Due to supplemental changes in Menlo Park’s agreements with its labor unions and unrepresented management, the city’s union employees will, starting in January, be able to participate in a statewide short-term disability program, and will receive two pay increases between now and when the new contract expires in July 2021. They will receive a 1 percent pay raise come Jan. 1, and an estimated 3.5 percent pay increase in July 2020, depending on increases in the regional cost of living.
In addition, in a step to recruit and retain non-union managers on staff, city employees at the management level will now be eligible for bonuses of up to $20,000, double the previous bonus cap.
The Menlo Park City Council unanimously approved supplemental terms to the city’s agreements with its two employee union chapters — the American Federation of County, State, and Municipal Employees (AFSCME) Local 829, and the Service Employees International Union (SEIU) Local 521 — and agreed to double the bonus cap for non-union managers Oct. 9.
AFSCME & SEIU
There are 37 AFSCME union members on Menlo Park’s staff, who are non-sworn (not police, in other words) and who represent mainly supervisors. There are 162 employees who are part of the SEIU’s Local 521 unit, mainly service workers.
One of the main changes in the supplemental agreements with the unions is a change in the disability policy, according to Menlo Park Administrative Services Director Lenka Diaz. Starting in 2019, employees will be enrolled in the California State Disability Insurance Program, and have access to short- and long-term disability programs, with premiums deducted. The city would pay for long-term disability insurance.
Currently, employees have to use leave time to make up for regular hours missed up to the 45th day before long-term disability kicks in. Under the new plan, a short-term disability policy will take effect for employees starting on day one of family leave and day seven of eligible leave for other reasons. Long-term disability wouldn’t take effect for 180 days. The change is expected to save the city about $23,000 for both unions.
In addition, the 1 percent pay raises employees will receive in January are estimated to cost the city $124,500 for both unions.
Their next raise would occur July 1, 2020, with a guaranteed salary increase between 2 and 4 percent, depending on that year’s increase in the Consumer Price Index, an indicator of changes in the regional cost of living. The raise is expected to be about 3.5 percent in July 2020, according to a staff report that indicated an estimated cost to the city of $899,000 for both unions.
The new terms also include increases to employees’ “cafeteria” health plans, commensurate with the increases in the Consumer Price Index, starting Jan. 1, 2021, which are expected to cost the city $136,600 for both unions.
The supplemental agreements include a provision for AFSCME employees that permits them to cash out unused compensatory time at overtime pay rates once he or she has accumulated the maximum amount, and, at the end of the year, to be paid for all unused compensatory time at the employee’s regular pay rate. SEIU employees already have this benefit, Diaz said.
Managers
The council also approved changes to the bonus program for the city’s management employees, who aren’t part of a union, agreeing to double the amount that managers may receive in bonuses, up to $20,000, for the 2018-19 fiscal year. The total 2018-19 budget for management bonuses is not being increased, and there is no proposed management bonuses budget for future years, according to Diaz.
The city has had a hard time hiring new managers, especially this year: Currently, seven of the city’s 24 unrepresented management positions, or about 29 percent, are vacant or under recruitment to fill.
One contributing reason for that, said Diaz, is that the city’s retirement formula and retiree health benefits for new employees are “some of the least generous in San Mateo County.” That’s partly by design: Keeping pension costs down is a priority for the city’s finance watchdogs, who don’t want the city to put itself in a fiscal pickle to pay for promised pension contributions it can’t afford in the future. Increasing the cap to $20,000 was considered a step to recruit and retain employees. Such earnings are not “pensionable,” so they are considered easier on the city funds in the long-term.
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