HomeMy WebLinkAboutAgenda - 10-05-2010 - 7dORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: October 5, 2010
Action Agenda
Item No. ~_
SUBJECT: 2011 Employee Benefits Recommendations
DEPARTMENT: Human Resources PUBLIC HEARING: (Y/N) No
ATTACHMENT(S):
1. Impact of Affordable Care Act
2. Health Insurance Overview
3. NCACC Interlocal Agreement
4. Dental Insurance Overview
5. Flexible Spending Account Overview
6. Supplemental Benefits Overview
7. Overview of Paid Leave Accruals
8. Proposed Amendment to Article IV,
Section 5.0 and Repeal of Article IV
Sections 10.0 and 23.0 of the Orange
County Personnel Ordinance
INFORMATION CONTACT:
Michael McGinnis, Human Resources
Director, 245-2552
Diane Shepherd, Benefits Manager,
245-2558
Clarence Grier, Financial Services
Director, 245-2453
Annette Moore, Staff Attorney, 245-2317
PURPOSE: To provide the Board with information on employee benefits and leave and present
the County Manager's recommendations for Employee Benefits for the 2011 Calendar Year.
BACKGROUND: The County provides permanent employees with an excellent comprehensive
benefit plan which includes health, dental, life insurance, employee assistance, flexible
compensation, supplemental retirement and paid leave.
For the past two years economic stresses have significantly challenged Orange County's ability
to continue to maintain the level of benefits expected by County employees. In response to
these challenges, the County implemented a number of personnel services cost saving
reduction programs, including suspension of the County 401(k) contribution to general
employees, no funding for salary increases (Merit or In-Range), allowance of voluntary
furloughs, institution of a six-month hiring freeze and where possible, and the elimination of
many vacant positions. Through these cost saving programs, and by budgetary cuts across the
organization, the County has been able to retain permanent employees. However, overall
staffing levels have decreased through the elimination of vacant positions and retirement. As
the number of positions and operational budgets within the County has decreased, the demand
for County services continues to increase and it has important to find ways to continue to
demonstrate the County's commitment to employees without increasing costs.
Employees have shown their willingness to engage in healthy activities to keep health insurance
benefits at current levels and to minimize costs such as: eighty-five percent of employees
completed the Health Assessment between October 2009 and March 2010, employees
2
participated in several successful wellness challenges and walking events as well as attended
Wellness/Employee Appreciation Day. In addition, over 200 employees attended group
meetings to learn more about their benefits and how their individual actions impact the cost of
health insurance.
Human Resources produced Wellness Weekly emails to provide details about benefits, county
employees' health and regulatory communications. Articles in Orange Alive as well as
discussions with employees and department directors further informed employees on how to
use their health care effectively. Staff was involved in presentations and discussions
throughout the year with the Employee Relations Consortium (ERC) and its Pay and Benefits
Committee to solicit their opinions regarding employee benefits. A Total Compensation Report
was issued to each permanent employee detailing the overall value of 2009 annual salary and
benefits.
The County benefits package is one way in which the County attracts and retains employees. li
is key that County benefits remain competitive to keep and retain qualified employees.
However, the need to provide competitive employee benefits must be balanced by an
awareness of the impact the costs associated with the benefits have on the County budget.
Staff has reviewed employee benefits and is providing a recommendation for benefits in 2011,
considering the current financial impact and the sustainability of such benefits going forward.
2011 Benefit. Plans
The following employee benefits are recommended for implementation for the 2011 calendar
year:
1. Health Care
a. The Affordable Care Act -Early Retiree Reimbursement Program
As a result of the heath care reform a component of the newly adopted Affordable Care Act
provides for reimbursement for 80% of medical costs through an Early Retiree Reimbursement
Program. Reimbursement is available for claims for pre-65 retirees covered by the County
Health Plan beginning June 1, 2010. Reimbursements must be used to reduce health benefit
premiums or costs; and/or reduce plan participants' health benefit premiums or out of pocket
expenses. Based on the County's past claims, it is estimated that the County may be eligible to
receive conservatively $150,000 over the next 18 months. The County must apply for this
program. Attachment 1 provides more detail related to health care reforms mandated by the
Affordable Care Act.
b. Renewal of Health Care Plans
The County currently provides two fully-insured health insurance plans for employees and pays
the employee portion of the coverage as well as a subsidy for dependent coverage. An
overview of the current plans, plan participation, and initial recommendations are described in
Attachment 2. The County received 2011 renewal rates from the North Carolina Association of
County Commissioners (NCACC) for the two fully-insured health insurance plans; with a total
increase of 6.5%. This amount is within the 7% increase budgeted by the Board for FY 2010-
11.
