a – Margins • G.5b – Competitive Rates 2. Updates to Commission Reference Guide • 2023 Governance Agenda • 2023 ERMU Organizational Chart • 2023 Utilities Commission Member Listing • 2023 Utilities Commission Meeting Schedule • 2023 Upcoming Events • 2023 Travel Expense Guidelines for Commissioners ATTACHMENTS: • Commission Policy Manual and Reference Guide updates listed above 66 COMMISSION POLICY MANUAL TABLE OF CONTENTS GOVERNANCE Authority and Purpose Policies G.1a Bylaws G.1b Organizational Core Purpose G.1c Mission Statement G.1d Vision Statement G.1e Organizational Values G.1f Organizational Fundamentals G.1g Planning Themes Governance Policies G.2 Commission Purpose G.2a Commission – City Council Relationship and Roles G.2a1 Payment in Lieu of Taxes (PILOT) and Other Donations to the City of Elk River G.2a2 Street Light Installation and Maintenance – Memorandum of Understanding G.2a3 Repairs to Private Water Utility Line – Memorandum of Understanding G.2b Governing Style G.2c Agenda Planning G.2d Commission Member Role, Responsibilities and Orientation G.2e Commission Member Conduct G.2e1 Conflicts of Interest G.2f Commission Officer Roles, Responsibilities and Succession G.2g Commission Committees G.2g1 Wage & Benefits Committee Charter G.2g2 Financial Reserves and Investment Committee Charter G.2g3 Information Security Committee Charter G.2g4 Dispute Resolution Committee Charter G.2h Independent Advisors to the Commission Commission – Management Connection Policies G.3 Commission - Management Roles G.3a Controlling Authority G.3b Delegation of Authority to the General Manager G.3c General Manager Accountability G.3d Monitoring Performance of the General Manager G.3e General Manager Performance Planning and Evaluation 67 Delegation to Management Policies G.4 Corporate Limitations G.4a Succession of Leadership G.4b Information and Support to the Commission G.4c Strategic and Business Planning G.4d Customer Interests G.4d1 Customer Data Privacy G.4e Core Customer Services G.4e1 Customer Accounts G.4e2 Electric Services G.4e3 Water Services G.4f Employee Interests G.4f1 Employee Handbook G.4f2 Controlled Substances G.4g Organization, Staffing, and Compensation G.4g1 Performance Metrics and Incentive Compensation G.4g1a Performance Metrics and Incentive Compensation Policy Score Card G.4h Financial Planning and Budgeting G.4i Financial Condition and Transactions G.4i1 Investments G.4i2 Financial Reserves G.4i3 Debt Issuance and Payment G.4i4 Procurement G.4i6 Public Purpose Expenditures G.4j Cost Allocation and Recovery G.4j1 Rates and Charges for Electric Service G.4j2 Rates and Charges for Water Service G.4j3 Customer Deposits G.4k MMPA Relationship, Representative and Governance G.4l Protection of Assets G.4l1 Use and Disposal of Utility Property G.4l3 Mobile Device Guidelines G.4l4 Third Party Attachment to Assets G.4m Corporate Risk Management G.4n Legal and Regulatory Compliance G.4o Environmental Stewardship G.4o1 Water Use Restrictions G.4p External Communications G.4q Community Involvement G.4r Mutual Aid Results Policies G.5 Goals and Results G.5a Margins G.5b Competitive Rates 68 69 70 71 !( !( !( !( !( !( !( !( !( !( !( !( !( !( !( !( !( !( !( !( !( !(!( !( !( !( !( !( !( !( !( !( !( !( !( !( !( 5TH ST NW 4TH ST NW MAIN ST N W 6TH ST NW UPLAND AVE NWPROCTOR AVE NWRUSH AVE NWRAILR O A D D R N WTIPTON AVE NWQUINN AVE NWOXFORD AVE NWNORFOLK AVEMORTON AVEMORTON AVE NWUPL A N D A V E N W 6TH ST NW 6TH ST NW PROCTOR AVE NW4TH ST NWQUINN AVE NWOXFORD AVE NW828 905 755 1340 1433 1170 1104 728 950 610 927 508 1437 425 1326 413 1304 1528 1506 1643 335 906 511 403548 1431 1305538 415 1154 5781705 1522 3451414 1184133213021624 1118420617 431 11667605 6 8 369517423 515 503 329 539 123746 8 430 17 0 6 13191417321 9471036114 0 328122016273301222486 504 12341516430 303 824 1331560 505151050734011783471504421 431523 413 403 529 1522415577 345 1429520 620 1218551517 405953420 429623 413 720116411701174140814141420315 1127113311211320131410151234 10211630 1634 622 1126113411381232 112111335711217122171611271321422 11114313221313 3811205416 12221204420 12124301020326 320 1206 16391536 432428 414 450 416 1227319 337117511631171123411501158 1018 1016110 5 1 7 1 8 12181221113910261214121511151209 414 1183141112214193751215122693610331027 Source: Esri, Maxar, Earthstar Geographics, and the GIS User Community Legend Pole ERMU - City Agreement - Item Description !( HWY 10 Trail Light - 14' Aluminum, City Owned, ERMU MTC !( !( !( !(!(!(!( !( !( !( !( !( !( !( !(!( !( !( !( !( !( !(!(!( !( !( !( !( !( !( !( !( !(!( !( !( !( !( !( !(!( 8TH ST NW UPLAND AVE NWUS HIGHWAY 10 NW VERNON AVE NWWAN D A V E N W XENIA AVE NW7TH S T N W GARY ST NWAL B A N Y S T N W WATSON AVE NWPRIVATE DR187TH CIR N W US HI G H W A Y 1 0 N W UPLAND AVE NW18599 13161 1936 1953 63318594 18679 18636 1790 18663 12884 17721927 13211 12888 186 2 9 1800 1903193418775 18743 617 1863 7 12891 7321920834 18810 823 18645 1911 847 1908183813241 13291 18648 17581910128801873618586 18735 184018 6 2 1 18660 18670 13337833193382174318371926835 723 194318725 839 825 842 18604 18401850611 805829852 832 855 847 822 1 8 6 1 3 17109241950 18570 1707 8321856 1746843 17387331822185284 2 1834 870 1 8 6 0 3 1718 184 5 185 1 18560 816 8281719 863 18732 17571 7 7 1 815 1 8 5 9 3 90912826 82018790 1726 17451716 185831797179712838 Source: Esri, Maxar, Earthstar Geographics, and the GIS User Community ± ± 0 250 500125 Feet Appendix - I. HWY 10 Trail Lights 72 #* #* [¨ [¨ Ô [¨ Ô [¨ [¨ [¨ Ô [¨ [¨ [¨ [¨ [¨ Ô #* #* Ô [¨ #* [¨#* #* #* [¨ [¨ Ô [¨ [¨ Ô [¨ #* [¨ Ô [¨ #* #* [¨ Ô [¨ Ô Ô [¨ [¨ MAIN ST NW US HI G H W A Y 1 0 N W RAILR O A D D R N W LOWELL AVE NW3RD ST NW KING AVE NWPARRISH AVE NWJACKSON AVE NWIRVING AVE NWLOWELL AVE NWJACKSON AVE NW755 630 208 812 633 729 805 822 729 311 815 300 831 560 200 817823 647 610 708 679720 907 657651345 716309 600 701323 555 653335 724322 612 204 315 313 709705707713707618 715717616906Source: Esri, Maxar, Earthstar Geographics, and the GIS User Community Legend Pole ERMU - City Agreement - Item Description [¨Downtown Light - City Planter Attachment #*Downtown Light - City Banner Attachment - Triangle Ô Downtown Light - City Banner Attachment - Rectangle Appendix - II. Main Street/Jackson Avenue - Downtown ± 0 100 20050 Feet 73 ^_^_ ^_ ^_^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_^_ ^_ ^_ ^_ ^_ ^_ ^_ ^_IRVING AVE NWJACKSON AVE NWSCHOOL ST NW FREEPORT ST NW4TH ST NW GATES AVE NWMAIN ST NW RAILR O A D D R N W 2ND ST NW 3RD ST NW 7TH ST NW 6TH ST NW US HI G H W A Y 1 0 N W 5TH ST NW 5 1/2 ST NW 8TH ST NW EVANS AVEHOLT AVE NWJEFFERSON L N N W PARRISH AVE NWUS H IGHWAY 169 NW GR E A T R I V E R E N E R G Y D R N W LINCOLN CIR N W HOLT AVE NWGATES AVE NW6TH ST NW MAIN ST NW8TH ST NW 4TH ST NW JACKSON AVE NWRAI L R O A D D R N WGATES AVE NW5TH ST NW 3RD ST NW 7TH ST NW FREEPORT ST NWGATES AVE NW5TH ST NW HOLT AVE NW500 355 755 800 550 847 400 300 809 534 900 804 716 525 350 556 530 510 518 846 850 516 728 18823 630 423 509 560 440 324 425 538 385 633 428 734 324 555 828 566378 370 429 402 555 433 518 610 824 513 543 608 415 420 290406 501 510 506 426 280602 503 300 836 827 403413501 369634 515 503 640 708 312818 820 554 356 736 413419403230330 358 818 502817 626 513546 210508514518624 522713 516512404570535550 529 724 557809 567729 612836 408200497502 310302611 730 537 531 523 515 724 718 704 538 530 510 558600 360 502508533 513808 525627 564621 617 604 366 362519 610546 501509517 611504626 620 612 529523627 617 609 422536520512512 547558527528 528 602532544536 345 502 647536528401 810 318 828 719817 821 825 57 0 632 532525511331618838 828 542 414822 420426430720816 801 515555570 809 541503519525549533702540521 515806 817 71 6 711624833 823821 816 810 801 827 525 604 42532671640050718853 622 634 604 574 580 363 507 714 544528540565541551533543557541533568562521540532526522381521602 514614522640 628 616 612606517373550607 623703708 631509 61 8 519513838 560 526 550351530 445 760679554559565 571 315 657418 714 618716 551543548651307612716613 323535375 305297309309 313317311627303319315321307126323129293701323 3196163 2 5620 305329 315313 709707327333Source: Esri, Maxar, Earthstar Geographics, and the GIS User Community Legend Pole ERMU - City Agreement - Item Description ^_Flag Mount Appendix - III. Jackson Avenue/Main Street/Evans Avenue ± 0 250 500125 Feet 74 COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2g1 Wage & Benefits Committee Charter PURPOSE: The Wage and Benefits Committee exists to help the Commission develop and maintain a pay plan structure and benefits package that are market competitive, help promote employee retention, and to help the Commission make informed decisions which provide value to the customers through fair labor expenses. This Committee also exists to help the Commission with succession planning and review pay equity compliance. MEMBERSHIP: The Committee shall be comprised of two Commissioners, the General Manager, the Administrations Director, and the Operations Director. At no time shall there be a quorum of the Commission on the Committee. The Commission shall appoint Committee members annually following the Commission election of officers during the March Regular Commission meeting. The Commission shall also appoint the Committee Chair at that time. ROLE OF THE COMMITTEE CHAIR: The primary role of the Committee Chair is to run the Committee meetings. The Committee will adhere to the Current edition of Robert’s Rules of Order Newly Revised for all situations to which they are applicable and are not inconsistent with ERMU’s bylaws, policies, and any special rules of order that the Commission may adopt. The Committee meetings may be open or closed to employees at the discretion of the Committee Chair. AUTHORITY: Except as established in this Committee Charter, the authority of the Committee is limited to the purpose of research and recommendation to the Commission. The Committee, at the discretion and through formal action of the Commission, may be empowered beyond the role of research 75 and recommendation such that it is consistent with the Organizational Core Purpose policies and the Commission Committees policy. SPECIFIC DUTIES: 1. At the request of the Commission, research and analyze topics related to employee compensation and benefits. 2. Annually perform market benchmarking and evaluate wages. The Committee shall present options and make recommendations regarding cost of living adjustments and pay plan structure modifications to the Commission for their consideration. 3. Review insurance policies and evaluate policy renewals related to employee benefit insurances. The Committee shall present options and make recommendations regarding these insurance policies to the Commission for their consideration. 4. Evaluate wage and benefit requests from employees. Present and make recommendations to the Commission as appropriate. 5. Review submittal information pertaining to pay equity compliance requirements and present options and make recommendations to the Commission as appropriate. 6. Record minutes of Committee meetings. Committee meeting minutes shall be subject to applicable data retention law and policies. SCHEDULE: At a minimum, the Committee shall meet on a quarterly basis. TERMINATION: The Committee shall exist until at such time formal action of the Commission is taken to dissolve the Committee. POLICY HISTORY: Adopted May 9, 2017 Revised February 14, 2023 76 COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2g3 Information Security Committee Charter PURPOSE: Information security is managing risks to the confidentiality, integrity, and availability of information using administrative, physical, and technical controls. The Information Security Committee exists to help develop and maintain industry appropriate information security policies and oversight. Because of shared hardware and resources, there exists an overlap and shared risk for ERMU and the City of Elk River (City) operations. Although governed autonomously, this shall be an advisory Committee to both the ERMU and the City. MEMBERSHIP: This Committee shall be comprised of equal representation from ERMU and the City. From ERMU this committee shall include a Commissioner and the General Manager. The General Manager will appoint three additional members, at least one of whom will be a manager and at least one will be an information technology employee. From the City this committee shall include a Councilmember and the City Administrator. The City Administrator will appoint three additional members, at least one of whom will be a manager and at least one will be an information technology employee. At no time shall there be a quorum of the Commission or the Council on the Committee. The Commission shall appoint ERMU’s Committee member representatives annually following the Commission election of officers during the March Regular Commission meeting. The Council shall appoint its member annually. The Committee shall elect a chair annually. The General Manager and the City Administrator shall serve as the authorized reporting representatives for their respective governing bodies. ROLE OF THE COMMITTEE CHAIR: The primary role of the Committee Chair is to run the Committee meetings and act as committee secretary. The Committee will adhere to the Current edition of Robert’s Rules of Order Newly 77 Revised for all situations to which they are applicable and are not inconsistent with ERMU’s bylaws, policies, and any special rules of order that the Commission may adopt; and similarly, the Committee action shall not be inconsistent with applicable laws and policies which regulate the City of Elk River. The Committee meetings may be open or closed to employees at the discretion of the Committee Chair. AUTHORITY: Except as established in this Committee Charter, the authority of the Committee is limited to the purpose of research and recommendation to ERMU and the City. SPECIFIC DUTIES: 1. Policies and Procedures: Assist ERMU and the City in the development of information security related policies. Review effectiveness of information security policy implementations. Identify and recommend how to handle non-compliance. Assist with the development of information security related procedures, standards, guidelines, and baselines to the ERMU and the City. At least annually, provide timely reports including recommendations regarding effectiveness of polices and procedures to ERMU and City leadership teams. 2. Risk Assessment: Review industry appropriate information security trends to maintain an up- to-date perspective on related risks and industry’s best practice risk mitigation methods. Identify significant threats and vulnerabilities. Assess the adequacy and coordination of the implementation of information security controls. Recommend methodologies and processes for information security. Evaluate ongoing related legal and regulatory compliance changes. Review incident information and recommend follow-up actions. At least annually, provide timely reports including recommendation regarding risks assessment to ERMU and City leadership teams. 3. Budget Development: Develop data needed for thorough evaluation of proposed information security initiatives for budget preparation and consideration. Information shall include options, risk evaluation, resource requirements, implementation timelines, and costs. At least annually and coordinating with their respective budgeting process schedules, provide timely reports regarding information security initiatives proposed for consideration to ERMU and City leadership teams. 4. Education and Awareness: Function as an information security program champion providing clear direction and unity in ERMU and City leadership teams’ support for approved security initiatives and policies. Develop and implement plans and programs to maintain information security awareness. Promote information security education, training, and awareness throughout ERMU and the City. SCHEDULE: At a minimum, the Committee shall meet on an annual basis. 78 TERMINATION: The Committee shall exist as a joint effort between ERMU and the City until at such time either the Commission or Council dissolve the joint nature of the Committee. POLICY HISTORY: Established August 8, 2017 Revised November 12, 2019 Revised February 14, 2023 79 COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2g4 Dispute Resolution Committee Charter PURPOSE: The Dispute Resolution Committee exists to provide customers an alternative dispute resolution option for circumstances which: require action beyond the authority assigned through the Delegation to Management Policies; require policy creation, revision, or exception; have exhausted the established utilities procedures and/or protocol; and involves customer protected data for which the customer prefers addressing the issue through a meeting closed to the public. For qualifying customer disputes, the Committee will provide: a formal hearing in a closed meeting allowing the customers to communicate the concern; recess and reconvene as needed to conduct appropriate research and/or deliberate; make a determination within parameters established through the Commission Policies and within the authorities delegated through this policy; and report and/or make recommendations to the Commission as required. MEMBERSHIP: The Committee shall be comprised of five members, three appointed annually and two which vary with each dispute. The three members appointed annually shall include two Commissioners and the General Manager. At no time shall there be a quorum of the Commission on the Committee. The Committee shall also include the director and the manager most directly involved in the dispute. The Commission shall appoint Committee members annually following the Commission election of officers during the March Regular Commission meeting. The Commission shall also appoint the Committee Chair at that time. ROLE OF THE COMMITTEE CHAIR: The primary role of the Committee Chair is to run the Committee meetings. The Committee will adhere to the Current edition of Robert’s Rules of Order Newly Revised for all situations to which they are applicable and are not inconsistent with ERMU’s bylaws, policies, and any special rules of order that the Commission may adopt. 80 AUTHORITY: Except as established in this Committee Charter, the authority of the Committee is limited to the purpose of dispute resolution within the authorities delegated to management through the Commission Policies, research related to customer disputes or complaints, and recommendations to the Commission. The Committee, at the discretion and through formal action of the Commission, may be empowered beyond the role as outlined in this policy such that it is consistent with the Organizational Core Purpose policies and the Commission Committees policy. SPECIFIC DUTIES: 1. After a formal request is submitted for a qualifying customer dispute, the Committee will schedule a hearing, either in person or virtual, within a reasonable amount of time. 2. Through the hearing, the Committee will allow the customer to communicate relevant information and request dispute resolution which may require policy creation, revision, or exemption. 3. The Committee is required to verify all information and data; and the Committee will review the Customer’s account history and other relevant information. 4. And as needed, the Committee shall research industry best practices related to the dispute. 5. The Committee is authorized to engage legal counsel for legal review and recommendations. 6. The Committee will make a determination whether resolution can be provided within the authorities assigned through this policy; and if so, the Committee will provide written summary of the dispute and the authorized resolution for implementation by management. 7. When no action is taken by the Committee toward resolution, the Committee will determine whether the request warrants further consideration by the Commission, in which case the Committee will present a summary of the dispute to the Commission and a make recommendation. In the event that no action is taken by the Committee, and the Committee has determined that the dispute does not warrant further consideration or advancement to the Commission, the Committee shall summarize their finding in a report to be provide to the customer and placed on file. 8. The Committee shall record minutes of all Committee meetings. Committee meeting minutes shall be subject to applicable data retention law and policies. SCHEDULE: The Committee shall meet on an as-needed basis. 81 TERMINATION: The Committee shall exist until at such time formal action of the Commission is taken to dissolve the Committee. POLICY HISTORY: Adopted January 12, 2021 Revised February 14, 2023 82 EMPLOYEE HANDBOOK 13069 Orono Parkway ELK RIVER, MN 55330 June 2022 Office: 763-441-2020 83 Table of Contents RECEIPT AND ACKNOWLEDGMENT ..................................................................... v 1. IMPORTANT NOTICE ABOUT THIS HANDBOOK ................................... 1 PERSONNEL RECORDS................................................................................... 1 ACCESS TO PERSONNEL RECORDS ........................................................... 1 GENERAL WORKPLACE POLICIES ........................................................................ 4 2. OPEN DOOR POLICY ....................................................................................... 4 3. EQUAL EMPLOYMENT OPPORTUNITY .................................................... 5 4. DISABILITY ACCOMMODATION................................................................. 5 5. HARASSMENT PROHIBITED ......................................................................... 6 Definitions of Sexual and Other Forms of Harassment ................................... 6 Scope of Policy ...................................................................................................... 7 Procedure for Reporting Harassment ................................................................ 7 Confidentiality – No Retaliation ......................................................................... 8 Questions About This Policy ............................................................................... 8 6. BUSINESS CONDUCT ....................................................................................... 8 7. ETHICS, GIFTS AND CONFLICTS OF INTEREST ..................................... 9 8. EMPLOYMENT OF RELATIVES ................................................................... 9 9. WHISTLEBLOWERS ...................................................................................... 10 10. WAGE INFORMATION .................................................................................. 10 11. WEAPONS PROHIBITED ............................................................................... 11 12. EMPLOYEE SAFETY ...................................................................................... 11 13. COMMITMENT TO A DRUG AND ALCOHOL-FREE WORKPLACE ................................................................................................... 12 14. EXPOSURE TO HAZARDOUS SUBSTANCES ........................................... 14 15. SOLICITATION AND DISTRIBUTION........................................................ 14 Non-Employees ................................................................................................... 15 Employees ........................................................................................................... 15 Related Policies................................................................................................... 15 Violation of This Policy By an Employee ......................................................... 15 16. ELECTRONIC COMMUNICATIONS: INTERNET, E-MAIL, AND SOCIAL MEDIA ............................................................................................... 16 General Guidelines Applicable to Electronic Communications, Including Communications Over Social Media .............................................. 16 Bandwidth Conservation ................................................................................... 18 17. SUPPLEMENTAL EMPLOYMENT .............................................................. 18 Fire Department Participation ......................................................................... 18 18. REPORT OF PERSONNEL CHANGES ........................................................ 19 19. ATTENDANCE.................................................................................................. 19 20. DISCIPLINE, DISMISSAL & LAY OFF ....................................................... 19 Discipline ............................................................................................................. 19 Probation and Dismissal .................................................................................... 20 84 Layoff/Reduction in Force ................................................................................ 20 21. JOB POSTING ................................................................................................... 20 22. PERFORMANCE REVIEWS .......................................................................... 21 Performance Metrics Incentives ....................................................................... 21 WAGES AND HOURS .................................................................................................. 21 23. WORK HOURS, OVERTIME, AND COMPENSATORY TIME ............... 21 General Policy .................................................................................................... 21 Compensatory Time........................................................................................... 22 24. EMPLOYEE CLASSIFICATIONS ................................................................. 23 Regular Full-Time Employee ............................................................................ 24 Regular Part-Time Employee ........................................................................... 24 Regular Field Worker........................................................................................ 