6.4. SR 07-10-2006
City of Elk River Item Number
REQUEST FOR COUNCIL ACTION 6.4.
Agenda Section I Meeting Date Prepared by
".t\.dtninis tra tion July 10,2006 Lori J ollnson, City ...Administrator
Item Description Reviewed by
Presentation of Pay Plan Reclassification Study
Introduction
1-1r. Rod l<.elsey from Riley, Dettmann, and I-Celsey \vill attend 11onday's meeting to present the results of
tlle pay plan reclassification study.
Discussion
Earlier this year, tlle Personnel Committee presented a request to the City Council to revie\v the city's pay
plan. The city's current pay plan and e\~aluation systetn \vere initially developed in the late 1980's,
updated in 1995, and tTIodified sliglltly in 1999. Ho\vev"er, \vitll the organizational stlucture approved in
NO\7"etnber 2004, it \vas ob,\rious tllat the city llad outgro\vn tlns st1ucture for se\Teral reasons. Gro\vth in
dle number of etnployees and positions and tlle cllange from a flat organization to one \vitll di,\rision
lna1lagers in addition to department lleads did not \vork \veil \~vith tlle existing pay plan. The Council
hired Rod I(elsey in Febluary to re\rie\v tlle city's internal hierarchy and make recommendations on the
city's pay plan.
1v1r. I(elsey \vill prese11t tlle results of tlle study at tlle lueeting on ~vlonday. He \vill also pro\lide
recolwnendations on tile pay plan; ho\vev"er, prior to preparing the final pay plan, \ve need input from tile
City Council on several items including tlle Council's philosophy on pay. For instance, ll0\V does tlle City
Council \vant tile city's pay to relate to tlle tnarket? Do \ve "Tant to be on tile bottom end, tlle middle, or
on the top end? \Y/e lla\re certainly found tllat pay llas been an issue \vith recruiting adding to the
difficulty in filling some upper management positions. Second, \ve have been using t\vel\Te cities as
comparable cities for market cOlnparisons. \Y./ e need input on \Vlletller you belie,\re tllose are tlle correct
cities to be using for tills comparison. TIle list of cities used based on comparable size and grO\vth
pattern is attaclled.
..:\lso attaclled is tile e"valuation criteria used to e\Taluate tlle positions. This methodology is different from
tile PDI system pre\7iously used as it is not task focused and gives credit for education and experience
requirements as \veil as tile problem sol\Ting requirements of tile job. TillS e\Taluation metllod takes more
aspects of tlle position into consideration resulting in a more accurate reflection of tile position. Tius
llelps to accurately v"alue positions SUCll as en,\rironmental, tecllnology, clerical, and others dlat have
cllanged significantly since tlle PDT systeln \vas de\Teloped in the early 1980's.
Once staff recei\Tes direction froln tlle Council on the city's pay philosopllY, I:vIr. l<.elsey \vill \vork ,vith
f\'1S. \V'ipper to de\relop a pay plan for Council consideration. ..:L\.t this time, ,,;"e are assuming that tlle ne\v
pay plan \vill take effect January 1, 2007. Step increases due in July 2006 \vill be based on the cmrent pay
plan and any positions tllat llav"e not prev"iously been assigned a pay grade \vill be assigned one based on
tlle current pay plan and tlle ne\v position luerarcllY.
Pay Plan Presentation
July 10, 2006
Page 2 of2
Financial Impact
TIle positions tllat lla\re cIlanged in tlle hierarchy may hav"e resulting pay increases; ho\ve,\rer, those \vill be
pllased in as step increases so tlle impact to dle budget \vould be minimal. If tlle Council adjusts the pay
plan, tllere \vill be additional costs in the future.
Attachments
List of cities used for market comparison.
Job e\raluation summary and factors from Riley, Dettman & I<elsey.
Action Requested
Receiv"e pay plan reclassification study from ~-1r. I(elsey and prov^ide direction to IV!r. l<.elsey and staff on
tile city's pay philosophy so tllat a re,\Tised pay plan can be dev"eloped.
Council Action
I'vIotion by
Second by _
,Tote
Follow Up
s: \ Council \Lori \2006 \ Pay Plan Presenta cion.doc
Cities used for benchmark comparison.
Andover
Anoka
Champlin
Chaska
Farmington
Hastings
Lino Lakes
Prior Lake
Ramsey
Rosemount
Savage
We use these cities regularly for comparison purposes and also typically use Forest Lake as well.
In this case, we decided not to use Forest Lake because they don't use pay ranges.
JOB EVALUATION
Job evaluation is a systematic process used to establish internal equity
among positions and the foundation for the development of an overall
classification hierarchy. The process has evolved from basic job slotting
to a more refined and systematic application of several compensable
factors to positions being evaluated. Most current job evaluation
methodologies are known as point-factor systems.
Our point-factor job evaluation methodology creates a total point profile
based on the breadth and depth in each position using the factors of:
Formal Preparation and Experience; Decision Making; Thinking
Challenges and Problem Solving; Interactions and Communications; and
Work Environment.
To achieve and maintain effective and ~ias-free job evaluation, evaluators must:
· Exercise consistent application of the system, based on
thorough training and a common understanding of the
concepts of internal equity and position classification.
· Commit to addressing and removing any process bias
which would result in over-evaluating or under-evaluating
a position.
· Ensure that no evaluations are scheduled or completed
without current and complete job documentation and
relevant background information.
· Be sufficiently inclusive from a process standpoint to help
ensure credibility of the job evaluation methodology
throughout the organization. When using a committee for
job evaluation, members chosen for that committee
should, as a whole, represent the breadth and depth of
the organization.
Summary of Job Evaluation Factors in the RDK Job Evaluation System
Formal Preparation and Experience
This job evaluation factor is applied to determine the most representative combination of formal
preparation (schooling at whatever level) and relevant Gob-linked) experience typically required to
Qualifv for the position being evaluated. It is important in this factor to verify the minimum
acceptable qualifications for the position being evaluated. (There are two decisions made on this
factor - one related to formal preparation and one made related to relevant experience.]
Decision Makina (Impact)
This job evaluation factor is applied to determine the regular and ongoing freedom to act; the
extent of the organization affected by those actions; and the best characterization of decision-
making typical of the position being evaluated. [There are three decisions made on this factor _
one related to the degree of freedom to act; one related to the extent of such judgments; and one
related to the nature of decision making.]
Thinkina Chal/enaes and Problem Solvina
This job evaluation factor is applied to determine the representative thinking challenges and
problem solving required on an ongoing basis and thereafter the depth of intellectual response to
those challenges and creativity involved in solving problems. [There are two decisions made on
this factor - one related to the context and complexity of challenges/problems and one related to
the depth of response required to address and resolve such challenges and problems.]
Interactions and Communications
This job evaluation factor is applied to determine the context of business-related interactions and
communications that are an ongoing part of performing the position being evaluated. [There are
two decisions made on this factor - one related to the type and context of business interactions
and one related to the impact of the outcomes and effects on information content and flow
throughout the organization.]
Work Environment
This job evaluation factor is applied to determine the potentiaJ for injury in performing the position
being evaluated and also determine what recognized health hazards regularly exist in the typical
work environment of the position being evaluated. [There are two decisions made on this factor _
one related to potential for injury and one covering the recognized health hazards in the work
environment.]
RILEY, DETTrtiANN & KELSEY LLC
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