Staff also received rates for a renewal of the same health plan design with potential self-insured
funding costs from the NCACC. Staff and benefits consultant, Mark III, closely analyzed the
claims and costs of aself-insured health care plan. Adequately funding aself-insured health
insurance plan would result in a 12% increase in funding for 2011, which is 5% above the
budgeted increase of 7%. The Manager does not recommend pursuing self-insurance for 2011
because it would not provide any financial savings at this time.
c. Participation in the NCACC Risk Management Agency ("Risk Pool")
The County currently participates in the NCACC Risk Pool. Attachment 3 is the NCACC
Interlocal Agreement Group Self Insurance Fund for Risk Sharing or Group Purchase of
Insurance which allows the County to join and participate in the NCACC Risk Pool which
provides coverage for Worker's Compensation, Liability and Property and the Health Insurance
Trust. The County has budgeted $6,338,000 for active employees' and an additional
$1,352,000 for retiree health insurance in FY 2010-11..
Recommendations:
• Authorize the Manager to sign the Early Retiree Reinsurance Program Plan Sponsor
application and Plan Sponsor Agreement and further authorize the Manager or designee
to carry out the program;
• Approve the renewal of the fully-insured health insurance plans with the NCACC with an
increase of 6.5%; and
• Approve the resolution and authorize the Manager to sign the NCACC Interlocal
Agreement for a Group Self Insurance Fund for Risk Sharing or Group Purchase of
Insurance. (See Attachment 3)
2. Dental Insurance
The County provides dental insurance through aself-insured dental plan with Delta Dental of
North Carolina. The County pays all costs for employee coverage (claims and an administrative
fee to Delta Dental). Employees pay the full premium for dependent coverage. Dental claims
are paid according to a unique Orange County Table of Allowances (TOA). Because of the
historically low levels of dental claims payments, the County increased its levels of
reimbursement for claims in both 2009 and 2010. The County continues to have low levels of
dental claims payments, and staff is recommending an increase in the reimbursement amounts
for endodontics, extractions, and major restorative care. The County budgeted $251,600 for
dental insurance for fiscal year 2010-11, which is sufficient to sustain increased levels of
reimbursement. An overview of the dental plan and recommended enhancements are provided
in Attachment 4.
Recommendation:
Change the Orange County Table of Allowances to increase the reimbursement amounts
for Endodontics, Periodontics, Extractions, and Major Restorative Benefits. (Attachment
4)
3. Flexible Compensation Plan
The County provides a Section 125 Flexible Compensation Plan administered by Tucker
Administrators. This Plan consists of: a) tax sheltering of health and dental premiums and b)
two Flexible Spending Accounts (a medical spending account and dependent/child care
spending account). Employees save money because no income or social security taxes are
deducted from contributions made to these accounts.
Attachment 5 is an overview of the flexible spending accounts, including changes mandated by
the Affordable Care Act. The County pays the administrative costs when employees choose to
contribute to a flexible spending account. The County has budgeted $15,600 for these
administrative costs in Fiscal Year 2010-11, however benefits consultant, Mark III, has
recommended they pay the administrative costs as part of their consultant services. Staff will
follow up on this.
Recommendation:
• Change to the Flexible Compensation Plan, as mandated by the Affordable Care Act, be
implemented for 2011. (Attachment 5)
4. Employee Assistance Program (EAP)
Magellan Behavioral Health provides the County's EAP for County employees and their
dependents. The EAP provides confidential assessment and counseling services, 24/7
emergency services, and legal consultation. The EAP is a complement to services provided
through the County Health Plan at no cost to employees or their dependents. The current
Agreement is being renewed for two years (January 1, 2011-December 31, 2012), at the same
rate as the 2009-2010 contract ($1.61 per employee per month). The County has budgeted
$15,500 for the Employee Assistance Program in FY 2010-11.
Recommendation:
• No changes to the EAP for 2011.