24 Exempt Employee .............................................................................................. 24 Non-Exempt Employee ...................................................................................... 24 Utilities Manager ................................................................................................ 24 Temporary Worker ........................................................................................... 25 25. TIME REPORTING POLICY ......................................................................... 25 General Policy .................................................................................................... 25 Recording Time .................................................................................................. 25 Frequency ........................................................................................................... 25 Time Deductions for Breaks ............................................................................. 26 Ensuring Accuracy of Timekeeping Reports .................................................. 26 Special Note About Work Performed Outside of Scheduled Times and Places ........................................................................................................... 26 26. REMOTE WORK POLICY ............................................................................. 27 27. FAIR PAY POLICY .......................................................................................... 31 All Employees ..................................................................................................... 31 Protection of Employee Rights ......................................................................... 31 Record Your Time And Review Your Pay Stub ............................................. 31 How to Raise a Question or Concern about your Pay or a Payroll Deduction ............................................................................................................ 31 Regular Attendance is an Essential Job Function and Your Attendance Record is a Performance Issue ..................................................... 32 Non-Exempt Employees .................................................................................... 32 On Call Time For Non-Exempt Employees ..................................................... 33 Exempt Employees ............................................................................................. 33 Salary Basis of Compensation .......................................................................... 33 Attendance and Recording Time for Exempt Employees .............................. 33 On Call Time For Exempt Employees ............................................................. 33 Deductions from an Exempt Employee’s Salary............................................. 34 Important Definitions. ....................................................................................... 34 Permissible Deductions from Salary. ............................................................... 34 Impermissible Deductions from Salary. .......................................................... 35 Permissible Deductions from An Exempt Employee’s Leave Bank. ............. 35 85 Questions or Concerns about This Fair Pay Policy ........................................ 35 28. BREAKS FOR NURSING MOTHERS TO PUMP BREAST MILK .......... 35 29. CALL OUT TIME: REGULAR FIELD WORKERS .................................... 36 30. ON-CALL ........................................................................................................... 36 Regular Field Workers. ..................................................................................... 36 Required On-Call Rotation for Regular Field Workers ................................. 36 Residency Rule ................................................................................................. 36 Response Time ................................................................................................. 36 Take Home Vehicles ........................................................................................ 37 Compensation for On-Call Time ..................................................................... 37 Compensation for Actual Response Time ....................................................... 38 Call out time ..................................................................................................... 38 Other On-Call Arrangements ........................................................................... 38 Superintendents. .............................................................................................. 38 Take Home Vehicles ........................................................................................ 39 31. ELECTRIC RE-CONNECT TIME ................................................................. 39 32. STORM PAY ...................................................................................................... 39 33. LEAD PAY DIFFERENTIAL .......................................................................... 39 34. LONGEVITY PAY ............................................................................................ 40 35. PAYCHECK DEDUCTIONS ........................................................................... 41 36. PAYCHECKS .................................................................................................... 41 37. NIGHTWORK REST TIME ............................................................................ 41 38. TRAVEL AND TRAINING TIME .................................................................. 42 BENEFITS ...................................................................................................................... 43 39. GENERAL BENEFITS ..................................................................................... 43 40. VACATION ........................................................................................................ 43 41. PURCHASED VACATION TIME (PVT)....................................................... 44 42. PAID SICK LEAVE .......................................................................................... 45 43. PAID HOLIDAYS ............................................................................................. 46 44. EMPLOYEE CLOTHING ................................................................................ 47 45. HEALTH CARE SAVINGS PLAN ................................................................. 48 46. 457 DEFERRED COMPENSATION .............................................................. 49 Leave Credit In Lieu Of Compensation........................................................... 49 47. HEALTH INSURANCE COVERAGE ........................................................... 49 48. DENTAL INSURANCE .................................................................................... 50 49. LONG-TERM DISABILITY ............................................................................ 50 50. LIFE INSURANCE ........................................................................................... 50 51. VISION INSURANCE....................................................................................... 50 52. HOME COMPUTER LOAN POLICY ........................................................... 51 53. EDUCATIONAL ASSISTANCE ..................................................................... 51 LEAVES OF ABSENCE ............................................................................................... 52 86 54. PARENTING LEAVE ....................................................................................... 53 55. MINNESOTA SICK FAMILY MEMBER OR SAFETY LEAVE ............... 53 56. SCHOOL ACTIVITIES LEAVE POLICY..................................................... 54 57. BONE MARROW AND ORGAN DONATION LEAVE .............................. 55 58. NATIONAL GUARD AND RESERVE LEAVE ............................................ 55 59. MILITARY LEAVE FOR UNIFORMED SERVICE.................................... 55 60. JURY/WITNESS DUTY LEAVE .................................................................... 56 61. PERSONAL LEAVE DAY ............................................................................... 56 62. BEREAVEMENT LEAVE ............................................................................... 56 63. GENERAL LEAVE ........................................................................................... 57 64. VOTING LEAVE; SERVICE AS ELECTION JUDGE ................................ 57 65. PAID LEAVE DONATION .............................................................................. 57 RECEIPT AND ACKNOWLEDGMENT ................................................................... 61 46703186v1 87 RECEIPT AND ACKNOWLEDGMENT (EMPLOYEE REFERENCE COPY) By signing this receipt, I acknowledge that I have received a copy of the Elk River Municipal Utilities Employee Handbook (the “Handbook”). This Handbook and the policies contained or referenced in the Handbook supersede and replace previously-issued handbooks, contrary oral or written statements of employment policy, and contrary employment practices. I understand that the Employee Handbook may be amended at any time, with or without notice. I understand that I do not have a protected property interest in my employment with the Utilities. I also understand that neither this Handbook nor any provision in it creates a contract of employment for any particular duration between the Utilities and me. Further, I understand that nothing in this Handbook creates a contract with specific terms between the Utilities and me. I acknowledge that it is my responsibility to become and remain informed about the employment policies and practices of the Utilities and to abide by the rules, regulations, standards and policies of the Utilities, including those contained in this Handbook. I also understand that any violation by me of the Utilities’ rules, regulations, policies, practices, or standards is just cause for discipline, up to and including termination of my employment. Date Print or Type Name Employee Signature 46703186v1 88 1. IMPORTANT NOTICE ABOUT THIS HANDBOOK This Employee Handbook sets forth general policies of the Elk River Municipal Utilities (the “Utilities”) and is intended to help you get to know the Utilities and your responsibilities. The Handbook applies to all Utilities employees. The Utilities Commission shall, in accordance with its statutory responsibility to manage the Utilities, be responsible for the maintenance and periodic revision of personnel policies, the Utilities’ personnel program, and this Handbook. The Utilities is committed to complying with all applicable law. If it comes to the attention of the Utilities that any provision of this Handbook is inconsistent with applicable law, the Utilities will comply with applicable law. Each employee of the Utilities is responsible to become and remain informed about the employment policies and practices of the Utilities and to abide by the rules, regulations, standards and policies of the Utilities, including those contained in this Handbook. This Handbook is designed to answer basic questions about the Utilities’ employment policies and procedures and to serve as a resource when you may need information. This Handbook cannot cover every situation, and the Utilities reserves the right to interpret and apply this Handbook and to address each situation as it determines appropriate. If you have any questions about the information in this Handbook, or if the Handbook does not appear to address your concern, please contact your immediate supervisor, another Utilities manager or Director, or the Utilities’ Human Resources Representative. No employee has a protected property interest in his or her employment with the Utilities, and nothing in or about this Handbook creates a contract of employment for any particular duration between the Utilities and any Employee. Further, to be clear, nothing in this Handbook creates a contract with specific terms between the Utilities and any employee. Violation of the Utilities’ rules, regulations, policies, standards or practices is just cause for discipline, up to and including termination of employment. PERSONNEL RECORDS Certain personnel records are required by law, and others are needed for the Utilities benefits and administrative purposes. Please be sure that all personal information in your file is accurate and up-to-date. If your personal information changes, please let Human Resources know. ACCESS TO PERSONNEL RECORDS Minnesota Law provides employees with certain rights relating to their personnel records. (See Minnesota Statutes Sections 181.960 to 181.965). The Utilities will comply with all 89 requirements of the law. As a new or continuing employee of the Utilities you are put on notice of the following rights and remedies provided by Minnesota law. 1. Employees, upon making a good faith written request, have the right to review their personnel record, as defined by the statute, up to once every six months. The record must be made available during the Utilities’ normal hours of operation, but not necessarily the employee's normal working hours, and at the employee's place of employment or other nearby location. The Utilities may require that the review be done in the presence of a Utilities representative. If employees so choose, they may make a written request for a copy of the personnel record which will be provided free of charge. 2. Former employees, upon making a good faith written request, have the right to receive a copy of their personnel record, as defined by the statutes, once each year after separation of employment for as long as the personnel record is maintained. The personnel records must be provided free of charge. 3. The Utilities must comply with the written request to review or provide a copy of the personnel records no later than seven working days after receipt of the written request, or no later than fourteen days after the receipt of the request if the personnel record is located outside of the state. 4. Employees and former employees have the right to submit a written position statement to the personnel record if the record contains any disputed information which the employee/former employee and the Utilities cannot agree to remove or revise. The written position statement may not exceed five written pages. The written position statement must be included along with the disputed information in the record for as long as the disputed information is maintained in the personnel record. A copy of the written position statement must also be provided to any other person who receives a copy of the disputed information from the Utilities after the written position statement is submitted. 5. If the Utilities and the employee have fully complied with the requirements related to disputed information, which are described in the paragraph immediately above, no communication by the employee or the Utilities of information contained in the personnel records may be made the subject of any common law civil action for libel, slander, or defamation, unless the Utilities communicates information with knowledge of its falsity or with reckless disregard of its falsity. 6. If the Utilities refuses to comply with the personnel record statutes, employees and former employees may bring a civil cause of action seeking to compel compliance and may recover actual damages plus costs for a violation of the statutes. In addition, the Minnesota Department of Labor & Industry can enforce the statutes and seek additional remedies and impose fines. 7. The Utilities may not retaliate against an employee for asserting the rights or seeking the remedies described above. Employers that retaliate against employees for exercising the rights or remedies described above may be liable for actual damages, back 90 pay, reinstatement, costs, attorneys' fees and other make whole relief. In addition, the Minnesota Department of Labor & Industry may seek additional remedies and impose fines. 8. Information that properly belongs in the employee's personnel record, as defined in the statute, which is omitted from the personnel record provided by the Utilities to the employee may not be used by the Utilities in certain legal proceedings including administrative, judicial or quasi-judicial proceedings, unless the Utilities did not intentionally omit the information and the employee is given a reasonable opportunity to review the omitted information prior to its use. 91 GENERAL WORKPLACE POLICIES 2. OPEN DOOR POLICY During your employment with the Utilities you may have certain concerns, such as an issue, suggestion, complaint, or question, about your job, your working conditions or some related matter. We strongly encourage you to raise any such concerns to Utilities management, so that we will have the benefit of your input on the matter and you will have the benefit of our best efforts to address any concerns you might have. In addition, you are required to report any conduct in the workplace or related to the Utilities that you believe is illegal, and to ask questions if you are not sure whether any particular conduct is legal or appropriate. Please also see the discussion under the Whistleblower Policy in this Handbook. Anyone who fails to report a known or suspected violation of law, regulation or internal policy may be considered to have committed an equally serious violation. That individual may be subject to corrective and/or disciplinary action, up to and including discharge. Under this Open Door Policy, we ask that you first raise any concern about your employment or the workplace with your immediate supervisor, if possible, and follow the steps below to have your concerns addressed. (Please note that issues of harassment should be addressed in accordance with the Utilities’ Harassment Policy in this Handbook.) 1. If you have any concern about any aspect of employment with the Utilities or with the Utilities’ business, please voice your concerns to your immediate supervisor as soon as possible. In most cases your immediate supervisor will be the person in the best position to address your concerns. The supervisor and the Utilities will make every effort to keep the matter confidential to the extent possible within the confines of the rights and obligations of you and the Utilities. 2. If for some reason you are not comfortable discussing your concerns with your immediate supervisor, choose another Utilities manager or Director with whom to discuss your concerns. Again, he/she will make every effort to keep the matter confidential to the extent possible. 3. Alternatively, or in addition, you may feel free to contact the Utilities’ Human Resources Representative. The Utilities strictly prohibits retaliation or reprisal of any kind against an employee who makes a good faith report regarding a known, or suspected, violation or concern regarding any law. 92 3. EQUAL EMPLOYMENT OPPORTUNITY The Utilities pledges its best efforts to avoid discrimination against any employee or applicant for employment because of race, color, creed, religion, sex, sexual orientation, gender identity, age, national origin, marital status, familial status, pregnancy, genetic information, veteran status, status with regard to public assistance, disability, status as a patient enrolled in the state of Minnesota medical marijuana registry program or an enrolled patient's positive drug test for marijuana, or any other status that may be protected by state or federal law. The Utilities prohibits discrimination against and harassment of any employee or job applicant on the basis of protected class status. Employees who participate in discrimination in violation of this Policy are subject to discipline up to and including termination. Retaliation against any employee for making a good faith complaint under this Policy or for assisting with investigations of complaints made under this Policy is also strictly prohibited. Any person who feels that he/she has experienced discrimination or harassment in violation of law and/or this Policy should immediately contact his/her supervisor, the Human Resources Representative, and/or any Utilities manager or Director. Any manager or Director who receives a report under this policy is required to communicate the matter to the Human Resources Representative immediately. 4. DISABILITY ACCOMMODATION The Utilities is committed to providing reasonable accommodation, as appropriate, for qualified employees who have disabilities and for health conditions related to an eligible employee’s pregnancy, childbirth, or related health conditions. An employee who believes that he or she requires an accommodation due to a disability, pregnancy or childbirth in order to perform the essential functions of his or her position should so advise his or her immediate supervisor, another Utilities manager or Director, or the Human Resources Representative. We ask that this request be made in writing. On receipt of a reasonable accommodation request, the Utilities will engage in an interactive process with the employee to determine if the employee is entitled to a reasonable accommodation and if one can be granted without creating an undue hardship for the Utilities. The Utilities reserves the right to request medical or other certification of the need for the accommodation in accordance with applicable law. Retaliation against any individual for making a good faith complaint under this Equal Employment Opportunity/Disability Accommodation policy, for opposing discrimination, or for participating in an investigation of any claim regarding discrimination or disability accommodation is strictly prohibited. 93 If you feel that you have experienced such retaliation, you should follow the Reporting Procedure outlined above in the Open Door Policy. Any manager or Director who receives a report under this policy is required to communicate the matter to the Human Resources Representative immediately. 5. HARASSMENT PROHIBITED All Utilities employees have a right to work in an environment free from discrimination and intimidation, including harassment. The mission of the Utilities is best accomplished in an atmosphere of professionalism that in turn is supported by mutual respect and trust. The Utilities expects all employees to work toward this goal. Harassment based on a person’s race, color, creed, religion, national origin, sex, sexual orientation, gender identity, disability, age, marital status, genetic information, status with regard to public assistance, veteran status or any other protected class status may be unlawful and is strictly prohibited by the Utilities. Definitions of Sexual and Other Forms of Harassment Harassment consists of unwelcome conduct based on a person’s race, color, creed, religion, national origin, sex, sexual orientation, gender identity, disability, age, marital status, genetic information, status with regard to public assistance, veteran status, or any other protected class status that is interfering with your job performance, or creating an intimidating, hostile, or offensive work environment; or when submission to such conduct is: • a condition of employment; or • a basis for an employment decision affecting your job. One form of prohibited harassment is sexual harassment. Sexual harassment includes unwelcome sexual advances, requests for sexual favors, sexually motivated physical contact or other verbal or physical conduct or communication of a sexual nature that is interfering with your job performance, or creating an intimidating, hostile, or offensive work environment; or when submission to such conduct is made: • a condition of employment; or • a basis for an employment decision affecting your job. The Utilities prohibits sexual harassment of any type and in any form, including verbal, physical, and visual harassment. Some examples of conduct that may be sexual harassment include: • use of offensive or demeaning terms that have sexual connotations; 94 • telling suggestive jokes or stories and conversations about sexual exploits, sexual preferences, and desires; • jokes, cartoons, pictures, objects or stories that have a sexual content; • threats, demands or suggestions that an employee’s work status, advancement or other terms and conditions of employment are contingent upon the employee’s toleration of or acquiescence to unwelcome sexual advances; • repeated, unwelcome sexual flirtations, propositions, or invitations to social engagements; or • unwelcome and objectionable physical contact or physical proximity. Scope of Policy The Utilities prohibits harassment of any type or form. This policy prohibits same sex harassment as well as harassment by members of the opposite sex. In addition, this policy prohibits sexual harassment and any other form of harassment by any individual, including Utilities managers, employees, co-workers, and third parties such as clients, elected officials, consultants, contractors or vendors who deal with the Utilities’ employees. Procedure for Reporting Harassment The Utilities wants to resolve any problems, but it can do so only if it is aware of them. The Utilities encourages any individual who believes he/she is being harassed to report any and all incidents of perceived harassment. If at any time you feel you are being harassed, you should immediately contact: your supervisor; and/or another Utilities manager or Director (including any superintendent of the Utilities or other representative as defined in Section 24 of this Handbook); and/or the Human Resources Representative. Any Utilities manager or Director or other person who receives a report under this policy is required to communicate the matter to the Human Resources Representative immediately. Your report of harassment may be oral or written; in either case, it is important that you state that your report is being made under this harassment policy, or that it concerns harassment. You may choose to whom you make the report; that choice, however, must be made from the list of individuals named above. 