5. Life/Accidental Death and Dismemberment Insurance
The County provides an employer-paid life insurance benefit equivalent to the employee's
annual salary with a maximum benefit of $50,000. The three-year contract with MetLife ends
December 2010. County staff has successfully negotiated athree-year rate beginning January
2011 to December 2013 at the same cost (22.5 cents for every $1,000 of coverage for life and
accidental death and dismemberment insurance) as the current contract. Employees may
purchase additional term life insurance through this Plan, which continues to be administered
through Mark III Employee Benefits. The County has budgeted $96,600 for life insurance in FY
2010-11.
Recommendation:
No changes to the current benefit are recommended for 2011.
Approve the three-year rate renewal and authorize the Manager to sign any agreement
with MetLife, pending review by the County Attorney.
6. Supplemental Benefits
Orange County allows employees to purchase supplemental insurance benefits such as short
term disability, cancer and hospitalization insurance through payroll deduction. Staff has
solicited the services of Mark III, a benefits consultant specializing in governmental employees,
to assist in developing and improving the supplemental insurance benefit program and will be
negotiating an agreement with Mark III. This will allow the County to enhance its supplemental
insurance benefits with minimal or no cost increase to the employees who currently have these
benefits, and will enable more employees to participate in these programs. Attachment 6 is an
overview of the supplemental benefit program with utilization information and recommended
changes in insurance carriers.
Recommendation:
• Authorize employee payroll deductions for supplemental insurance benefits.
7. Employee Paid Leave
Permanent, full-time County employees currently earn vacation, petty and personal leave for
each month in which they are in a pay status for one-half the month. Attachment 7 provides an
overview of employee leave, including recommended changes and a chart of current and
proposed accruals. As the County moves forward with automated time-keeping and self service
programs., additional efficiencies to administrative processes must be considered. Expense to
the County occurs when employees separate from employment and are paid for vacation
accruals (to a maximum of 240 hours). Attachment 8 details the proposed changes to the
Personnel Ordinance. Recommended changes to the Personnel Ordinance would:
1. Combine petty, personal and vacation leave effective January 1, 2011 into
anew category of Annual Leave.
2. Change Annual Leave accruals from a monthly to bi-weekly basis,
3. Provide that all annual leave could be used in increments of 15 minutes.
4. Increase leave accruals by adding 29.9 total hours a year, or 1.15 hours to
each of 26 pay periods, to the existing vacation accrual rates. (Please note
that 30 hours is not equally divisible by 26 pay periods.)
Recommendation:
The Board amend the Orange County Personnel Ordinance Article I V, Section 5.0
Employee Leave and Repeal Article lV, Section 10.0 Petty Leave and Article IV, Section
23.0 Petty Leave (See attachment 9)
8. Tuition Refund Program
Orange County provides a tuition refund program for permanent employees for the purpose of
assisting them further their education and skills. All courses must be job related and approved
by the Department Director. Refunds are for tuition, fees and required books, and are limited to
$600 per employee in a fiscal year. Students may attend traditional or on-line courses. The
County has budgeted $11,000 for tuition refunds in FY 2010-11.
Tuition Refund Program Funding and Participation
Ex enditures # of Partici ants
FY 2003-04 $7,846 18
FY 2004-05 $10,000 22
FY 2005-06 $10, 979 23
FY 2006-07 $8,399 17
FY 2007-08 $9,174 18
FY 2008-09 $5,588 12
FY 2009-10 $9,958 18
Recommendation:
• No changes are recommended to the Tuition Refund Program.
Next Steps:
Pending approval of the 2011 Employee Benefits Renewal, Staff will
• Develop and disseminate communications and schedule informational meetings.
• Hold Open Enrollment, tentatively scheduled for October 20 to November 18.
6
• Conduct multiple wellness events, including flu shot clinics provided Orange County
Health Department, at various locations.
• Enter into any necessary agreements.
Future Plans
• Human Resources and Health Department staff are reviewing the feasibility of
developing an employee health clinic that would provide services to employees during
the work day. Components to be further researched include service model, cost,
location, staffing and privacy concerns.
FINANCIAL IMPACT:
Health Insurance: The 6.5% health insurance increase is within the FY 2010-11 approved
budget of 7%.
Total Annual County Cost (Active Employee/Retiree
Cost Employees & Cost for Dependents
Retirees
Current Premium $8,290,000 $6,830,000 $1,460,000
Renewal Full -Insured $8,830,000 $7,300,000 $1,550,000
Early Retiree Reimbursement Program: Funds received from this program are conservatively
estimated at $150,000 over an 18-month period and may only be used for specific health care
related expenses.
Dental Insurance: There is no impact to the FY 2010-11 approved budget. Dependent
premiums and county contributions will remain the same for 2011. Increases in claim payments
are anticipated and are expected to reduce the balance in the dental account.
Life/Accidental Death and Dismemberment Insurance; Flexible Compensation Plan/Flexible
Spending Accounts; and Employee Assistance Program:
There is no additional budget impact. All costs are based on the number of active employees
or participants and will remain the same for 2011, fluctuating throughout the year due to the
number of covered employees.
Supplemental Benefits:
There is no financial impact to the County because the cost of these benefits is borne by the
employees who participate.
Annual Leave:
There is no financial impact because leave is already incorporated into annual salaries, and the
same amount of leave will continue to be paid at separation from Orange County.
RECOMMENDATION(S): The Manager recommends that the Board:
• Authorize the Manager to sign the Early Retiree Reinsurance Program Plan Sponsor .
Application and Plan Sponsor Agreement and authorize the Manager or designee to
carry out the program;
• Approve the renewal of the fully-insured health insurance plans with the NCACC at an
increase of 6.5%;
• Approve the resolution and authorize the Manager to sign the NCACC Interlocal
Agreement Group Self Insurance Fund for Risk Sharing or Group Purchase of Insurance
for Health Care Trust Group Benefits, Liability and Property and Worker's Compensation
Pools},
• Approve changes to the Orange County Table of Allowances to increase the
reimbursement amounts for Endodontics, Periodontics, Extractions, and Major
Restorative Benefits;
• Approve changes to the Flexible Compensation Plan, as mandated by the Affordable
Care Act, to be implemented beginning January 1, 2011;
• Approve the three-year rate renewal and authorize the Manager to sign any agreement
with MetLife, pending review by the County Attorney;
• Authorize employee payroll deductions for supplemental insurance benefits; and
• Amend the Orange County Personnel Ordinance Article fV, Section 5.0 Employee Leave
effective January 1, 2011 and repeal Article IV, Sections 10.0 Petty Leave and 23.0
Personal Leave effective December 31, 2010.
Attachment 1
Page
THE IMPACT OF THE AFFORDABLE CARE ACT ON ORANGE COUNTY
Recent National legislation has made significant changes to the way employers administer
health insurance, but will have minimal impact on Orange County in the next few years. The
chart below shows the impact of the changes the Affordable Care Act (ACA) will have on
Orange County employees and retirees for the next eighteen months.
Chan a in Le islation How Oran a Coun Will Be Affected
Dependent coverage allowed for adult Dependents up to age 26, regardless of
dependent children up to age 26. The student status, have been eligible to remain
only exception is if the child is not on our health insurance since January
eligible to enroll in other employer- 2010. Beginning January 2011, the
provided coverage. definition of dependent will include married
children er ACA.
Elimination of pre-existing condition No impact; already part of our plan.
exclusions for children under a e 19
Elimination of coverage rescissions No impact; already part of our plan.
(cancellation of coverage) after
someone has submitted medical
claims.
Elimination of lifetime maximum No impact; already part of our plan.
covera a limits.
Requires preventive care benefits be No impact; already part of our plan.
rovided.
Requires time for FLSA non-exempt Effective immediately. Minimal impact;
employees and a private space be mothers are not required to be paid for this
rovided to nursin em to ees. time.
Over the Counter (OTC) medications Our plan for 2011 will be changed to reflect
require prescription to be eligible under this.
Flexible S endin Account.
W2 for 2011 must report the value of 2011 W2s, issued in 2012, must be revised
health covera a to include value of health insurance
Provide Health Insurance to ALL Reduce work schedule of all temporary
employees working 30 hours or more a staff to below 30 hours a week
week (not just permanent employees)
effective 2014.
A temporary, retiree health subsidy (Early Retiree Reimbursement Program) will be available to
the County for claims beginning June 2010 for retirees age 55 or older who are not eligible for
coverage under Medicare. Reimbursement is for 80% of health claims (medical, surgical,
hospital, prescription drug and others to be defined) that are between $15,000 and $90,000.
Staff is working on the application to ensure the County can take advantage of this subsidy.