95 The Utilities will promptly investigate harassment complaints as appropriate, and take other appropriate action. Any person who is found to have committed prohibited harassment will be subject to corrective action up to and including termination. Confidentiality – No Retaliation The Utilities will strive to protect the confidentiality of information the Utilities receives pursuant to this policy to the extent feasible and to the extent permitted by law. Retaliation against any individual for making a good faith complaint under this policy, for opposing harassment, or for participating in an investigation of any claim regarding harassment or inappropriate behavior is strictly prohibited. If you feel that you have experienced such retaliation, you should follow the Reporting Procedure outlined in this policy. Questions About This Policy Any questions about this policy or any related matter should be referred to the Human Resources Representative or any Utilities manager or Director. 6. BUSINESS CONDUCT In accepting employment with the Utilities, employees become its representatives to the public and are responsible for assisting and serving the customers for whom they work. An employee’s primary responsibility is to serve the customers of Elk River Municipal Utilities. The values of Elk River Municipal Utilities - ethics, open and honest communication, maintaining a positive workplace for employees, and serving customers – must guide our daily business activities. We strive for and take individual responsibility for ethical behavior – not only because it is the right thing to do, but also because it is a fundamental value in public services. Unacceptable conduct consists of any act or omission that, in the business judgment of Elk River Municipal Utilities, significantly departs from expected standards of behavior affecting the workplace. Some examples of unacceptable conduct include, but are not limited to: 1. Not performing assigned duties to the best of the employee’s ability at all times. 2. Not rendering prompt and courteous service to customers and the public at all times. 3. Not maintaining courtesy and professionalism towards other employees. 4. Unauthorized possession of Utilities property. 5. Falsifying timekeeping records or any other Utilities records. 6. Violating the Utilities’ work rules regarding alcohol and illegal drugs. 7. Violating the Utilities’ rules regarding Electronic Communications. 8. Fighting or threatening violence in the workplace. 96 9. Negligence or improper conduct leading to damage of employer-owned or customer-owned property. 10. Insubordination or other disrespectful conduct, including failing to respond to warnings or directives to improve conduct or performance. 11. Violation of safety or health rules. 12. Sexual or other unlawful or unwelcome harassment. 13. Unauthorized possession of firearms or any object that could be considered a dangerous weapon (or other violation of the Utilities’ weapons policy). 14. Excessive absenteeism or any absence without reasonable notice. 15. Unauthorized disclosure of business secrets or confidential information. 16. Misuse of Utilities resources. 17. Any other behavior unacceptable to Utilities management or any conduct inconsistent with the policies in this Handbook or the rules, practices or standards of the Utilities. All employees have a personal responsibility to report any behaviors or practices that may constitute unacceptable conduct under this policy. Such conduct may risk our future success. If you have any concerns or questions, discuss them with the Human Resources Representative, your supervisor or any Utilities manager or Director. These concerns will be treated confidentially (to the extent possible) and with high priority. 7. ETHICS, GIFTS AND CONFLICTS OF INTEREST Utilities employees shall not use their official position for personal gain, engage in any business or transaction or have a financial interest, direct or indirect, which is in conflict with the proper performance of their official duties. Utilities employees must scrupulously avoid any activities that suggest a conflict of interest between their private interests and Utilities responsibilities. Employees shall not accept, either directly or indirectly, any money, property, gift, gratuity, reward, loan, fee, discount, or special consideration or special accommodation from any vendor or potential vendor to the Utilities or the City of Elk River, or that arises from or is offered because of their employment or any activity connected with their employment with the Utilities. 8. EMPLOYMENT OF RELATIVES It is generally the policy of the Utilities not to employ relatives or cohabitants of current employees or Utilities Commissioners. The purpose of this policy is to prevent conflicts of interest, the appearance of such conflicts, undue influence over an individual’s employment, and distraction from workplace productivity and safety. Occasional exceptions may be made to this general policy for legitimate business reasons in the discretion of the Utilities; provided, however, that in no event will relatives or cohabitants be permitted to be in a direct reporting relationship at the Utilities. “Relative” for purposes 97 of this policy includes parent, marital or non-marital domestic spouse, sibling, child and step-child, grandparent, grandchild, parent-in-law, a person for whom the employee is a legal guardian, first cousin, sibling-in-law, son/daughter-in-law, niece/nephew, and aunt/uncle. 9. WHISTLEBLOWERS Pursuant to Minn. Stat. § 181.932, Elk River Municipal Utilities will not discharge, discipline, threaten, or otherwise discriminate against, or penalize an employee regarding the employee’s compensation, terms, conditions, location, or privileges of employment because: a. The employee, or a person acting on behalf of any employee, in good faith, reports a violation or suspected violation of any federal or state law or rule adopted pursuant to law to the Utilities or to any governmental body or law enforcement official; b. The employee is requested by a public body or office to participate in an investigation, hearing, inquiry; or c. The employee refuses the Utilities’ order to perform an action that the employee has an objective basis in fact to believe violates any State or Federal law or rule regulation adopted pursuant to law and the employee informs the Utilities that the order is being refused for that reason. The Utilities will make reasonable efforts to preserve as confidential the identity of an employee making a report under this policy to the extent feasible and consistent with applicable law. Any Utilities manager or Director who receives a report under this policy is required to communicate the matter to the Human Resources Representative immediately. Employees shall not make any statements or disclosures pursuant to this section knowing that they are false or that they are in reckless disregard of the truth. This section does not permit disclosures that would violate federal or state law or diminish or impair the right of any person to the continued protection of confidentiality or communications provided by common law. 10. WAGE INFORMATION Employees working for the Utilities, or living, in Minnesota have the right, under Minn. Stat. §181.172, to choose to disclose their own wages and to discuss another employee’s wages that have been voluntarily disclosed by that employee. In addition, regardless of location, employees who are not managers or supervisors also have these rights. An employee does not, however, have the right to disclose to a competitor of the Utilities or to any other person any wage information regarding other employees of the Utilities that 98 he or she has learned in the course of performing job duties that involve access to confidential and private information about employees. The Utilities shall not require an employee to agree to give up his or her wage disclosure rights as a condition of employment, to sign any document that purports to deny an employee his or her wage disclosure rights, or take any retaliatory or other adverse employment action against an employee for exercising his or her wage disclosure rights. A copy of Minn. Stat. §181.172 can be obtained from Human Resources. §181.172 permits a civil cause of action for a violation of the statute and, in any such action, the court may, if found appropriate, order job reinstatement, back pay, restoration of lost service credit, and the expungement of adverse records. 11. WEAPONS PROHIBITED Elk River Municipal Utilities prohibits all employees from carrying or possessing firearms or other weapons while acting in the course and scope of their employment for the Utilities. Carrying or possessing firearms or weapons in Utilities vehicles is also prohibited. This policy extends to any situation in which employees are acting in the course and scope of their employment including while utilizing personal vehicles or attending work-related training. However, it is not a violation of this policy to lawfully carry a firearm in a personal vehicle that is lawfully encased and secured. Employees may be disciplined for violations of this policy up to and including termination of employment. A narrow exception is made to this policy, which is applicable only in connection with attendance at the Minnesota Municipal Utilities Underground School (“MMUA Underground School”) or the Minnesota Municipal Utilities Overhead School (“MMUA Overhead School”). Both of these events are held at the MMUA Training Center in Marshall, MN. An employee is not prohibited from carrying or possessing a firearm or other appropriate weapon in a situation where, in connection with his or her Utilities employment, the employee is using a Utilities vehicle while attending MMUA Underground School or MMUA Overhead School --- if and only if the employee’s participation in the MMUA Underground School or MMUA Overhead School includes a hunting or target-shooting activity, and provided that the employee is otherwise lawfully permitted to carry and possess a firearm. This exception applies only for the duration of the specific MMUA event and the period of the employee’s travel to and from the event. 12. EMPLOYEE SAFETY Safety is of paramount importance to the Utilities. All employees and managers must follow the regulations and laws of the State of Minnesota and rules of the Utilities governing the safety of employees and the public. If employees have questions or concerns about issues affecting safety, they should immediately discuss them with their supervisor, 99 any Utilities manager or Director, the Human Resources Representative, or the relevant public safety authority. Employees are required to report accidents resulting in personal injuries and/or vehicle, equipment, or property damage to their supervisor immediately. Personal Injuries. Immediately report to your supervisor all accidents and injuries occurring within the course of your employment. The supervisor shall submit a First Report of Injury and a Supervisor’s Report of Injury Form to the Human Resources Representative within twenty-four (24) hours of receiving such report from you. - Vehicle, equipment, or property damage accidents. Immediately report to your supervisor all damage to Utilities property. The supervisor should submit documentation regarding the incident to the Utilities’ Finance Manager within twenty-four (24) hours of the time of the damage or accident. A copy of the Minnesota Motor Vehicle Accident Report must be submitted for all vehicle accidents. The Utilities will provide necessary safety equipment to employees. This may include: • One pair of safety glasses at the time of employment. The employee shall provide the correct prescription for the safety glasses. • The Utilities will pay the cost of new safety lenses, upon a change in the prescription. If needed, frames will be replaced as needed contingent upon supervisor approval. • Safety glasses that are broken or damaged while the employee is on the job will be replaced by the Utilities. 13. COMMITMENT TO A DRUG AND ALCOHOL-FREE WORKPLACE The Utilities is committed to providing a safe, healthy, and productive drug and alcohol- free workplace. To promote this goal, employees and others are required to report to work in appropriate mental and physical condition to perform their jobs in a satisfactory manner. Being under the influence of alcohol or illegal drugs (as classified under federal, state, or local laws), including marijuana, while on the job poses serious health and safety risks to employees and members of the public/others, which is not tolerated. As a condition of employment employees must adhere to the terms and conditions of this policy. Prohibited Conduct The Utilities expressly prohibits the following activities at any time that the employee or other person is either (1) on the Utilities’ facilities (whether or not the employee is working) or (2) on duty or conducting Utilities business (either on or away from the Utilities’ 100 facilities) (the locations in (1) and (2) above are collectively referred to as the “Workplace” under this policy): • The use, abuse, or being under the influence of alcohol, illegal drugs, or other impairing substances. • The possession, sale, purchase, transfer, or transit of any illegal or unauthorized drug, including prescription medication that is not prescribed to the employee or drug-related paraphernalia. • The illegal use or abuse of prescription drugs. While the use of marijuana has been legalized under the laws of some states for medicinal uses, it remains an illegal drug under federal law and its use in, and as it impacts, the Workplace is prohibited by the Utilities’ policy. The Utilities does not discriminate against employees on the basis of their off-duty use of medical marijuana that is in compliance with any applicable state medical marijuana law. However, employees may not consume or be impaired by marijuana while in the Workplace, even if the employee has a valid prescription for medical marijuana. Nothing in this policy is meant to prohibit the appropriate use of over-the-counter medication or other medication that is legally prescribed to the employee, to the extent that it does not impair an employee's job performance or safety or the safety of others. Employees who take over-the-counter medication or other medication legally prescribed to the employee should inform their immediate supervisor if they believe the medication may impair their job performance, safety, or the safety of others or if they believe they need a reasonable accommodation before reporting to work while under the influence of that medication. For more information on how to request a reasonable accommodation, please refer to the Utilities’ Reasonable Accommodation policy. A violation of this policy is subject to disciplinary action, up to and including termination of employment or contractual relationship, and/or required participation in a substance abuse rehabilitation or treatment program as may be provided by applicable state law. Such violations may also have legal consequences. Utilities-Sponsored Events From time to time, the Utilities may sponsor in-person or remote social or business-related events at which alcohol is served and/or usage is permitted. This policy does not prohibit the use or consumption of alcohol at such events. However, if employees choose to consume alcohol at such events, they must do so responsibly and maintain their obligation to conduct themselves properly and professionally at all times with colleagues and/or current or prospective clients. Workplace Searches and Inspections In order to achieve the goals of this policy and maintain a safe, healthy, and productive work environment, the Utilities reserves the right at all times to search employees at the Workplace, as well as their surroundings and possessions, for substances or materials in violation of this policy. This right extends to the search or inspection of clothing, desks, bags, briefcases, containers, packages, boxes, lunch boxes, and any vehicles on or in the 101 Workplace where prohibited items may be concealed. Employees should have no expectation of privacy while in the Workplace, except in restrooms, locker rooms, or dressing areas. Drug Testing Applicants and Utilities employees are subject to certain kinds of drug testing in accordance with applicable law and Utilities policy. Separate policies are maintained for CDL drivers and for other employees and are distributed at the start of employment and periodically throughout employment. Copies of the Utilities’ drug testing policies are available upon request from Human Resources and the Administrations Director. 14. EXPOSURE TO HAZARDOUS SUBSTANCES Any employee routinely exposed to hazardous substances or harmful physical agents as defined in the Minnesota Employee Right to Know Act (MINN. STAT. § 182.675) shall be trained before being assigned or reassigned work exposing the employee to such substances or agents and shall be given training annually thereafter. Training shall include an explanation of how and where information about hazards is stored in the workplace, how the hazards are labeled, and where to obtain specific information. The supervisor (or other designee) shall provide for such training and for compliance with the Minnesota Employee Right to Know Act, including the establishment of specific policies to insure compliance with the state law and regulations. An employee acting in good faith has the right to refuse to work under conditions which the employee reasonably believes present an imminent danger of death or serious physical harm to the employee. 15. SOLICITATION AND DISTRIBUTION The Utilities intends to establish and maintain a safe and productive business environment and to prevent interference with the work of its employees. This policy prohibits solicitation and the distribution of literature on Utilities property by non-employees. In addition, this policy addresses the limited circumstances under which solicitation and the distribution of literature on Utilities property by employees will be permitted, and it addresses the wearing and display of items, posting material on Utilities bulletin boards, and certain uses of the Utilities’ computer, email, and other resources. The term solicitation means any oral or electronic communication that encourages, advocates, demands, or requests any position or action or contribution of money, time, effort, personal involvement or membership in any organization or the sale or purchase of any merchandise or service. The term distribution means posting, handing out, or otherwise distributing any written material in hard copy. 102 Non-Employees Non-employees of the Utilities are strictly prohibited from engaging on Utilities premises in: i) trespassing; ii) the solicitation of any person; and iii) the distribution of any written material. Any violation or attempted violation of this policy by a non-employee should be reported immediately to the on-site supervisor. Employees Employees are prohibited from solicitation, for any purpose, during the working time of any employee involved in making or receiving the solicitation. Employees are prohibited from distribution of written material in any work area at all times. Employees are also prohibited from distributing written material anywhere during the working time of any employee actively engaged in the distribution. This policy does not prohibit an employee from performing solicitation or distribution in a non-work area on behalf of a third party that is not engaged in commercial, for-profit, or political activity, provided the employee has received the advance approval of the on-site supervisor to engage in such solicitation or distribution. Related Policies • Utilities Bulletin Boards. The Utilities in its discretion may permit employees to distribute written material by posting on Utilities bulletin boards in accordance with this policy, provided that any material for such posting must be reviewed and approved in advance by a Utilities manager or Director, who may consult with the Human Resources Representative before making a decision whether or not to allow the posting. • Solicitation and Distribution on Utilities Computer and E-Mail Systems. Employees and non-employees are prohibited from using Utilities computer systems and other property and resources, including the Utilities e-mail system, for solicitation or distribution, except in connection with a Utilities-sponsored activity or, with advance approval of the on-site supervisor, on behalf of a third party that is not engaged in commercial, for-profit, or political activity. Violation of This Policy By an Employee Any employee in violation of this policy will be subject to disciplinary action up to and including discharge. 103 16. ELECTRONIC COMMUNICATIONS: INTERNET, E-MAIL, AND SOCIAL MEDIA This policy covers all types of electronic communications. All Utilities computers, software, servers, computer systems, cell phones and telephone systems and other electronic services arranged for by the Utilities (“Electronic Communications Systems” or “ECS”) are the property of the Utilities and are intended and expected to be used for Utilities business. While occasional use of these systems for personal, non-business use is acceptable, employees must demonstrate a sense of responsibility and may not abuse such privileges. Communications of any kind by a Utilities employee over the Utilities’ ECS, whether work-related or personal, is subject to monitoring and review by the Utilities at any time, with or without notice or permission. Employees should have no expectation of privacy in the use of these systems. The use of passwords on these systems does not mean that messages stored on them are private or confidential, either from the Utilities or others. This policy covers all usage and communications by employees in, on or over the Utilities’ Electronic Communications Systems, including e-mail, voice-mail, Internet and social media, whether such usage or communications are from the Utilities’ offices or from a remote location. This policy also covers electronic communications not done in, on, or over the Utilities’ ECS but in which the employee identifies himself or herself as a Utilities employee. Violations of this policy may result in discipline, up to and including termination. All communications sent by employees over the Utilities’ ECS must be respectful in tone and professional. Communications over the Utilities’ ECS may not be used for transmitting, retrieving or storing any communications of a discriminatory or harassing nature, derogatory to an individual or group, obscene, or which are of a defamatory or threatening nature. Such communications should not be used for “chain letters” or for any purpose which is illegal or against Utilities policy. Employees must respect other people’s electronic communications. Employees may not obtain unauthorized access to another’s e-mail or voice-mail messages, except pursuant to direction from a Utilities manager or Director for the purposes specified above. Employees may not use the e-mail or voice-mail systems in a way that causes congestion on the systems or that significantly interferes with another employee’s ability to use the systems. GENERAL GUIDELINES APPLICABLE TO ELECTRONIC COMMUNICATIONS, INCLUDING COMMUNICATIONS OVER SOCIAL MEDIA • In general, the Utilities encourages the use of e-mail and other available electronic communications with residents, consultants, and others as a means of providing services more effectively and efficiently. Internet e-mail is provided and is intended for the Utilities’ business use. 104 • Tact counts. • Humor might not work. Attempts at humor in electronic communications are especially difficult to carry off successfully, so be careful and “when in doubt, leave it out.” Take extra steps to make your intent clear in written communications. • Never gossip, don’t provide confidential personal information about yourself or someone else, and refrain from emotional responses. • Do not communicate with residents, consultants or others using e-mail without first obtaining their consent to email communication. Employees at all times must use discretion in communicating sensitive information and should select communications methods that will protect the confidential and/or sensitive nature of such information. • Communications over the Utilities’ ECS may be identifiable and attributable to the Utilities. Do not send electronic communications that you would not send, or would not be authorized to send, over Utilities letterhead. • The Utilities’ ECS may not be used to participate in social media or other electronic forums except for approved Utilities business, professional development, or business development purposes. • The Utilities’ ECS may not be used to access pornographic or obscene material or other offensive or inappropriate content. • Internet access is provided primarily for you to retrieve information. Do not use the ECS to post information, comments or statements, except for prior-approved Utilities business, professional development or Utilities business development purposes. • An Internet site may request information about you in order to build a user profile or mailing list. Refuse any such requests when using the Utilities’ ECS. Respond “no” to any suggested download, upgrade, or enhancement of software. Do not make any purchases or access a web site that charges a fee, except for approved Utilities business purposes. • Employees may not send electronic communications over the ECS that attempt to hide the identity of the sender or that represent the sender as someone else or someone from a different Utilities or a company. • Employees must respect all copyrights and intellectual property rights of others’ materials, and may not copy, retrieve, modify or forward copyrighted, patented or trademarked materials except as permitted by the owner or as a single copy for reference use only. 105 • Internet and other ECS usage is not confidential. The Utilities receives detailed monthly reports on Internet usage by individual employees and the Utilities’ software tracks each Internet site you visit. Bandwidth Conservation The Utilities uses the Internet for a number of key Utilities functions. To ensure sufficient bandwidth to perform these functions, the Utilities has implemented a variety of bandwidth conservation measures. These measures include blocking websites that have no instructional or administrative value. Employees may not use Internet radio stations for casual listening and/or background music. Employees may not download music or video files from the Internet. Employees who violate any of the guidelines may be subject to disciplinary action including, but not limited to, written warnings, revocation of access privileges and termination of employment. 