9
Attachment 2 Page
HEALTH INSURANCE OVERVIEW
Two health plans are contracted through the NCACC Health Insurance Trust and administered
by CIGNA: a Health Maintenance Organization (HMO) and a Preferred Provider Organization
(PPO). Because of the higher coverage level, the cost of the HMO is higher than the PPO
HMO PPO in network PPO out of network
Office Visits (Primary $15 $15 70% after deductible
Care of $500 is met
Office Visits $30 $30 70% after deductible
S ecialist of $500 is met
Emergency Room $150 $150 $150; 70% after
Co-Pay deductible if not a true
emer enc
Deductible--Applies to $250 $250 $500--Applies to all
all other services, services, inc. lab work
excludin lab work
Co-Insurance None 10% up to 30%, up to
(employee's $1,000/year $2,000/year
responsibility for
char es
Out of Network No Yes Yes
Providers Allowed
Individual Premium, $531.44 $509.02
effective Jan 1, 2011
Total Family
Premium, effective
Jan 1, 2011 (County $1,594.28 $1,527.08
subsidizes at same
rate for both lans
The current number of employees enrolled in each plan, past rate changes, and past plan
changes to employee health insurance are shown below.
HEALTH INSURANCE PARTICIPATION
Health Plan Number Enrolled
Total Active Retirees
Employees
Open Access Plus In-Network Co-
Pay (HMO) 815 69 123
Open Access Plus Co-Pay (PPO)
119 104 15
10
Attachment 2 Page
The County currently pays 100% of the monthly premium for individual coverage for both the
HMO and PPO plans. The County also subsidizes the premium cost for the employee's
dependent coverage at 52%, based on the lower priced plan (which is the PPO plan). This
practice was established several years ago to provide affordable and thus, accessible health
insurance coverage for dependents (spouse, domestic partner, and/or children) to employees.
This is particularly attractive to lower salaried employees for whom dependent health insurance
coverage is a significant percentage of salary. Continuation of this level of subsidy maintains a
"family friendly" feature that is highly valued by the 40% of employees with dependent coverage.
Employees with dependent coverage will see an increase of 6.5% in their premiums this year.
For 2010, the national health care trend (percentage increase in claims costs that actuaries
expect to see in the next 12-month period) has continued to increase at a rate of 10% over the
previous year.. The trend in North Carolina has been 12%. Because of lower claims experience
over the last 18 months the Orange County increase was trended to be closer to 7%. Based on
this trending, the FY 2010-11 budget included a 7% increase for health insurance. The renewal
rate from the NCACC for the same health insurance plans, with minor plan design changes, has
resulted in an overall increase of 6.5% effective January 2011.
Two enhancements are recommended to the plan design, and have been included in the
renewal rates for both the HMO and PPO plans. The County pays the employee premium as in
previous years, for both plans. Both HMO and PPO plan designs are renewed at the same
level as 2010 including enhancements:
a) Coverage for up to $1,000 per year for hearing aids; and
b) Coverage for dependents up to age 26 regardless of student or marital status as
specified by health care reform legislation.
Elimination of the CIGNA Health Advisor program is recommended because this fee program
duplicates many of the components of the chronic disease management program provided by
Alere, as part of the NCACC health insurance.
Renewal: The County contribution formula for the employee premium .and dependent coverage
remains at the same rate as previous years, for both HMO and PPO plans. Orange County
remains fully-insured for health insurance with the increased premiums remaining in effect for
the full 2011 plan year. Costs are based on an annual premium per member based on
coverage level, and those premiums cover all administrative costs, medical and prescription
claims, and additional stop loss insurance.
In considering the renewal, Staff and consultant Mark III reviewed the cost of self-insured
funding focusing on the claims costs and the amount of risk the county is willing to take, the
cost of stop loss insurance, and cost of employees' premiums for dependents. Costs to Orange
County include the actual claims and administrative fees, which includes the cost of specific and
aggregate stop loss insurance. Specific stop loss insurance provides protection when individual
claims exceed a certain dollar amount, such as $50,000. Aggregate stop loss insurance
provides protection should the total claims cost exceed the anticipated amount, such as 125%.
Based on the strong renewal for fully-insured coverage, the County would not benefit by making
a change to self-insurance.
Attachment 2
HEALTH INSURANCE OVERVIEW
Rate Changes
The chart below lists past increases implemented by the NCACC Health Insurance Trust:
Page
Calendar % Monthly Cost of Monthly Increase in Coverage Changes to the
Year Increase in Employee Only Employee Only Plan
total Coverage coverage over previous
premium year
rate
2011 6.5% $531.44 $32.44 $1000 allowance for hearing
aids; remove Health Advisor..
2010 2.5% $499.00 (HMO) $13.12 $0 generics, increase in
number of therapy visits, no
cost visits to Minute Clinics
2009 7.9% $485.88 (HMO) $40.82 Addition of Health Advisor
ro ram
2008 9.7% $445.06 (HMO) $39.42 Increased office visit co-pays
$10/$20 to $15/$30
2007 1.9% $405.64 $7.40 Free preventive care
2006 16.5% $398.24 $55.47 $250 deductible added to HMO
2005 -3.6% $342.77 -$12.84- None
2004 13.8% $355.61 $43.17 Increase in ER co-pay ($100 to
$150
2003 25.0% $312.44 $62.50
2002 8.0% $249.94 $18.41
Attachment 2
Page
HEALTH INSURANCE OVERVIEW
MONTHLY PREMIUMS
Open Access Plus In-Network Co-Pay Plan
(HMO)
Total Premium County Cost Employee Cost Monthly
E
l # of
2010
2011
2010
201
2010
2011 mp
oyee
Increase Employees
Affected
Em to ee $499.00 $531,44 $499.00 $531.44 $0.00 $0:00 $0.00 460
Em /Child $698.58 $743:98 $577.38 $614.89 $121.20 $129,09 $ 7.89 95
Em /Children $963.06 $1 025.66 $709.10 $755.19 $253.96 $270.47'' $ 16.51 74
Em /S ouse $1 052.88 $1 121.32' $753.83 $802.82" $299.04 $318:50 $ 19.46 82
Em /Famil $1 496.98 $1 594:28 $975.04 $1 038.41' $521.94 $555.87 $ 33.93 104
Open Access Plus Co-Pav Plan (PPO1
Total Premium County Cost Employee Cost Monthly
Em
lo # of
E
l
2010
2011
2010
2011
2010
2011 p
yee
Increase mp
oyees
Affected
Em to ee $477.96 $509:02 $477.96 $509:02 $0.00 $0:00 $0.00 74
Em /Child $669.14 $712.62 $577.38 $614.89 $91.76 $97.73 $ 5.97 13
Em /Children $922.46 ` $982.42 $709.10 $755:'19 $213.36 $227.23 $ 13.87 10
Ern /S ouse $1,008.48 $1,074:02 $753.83 $802.82' $254.64 $271:20 $ 16.56 8
Em /Famil $1433.88 $1'527:08 $975.04 $1 038.41 $458.84 $488.67. $ 29.83 14
2
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A-}~-achr~en+ 3 ,s
N O R T H C A R D L I N A
ASSOCIATION OF COUNTY COMMISSIONERS
INTERLOCAL AGREEMENT
FOR A GROUP SELF-INSURANCE FUND
FOR RISK SHARING OR GROUP PURCHASE OF COVERAGE
This Agreement is made and entered into by and between all the parties who join together to become
Members of the North Carolina Association of County Commissioners Risk Management Agency
(hereinafter referred to as the "Risk Pool"). The Risk Pool acts by and through its Board of Trustees
as provided herein and as provided within the Bylaws of the Risk Pool. The Risk Pool encompasses
the North Carolina Association of County Commissioners Joint Risk Management Agency Workers'
Compensation Fund {hereinaf#er referred to as the "Workers' Compensation Pool"); the North
Carolina Association of County Commissioners North Carolina Counties Liability And Property Joint
Risk Management Agency {hereinafter referred to as the "Liability and Property Poo!"); and the North
Carolina Association of County Commissioners Health Insurance Trust (hereinafter referred to as the
"Group Benefits Pool°; all three are referred to collectively as "Pools"}.
ARTICLE 1. PURPOSE
1. To carry out the desire of certain counties and governmental entities of the State of North
Carolina to create and become the Risk Pool, and to enable these coun#ies to pool the retention
of their risks, liabilities or payments, or for the group purchase of coverage, pursuant to the
provisions of North Carolina General Statutes 153A 92(d), 153A-445(a)(1) and 160A-460
through 160A-466.