17. SUPPLEMENTAL EMPLOYMENT The Utilities does not restrict employees from engaging in outside employment. However, the Utilities expects regular full-time employees to consider Utilities work their primary employment. No Utilities employee may engage in outside employment that interferes with the performance of his/her duties with the Utilities, that represents a conflict of interest, or that may influence or bias an employee’s job related decision making ability. The Utilities will not change an employee’s work hours to facilitate the scheduling of any outside employment. If a supervisor believes an employee’s outside employment is detrimental to the Utilities and his/her position, the employee may be asked to discontinue the outside employment. If an employee is asked to discontinue outside employment and fails to do so, he/she may be subject to discipline up to and including termination. Fire Department Participation Employees are allowed to participate as a part-time paid firefighter in a Fire Department. A non-exempt employee will be allowed to respond to fire calls as approved and determined by his/her department supervisor, based on the work assignments and responsibilities of the employee and department. Non-exempt employees responding to fire calls during scheduled work hours will need to use vacation time for time away from work, and exempt employees need to use vacation time or make-up time for the same scenario. An employee may not respond to fire calls while on-call for the Utilities. 106 18. REPORT OF PERSONNEL CHANGES The Utilities attempts to maintain complete and accurate personnel information on its employees. It is the responsibility of each employee to notify the office of the Utilities when changes occur, including: • Name (through marriage or otherwise); • Address; • Beneficiaries for life insurance and retirement; • Telephone number; • Person to contact in case of emergency; or • Other changes which may affect benefits coverage. 19. ATTENDANCE Regular attendance is an essential function of every job with the Utilities. Every Utilities employee has an important role to play in maintaining a productive workplace. Therefore, it is essential that all employees report to work as scheduled every day. Unsatisfactory attendance, including reporting late to work and leaving work early may result in disciplinary action up to and including discharge. If an employee must be absent from work for any reason, other than approved time off, the employee must notify his/her immediate supervisor at least thirty (30) minutes prior to the start of his/her normal working hours. If an emergency prevents the employee from notifying his/her supervisor at such time, the employee must call his/her immediate supervisor as soon as possible during the workday. 20. DISCIPLINE, DISMISSAL & LAY OFF Discipline. The Utilities retains the right to take disciplinary and other action as it believes appropriate to manage employee performance and workplace conduct. The type and level of discipline imposed will be at the Utilities’ discretion based upon the nature and severity of the issue and the circumstances as a whole. Examples of discipline and other action that may be taken to manage performance and workplace conduct include, but are not limited to: • Documented Coaching and Counseling • Oral reprimand • Written reprimand • Performance Improvement Plan • Suspension • Demotion 107 • Termination. Discipline and other action may be used in any order or combination in the discretion of the Utilities. In some cases, one or more disciplinary actions will be taken before termination; in other cases, termination will be immediate. While the Utilities strives for consistency, the level of discipline taken in any given case does not establish a controlling precedent for future circumstances. Probation and Dismissal. All new employees shall be on probation for a period of one hundred eighty (180) days. Continued employment during this period shall rest solely with the discretion of the Utilities Commission. After that period, the employee shall attain regular status subject to the following: Employees on regular status may be dismissed only for cause, which may include, but is not limited to, the following: Conduct in violation of or inconsistent with Utilities policy, including but not limited to any and all policies set forth in this Handbook; conduct or language that is improper or inappropriate in the discretion of the Utilities; insubordination; failure to do the work assigned in a manner satisfactory to the Utilities; dishonesty or stealing; and the sale, transfer of, or possession, or being under the influence, of intoxicating beverages or controlled or mood altering substances while on the job. Layoff/Reduction in Force. The Utilities reserves the right and sole discretion to eliminate positions and/or reduce the hours associated with a position for any legitimate business reason, with or without cause. 21. JOB POSTING As position vacancies occur at the Utilities, the position’s job description will be posted in a prominent location to inform employees of the vacancy. Employees in good standing that wish to be considered for the position are encouraged to contact the appropriate decision-maker(s) indicated on the posting. The Utilities may also advertise the vacancy to attract external candidates. The Utilities retains all its managerial rights and has the sole discretion to decide which candidate is best qualified to fill a vacant position, whether or not the candidate is a current Utilities employee. 108 22. PERFORMANCE REVIEWS An employee’s immediate supervisor or department head normally will conduct a performance review on an annual basis. Employee performance, however, may be coached or reviewed formally or informally at any time. Performance reviews are an opportunity for employees, management, and the Utilities to assess an individual’s job performance and to assure the continuing improvement of every employee’s performance. The performance review system is designed to: • Ensure that quality services are provided to the public at the least possible cost; • Motivate and develop employees to their fullest potential; • Clarify roles and mutual expectations of supervisors and employees; • Promote open and ongoing communication between employees at all levels, including feedback from subordinates to supervisors; and • Assist in determination of whether employees are meeting the performance standards for their position. The performance review will usually be documented in writing as well as delivered orally to the employee in person. Completed performance review forms should be signed by the employee and the supervisor or other Utilities manager, Director or other representative delivering the review to the employee. These completed forms are generally maintained in the employee’s personnel file. Performance Metrics Incentives The Utilities uses a Performance Metrics Incentive system to annually award performance- based compensation to eligible employees (those currently employed who are in good standing). An employee must remain employed by the Utilities at the time such award is to be made in order to receive the incentive. WAGES AND HOURS 23. WORK HOURS, OVERTIME, AND COMPENSATORY TIME General Policy For purposes of timekeeping and overtime calculations, the regular workweek at the Utilities runs from Tuesday through Monday. 109 Non-exempt employees are paid on the basis of hours worked. Exempt employees are paid on a salary basis; their compensation is not based on the number of hours they work. Overtime & Overtime Compensation Overtime is earned and compensated as follows. All non-exempt employees earn overtime for all time worked in excess of forty (40) hours during the workweek (Tuesday – Monday). Regular field workers earn overtime for regular work performed in excess of eight (8) hours in a day. Earned overtime will be compensated a rate equivalent to one and one-half times the employee’s regular rate of pay; except that time worked on Sundays and designated Holidays will be compensated a rate equivalent to two times the employee’s regular rate of pay. Generally, overtime compensation is paid directly to the employee on their regular payroll check for the period in which the overtime is earned. Alternatively, for up to 40 hours of earned overtime per year, non-exempt employees may elect to receive and accrue Compensatory Time (“Comp Time”) in lieu of direct overtime pay. Comp Time is accrued and paid at the same rate as other earned overtime, i.e., at one and a half times the employee’s regular rate of pay; or two times the regular rate for time worked on Sundays or designated holidays. Receipt and Use of Comp Time is explained in more detail below. Note. Further, if a field worker uses sick or vacation time during the regular eight-hour day, this will not affect the earning of overtime for those hours worked in excess of the regular workday. Also, when a field worker is mandated to start work prior to the normal scheduled workday, the hours worked outside of the regular scheduled workday will be paid at a rate of one and one-half time the employee’s regular rate of pay; or two times the regular rate for time worked on Sundays or designated holidays; or the employee may elect to accrue Comp Time for the earned overtime as described below. The eight hour and double time provisions above do not apply to travel and training time spent away from the regular workplace, but the forty-hour overtime pay provision does apply in all cases where an employee is engaged in activity related to and/or required in connection with his or her Utilities employment. Exempt employees are salaried and do not earn or receive overtime or, in turn, Comp Time. Compensatory Time Compensatory Time (“Comp Time”) is paid time off for earned overtime in lieu of direct pay. Comp Time is accrued at the rate of one and one-half hours (or, two hours for overtime earned for work on Sundays or designated holidays) for each hour of overtime earned. 110 Comp Time may be accrued and taken in lieu of direct overtime pay in accordance with the following rules. • When an employee earns overtime they may elect to accrue Comp Time in lieu of direct pay for the overtime. • Accrual of Comp Time is subject to a cap of 40 hours per calendar year. Once an employee has accrued 40 hours of Comp Time in a calendar year, no further Comp Time may accrue in that calendar year, even if the employee has used some or all of the 40 hours previously accrued. Once the 40-hour cap is reached, all further earned overtime will be paid directly on the paycheck for the period in which it is earned. • When an employee elects Comp Time they will not receive any pay for the hour of overtime worked on their paycheck for the period in which the overtime is earned. Instead, the employee will accrue one and a half hours (or, two hours for overtime earned for work on Sundays or designated holidays) of Comp Time to be used at the employee’s election within the calendar year before December 15. • Under no circumstances will Comp Time ever be forfeited. Accrued Comp Time that has not been used by December 15 will be paid out in full on the last payroll check of the calendar year. Under no circumstances will Comp Time carry over to a following calendar year. • In order to elect to accrue Comp Time in lieu of receiving direct overtime pay in the current payroll period, an employee must mark their timesheet for “Comp Time,” clearly indicating the number of earned overtime hours they wish to accrue as Comp Time in lieu of direct overtime pay. • In order to use Comp Time, employees are to follow the same procedures as apply to other paid time off and leave requests, including making specific arrangements with their supervisor. Use of Comp Time is subject at all times to the operating needs of the Utilities. • If at the time an employee separates from employment with the Utilities they have accrued unused Comp Time, all such Comp Time will be paid out at the hourly pay rate the employee is earning at the time of separation. 24. EMPLOYEE CLASSIFICATIONS The following definitions are provided to assist employees in understanding their employment classification and benefits eligibility. Although employees generally will be classified as one of the following, they should be aware that their classification may change at any time as the Utilities considers appropriate. 111 All employees are designated as either non-exempt or exempt from federal and state wage and hour laws. Non-exempt employees are covered by specific provisions of the wage and hour laws, including overtime pay. Exempt employees are excluded from specific provisions of the wage and hour laws, including the overtime provisions. Generally, exempt employees are engaged in managerial, professional, administrative, or executive positions and are paid on a salaried basis. It is our policy to fully comply with federal and state wage and hour laws. In keeping with this commitment, we will pay exempt employees their full salary (or salary plus vacation to equal the amount of the full salary) for any workweek in which they perform work, regardless of the number of days or hours worked, subject only to deductions that are permitted by law. Full day deductions from pay that are permitted by law include, for example, deductions for personal time off, sick days before or after eligibility for paid sick leave, or for infractions of written workplace conduct rules including but not limited to any rule or policy set forth in this Handbook. Full or partial day deductions may be made from the salaries of exempt employees for infractions of safety rules of major significance and in certain other limited circumstances. Employees are classified according to the following definitions: Regular Full-Time Employee. A regular full-time employee typically works 40 or more hours per week, and is not classified as a temporary worker. Regular Part-Time Employee. A regular part-time employee typically works fewer than 40 hours per week, and is not classified as a temporary worker. Regular Field Worker. An employee whose regular assigned position involves performing a significant portion of his or her work outside of the Utilities’ physical facilities. Exempt Employee. An employee whose duties result in exclusion of the employee’s work from coverage under the minimum wage and/or overtime provisions of the wage and hour laws. Non-Exempt Employee. An employee whose duties result in coverage of the employee’s work under the minimum wage and/or overtime provisions of the wage and hour laws. Utilities Manager. Any employee of the Utilities, or other individual identified by the Commission, who is a Utilities supervisor, superintendent, manager, director, representative or other individual who is generally identified to employees by Utilities policy, practice or communication as having managerial, supervisory, or administrative authority to act on behalf of the Utilities, regardless of whether such authority is limited or subject to the authority of others in the Utilities’ organizational structure. 112 Temporary Worker. A temporary worker typically is hired for a specific period of time. Generally, temporary workers are hired as interim replacements, to supplement the work force, and/or to assist with specific projects. Temporary workers often will be informed of an estimated duration of their assignment, although either the worker or the Utilities may end the work relationship at any time. Temporary work that continues beyond an estimated duration in no way implies a change in the worker’s status. Temporary workers retain their temporary status unless and until they are specifically notified by the Utilities of a change. 25. TIME REPORTING POLICY General Policy The goal of the time reporting system is the accurate and timely reporting of time worked (by job or account) and time off (by category). This is essential for (1) guaranteeing that employees are paid correctly and that their leave accumulations are accurate, (2) monitoring actual performance against budgetary goals, and (3) ensuring labor costs are properly reported. Each employee is responsible for the accurate submission of his or her own personal time reporting, and each supervisor is responsible for reviewing the employee’s compliance with this time reporting policy. Recording Time Non-exempt employees are required to record and submit the following on their timecard: • Amount of Time Worked in increments of the nearest one-quarter hour; • Description of the activities performed during the time worked; • Identification of the account to be charged (accounting system designation); and • The work order(s) to which the time applies (as appropriate). The purpose of the description of activities during the time worked is to document for employee performance and client accountability purposes how an employee’s work time was spent. Work orders are utilized for specific projects to track time and labor for billing purposes, or capitalization projects. Frequency Non-exempt employees are required to fill out their timecards daily. It is preferred that employees fill out their timecards at the end of each completed workday, but timecards 113 may be completed within the first hour of arriving at work on the subsequent workday. This is not intended to conflict with payroll deadlines for paperwork. Timecards may be checked periodically throughout the pay period for completeness and accuracy. It is understood that timecards must be available for, and are subject to review/audit by, the employee’s supervisor at any time. Time Deductions for Breaks Field workers generally will receive one 15-minute paid break in the morning and one in the afternoon; and will receive a 30-minute unpaid lunch break during each shift. Office employees receive a 60-minute break for lunch, 30 minutes of which is paid in lieu of having two fifteen-minute breaks, morning and afternoon. The other 30 minutes of the office employees’ 60-minute lunch break is unpaid. Please see below under “Ensuring Accuracy of Timekeeping Reports” for important information about pay practices affecting unpaid lunch breaks. Ensuring Accuracy of Timekeeping Reports Non-exempt employees are responsible for, and must take steps to ensure, the accuracy and completeness of time reporting data collected. This is critically important because the Utilities relies on such submissions in carrying out its duty to properly pay wages and other forms of compensation. Furthermore, knowingly submitting or approving inaccurate time reporting data is a violation of policy and may subject the person to disciplinary action. PLEASE NOTE: By submitting time reporting data a non-exempt employee is attesting to the accuracy of the time data reflected on the timecard and/or in the report. PLEASE NOTE FURTHER: Because of the regularity of our break and work schedules, the Utilities automatically deducts scheduled unpaid lunch breaks. If an employee does not receive the 30-minute unpaid lunch break on any given shift, the Utilities will pay you for that 30-minutes. We can do so, however, only if you notify us that you did not get your break. It is your responsibility to provide this notice to your supervisor. A pattern of not taking unpaid lunch breaks may subject an employee to discipline; but it will never result in the Utilities failing or refusing to pay for such time. Special Note About Work Performed Outside of Scheduled Times and Places Each non-exempt employee must accurately record and properly report all time spent performing work for the Utilities, regardless of the location where such work is performed. Employees generally should not perform work at times or places outside of the times and places they are scheduled to work by the Utilities. If a need for work outside of scheduled times or places is, or should be, anticipated, the employee should seek permission to perform such work from Utilities management in advance, and if permission is not secured in advance such work should generally not be performed. Performing work outside of 114 scheduled and approved times and places may result in discipline; it shall not under any circumstances, however, result in an employee not being paid for time spent performing Utilities work. In the case of a non-exempt employee who is on call, the on-call stipend paid to the employee covers all compensation due for calls taken as to which there is no call out. If unanticipated, time-sensitive, or urgent work needs to be performed at times and/or places outside of those scheduled by the Utilities, the non-exempt employee should perform only so much of the work as is necessary to address the immediate need. Regardless of whether work is anticipated or of an urgent nature, and regardless of whether advance permission has been received to do such work or not, all time spent by a non- exempt employee actually performing Utilities work must be accurately recorded and properly reported to Utilities management. Further to the Special Note above: Time Worked Remotely Any and all time worked remotely, including time spent accessing Utilities systems or data for the benefit of the employer, must be recorded and reported to the Utilities in order to assure proper compensation, in accordance with the applicable provisions for exempt and non-exempt employees of this Time Reporting Policy and the Fair Pay Policy below in Section 27. 26. REMOTE WORK POLICY Purpose This policy governs the practice of working remotely, other than for field work, from locations other than a Utilities facility, including an employee’s home. Working remotely is voluntary for the employee and at the sole discretion of Utilities management. Elk River Municipal Utilities is committed to providing excellent customer service for our customers, as well as attracting and retaining critical employee talent, increasing productivity and efficiency and saving on workspace and costs. A remote work policy can help provide these benefits. Working remotely should never be allowed to adversely affect external or internal service or operational needs of the Utilities. General Guidelines Remote work as defined for this policy means working some or all scheduled hours and/or performing some or all job duties from a location not on Utilities premises: • Working all scheduled hours off-site, or • Working some scheduled hours off-site and some on Utilities premises. Employees may not access Utilities’ systems or data remotely without first obtaining written permission. 115 Regardless of location, a remote worker remains responsible for all job duties, responsibilities and obligations associated with their position, even if such duties require the employee to come into a Utilities facility while performing work remotely. Employees and supervisors should seek to find solutions to maximize benefit to the Utilities and to the employee. Remote work arrangements will be considered by the Utilities on an individual, case-by- case basis. A Remote Work Agreement form must be completed and approved by the Supervisor and the employee before an employee will be permitted to begin a remote work arrangement. Because the primary focus of the Utilities is always on serving the needs of customers, remote work arrangements may not be feasible for some positions. Field workers, in particular, generally have duties that cannot be performed remotely. Remote work arrangements may vary depending on the position and department. Supervisors are responsible for determining remote work arrangements and schedules within their departments, subject to the approval of the General Manager or their delegate. The Utilities has sole discretion in considering an employee request to work remotely and setting remote work policy for a particular department, employee group, or employee. In exercising this discretion the Utilities may consider the following factors and guidelines and any other relevant matters: • The length of an employee’s continuous, regular employment and degree of success performing their job duties. • Remote work requires the same focus on job duties as if the employee were in the office; repeated interruptions from household members, pets or other distractions may disqualify an employee from remote work. • There must be adequate department coverage during all standard hours. • There must be no adverse impact on internal or external customers. • There must be no known safety issues associated with working remotely. • There must not be any known security issues with technology or otherwise. • Employees working under a Performance Improvement Plan are not eligible for remote work. • Internal and external customers must be given direction on who to contact in the employee’s absence if the employee is not available during all business hours. • A remote work schedule must not result in additional overtime for the employee or co-workers. • The employee will not be allowed to work outside the State of Minnesota except when travelling on Utilities business or during time when the employee is otherwise scheduled to be away from work. • The Utilities may end an employee’s remote work arrangement at any time. • There may be other or additional considerations when an employee with a qualifying disability requests remote work as a reasonable accommodation. The 116 Utilities will follow its Reasonable Accommodations Policy and consider such requests on a case by case basis. Employees and supervisors may consider various types of scheduling options for efficiency and productivity in remote work arrangements, including: • Entire weeks on site or working remotely. • Certain days on site; remaining days working remotely. • Whether to have entire teams of employees on site on the same day(s) on a regular basis. Employees should expect to remain flexible as to their days and hours for work onsite and at remote locations in accordance with the particular duties of their job and the needs of the Utilities. Remote work arrangements remain subject at all times to change by the Utilities. Work Hours, Calendars and Meetings An employee with a remote work arrangement must agree to be accessible by phone, virtual computer software and email as needed during their scheduled working time. Depending on the employee’s position and the needs of the Utilities, the work schedule may include core hours during which the employee must be available or the schedule may include greater flexibility for the employee to work outside the Utilities’ normal business hours. Non-exempt remote workers (those who are classified as not exempt from the overtime requirements of the Fair Labor Standards Act (FLSA)) are required to record all hours worked in a manner designated by the Utilities as discussed in Sections 25 and 27 of this Handbook. Overtime during a remote work arrangement is subject to the same requirements for approval in advance as all other overtime. Exempt employees, (those who are classified as exempt from the overtime requirements of the FLSA must follow the Utilities’ applicable payroll and timekeeping policies as discussed in Sections 25 and 27 of this Handbook and are generally accountable for their normal work week hours. All remote workers must use sick, vacation or compensatory time to cover periods of time off in accordance with the Utilities’ normal policies. Remote workers are responsible for keeping their electronic calendars up to date and accessible to anyone in the Utilities during all scheduled work hours. Appointments for doctor or other private appointments can be marked as “private” or “personal time out of office.” Please include travel time as needed to help others schedule meetings. Remote workers must attend all required meetings, including those which normally would be held on a remote workday, and are also responsible for obtaining information from 117 optional meetings when such meetings impact their work with the Utilities. Supervisors are responsible for setting expectations for their work teams regarding whether meeting attendance will be in-person, remote or hybrid, considering these guidelines: • Meetings of a sensitive, highly interactive, or complex nature are best held entirely in-person (e.g., brainstorming, troubleshooting, project “kick-off” meetings, performance reviews, disciplinary meetings). • In-person business meetings with others may not be held in an employee’s home. Work Environment and Technology For employees with a remote work arrangement, the employee must establish an appropriate work environment to avoid problems associated with safety or poor ergonomics. The Utilities will not be responsible for costs associated with initial setup of an employee’s remote office such as remodeling, furniture, lighting, repairs, or modifications to the office space. Employees will be offered appropriate guidance in setting up a workstation designed for safe, comfortable work. The Utilities may provide employees with appropriate technology (e.g., computer, monitor(s), docking station, mouse, keyboard, headset) for one location, either on-site at Utilities officers or off-site. Employees who work in a hybrid remote work arrangement (both on and off site) are responsible for providing the technology required to work remotely effectively and efficiently. This includes a reliable internet connection. All Utilities -owned equipment must be returned upon termination of the remote work arrangement or at termination of employment. The Utilities will supply the employee with the appropriate office supplies (pens, paper, etc.) for their assigned job responsibilities, which the employee must pick up on site. An employee may be required to come into the office in order to perform some duties such as mailing, scanning and photocopying. The Utilities may not provide reserved on-site office space for employees with remote work arrangements. Utilities Employment Policy and Benefits Coverage The Utilities’ normal policies and procedures (for example, computer use, data practices, respectful workplace, outside employment, etc.) apply to employees working remotely. Employees should ask their supervisors if they have any questions about whether or how a particular Utilities policy applies to a remote work environment. An employee working remotely is generally covered by the Utilities’ Workers' Compensation insurance while acting in the course and scope of employment and must report any injury to their supervisor as soon as possible. 118 27. FAIR PAY POLICY Elk River Municipal Utilities (referred to in this Fair Pay Policy as the “Employer” or the “Utilities”) is committed to fair compensation for its employees as explained in this Fair Pay Policy. Specifically, it is the policy and practice of the Employer to accurately compensate employees and to do so in compliance with all applicable state and federal laws. The Utilities will never knowingly fail or refuse to pay an employee the full amount of compensation to which he or she is entitled by law for work performed on behalf of the Utilities. ALL EMPLOYEES Protection of Employee Rights The Employer will protect the right of each employee to receive compensation according to the law. Violations of this Fair Pay Policy, whether by a managerial or non-managerial employee, may result in disciplinary action, if appropriate under the circumstances, up to and including termination of employment. The Employer will not tolerate or allow any form of retaliation against individuals who report alleged or suspected violations of this policy or who cooperate in the Employer’s investigation of such reports. Retaliation is unacceptable, and any form of retaliation in violation of this policy will result in disciplinary action, up to and including termination. Record Your Time And Review Your Pay Stub To ensure that you are paid properly for all time worked and that no improper deductions are made, you must record correctly all work time and review your paychecks promptly to identify and to report all errors. The Employer makes every effort to ensure that its employees are paid correctly. Occasionally, however, inadvertent mistakes can happen. When mistakes happen, the Employer will promptly make any corrections necessary to provide you with the pay to which you were entitled and as otherwise required by law. To assist the Employer in its efforts, please review your pay stub when you receive it to make sure it is correct. If you believe a mistake has occurred or if you have any questions, please use the following procedure. How to Raise a Question or Concern about your Pay or a Payroll Deduction If you have questions about your pay or any deduction from your pay, please immediately contact your supervisor/manager. If you believe your paycheck has been subjected to an improper deduction or that the pay you have received does not accurately reflect the compensation you are entitled to for your work, you should immediately report the matter to your supervisor/manager, the Finance Manager, or the Payroll Specialist. 119 The Employer will fully investigate every such report, including by reviewing appropriate time and payroll records and interviewing persons responsible for payroll and/or payroll deductions. If you have been paid incorrectly or if the Employer determines that a deduction was improperly made, the Employer will reimburse you as promptly as possible, which will be no later than two pay periods from the time you report the suspected problem. The individual(s) responsible for the error will be investigated further to determine if the error was an isolated incident or whether instead it may be part of a pattern of conduct that requires further action on the part of the Employer. Regular Attendance is an Essential Job Function and Your Attendance Record is a Performance Issue Regular attendance is an essential function of jobs with the Employer. The failure of any employee, whether exempt or non-exempt, to perform according to the Employer’s expectations, including any failure by an employee to meet the Employer’s attendance standards, may result in disciplinary action up to and including termination of employment. For these and other reasons, it is important for employees to accurately record the time they work for the Employer. NON-EXEMPT EMPLOYEES If you are classified as a non-exempt employee, the Employer relies on your use of the timekeeping software to maintain an accurate record of the total hours you work each day. The timekeeping software is designed to reflect all regular and overtime hours worked, any absences, late arrivals, early departures and meal breaks. If any error or inaccuracy occurs in connection with your use of the timekeeping software it is your responsibility to notify your supervisor/manager to correct the error or inaccuracy. When you receive each pay check, please verify immediately that you were paid correctly for all regular and overtime hours worked during each work week. You should not work any hours that are not scheduled or requested of you by the Employer unless you are authorized to do so by your supervisor. Do not start work early, finish work late, work during a meal break or perform any other extra or overtime work unless you are authorized to do so and you record such time on your time card. Non-exempt employees are strictly prohibited from performing any “off-the-clock” work. “Off-the-clock” work means work you perform but fail to report on your time card. Any employee who fails to report or inaccurately reports hours worked will be subject to disciplinary action, up to and including termination. It is a violation of the Employer’s policy for any employee to falsify a time card, or to alter another employee’s time card. It is also a serious violation of Employer policy for any employee or manager to instruct another employee to incorrectly or falsely report hours worked or alter another employee’s time card to under-report or over-report hours worked. If any manager or employee instructs you to either (1) incorrectly or falsely under-report or over-report your hours worked, or (2) alter another employee’s time records to 120 inaccurately or falsely report that employee’s hours worked, you should report the situation immediately to the Payroll Specialist, the Finance Manager, or your supervisor/manager. On Call Time For Non-Exempt Employees Non-exempt employees in certain positions may be scheduled to be on call for duty of various kinds. Compensation for time spent on call by non-exempt employees is generally subject to applicable state and federal law and to the terms of any governing union contract. Similarly, compensation for time spent actually working is paid according to applicable state and federal law and to the terms of any governing union contract. EXEMPT EMPLOYEES Salary Basis of Compensation If you are classified as an exempt employee, you will receive a salary that is intended to compensate you for all hours worked for the Employer. This salary will be established at the time of hire or when you become classified as an exempt employee. While your salary may be subject to review and modification from time to time, such as during salary review times, the salary will be a predetermined amount that will not be subject to deductions for variations in the quantity or quality of the work you perform. Attendance and Recording Time for Exempt Employees Although exempt employees are paid on a salary basis and not by the hour, all exempt employees are nevertheless required to record all time spent working for the Employer. This is important for a variety of reasons, but it is not for the purpose of paying an exempt employee other than on a salary basis. For payroll purposes, the regular workweek for exempt employees of the Employer is defined as the week running from Tuesday morning at 12:00 a.m. to the following Monday evening at 11:59 p.m. The regular business workday for exempt employees is generally from 7:00 a.m. to 3:30 p.m. or 8:00 a.m. to 4:30 p.m., unless a manager, Director, or supervisor has specified other expectations or arrangements. The Employer generally expects that an exempt employee will work forty or more hours in each workweek. Exempt employees are required to meet the Employer’s attendance standards, which the Employer sets in its discretion. On Call Time For Exempt Employees Exempt employees who are assigned on-call duty or pager duty do not receive additional pay for that duty. The Employer may, from time to time in its discretion, choose to assign certain credit or rewards to exempt employees for performing such duty. 121 Deductions from an Exempt Employee’s Salary The Employer does not permit any payroll deduction unless it is approved by the Finance Manager. Deductions from an exempt employee’s salary will only be made in good faith and in compliance with applicable law. No manager or other employee of the Employer has the authority to order any deductions from an exempt employee’s salary without the approval of the General Manager. Federal and state law limit the deductions that may be made from the salary of an exempt employee. The Employer intends to fully and strictly comply with these limitations. Please note that these limitations concern the amount of gross salary received on the paycheck; but these are different from any limitation on deductions from an employee’s leave bank. Further explanation of how this works follows below. Important Definitions. A deduction from salary is a deduction that results in a lower gross pay amount on an employee’s paycheck. A deduction from a leave bank does not result in a lower gross pay amount on an employee’s paycheck, but, rather, reduces the balance in the employee’s leave account; or, in other words, reduces the amount of an employee’s accrued and unused vacation or sick leave. Permissible Deductions from Salary. Absent contrary state law requirements or a specific employment contract executed by a duly authorized representative of the Employer, the salary of an exempt employee may be reduced for any of the following reasons: • Full day absences for personal reasons. • Full day absences for sickness or disability (which absence may otherwise be paid through any sick time benefits available to the salaried employee, if any). • Full day disciplinary suspensions for infractions of the Employer’s written policies and procedures. • Full day disciplinary suspensions for violations of workplace safety rules of major significance. • To offset amounts received as payment for jury and witness fees or military pay. • The first or last week of employment in the event the employee works less than a full week. 122 The salary of an exempt employee may also be reduced for certain types of deductions such as the employee’s portion of health, dental or life insurance premiums; state, federal or local taxes, social security; or, voluntary contributions to a Section 457 retirement plan. Impermissible Deductions from Salary. In any work week in which an exempt employee performs any work, the exempt employee’s salary amount will not be reduced for any of the following reasons, although, as explained further in more detail below, the employee’s leave bank may be reduced for these reasons, in some circumstances: • Partial day absences for personal reasons, sickness or disability. • Absence because the facility is closed on a scheduled workday. • Absences for jury duty, attendance as a witness, or military leave in any week in which you have performed any work. • Any other deductions prohibited by state or federal law. Permissible Deductions from An Exempt Employee’s Leave Bank. Federal and state law permit the Employer to reduce an exempt employee’s accrued vacation or sick balance for full or partial day absences for personal reasons, sickness or disability. Deduction for the use of such leave time will not be made from the exempt employee’s salary, but from the exempt employee’s leave bank. Questions or Concerns about This Fair Pay Policy If you have questions or concerns about this Fair Pay Policy, please contact your supervisor/manager, any Director, or Human Resources. 28. BREAKS FOR NURSING MOTHERS TO PUMP BREAST MILK Employees who need to express breast milk for their infant child during the twelve (12) months following the birth of the child will be provided with reasonable break times for this purpose each day, as long as such breaks do not unduly disrupt company operations. As far as possible, such breaks must run concurrently with regular break times otherwise provided; and must be arranged so that the requirements of the job can be adequately met by other staff on duty. It is not necessary for an employee to clock out for such breaks unless regular unpaid meal break time is being used; the Utilities will not reduce the compensation of any employee as a result of taking lactation breaks. Employees needing time to express breast milk should contact their supervisor to inform them of the need and discuss an appropriate private location. For lactation breaks Employees will be provided an appropriate private (non-bathroom) space with an electrical outlet that is shielded from view and free from intrusion. 123 29. CALL OUT TIME: REGULAR FIELD WORKERS Regular field workers who are asked to report for work outside their regular working hours shall be paid a minimum of two (2) hours each time they report for work. Scheduled work contiguous to normal working hours shall not be subject to this two (2) hour minimum reporting pay obligation. However, if a regular field worker reports for work before or remains after the regular eight (8) hour workday, or works on a Saturday, Sunday or Holiday, he/she will be paid at the applicable overtime rate for each hour worked over eight in a day, or on a Sunday or Holiday, as applicable. Such reporting and overtime pay is not applicable to situations involving travel or training time away from the regular workplace except where the employee’s total working time for the workweek exceeds 40 hours, in which case the 40-hour overtime provision will apply. Work performed for which an employee does not report to a particular work site, such as work that can be performed on a laptop computer from a non-work site, shall not be subject to this two hour minimum reporting pay obligation. This policy does not apply to employees other than regular field workers. 30. ON-CALL Regular Field Workers. Required On-Call Rotation for Regular Field Workers. Regular field workers (including linepersons, water operators, and other specifically trained field workers) are subject to a residency rule. These same workers are also subject to required participation in a scheduled on-call rotation. Apprentices may be excluded from the on-call rotation for up to one year from their date of hire, per management discretion. The on-call rotation is scheduled in one (1) week blocks. Residency Rule. The residency rule applies to the regular field workers who may be required to serve on-call. The residency rule is that these employees must live within a twenty (20) mile radius or thirty minute commute of the power plant. Response Time. The following guidelines on response time apply to regular field workers in the on-call rotation schedule on a 24-hours-a-day, seven-days-a-week basis during the workers’ scheduled on-call weeks. • While on-call, workers must remain within the 20-mile residency radius. 124 • While on-call, workers are expected to make immediate telephone contact in response to a call. • While on-call, workers are expected to urgently report to a site of need within a reasonable time, which will vary depending on the identified reason for the call. Depending on the need an on-call worker may find it necessary to call in a field partner to assist in providing appropriate and timely call response. Take Home Vehicles. Regular field workers who are part of the scheduled on-call rotation will be provided a company vehicle to take home for the exclusive purpose of responding to calls about Utilities business during the on-call block. Compensation for On-Call Time. Time spent on-call by regular field workers is not working time. In recognition of this on-call service, however, nominal compensation is paid. Weekly Compensation for Workers in an On-Call Rotation. For workers in a regular on-call rotation, compensation of fourteen (14) hours at the worker’s base rate of pay is paid, which covers an entire one (1) week block of on-call service. This compensation covers all time spent on call during the on call week, including phone or other remote triage work as to which there is no call out. Pro Rata Compensation for Workers Performing Back-Up On-Call Service. Workers not in a regular on-call rotation may be designated and required to serve on-call on a back- up basis. Such workers who serve on-call for less than a full week at a time will be compensated for their on-call service on a pro rata basis for each day of on-call service, at the daily rate of 1/7 of 14 hours times the worker’s base rate of pay. Workers not in a regular on-call rotation who serve on call, upon designation, for a full week will receive compensation on the same basis as do workers who are in an on-call rotation. When a recognized paid holiday falls within the on-call block covered by the worker (whether a week or portion thereof), eight (8) vacation time hours will be awarded as additional on-call compensation. 125 Compensation for Actual Response Time. Time spent actually responding to a call that is received while a worker is serving on-call, however, is working time, and is therefore paid based on an employee’s regular rate of pay. Call out time. When an employee is on-call, the Utilities’ policy on call out time pay still applies, in accordance with the terms of that policy. Other On-Call Arrangements. Certain employees other than regular field workers, namely, the Operations Director, Electric Superintendent and the Water Superintendent, are subject to call response requirements for emergency preparedness and/or customer service purposes. The Operations Director, Electric Superintendent and the Water Superintendent are not subject to the residency rule that applies to regular field service workers. Superintendents. Electric Superintendent. The Electric Superintendent is required to be available to triage or respond on an as-needed basis to emergency calls 24 hours a day, seven days a week without rotation. Such on-call time and availability is not working time. The Electric Superintendent is not required to remain within the residency radius and does not receive additional compensation for on-call time or for actual response time. The call out time policy does not apply to the Electric Superintendent. The Electric Superintendent shall arrange for another qualified Utilities employee to be on call: 1) during his or her scheduled vacation periods; 2) when it is necessary for the Electric Superintendent to use accrued sick leave. Water Superintendent. The Water Superintendent is required to be available to triage or respond on an as-needed basis to emergency calls 24 hours a day, seven days a week without rotation. Such on-call time and availability is not working time. The Water Superintendent is not required to remain within the residency radius and does not receive additional compensation for on-call time or for actual response time. The call out time policy does not apply to the Water Superintendent. The Water Superintendent shall arrange for another qualified Utilities employee to be on call: 1) during his or her scheduled vacation periods; 2) when it is necessary for the Water Superintendent to use accrued sick leave. 126 Operations Director. The Operations Director is required to be available to triage or respond on an as-needed basis to emergency calls 24 hours a day, seven days a week without rotation. Such on-call time and availability is not working time. The Operations Director is not required to remain within the residency radius and does not receive additional compensation for on-call time or for actual response time. The call out time policy does not apply to the Operations Director. The Operations Director shall arrange for another qualified Utilities employee to be on call: 1) during his or her scheduled vacation periods; 2) when it is necessary for the Operations Director to use accrued sick leave. Take Home Vehicles. Based on the expectation that they will regularly be available to respond in a timely and appropriate manner to calls about Utilities business outside of regular business hours, the Operations Director, the Electric Superintendent and the Water Superintendent, are provided Utilities vehicles to take home. These vehicles are subject to the Utilities’ Use and Disposal of Utility Property policy and may only be used for the exclusive purpose of responding to calls about Utilities business. 31. ELECTRIC RE-CONNECT TIME Regular field workers performing electric re-connects at times other than during their scheduled work hours will be paid in accordance with the general policy on Call Out Time for Regular Field Workers. 32. STORM PAY Employees assigned to work at another utilities distribution system to assist with restoration following a storm, will receive time and one-half (1.5) times their regular rate of pay for all such hours worked, except hours worked on Sunday or an Elk River Municipal Utilities recognized Holiday, which shall be paid at two (2.0) times the employee’s regular rate of pay. The Utilities will use its best efforts to rotate and distribute these assignments equally with priority on maintaining proper staffing levels at Elk River Municipal Utilities. 