2. To be governed and directed through the efforts of the Risk Pool Board of Trustees, as
described in the Bylaws of the Risk Pooi, which are incorporated by reference into this
Agreement.
3. To provide for the discharge, from the assets of the Risk Pool, from funds roller#ed from
Members, and through excess or other insurance purchased by the Risk Pool, in accordance
with the terms and scope of the contracts of coverage and as determined by the participation of
the individual Members of the Risk Pool, of any: a) insurance premiums; b) covered property
losses incurred; c}lawful liability claims against any member of the Liability and Property Pooi in
which awards have been sustained by final judgment or by the rules of the Risk Pool if
settlement is made; d) claims for health benefits covered by the plan for members of the Group
Benefits Pool and e} lawful workers' compensation claims against members of the Workers'
Compensation Pool, when awards have been sustained by final judgment ar by the rules of the
Risk Pool if settlement is made.
4. To provide for payment by Members of the Risk Pool of contributions based upon appropriate
classi#ications, rates, experience modifications, or other methodologies, out of a portion of which
the Risk Pool will establish and main#ain a fund far the payment of covered claims, losses and
the administrative costs of operating the Risk Pool.
Interlocal Agreement Page 1 of 6
Amended December 2009
14
ARTICLE 11. E1=1:ECTIVE DATE, DURATION AND MEMBERSHIP
Any qualifying county or governmental unit that formally applies for membership in the Risk Pool will
be admitted and become a Member. This Agreement is effective as of the date the Resolution
adopting this Agreement is executed, and the membership application and fully executed Resolution
are incorporated by reference into this Agreement. This Agreement replaces a!I prior Interlocal
Agreements and Participation Agreements, is effective from year to year, and shall remain in force
unless terminated in writing by the Risk Pool, the Member, or the Board of Trustees as specified
herein.
Risk Pooi Members may join the Workers' Compensation Pool, Liability and Property Pool and the
Group Benefits Pool, or may elect to only join one or iwo of these offered Pools. Members shall
designate the membership election on the Resolution and provide a new, fully executed Resolution if
individual Pool membership changes.
Under the plans offered by the Risk Pool, a Member`s coverage will be automatically renewed on the
termination date of the coverage regardless of whether payment for the subsequent coverage period
has been received by the Risk Pool. The continuation of coverage will be pursuant to the same terms
and conditions as the expiring coverage and as set forth in this Agreement. Each renewal shall be
subject to a recalculation of contributions by the Risk Pool.
ARTICLE III. TERMS AND CONDITIONS
1. The coverage terms, deductibles, conditions, limits of liability, exclusions, exceptions,
agreements, requirements #or cooperation of Members, subrogation and other #erms of
membership shall be governed primarily by the Coverage Documents and secondarily by the
Member Guide distributed to the Members.
2. Accurate information is necessary to determine the Group Benefits contribution, including the
number of employees, dependents to be covered and the claims experience of the individuals
subject to coverage. The Member must provide accurate information as requested within thirty
(30) days of the date of the request. if accurate information has not been provided, the Risk Pool
has the discretion to adjust the contribution amount accordingly.
3. A Member may be eligible for a multi-pool discount if the Member is a member of two (2) or
more Pools. Any Member that has outstanding contribufions due to the Risk Pool from the most
recent fully completed fiscal year will have their multi-pool discount adjusted by the amount of
those outstanding contributions.
4. Changes in funding types, rates and plan specifications will occur only on the Member's renewal
date and wUl remain in effect for the coverage period. However, the Risk Pool reserves the right
to make. adjustments to the Member's contribution and/or the plan specifications if a material,
substantive amendment or modification to the Group Benefits coverage is instituted. It is the
responsibility of the Risk Poot to provide notice to the Member sixty (60) days prior to any such
contribution change, amendment or modification.
5. Contributions are due on or before the 1st day of each month. If a Member fails to remit the
required contribution, the Risk Pool may suspend the payment of the Member's claims in
t
Interlocal Agreement Page 2 of 6
Amended December 2009
15
accordance with the Payment Policy adopted by the Board of Trustees. In the event of
termination of this Agreement, the Member remains responsible for any contributions payable, up
to and including the date of termination.
6. All claims for employees and authorized individuals are required to be timely reported to the
Claims Administrator. Failure to do so may result in the claim not being reimbursed. Group
Benefits claims submitted later than twelve (12) months following the date of termination shall
not be paid.