33. LEAD PAY DIFFERENTIAL An employee who is currently a lineman shall assume the duties of a lead lineman when the lead lineman is absent from a crew, provided that only the most senior lineman on a 127 crew shall assume the lead lineman’s duties. The lineman assuming such duties shall receive a rate differential equal to 3% of the applicable rate of pay times the number of hours worked during which the lineman assumed such lead duties. The rate differential provided in this policy applies during both regular scheduled work hours and after hours. During after-hours call out, as well as at any other time, this rate differential will be paid only when the crew is full and the lead lineman is absent. 34. LONGEVITY PAY The Utilities values long term dedicated service by Employees. Beginning on January 1, 2022, a Longevity Bonus will be paid to qualifying eligible employees based on their years of service according to the schedule below. The purpose of the Longevity Bonus is to recognize the service of Employees that work for the Utilities long-term. Regular full-time and regular part-time Employees are eligible for a Longevity Bonus when they qualify as set forth in this Section. Regular full-time employees are eligible to receive a Longevity Bonus once each time they qualify by reaching a milestone anniversary date in accordance with the following schedule: Milestone: Years of Service Longevity Pay Amount 8 years $1,550 12 years $2,025 16 years $2,100 20 years $2,125 24 years $2,300 28 years $3,000 32 years $3,000 Regular part-time employees are eligible to receive a Longevity Bonus once each time they qualify by reaching a milestone anniversary date in accordance with the following schedule: Milestone: Hours of Service Longevity Bonus Amount 16,640 $1,550 24,960 $2,025 33,280 $2,100 41,600 $2,125 49,920 $2,300 58,240 $3,000 66,560 $3,000 128 A Longevity Bonus is paid in one lump sum within 60 days of the anniversary date on which the Employee reaches the relevant milestone. Qualifying Employees who are eligible for a Longevity Bonus will be invited to the next monthly Commission meeting that is at least ten days after their anniversary date, where the Commission Chair and the Employee’s manager will present the Longevity Bonus paycheck to the Employee(s). Because longevity pay is considered supplemental income by the Internal Revenue Service, 22% will be withheld in taxes from the employee’s longevity pay during check processing. 35. PAYCHECK DEDUCTIONS By law, the Utilities is required to withhold federal and state taxes, FICA and PERA from an employee’s pay. The Utilities also has a Health Care Savings Plan with mandatory participation and will withhold applicable amounts from an employee’s pay. In addition, other deductions may be made upon authorization of a participating employee including the following: a. Employee share of health insurance g. World Vision b. Credit Union h. United Way c. PERA life insurance d. 457 contributions e. Flexible benefits f. Computer Loans up to $1,200.00 (12 month term) 36. PAYCHECKS Employees are paid every two weeks. The pay period begins every other Tuesday at 12:00 a.m. and ends every other following Monday at 11:59 p.m. Payday is the Friday immediately following the end of the pay period. Employees are responsible for their paychecks upon receipt. Direct deposit is preferred but a check is available to employees upon request. 37. NIGHTWORK REST TIME The Utilities will provide a regular field worker with one hour paid rest time for each hour worked between 10:00 p.m. and 6:00 a.m., excluding work performed during such window on Saturday or Sunday. The worker must make arrangements with his or her supervisor before taking such rest time. This nightwork rest time shall be taken during the next scheduled work shift. If the supervisor does not release the worker to take this nightwork rest time, all hours worked by the worker on the next scheduled shift shall be paid at one and one half times the worker’s base rate of pay. It is the employee’s responsibility to notify the supervisor and obtain approval prior to taking the rest time. It is also the employee’s responsibility to take the nightwork rest time if it is approved by the supervisor. 129 The employee’s failure to take approved nightwork rest time shall result in forfeiture of such rest time. Nightwork rest time does not apply and is not paid in connection with travel or training time away from the regular workplace. 38. TRAVEL AND TRAINING TIME Employees are paid for time spent in training related to their position with the Utilities, which must be approved in advance by the supervisor. Employees will be paid for their time spent traveling in the following circumstances. 1. When a non-exempt employee is engaged in travel which keeps the employee away from home overnight and which cuts across a regular workday; 2. When a non-exempt employee travels to a special one-day work assignment in another city that does not require an overnight stay; 3. When a non-exempt employee spends time traveling as part of the employer’s principal activity; 4. When a non-exempt employee spends time traveling between home and work in “call back” or “emergency” situations; and 5. When a non-exempt employee performs work during travel. Overtime (at one and a half times the regular rate of pay) will be paid in connection with training or travel time only when, and to the extent, that an employee’s total compensated hours in a workweek exceed 40. The eight hour and double time provisions of the Utilities’ wage and hour policy do not apply to days involving work-related travel or training. 130 BENEFITS 39. GENERAL BENEFITS This handbook provides a brief description of benefits available to eligible employees. The descriptions provided here are not intended to be comprehensive and all questions regarding eligibility and benefit levels should be directed to your supervisor so the specific plan documents can be reviewed for an answer. The plan documents govern any inconsistencies between these documents and the information provided here. Benefits and eligibility requirements are subject to change, and such changes may not be reflected in this description. Further, to be clear, nothing in the Benefits sections or elsewhere in this Handbook creates a contract with specific terms between the Utilities and any employee. The Utilities expects to offer its benefit plans for the foreseeable future, but it reserves the right, in its sole discretion, to change, modify or eliminate them at any time, except to the extent prohibited by law. 40. VACATION All regular full-time employees shall accrue vacation according to the following schedule: Years of Service Accrued Per Pay Period Accrued Per Year 0-4 3.70 hours 12 days 5 4.00 hours 13 days 6-9 4.62 hours 15 days 10 4.93 hours 16 days 11 5.24 hours 17 days 12 5.54 hours 18 days 13 5.85 hours 19 days 14-15 6.16 hours 20 days 16-18 6.77 hours 22 days 19 7.70 hours 25 days 20-21 8.00 hours 26 days 22-23 8.31 hours 27 days 24+ 8.62 hours 28 days Vacation days accrue each pay period as shown in the table above. Paid vacation may be taken as soon as it is accrued. Accrual rates change, as applicable, on an employee’s anniversary date. Example: If an employee’s start date was July 1, 2016, the new accrual rate would start July 1, 2021. If an employee is on leave and using vacation on a basis of less than the regular eight-hour day, and so not receiving full vacation pay for each day, the accrual is calculated on a pro rata basis. 131 Regular part-time employees accrue paid vacation under this schedule on a pro rata basis. Temporary and seasonal employees are not eligible for paid vacation. Employees must request time off for vacation as far in advance as feasible. When possible, employees will be granted vacation time of their choice. However, scheduling of vacation time is subject to the operating needs of the Utilities. Unused vacation days may be carried over from year-to-year, but only to a limited extent, as follows. Unused vacation carryover will be limited to the number of hours accrued during the previous year. Accrued vacation days beyond the carryover limit are lost. For example, if an employee with 2 years of service has accrued but not used 15 vacation days by the end of the pay period containing his or her anniversary date, he or she will only be permitted to carryover 10 days to the next year. Paid vacation may not be used for the purpose of extending an employee’s active employment with the Utilities or for retaining a full-time equivalency percentage that is not based on an employee’s actual planned and scheduled working time. Employees who voluntarily end their employment and who give the Utilities proper (generally at least two-weeks) notice, and employees terminated involuntarily by the Utilities for reasons other than an ethics violation, fraud, theft, or other egregious misconduct, shall be paid out for the amount of earned but unused vacation time in their account as of the date of separation, provided they sign and do not rescind an agreement releasing claims arising out of their employment, in a form prescribed by the Utilities. Employees involuntarily terminated by the Utilities for an ethics violation, fraud, theft, or other egregious misconduct shall not be paid out any unused vacation time. Employees who retire immediately eligible to claim their pension and who give the Utilities proper notice (generally at least two-weeks) shall have 100% of unused vacation time converted into cash and deposited into their Post Employment Health Care Savings account, but only on the condition that they sign and do not rescind an agreement releasing claims arising out of their employment, in a form prescribed by the Utilities. The Operations Director, Electric Superintendent and Water Superintendent accrue paid vacation at the rate set forth above and are generally subject to this Vacation policy; but they each shall also receive an additional 40 hours of paid vacation per year, the balance of which will be paid out at their respective then-current base rates of pay if not used by the end of the year. No such balance may be carried over from year to year. 41. PURCHASED VACATION TIME (PVT) Upon starting employment and during each annual open enrollment period, an employee may purchase up to 40 hours of additional paid vacation time. If an employee decides to purchase vacation time, the employee pays for the hours on a pre-tax basis. The cost of 132 the purchased vacation time will be deducted equally from each paycheck over the course of the year and paid out at the rate in effect upon payout. Vacation is purchased in one-hour increments with a minimum purchase of eight hours and a maximum purchase of 40 hours. Per IRS regulations, the purchased vacation time can only be used once the employee’s entire accrued vacation time has been exhausted. Purchased vacation hours must be used in the calendar year in which they are purchased. Any purchased vacation hours that have not been used before the second to last pay period end date of the calendar year will automatically be paid out in the last paycheck of the calendar year in which the vacation time was purchased, at the rate in effect at the time of payout and subject to withholding at the supplemental tax rate. Therefore, purchased vacation time will not be available for use in any year after mid-December. Upon separation from employment, if purchased vacation time used exceeds the cost of such purchase that has been deducted up to that time, the employee must pay the difference back to ERMU. However, if the employee has remaining purchased vacation time that has not been used, it will be paid out to the employee upon separation. New employees are allowed to buy purchased vacation time based on their benefit eligibility date, as listed in the chart below. Benefit Eligibility Date Maximum PVT Hours Eligible for Purchase January – March 40 Hours April – May 32 Hours June – July 24 Hours August – September 16 Hours October – November 8 Hours December 0 Hours 42. PAID SICK LEAVE Regular full-time employees accrue sick leave at the rate of 3.70 hours per pay period (approximately 8 hours per month or 12 days per year). If an employee is on leave and using sick leave less than the regular 8-hour day, and so not receiving full pay, the accrual is calculated on a pro rata basis. Regular part-time employees accrue sick leave pro rata based on the full-time accrual rate. Temporary and seasonal employees are not eligible for sick leave. Sick leave may be used for illness and for visits to a health care provider (including any visit that would qualify for reimbursement under IRS Flexible Health Care Spending Accounts guidelines, which include, for example, medical doctors, dentists and optometrists). Sick leave may be used to cover illness or visits of the employee or the employee’s child or another “covered relative” as defined below, or for purposes of 133 parenting leave in accordance with Minnesota law. To be a “covered relative” under this policy an individual must have same residence address as the employee and must receive substantially all of his or her financial support from the employee. Sick leave may also be used when an employee’s daycare facility is closed due to sickness. Documentation from a health care provider may be requested by the Utilities in its sole discretion. Misuse of paid sick leave may result in disciplinary action. In addition, an employee’s sick time can also be used for a “safety leave” for covered relatives for the purpose of providing or receiving assistance due to sexual assault, domestic abuse or stalking. See also Minnesota Sick Family Member or Safety Leave, Section No. 55, below. Sick leave may not be used for the purpose of extending an employee’s active employment with the Utilities or for retaining a full-time equivalency percentage that is not based on an employee’s actual planned and scheduled working time. Employees are required to notify their immediate supervisor at least thirty (30) minutes prior to the start of their regular working hours if they intend to be absent from work. If an emergency prevents the employee from notifying his/her supervisor at such time, the employee is expected to call as soon as possible during the workday. Employees are also required to keep their supervisors informed of their condition and anticipated return to work. An employee attempting to use sick time for reasons other than those explicitly permitted in this policy will be subject to disciplinary action up to and including termination. A doctor’s certification of the need for sick leave in accordance with this policy shall be required if an employee is absent more than four (4) days or if abuse of sick leave is suspected by the employee’s immediate supervisor, a Utilities manager, Director, or the Human Resources Representative. In some circumstances, an employee may be requested to submit to a medical examination by an appropriate health care provider to confirm whether the employee is fit for duty. In such a circumstance, the Utilities may select the health care provider to conduct the examination. Unused sick leave will not be paid out in wages upon termination of employment, but in some circumstances is subject to limited conversion under the Health Care Savings Plan policy found elsewhere in this Handbook. 43. PAID HOLIDAYS Regular full-time employees who are non-exempt will be paid for eight (8) hours at their base wage rate for each of the following holidays: New Years Day Veterans Day Martin Luther King Day Thanksgiving Day 134 Presidents Day Friday following Thanksgiving Day Memorial Day Christmas Eve Day Independence Day Christmas Day Labor Day Eligible part-time employees who are non-exempt will receive paid holidays on the same basis as regular full-time employees, except that holiday pay will be pro-rated according to the number of hours worked. Exempt employees are permitted to observe the designated holidays above without reduction of their salary. If the holiday falls on a Saturday, the preceding Friday will be observed. If the holiday falls on a Sunday, the following Monday will be observed as a holiday. Employees will not receive holiday pay for any holiday that falls during any leave of absence. 44. EMPLOYEE CLOTHING It is required that employees wear clothing items specified by the Utilities for their position and activity during working time. For regular field workers potentially exposed to electric hazards, the Utilities will provide an initial issue of five fire retardant long sleeved shirts, five fire retardant pants, and five fire retardant tee shirts per outside employee exposed to electric hazards. A second set of five fire retardant long sleeved shirts, five fire retardant pants, and five fire retardant tee shirts will be issued after the probationary period. As an alternative option, one fire retardant hooded fleece may be substituted for two fire retardant long-sleeved shirts and/or one sweatshirt may be substituted for two long-sleeved shirts. Field Supervisors may substitute logoed fire retardant dress shirts for fire retardant uniform shirts. Provided clothing may also include: lineman’s climbing boots, summer work boots, rubber boots, rubber overshoes, insulated winter boots, and coveralls (used for maintenance on trucks). The Utilities will issue a check to the supplier for the covered items. For Commissioners and employees other than regular field workers, the Utilities will provide a $75 annual allowance for Utilities logo clothing. On an annual basis, the Utilities will replace worn out items that have been provided by the Utilities. Worn out items should be turned in to the Utilities. The Utilities will also provide and replace the following as necessary in the Utilities’ discretion: fire retardant lined and unlined bib overalls, fire retardant lined parka and hood, fire retardant lined bomber jacket, and hats with the appropriate emblems and identification. Upon the end of employment with the Utilities, an employee must return all Utilities- logoed clothing items that were issued to him or her that were paid for by the Utilities. 135 45. HEALTH CARE SAVINGS PLAN Utilities’ employees participate in the Minnesota Post Employment Health Care Savings Plan (HCSP) established under Minn. Stat. § 352.98 and as outlined in the Minnesota State Retirement System’s Trust and Plan Documents. All funds collected by the employer on behalf of the employee will be deposited into the employee’s Post Employment Health Care Savings Plan account. General participation rules are outlined below, for a complete guide regarding benefits, use, and eligibility see the plan’s documents. 1. Employees are required to contribute to the Post Employment Health Care Savings Plan. These funds will be deposited after each pay period. The contribution shall be based on the following structure: There will be four groups, concurrent with the pay plan. The four groups are Office, Field Workers, Line Workers, and Management. All groups shall participate in contributions as follows: a. Employees with fewer than 10 years of service are required to contribute 1% of their gross wages. b. Employees with fewer than 20 years of service and at least 10 years of service are required to contribute 2% of their gross wages. c. Employees with at least 20 years of service are required to contribute 3% of their gross wages. 2. Employees who have accrued over 960 hours of sick time will have 50% of those hours converted to cash and deposited in their Post Employment Health Care Savings account. The conversion will take place once a year at the end of December. 3. Employees who voluntarily end their employment and who give the Utilities proper (generally at least two-weeks) notice, and employees whose employment ends involuntarily because of lack of work, will have 50% of unused sick leave, up to a maximum of 120 days, converted into cash and deposited into their Post Employment Health Care Savings account provided they sign and do not rescind an agreement releasing claims arising out of their employment, in a form prescribed by the Utilities. Employees involuntarily terminated by the Utilities for any reason other than lack of work shall not be eligible to receive such conversion. No contributions will be accepted by the Plan on behalf of an employee after the death of the employee. 4. Employees who retire immediately eligible to claim their pension and who give the Utilities proper notice (generally at least two-weeks) shall have 100% of unused vacation time converted into cash and deposited into their Post Employment Health Care Savings account, but only on the condition that they sign and do not rescind an agreement releasing claims arising out of their employment, in a form prescribed by the Utilities. 136 46. 457 DEFERRED COMPENSATION The Utilities will match funds contributed by employees, up to a maximum contribution of $2,500.00. These plans are administered by the Minnesota State Deferred Compensation Plan and/or Wenzel & Associates’ John Hancock Plan. Employees in the Management Pay Group are eligible for an additional employer matching (dollar for dollar) contribution up to 2.5% of the manager’s annual base salary, conditioned on the individual providing the Utilities with authorization for the necessary payroll deduction and subject to applicable legal limits to such contributions. All Utilities employees are subject to Minnesota law capping public employee salaries based on the Governor’s salary. Certain definitions and exclusions apply from time to time to the calculation of salaries under that cap, including, for example, vacation and sick leave allowances. Leave Credit In Lieu Of Compensation. Each employee will be paid that portion of the employee’s assigned salary that is permitted by law to be paid. An employee whose salary and other forms of compensation exceed the amount permitted by law to be paid is entitled to receive paid leave time in lieu of that portion of the salary that exceeds the amount permitted by law to be paid. The amount of such paid leave credit will be calculated using the employee’s annual rate of pay established pursuant to the applicable compensation policy and plan. The Commission and the General Manager are each authorized to establish the assigned salary using the provisions of this policy and the compensation plan established by the Commission. Further information about this Leave Credit is available from management or Human Resources upon request. For more information about the Utilities’ benefit plans consult the summary plan descriptions that have been distributed to each employee, additional copies of which are also available upon request. 47. HEALTH INSURANCE COVERAGE For eligible employees who regularly work 30 hours per week and enroll in a health insurance plan provided by the Utilities, the Utilities will pay a majority of the premium charged, and will set the employee share of the premium for each level of coverage available. The Utilities current group health insurance allows the Utilities to offer a Health Savings Account-related plan. Plans, plan designs, and employee share of premiums may change from time to time. The amount of the monthly premium for a health insurance plan 137 that is the responsibility of the employee is currently as follows. Premiums and employee shares are subject to change from time to time. COVERAGE MONTHLY EMPLOYEE SHARE • Employee $105 • Employee + 1 $210 • Family $315 Employees should consult the applicable Summary Plan Description (SPD) for details regarding coverage and eligibility. A copy of the SPD will be provided to employees and is available upon request. 48. DENTAL INSURANCE Eligible employees who regularly work at least 30 hours per week and who enroll in the Utilities’ dental insurance plan, the Utilities will pay seventy-five percent (75%) of the monthly premium per employee/family for dental insurance. Any monthly premium over and above 75% of the dental coverage is the responsibility of the employee. Employees should consult the Summary Plan Description for details regarding coverage and eligibility. A copy of this description will be provided to employees and is available upon request. 49. LONG-TERM DISABILITY A Long-Term Disability Plan is provided to eligible employees who regularly work at least 30 hours per week. Schedule amount: 60% of Monthly Earnings subject to a maximum amount of $5,000.00 per month. Employees must be employed for two (2) months to qualify for coverage. Employees should consult the Summary Plan Description for details regarding coverage and eligibility. A copy of this description will be provided to employees and is available upon request. 50. LIFE INSURANCE Life insurance is provided to each employee at a rate of Two and One Half times (2½) the employee’s annual salary, to a maximum of $85,000.00. Employees should consult the Summary Plan Description for details regarding coverage and eligibility. A copy of this description will be provided to employees and is available upon request. 51. VISION INSURANCE Eligible employees who regularly work at least 30 hours per week are eligible to enroll in the Utilities’ vison insurance plan. The monthly premium for vision coverage is the responsibility of the employee. Employees should consult the Summary Plan Description 138 for details regarding coverage and eligibility. A copy of this description will be provided to employees and is available upon request. 52. HOME COMPUTER LOAN POLICY In an effort to encourage all employees to develop and improve their computer skills, employees may purchase a home computer per the following guidelines. 1. The purchased computer and software shall be new, not reconditioned, not used. 2. The purchased computer shall be used in the employee’s home. 3. Employee must provide a receipt reflecting the purchase of this computer. 4. The Utilities will provide an interest-free loan for the purchase of this computer up to $1,200.00, for a term not to exceed 12 months. 5. Employee will repay the computer loan to the Utilities in not more than 25 equal installment payments authorized and made through payroll deduction, upon the employee’s election by signed authorization form. 6. Employee must maintain ownership and possession of the computer for the duration of the loan term. 7. If the employee leaves the Utilities before the loan is paid back in full, the Utilities will withhold the outstanding portion of the loan from the employee’s final paychecks (including any check for unused and unpaid benefits) as authorized by the employee in the authorization form signed at the time the loan is made. 53. EDUCATIONAL ASSISTANCE The Utilities will provide financial assistance to eligible employees for pre-approved courses that are job related, lead to a job-related degree, or are within areas beneficial to the Utilities in its discretion and pursuant to this policy. With regard to education required by the Utilities or in connection with a Utilities-approved apprenticeship training program, check with a Utilities manager or Director. 1. All full-time Utilities employees with at least three months of continuous employment are potentially eligible for reimbursement under this policy. 2. The Utilities may pay up to 100% reimbursement of the costs for tuition, registration, fees, books and course required materials after successful completion of a pre-approved course. Courses must be at accredited colleges, universities, or vocational schools or be short courses conducted by recognized professional training organizations. 3. A course may be approved if: a) It is directly related to the employee’s work for the Utilities. b) It is required by a program of study leading to a degree that is directly related to the employee’s work for the Utilities. 139 c) It will improve the employee’s work for the Utilities. d) It is expected to be completed within a time acceptable to the Utilities. 4. This policy will not cover recreational or personal interest courses. 5. Prior to registration, the employee must have full approval for the course from Utilities’ management designated as having approval authority for such matters. 6. The Utilities reserves the right to disapprove educational assistance requests and to amend or eliminate this policy from time to time in its discretion. 7. Total reimbursements to an employee during the academic year may not exceed $3,000. 8. Not eligible for reimbursement are costs of: a) late fees and fees due to an employee error b) meals, transportation, lodging, insurance, etc. 9. If an employee is eligible for education assistance from any outside source (e.g.: G.I. Bill, grants, scholarships, etc.), the employee must apply for any assistance first and request the balance through this Education Assistance Policy. 10. Termination of employment prior to completion of a course will disqualify the employee for educational assistance. 11. Courses not satisfactorily completed within the time expected or otherwise acceptable to the Utilities will not receive reimbursement but must instead be paid for by the employee. 12. Course attendance and preparation must take place outside of scheduled work hours and must not jeopardize the employee’s work performance. 13. Employees will be paid for any time used in attending courses for which they are required by the Utilities to attend. All tuition and fees for such course will be paid for by the Utilities. LEAVES OF ABSENCE The Utilities provides leaves of absence according to the following policies. Unless otherwise indicated, all leaves of absence are unpaid. However, employees taking unpaid leave are required to concurrently use any paid vacation or other paid time they have available concurrently with their unpaid leave, beginning with using accrued paid vacation time. 140 An employee requesting a leave of absence must complete a Request for Leave of Absence form. Forms for requesting a leave of absence are available from the Human Resources Representative. When possible, advance notice of a leave should be provided to an employee’s supervisor so work schedules can be adjusted accordingly. 54. PARENTING LEAVE Under the Minnesota Parental Leave Act, a Minnesota employee who has worked for the Utilities for at least 12 months and who has worked at least one-half (1/2) time during the twelve (12) months preceding a leave is entitled to take up to twelve (12) weeks of unpaid leave as follows: • An eligible biological or adoptive parent make take such leave for the birth or adoption of a child; and • An eligible female employee may take such leave for prenatal care or incapacity due to pregnancy, childbirth, or related health conditions. An employee requesting parental leave must give the Utilities at least thirty (30) days advance notice of the start and end dates of the requested leave, unless such notice is not possible due to legitimate unanticipated factors in which case as much notice as is possible should be given. For a leave for the birth or adoption of a child, the leave must begin within either 12 months of the birth or adoption or, if the child must remain in the hospital longer than the mother, within 12 months of the child leaving the hospital. Insurance benefits will continue during the leave, but the employee must pay his or her portion of the premiums during the leave and will be required to reimburse the Company for premiums paid by the Company during the leave if the employee does not return to work following the leave. If any employee is eligible for parental leave under both the FMLA and the MN Parental Leave Act, the parental leave time taken under the Company’s FMLA leave policy will run concurrently with time taken under this policy. If you are eligible for both unpaid MN parental leave and any paid vacation or long-term disability insurance, you must use this paid time off or salary continuation benefit during any MN parental leave period up to the amount needed to cover the entire parenting leave. Following leave under this policy, an employee will be reinstated to his or her same job or one with comparable duties, hours, and pay. 55. MINNESOTA SICK FAMILY MEMBER OR SAFETY LEAVE A Minnesota employee who has worked for the Utilities for at least 12 months and who has worked at least one-half (1/2) time during the past twelve (12) months may use his or 141 her accrued sick time to care for the employee’s sick or injured child, stepchild, foster child, adopted child, adult child, spouse, sibling, parent, parent-in-law, stepparent, grandparent, or grandchild (including a biological, step, foster, or adopted grandchild) for reasonable times as the employee’ s attendance may be necessary. This type of leave is referred to as a “Sick Family Member Leave”. In addition, a Minnesota employee who has worked for the Utilities for at least 12 months and who has worked at least one-half (1/2) time during the past twelve (12) months may use his or her accrued sick time to receive assistance or provide assistance to the employee’s child, stepchild, foster child, adopted child, adult child, spouse, sibling, parent, parent-in-law, stepparent, grandparent, or grandchild (including a biological, step, foster, or adopted grandchild) because of domestic abuse (as defined in Minn. Stat. §518B.01), sexual assault (as defined in Minn. Stat. §§609.342, 609.3453, or 609.352), or stalking (as defined in §Minn. Stat. 609.749). This type of leave is referred to as a “Safety Leave.” Eligible employees are limited to using a maximum of 160 hours of sick time in any 12- month period for a Safety Leave or for a Sick Family Member Leave resulting from the illness of or injury to the employee’s adult child, spouse, sibling, parent, parent-in-law, stepparent, grandparent, or grandchild. Sick time under this policy must be used in the same manner as the employee would use the sick time for his/her own illness. Please note that, if an employee is also eligible for FMLA leave to care for a sick family member, FMLA leave and Minnesota Sick Family Member Leave time will run concurrently. 56. SCHOOL ACTIVITIES LEAVE POLICY Employees who have worked at least one-half time during the preceding twelve months are entitled to up to 16 hours leave during any 12-month period to attend school conferences or classroom activities related to the employee’s child, provided the conferences or classroom activities cannot be scheduled during non-work hours. If an employee’s child receives child care services or attends a pre-kindergarten regular or special education program, the employee may use the leave time to attend a conference, or activity related to the employee’s child, or to observe and monitor the services and program, provided the conference, activity or observation cannot be scheduled during non-work hours. When the need for leave under this section is foreseeable, the employee must provide reasonable prior notice of the leave to his or her immediate supervisor and make a reasonable effort to schedule the leave so as not to unduly disrupt Utilities business. Regular paid sick leave may not be used for purposes of this school activities leave. 142 57. BONE MARROW AND ORGAN DONATION LEAVE Employees who work an average of twenty (20) or more hours per week who seek to undergo a medical procedure to donate bone marrow or an organ or partial organ will be granted up to forty (40) hours of paid leave. Regular sick leave need not be used when this Bone Marrow and Organ Donation Leave policy is applicable to the circumstances. The Utilities may require verification by a health care provider of the purpose and length of each leave requested by the employee pursuant to this policy. 58. NATIONAL GUARD AND RESERVE LEAVE Any officer or employee of the Utilities who is a member of the National Guard or other reserve unit is entitled to a leave of absence from public office or employment without loss of pay, seniority status, efficiency rating, vacation leave, sick leave, or other benefits for the time that he/she is engaged with the reserve in training or active service so long as such leave does not exceed a total of fifteen (15) days in any calendar year. Such leave will be allowed only in cases where the required military or naval service is satisfactorily performed. Such leave will not be allowed unless the officer or employee: • Returns to the public position immediately on being relieved from such military or naval service and not later than the expiration of the time herein limited for such leave; or • Is prevented from returning to Utilities employment by physical or mental disability or other cause not due to the officer’s or employee’s own fault; or • Is required by proper authority to continue in such military or naval service beyond the time herein limited for such leave. 59. MILITARY LEAVE FOR UNIFORMED SERVICE Except as provided otherwise in the National Guard and Reserve Leave Policy above, employees who are members of, apply to perform, or have an obligation to perform service in a uniformed service will be granted an unpaid leave of absence to perform such service. Military leave requests shall be made to the immediate supervisor. The term “uniformed service” means the Armed Forces, the Army National Guard and the Air National Guard when engaged in active duty, active duty for training, initial active duty for training, inactive duty training, full-time National Guard duty, the commissioned corps of the Public Health Service, and any other category of persons designated by the President in time of war or emergency. As soon as an employee is informed of the dates of the military training, he or she should notify his or her supervisor and request a leave of absence, even if he or she has not yet received written orders. 143 In the case of an employee whose period of military service is less than 31 days, an employee must report back to his or her job at the first regularly scheduled shift after the completion of military service and the time required for return from the place of military service to the place of civilian employment. An employee called to active duty for more than 30 days, but less than 181 days, must report back to his or her job not more than 14 days after the completion of his or her military service. An employee called to active duty for more than 180 days must report back to his or her job not more than 90 days after the completion of his or her military service. This Policy is not intended to preclude leave with pay as may be provided in the National Guard and Reserve Leave Policy above. 60. JURY/WITNESS DUTY LEAVE Employees will be allowed a leave of absence pursuant to state statute without restriction or sanction when called for jury duty. • An employee performing jury duty or subpoenaed as a witness in court or voluntarily serving as a witness on behalf of the Utilities in a case in which the Utilities is a party will receive the difference between his/her regular rate of pay and the amount received as juror or witness up to the maximum allowed by state or federal law. • The employee must notify his/her supervisor and complete a leave of absence form within 48 hours of receiving call for jury duty. • An employee excused or released from jury duty during his/her regular work hours must report to his/her supervisor immediately thereafter. • Time spent on jury duty will not count as time worked in computing overtime. 61. PERSONAL LEAVE DAY Each January 1st, every regular employee will be credited with one day of paid personal leave, which will be available to be taken during the next 12 months, with the scheduling approval of management. This day, if unused, will not be carried over from year to year, and it is not paid out or converted upon separation from employment. 62. BEREAVEMENT LEAVE A leave of absence, with pay and fringe benefits may be granted to a regular full-time employee for a maximum of three (3) days in the event of the death of a spouse, child, parent, brother, sister, grandparent, grandchild, or parent-in-law, brother-in-law, sister-in- law, grandparents-in-law, step-parents, step-siblings and step-children. 144 63. GENERAL LEAVE The Utilities recognizes that circumstances of a unique personal nature may cause an employee to seek time off without pay. The Utilities may, at its sole discretion, grant unpaid personal leaves of absence to employees (“General Leave”). Approval is required of the employee’s immediate supervisor and the General Manager before General Leave will be granted. In no event will General Leave be granted for longer than ninety (90) days, unless special approval is received from the General Manager. Vacation and sick leave will not accrue during a General Leave. Further, the employee on General Leave will not be eligible for holiday pay during the leave. The Utilities will not contribute to the cost of insurance premiums for an employee on General Leave. Employees are expected to return from General Leave when the reason for the leave expires. Employees who take a General Leave have no right to reinstatement. 64. VOTING LEAVE; SERVICE AS ELECTION JUDGE Under Minnesota Statutes Section 204C.04, employees who are eligible to vote in an election to fill a vacancy in the office of United States Senator, United States Representative, State Senator or State Representative, or a presidential primary have the right to be absent from work for the time necessary to vote and return to work on the day of that election without penalty or deduction from salary or wages because of the absence. The Utilities will not abridge or interfere with this right. The Utilities will provide an employee with paid time off to serve as an election judge, provided that the employee gives the Utilities at least 20 days’ advance written notice. The Utilities will reduce the employee’s pay by the amount the employee is paid to serve as an election judge. 65. PAID LEAVE DONATION With the written consent of the Utilities’ General Manager or Finance Manager, employees wishing to do so may voluntarily donate accrued paid leave time that is presently available for use by the donor employee to a co-worker who is experiencing a major or catastrophic life event in the form of a medical emergency, loss of a family member, or other extraordinary circumstance (subject to management approval) necessitating time off from work for which the receiving employee has insufficient paid time off available. Examples of such a life event include, but are not limited to, a heart attack, stroke, organ transplant, or other medical condition of the employee or a family member for whose care the employee bears substantial responsibility. An employee will be eligible to receive and use donated paid leave only if the following conditions are satisfied: 145 1. The receiving employee must submit a request for paid leave donation in the form prescribed by the Utilities. 2. The receiving employee’s request for leave must be based on medical need to be absent from the workplace that is supported by documentation from a health care provider. 3. There is a reasonable expectation based on a treating provider’s documentation that the receiving employee will return to work within a reasonable time following any leave of absence unless the employee qualifies for long term disability insurance benefits. 4. The receiving employee is currently eligible to accrue sick leave and vacation under the Utilities’ policies. 5. The receiving employee has exhausted all of the employee’s own paid leave time including all sick, vacation, compensatory, and other paid time. 6. The sick leave taken by the receiving employee will not be subject to income replacement by disability or workers compensation insurance. The following additional conditions apply to leave donation under this policy: 1. All donations must be made in increments of eight (8) hours subject to a limit of 16 hours per donor to a particular recipient per year. Leave donation must be in one of the following configurations: i) a total of eight hours of paid sick leave; ii) a total of eight hours of vacation; iii) a total of sixteen hours, with eight hours being vacation and eight hours being paid sick leave; iv) a total of sixteen hours, with sixteen hours being paid sick leave; v) a total of sixteen hours, with sixteen hours being vacation time. 2. The donor employee must complete a Paid Leave Donation Form prescribed by the Utilities in order to donate paid leave. 3. The total amount of paid leave donated to any individual employee in any rolling twelve-month period measured backward from the employee’s most recent request for leave donation may not exceed 240 hours. 4. The Utilities will set a deadline for donations of paid leave to the receiving employee (“Donation Deadline”). No donations of paid leave will be accepted in response to the receiving employee’s Request for Paid Leave Donation after the Donation Deadline. 5. The Utilities will set a date on which submitted donations of paid leave will become final and effective (“Donation Effective Date”). The Donation Effective 146 Date shall be no more than ten business days after the deadline for donations to the receiving employee. 6. Before the Donation Effective Date, if Paid Leave Donation Forms are submitted for a total amount of leave that is more than the number of hours requested by the employee in the Paid Leave Donation Request Form, or for more than the maximum total donation of 240 hours, the Utilities will pro rate donations to the maximum allowed, among all employees submitting a Paid Leave Donation Form for the receiving employee and will notify all such employees in writing of such pro rating and the final number of hours from their Paid Leave Donation Form that will be donated to the receiving employee on the Donation Effective Date. 7. On the Donation Effective Date the Utilities will transfer all paid leave donations that are indicated collectively on the Paid Leave Donations Forms submitted, prorated, if necessary, in accordance with this policy, to the account of the receiving employee; and will reduce the corresponding account balances of the donating employees accordingly. 8. Donation of paid leave is permanent and final as of the Donation Effective Date and cannot be rescinded thereafter. Donated paid leave may not be transferred back to the donor after the Donation Effective Date under any circumstances. If the donated paid leave is not used by the receiving employee it is forfeited by all parties. 9. Donated paid leave time may be used by the receiving employee only for purposes of the medical leave necessitated by the catastrophic life event supporting leave donation under this policy. 10. Donated paid leave may be used by the receiving employee only for work time actually and necessarily missed due to the leave taken for the purpose set forth in the leave request submitted under this policy, and for no other purpose. 11. Donated paid leave may be used by the receiving employee only to replace the employee’s normal work hours lost, up to a maximum of the receiving employee’s FTE (measured as of the date on which the leave begins). 12. Donated paid leave must be used by the receiving employee concurrently with any applicable unpaid leave available to the receiving employee. 13. Donated paid leave must be used during the leave taken for the purpose submitted in the leave request under this policy. 14. Donated paid leave not used as described in this policy will be forfeited by the recipient. 147 15. When used by the receiving employee, donated paid leave will be paid at the receiving employee’s current rate of pay. 16. The donation of paid leave time will permanently decrease the amount of accrued unused paid leave in the donor’s paid leave account(s) and thereafter will not be counted or used by the donor or the Utilities for any purpose. For the avoidance of doubt, this means, among other things, that donated paid leave time does not qualify to be counted as unpaid sick leave for purposes of any severance pay calculation. 17. The Utilities will treat the identity of donor employees under this policy as private and confidential information. 18. This policy applies on a prorated basis to part-time employees eligible to accrue and receive paid leave time. 46703186v1 148 RECEIPT AND ACKNOWLEDGMENT (EMPLOYER COPY: MUST BE SIGNED AND RETURNED TO MANAGEMENT) By signing this receipt, I acknowledge that I have received a copy of the Elk River Municipal Utilities Employee Handbook (the “Handbook”). This Handbook and the policies contained or referenced in the Handbook supersede and replace previously- issued handbooks, contrary oral or written statements of employment policy, and contrary employment practices. I understand that the Employee Handbook may be amended at any time, with or without notice. I understand that I do not have a protected property interest in my employment with the Utilities. I also understand that neither this Handbook nor any provision in it creates a contract of employment for any particular duration between the Utilities and me. Further, I understand that nothing in this Handbook creates a contract with specific terms between the Utilities and me. I acknowledge that it is my responsibility to become and remain informed about the employment policies and practices of the Utilities and to abide by the rules, regulations, standards and policies of the Utilities, including those contained in this Handbook. I also understand that any violation by me of the Utilities’ rules, regulations, policies, practices, or standards is just cause for discipline, up to and including termination of my employment. Date Print or Type Name Employee Signature 149 COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4g1 Performance Metrics and Incentive Compensation 1.0 PURPOSE AND SUMMARY The successful performance of the ERMU is measured in terms of the Utilities’ ability to meet our strategic goals and mission. By improving our efficiency and level of performance in meeting our strategic goals and mission we can improve the delivery of value to our customers. To create incentives for employees to take personal responsibility for accomplishment of the Utilities’ strategic goals and mission, the Utilities has established a Utilities Performance Metrics-based Incentive Compensation system (“UPMIC”). Through UPMIC the employees of ERMU will have an opportunity, as a group, to earn annual incentive compensation for each qualifying employee by contributing individually to the overall success of ERMU on a daily basis. Under UPMIC, either all qualifying employees will earn an incentive compensation distribution in a given year, or none will. And not only will incentive compensation under UPMIC in that sense be an all or nothing proposition each year, but there will be an equal percentage share basis for all on which the incentive compensation will be paid out if earned. This appropriately reflects the reality that we all succeed, or fall short, together as a team. To administer the UPMIC and measure objectively the level of performance that must be achieved for qualifying employees to earn incentive compensation, the attached UMPIC Performance Metrics Policy Score Card (“Score Card”) has been created. The Score Card will be subject to revision annually based on the performance metrics adopted by the Commission annually for the coming year (“Performance Metrics”). By tracking and measuring the Performance Metrics and creating incentive for employees to achieve the goals the Metrics embody, the Utilities believes it will be better able to focus efforts and resources on becoming more efficient and successful in meeting our strategic goals and mission and delivering improved value to our customers. 150 2.0 UTILITIES PERFORMANCE METRICS SCORE CARD As reflected on the Score Card, the Performance Metrics are divided into the following three categories: Safety, Reliability and Quality of Utility Services; Workforce Development; and Financial Goals. These categories are used to characterize the overall strategic goals and mission of ERMU. Under the Performance Metrics, these three main categories are then divided into various weighted factors, or sub-categories. These sub-categories, their percentage weight, and the goal or target for each, shall be established by the Utilities Commission annually. The Performance Metrics as adopted are reflected in the attached Score Card. As discussed above, the Performance Metrics and thus the Score Card are subject to modification and adoption by the Commission annually, which will normally occur during the Utilities’ budgeting process. 3.0 UTILITIES PERFORMANCE INCENTIVE COMPENSATION DISTRIBUTION CRITERIA Under the UPMIC a Performance-Based Compensation Incentive, if earned, will be distributed to Qualifying Employees annually. The total amount available to be earned by Utilities employees as a Performance Based Compensation Incentive each year will be an amount up to 2.5% of the Utilities’ total gross wages paid to Qualifying Employees during the Measurement Period. The measuring period used to calculate how much, if any, of the Performance-Based Compensation Incentive the Utilities employees have earned will be the calendar year (the “Measurement Period”). After the Measurement Period is complete and the Commission has received its audit in the spring of the year following the Measurement Period, the Performance Metrics will be applied to determine whether the Performance-Based Compensation Incentive has been earned for the Measurement Period. In doing so, the performance of the Utilities in each sub-category will be reviewed. If the sub-category performance meets or exceeds the established goal, the sub-category will be scored with the designated percentage that will contribute to a total Performance Metrics Multiplier to be used as a factor in calculating the distribution earned, if any, as shown in the Score Card (“Multiplier”). The Multiplier has a maximum factoring effect of 100%. The Multiplier is used to determine how much, if any, of the amount established by the Commission for the UPMIC Performance-Based Compensation Incentive has been earned in the Measurement Period. (For example if the Multiplier equals 100%, the distribution would equal 2.5%. If the Multiplier equals 75%, the distribution would equal 1.875%.) In other words, the amount established by the Commission may be earned on an annual basis by the group of Qualifying Employees (as defined below in Section 4.0) in whole, in part, or not at all. After the Multiplier is calculated on the Score Card, the Performance Based Compensation Incentive earned, if any, will be distributed to Qualifying Employees. The total amount to be distributed as the Performance Based Compensation Incentive will be the product of: a) the Multiplier; and b) 2.5% of the Utilities’ total gross wages paid to Qualifying Employees during the Measurement Period. 151 The percentage of the Performance Based Compensation Incentive awarded to each Qualifying Employee will be based on the gross wages of each Qualifying Employee during the Measurement Period. To each Qualifying Employee, the distribution would be allocated in a lump sum equal to the product of: a) the Multiplier; and b) 2.5% of that employee’s gross wages paid during the Measurement Period. (For example, if a Qualifying Employee’s gross wages earned during the Measurement Period were equal to $50,000 and the Multiplier was equal to 100%, the total distribution to that employee would be equal to: $50,000 x 2.5% x 100% = $1,250.) If the Utilities’ margins are negative due to sudden and unforeseen material changes to the industry or customer base, the Commission reserves the right to withhold distribution of the Performance Based Compensation Incentive in any given year. 4.0 EMPLOYEE QUALIFICATIONS AND DISTRIBUTION OF THE INCENTIVE COMPENSATION An employee of the Utilities will be eligible for participation in the Performance Metrics Incentive Compensation distribution if the employee meets the following eligibility requirements and is therefore a “Qualifying Employee” for purposes of this policy. a. The employee is in good standing with the Utilities. An employee would not be eligible while on disciplinary probation or a performance improvement action plan. b. The employee was a Full Time or Part Time employee during the Measurement Period. Seasonal, and Temporary employees are not eligible. The UPMIC Performance Based Compensation Incentive distribution will be made to Qualifying Employees on the first payroll date after the thirty day period following the date on which the Commission formally receives its annual auditor’s report in an open meeting. POLICY HISTORY: Adopted December 12, 2012 Revised January 14, 2020 Revised December 13, 2022 GP:3300714 v4 152 COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4j3 Customer Deposits 1.0 POLICY To minimize the exposure of bad debt expense for ERMU and its rate payers, which helps keep rates from unfairly increasing for those customers who do pay their bills, customer accounts may be subject to a deposit. 2.0 DEPOSIT REQUIRED All residential, commercial, and industrial customers of ERMU will be required to submit a deposit in the acceptable form set forth below subject to the exceptions set forth below. In addition, existing customers who have been disconnected or previous customers who have had their account sent to collections by ERMU for non-payment of amounts due shall be required to submit a deposit in addition to all amounts owed before service will be reconnected. Existing customers who are establishing a new account or adding an additional account are also subject to the deposit policy. Failure to submit the required deposit at the time of application for commercial accounts, or when due for residential accounts, shall be cause for ERMU to immediately terminate service. 3.0 AMOUNT OF DEPOSIT A. Residential Customers The amount to be deposited for residential services shall be: • $100 for apartments • $100 for water and sewer service • $150 for electric service • $250 for all services. 153 B. Commercial Customers The amount required to be deposited for commercial and industrial services shall generally be equal to two times ERMU’s estimate of the customer’s highest monthly utility bill. For commercial customers on the non-demand rate, the minimum deposit will be $250. For commercial customers on the demand electric rate, the minimum deposit will be $1,000. ERMU may increase or decrease the security deposit based on assessment of risk. 4.0 FORM OF DEPOSIT The deposit shall be in the form of a cash deposit or an irrevocable letter of credit. If in the form of an irrevocable letter of credit, the letter of credit shall be renewed at least 30 days prior to its expiration. Failure to renew a letter of credit will result in the letter of credit being drawn on and the cash recovered from the letter of credit being held by ERMU as a cash deposit. If ERMU is not able to draw on the letter of credit, the customer shall submit a cash deposit prior to expiration of the letter of credit. Failure to submit the required deposit shall be cause for immediate termination of service by ERMU. 5.0 RECEIPT FOR DEPOSIT At the time the deposit is made ERMU will furnish the customer with a written receipt specifying the conditions, if any, the deposit will be diminished upon return. 6.0 RETURN OF DEPOSIT Any deposit received by ERMU shall be returned to the customer within 45 days of termination of service, provided that the customer has paid in full all amounts due on the account. If the customer has not paid in full within 30 days of the termination of service, the deposit will be applied to any outstanding amounts owed by the customer to ERMU. If the deposit exceeds the amount due, the balance will be returned to the customer. If the deposit is not sufficient to cover the amount due, the customer shall remain liable to ERMU for the balance and shall pay the balance due within 15 days of notice from ERMU. ERMU reserves the right to use reasonable legal means to collect amounts due. 7.0 INTEREST ON DEPOSITS Interest shall be paid on all deposits in excess of $20 at the rate established by Minnesota Statutes, 325E.02 (b). ERMU may, at its option, pay the interest at intervals it chooses, but at least annually, by direct payment or as a credit on the customer’s account. 8.0 SUBMISSION OF AND EXCEPTIONS TO DEPOSIT REQUIREMENT A. Residential Customers 154 Residential customers may submit the required deposit at the time service is requested, or have the deposit billed with the customer’s first bill for services provided. Failure to pay a deposit when billed shall be cause for ERMU to immediately terminate service. ERMU may, in its discretion, waive the required deposit for residential customers if the customer consents to ERMU’s collection of credit history data on the customer, the customer’s credit score is above 90 percent probability of non-default, and the customer has no history of disconnection for non-payment to ERMU, and no history of late payments to ERMU two times in 12 months. B. Commercial and Industrial Customers All commercial and industrial customers will complete an application for service that identifies the individual or business entity that will be entering into a service agreement and will pay an application fee per the fee schedule. All commercial and industrial customers shall submit the required deposit and enter into a service agreement with ERMU prior to the time service is desired. The service agreement shall be an agreement on the part of the individual or business entity to make payment of all amounts billed by ERMU for electric, water and sewer services, and to be liable for any default or non-payment of amounts billed by ERMU. ERMU may, in its discretion, reduce or increase the required deposit for commercial and industrial customers if a service agreement is executed by the customer, the customer has provided ERMU with sufficient information to allow ERMU to analyze the credit risk of the individual or business entity executing the service agreement, and ERMU, in its sole discretion, determines to reduce or increase the deposit required based on its analysis. POLICY HISTORY: Adopted March 9, 2010 Revised February 14, 2012 Revised June 16, 2015 Revised February 9, 2016 Revised January 9, 2018 Revised August 10, 2021 Revised December 13, 2022 155 COMMISSION POLICY Section: Category: Governance Results Policies Policy Reference: Policy Title: G.4l4 Third Party Attachment to Assets PURPOSE: Consistent with all Results Policies, the Commission shall establish clear expectations for producing the right results for the right people in the right way. With this policy the Commission affirms their commitment to the Organization Fundamentals Policies prioritizing financial and organization health by protecting its assets. Consistent with the Protection of Assets Policies, the General Manager shall be responsible for appropriate oversight in the protection of the organizations assets to be sure that they are protected, appropriately used, adequately maintained, or placed at undue risk. Part of this oversight is maintaining competitive positions or business arrangements that safeguard’s the business purpose and financial return of ERMU’s assets. Elk River Municipal Utilities will not allow any attachments to our assets without a third party attachment agreement signed and executed. POLICY: The various third party attachment to assets shall be as follows: 1. Pole Attachments - Elk River Municipal Utilities generally does not allow attachments to poles due to the construction design elements of the poles. Elk River Municipal Utilities, upon the terms and subject to the conditions set forth therein, may enter into an agreement providing a grant of license to a third party for the attachment of communication equipment. The Pole Attachment Agreement shall establish requirements for, but not limited to the following: payment terms, method to determine allocation of installation costs, access, design standards, and hold harmless terms. The Utility reserves the right to deny or remove any unsafe or hazardous attachments or attachments made without proper permission or not meeting the terms of the aforementioned agreement. The annual license fee for communication equipment attachments per pole shall be adjusted as needed and published in the Utilities Fee Schedule annually. The third party will be responsible for tracking and inventorying all attachments and will periodically audit to assure accurate quantities for billing purposes. 156 2. Water Tower Attachments - Elk River Municipal Utilities, upon the terms and subject to the conditions set forth therein, may enter into an agreement providing a grant of license to a third party to lease space for the attachment of communication equipment. The Water Tower Lease Agreement shall establish requirements for, but not limited to the following: payment terms, method to determine allocation of installation costs, access, design standards, and hold harmless terms. The Utility reserves the right to deny or remove any unsafe or hazardous attachments or attachments made without proper permission not meeting the terms of the aforementioned agreement. 3. Streetlight Attachments – Elk River Municipal Utilities generally does not allow attachments to streetlights due to the construction design elements of the lights. Elk River Municipal Utilities, upon the terms and subject to the conditions set forth therein, may enter into an agreement providing a grant of license to the City of Elk River for attachments, per the G.2a2 Policy of Streetlight Installation and Maintenance Agreement. This is in support of maintaining a working relationship with the City to realize opportunities for greater value. The Utility reserves the right to deny or remove any unsafe or hazardous attachments or attachments made without proper permission not meeting the terms of the aforementioned agreement. 4. Other Attachments - Elk River Municipal Utilities generally does not allow attachments to its assets due to the construction design elements of the assets. Elk River Municipal Utilities, upon the terms and subject to the conditions set forth therein, may enter into an agreement providing a grant of license to a third party for attachments to assets. The Utility reserves the right to deny or remove any unsafe or hazardous attachments or attachments made without proper permission not meeting the terms of the aforementioned agreement. POLICY HISTORY: Adopted December 13, 2022 157 COMMISSION POLICY Section: Category: Governance Results Policies Policy Reference: Policy Title: G.5a Margins PURPOSE: Consistent with all Results Policies, the Commission shall establish clear expectations for producing the right results for the right people in the right way. With this policy the Commission affirms their commitment to the Organization Fundamentals Policies prioritizing financial and organization health by setting an annual goal for operational margins. The annual strategic and business planning, consistent with the Financial Planning and Budgeting Policy, shall be conducted such that the organization has appropriate operating margins. By establishing clear expectations for operating margins through policy, the Commission creates clear and consistent direction for the General Manager. This clear direction provides stability in organizational vision allowing the General Manager, while developing the annual budget and business plan, to more effectively utilize long range tools, such as multiple year capital improvement plans, to produce both short term and long term financial and organizational health. Additionally, this practice helps to avoid inconsistent direction to the General Manager from year to year such as tight margins one year due to rate competitiveness concerns and concerns another year about revenues and desiring higher margins. POLICY: To promote financial health and organization stability, the General Manager shall develop the annual business plan and budgets for the following services as follows: 1. Electric –The budget shall be developed with margins that are at least 1.5% of total revenue but no greater than 3.5% of total revenue. 2. Water –The budget shall be developed with margins that are at least 1.5% of total revenue but no greater than 3.5% of total revenue. *Margins will also meet requirements set by any bond convenance. 158 POLICY HISTORY: Adopted October 11, 2022 Revised December 13, 2022 159 COMMISSION POLICY Section: Category: Governance Results Policies Policy Reference: Policy Title: G.5b Competitive Rates PURPOSE: Competitive rates play a critical role in customer satisfaction, economic development opportunities, and business retention. The organization’s Mission includes the statement that the services provided are “cost effective.” And the organization’s Fundamentals and Values both specify “competitiveness.” These defining organizational position policies reflect the expectations of the customers, the consumer-owners. With this policy, the Commission recognizes the importance of remaining competitive through strategic short-term and long-term planning, budgeting, and rate design. Consistent will all Results Policies, the Commission shall establish clear expectations for producing the right results for the right people in the right way. With this policy the Commission affirms their commitment to the Organization Fundamentals Policies prioritizing financial and organization health by establishing reporting requirements regarding the competitiveness of rates. POLICY: To provide the Commission with the information needed, in a timely manner, for evaluation of rate competitiveness, the General Manager annually provides a rate competitive analysis report to the Commission prior to rate setting for the following budget year. The report shall include the following information: 1. Electric a. Report the blended $/kWh effective electric rate data (total revenue collected/total kWh sold) as available through the U.S. Department of Energy, Energy Information Administration, Form EIA-861. The report shall include ten-year trend data graphing ERMU electric rates compared to neighboring competitor electric utilities. Recognizing that the data release lags one year, the intent of the report shall be to provide graphical trend data for long term planning rather than short term comparisons. The report shall be provided to the Commission annually prior to rate setting for the following budget year. 160 b. Report customer class rate analysis comparing ERMU electric rates to neighboring competitor electric utilities. The report shall include ten-year trend data graphing ERMU electric rates compared to neighboring competitor electric utilities. The intent of this is to show, from a customer perspective, how rate competitiveness would be perceived currently. The report shall include all rate classes or other unique customer types within rate classes. 2. Water a. Report tiered water rate comparisons, as available locally sourced. The report shall include data graphing ERMU water rates compared to neighboring water utilities. The intent of the report shall be to provide trend data for long term planning rather than short term comparisons. b. Report customer class rate analysis comparing ERMU water rates to neighboring communities, as available through regional AE2S survey reports. The report shall include ten-year trend data graphing ERMU water rates compared to neighboring competitor water utilities. The intent of this is to show, from a customer perspective, how rate competitiveness would be perceived currently. The report shall include all rate classes. POLICY HISTORY: Adopted December 13, 2022 161 Tuesday, January 10: • Annual Review of Committee Charters Tuesday, February 14: • Review Strategic Plan and 2022 Annual Business Plan Results Tuesday, March 14: • Oath of Office • Election of Officers • Annual Commissioner Orientation and Review Governance Responsibilities and Role Tuesday, April 11: • Audit of 2022 Financial Report • Financial Reserves Allocations • Review 2022 Performance Metrics Tuesday, May 9: • Annual General Manager Performance Evaluation and Goal Setting Tuesday, June 13: • Tuesday, July 11: • Annual Commission Performance Evaluation • Review and Update Strategic Plan Tuesday, August 8: • Annual Business Plan – Review Proposed 2024 Travel, Training, Dues, Subscriptions, and Fees Budget Tuesday, September 12: • Annual Business Plan – Review Proposed 2024 Capital Projects Budget Tuesday, October 10: • Annual Business Plan – Review Proposed 2024 Expenses Budget Tuesday, November 14: • Annual Business Plan - Review Proposed 2024 Rates and Other Revenue • Adopt 2024 Fee Schedule • 2024 Stakeholder Communication Plan Tuesday, December 12: • Adopt 2024 Official Depository and Delegate Authority for Electronic Funds Transfers • Designate Official 2024 Newspaper • Approve 2024 Regular Meeting Schedule • Adopt 2024 Governance Agenda • Adopt 2024 Annual Business Plan 2023 GOVERNANCE AGENDA 162 Electric & Water Customers Utilities Commission General Manager Operations Director Engineering Manager IT/OT Technician GIS/Mapping Technician Water Superintendent Water Operations Foreperson Water Operator Water Operator Water Operator Technical Services Superintendent Electrical Tech / Electrician Electrical Technician Locator Locator Substation Apparatus Tech Electric Superintendent Line Crew Foreperson Lead Lineworker Lineworker Lead Lineworker Lineworker Lead Lineworker Lineworker Lead Lineworker Lineworker Lineworker Lineworker (vacant) Field Crew Foreperson Lead Bore Rig Operator Bore Rig Operator Inventory & Procure Foreperson Inventory & Procure Assistant Finance Manager AP/PR Specialist Accountant Administrations Director Governance & Comms. Manager Communications & Admin Coord Customer Service Manager (vacant) Billing Specialist Credit & Collection Specialist Customer Service Representative Customer Service Representative Customer Service Representative Customer Service Representative Conservation & Key Accounts Mgr Human Resources Generalist 2023 Organizational Chart Last Updated December 8, 2022 46 of 48 FTE 163 Utilities Commission Members Paul Bell Email: pbell@ermumn.com Term Expires: 02/28/24 John Dietz, Utilities Chair Council Representative Email: jdietz@ermumn.com Term Expires: 02/28/25 Mary Stewart Email: mstewart@ermumn.com Term Expires: 02/28/25 Matt Westgaard Council Representative Email: mwestgaard@ermumn.com Term Expires: 02/28/26 Nick Zerwas Email: nzerwas@ermumn.com Term Expires: 02/28/26 164 Utilities Commission Meeting Schedule2023 S M T W T F S S M T W T F S S M T W T F S S M T W T F S 1 2 3 4 5 6 7 1 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 2 3 4 5 6 7 8 2 3 4 5 6 7 8 8 9 10 11 12 13 14 15 16 17 18 19 20 21 9 10 11 12 13 14 15 9 10 11 12 13 14 15 15 16 17 18 19 20 21 22 23 24 25 26 27 28 16 17 18 19 20 21 22 16 17 18 19 20 21 22 22 23 24 25 26 27 28 29 30 31 23 24 25 26 27 28 29 23 24 25 26 27 28 29 29 30 31 30 30 31 S M T W T F S S M T W T F S S M T W T F S S M T W T F S 1 2 3 4 1 2 3 4 5 6 1 2 3 4 5 1 2 3 4 5 6 7 8 9 10 11 7 8 9 10 11 12 13 6 7 8 9 10 11 12 5 6 7 8 9 10 11 12 13 14 15 16 17 18 14 15 16 17 18 19 20 13 14 15 16 17 18 19 12 13 14 15 16 17 18 19 20 21 22 23 24 25 21 22 23 24 25 26 27 20 21 22 23 24 25 26 19 20 21 22 23 24 25 26 27 28 28 29 30 31 27 28 29 30 31 26 27 28 29 30 S M T W T F S S M T W T F S S M T W T F S S M T W T F S 1 2 3 4 1 2 3 1 2 1 2 5 6 7 8 9 10 11 4 5 6 7 8 9 10 3 4 5 6 7 8 9 3 4 5 6 7 8 9 12 13 14 15 16 17 18 11 12 13 14 15 16 17 10 11 12 13 14 15 16 10 11 12 13 14 15 16 19 20 21 22 23 24 25 18 19 20 21 22 23 24 17 18 19 20 21 22 23 17 18 19 20 21 22 23 26 27 28 29 30 31 25 26 27 28 29 30 24 25 26 27 28 29 30 24 25 26 27 28 29 30 31 Holidays Jan 2 - New Year's Day observed Nov 10 - Veterans Day Jan 16 - Martin Luther King Jr. Day Nov 23 - Thanksgiving Feb 20 - Presidents' Day Nov 24 - Day after Thanksgiving May 29 - Memorial Day Dec 25 - Christmas Eve observed July 4 - Independence Day Dec 26 - Christmas Day observed Sept 4 - Labor Day January April July October February May August November Commission meetings are held at Elk River City Hall, 13065 Orono Parkway, Elk River, MN, unless otherwise posted. March June September December NOTE: ALL DATES ARE SUBJECT TO CHANGE Commission meetings are held the second Tuesday of each month and begin at 3:30 p.m. 165 MMPA Annual Meeting July 25, 2023 - Location to be determined MMUA Summer Conference August 21-23, 2023 - Duluth, MN 2023 UPCOMING EVENTS 166 Travel Expense Guidelines for Commissioners Meals Food allowances are actual expenditures for meals and gratuity, excluding alcoholic beverages. When employees travel and incur expenses to be reimbursed for meals, please use the following guidelines for spending. This spending amount is based on the IRS established “per diem” amounts for general spending of travelling individuals. Itemized receipts must be submitted for reimbursement. When travelling for the entire day, the maximum to be reimbursed per day is $55. That can be distributed as $10 for breakfast, $20 for lunch, and $25 for dinner. This distribution per day is variable, as long as the maximum is not exceeded. For example, if $5 is spent on breakfast, $30 could be spent on dinner. If there are multiple days involved, the distribution per days is also variable. For example, if $45 is spent one day, $65 could be spent the next day. If you are travelling for a partial day, and only one or two meals are involved, please use the guideline amounts per meal: $10 for breakfast, $20 for lunch, and $25 for dinner. If you are at an event where the meal is provided and included in the fee for the event, please have that meal unless there are extenuating circumstances why you cannot (such as allergies to certain foods.) Additionally, the IRS has established per diems for specific geographic areas of high cost. High cost areas are $76 per day, versus $55. So the per diem amount is different for Washington, DC (a designated high cost area) than Elk River, MN. If you are travelling to areas outside of Minnesota, and are concerned you may be visiting a high cost area, please feel free to visit the IRS website for a listing of these areas. Mileage The 2023 business mileage reimbursement rate is 65.5 cents per mile. Compensation Members of the Commission representing ERMU at meetings/conferences that are in addition to the commission meetings will receive a $75 per day stipend. 167