7. The Member shall cooperate with the Risk Pool concerning settlement efforts, litigation or
anticipated litigation of any claim. If a claim is made, a lawsuit is filed or court notices are
received by a Member or its representative that may fall within the scope of Risk Pool coverage,
the Member shall immediately forward to the Risk Pool every document received. Pursuant to
the Risk Poops request and payment by the Risk Pool of reasonable expenses, the Member
shall attend hearings, trials and other proceedings if requested and will assist in effecting
settlements, in securing and providing evidence, in attaining the attendance of witnesses and in
fully cooperating with the Risk Pool and ifs designee with regard to the defense of the claim.
8. No Member shall make voluntary and direct payment of a claim or aclaims-related expense
without the prior approval of the Board of Trustees or its designee. Any Member making a
voluntary payment or entering into an agreement #o pay without approval will be responsible for
the claim and any expenses paid or committed, including the cost of a legal defense.
9. The Risk Pool may use and disclose the Personal Health Information of individuals subject to
this coverage only in compliance with the HIPAA Privacy Rule and other applicable provisions.
10. This Agreement and coverage with Pool(s) may be canceled by the Risk Pool on the renewal
date after providing written notice by certified mail, return receipt requested, to the Member at
least sixty {60) days prior to the renewal date. The Risk Pool may also cancel this Agreement
andlor the coverage provided at any time pursuant to the following: (a) after giving ten (10) days
written notice to the Member in accordance with the terms of the Payment Policy adopted by the
Board of Trustees; {b) if the Member reorganizes or dissolves; or (c) if the Member fails to
initiate and administer any reasonable loss prevention recommendation submitted by the Risk
Pool to the Member.
11. The Member may cancel this Agreement ar membership in an individual Pool without penalty on
the renewal date of coverage if it provides written, advance notice to the Risk Pool at least sixty
(60} days prior to the coverage renewal date. If notice of termination to the Risk Pool is provided
less than sixty (60) days before the Member's renewal date, but prior to the renewal effective
date, ten percent {10%} of the annual estimated renewal contribution must be paid by the
Member. If notice to the Risk Pool is provided after the renewal date, the total annual estimated
renewal contribution must be paid by the Member. The Member may file an Appeal with the
Board of Trustees, pursuant to Paragraph 12 of this Article, requesting that this Agreement be
terminated as to Group Benefits Pool membership at a time other than the renewal date when a
substantive amendment or modification to the Group Benefits coverage is instituted.
12. The Member shall have the righ# to file an Appeal concerning any action taken or decision made
by the Risk Pool in accordance with the Appeals Procedures adapted by the Risk Pool, by
requesting review by the Risk Pool's Board of Trustees, whose decision will be final. Any Appeal
Interiocal Agreement Page 3 of 6
Amended December 2008
16
shall be submitted in writing to the Director of Risk Management Services within thirty (30) days
of the challenged decision or action.
13. in the interest of providing effective governance, the Member, or at least one of its budgetary
contributors, mus# be a member of the North Caroiina Association of County Commissioners
(hereinafter °Association").
14. The Association is designated as the Administrator of the Risk Pool unless otherwise designated
by the Board of Trustees. As detailed further in the Service Agreement between the Risk Pool
and Association, the Administrator supervises all other service contractor(s), deposits ail
contributions as colEected to the bank account(s) designated by the Board of Trustees, and
disburses monies as provided by the policies, rules, regulations and Bylaws of the Board of
Trustees, and in compliance with the Service Agreement(s) executed with the service
contractors}.
15. In its discretion, the Board of Trustees shall determine and may modify the timing of payments
made by Members and the amount of Member contributions to maintain the soundness and
financial security of fire Risk Pool.
16. A certified public accounting firm shall audit the Risk Pool annually and report to the Board of
Trustees as detailed in the Bylaws. The Risk Pool retains the right to audit and review a
Member's financial and business records relevant to the subject matter of this Agreement or any
dispute regarding this Agreement.
17. Notice: Any written notice to the Risk Pool shall be made by first class mail, postage prepaid,
and delivered to the Director of Risk Management Services, North Carolina Association of
County Commissioners, 215 N. Dawson Street, Raleigh, NC 27603.
ARTICLE IV. AMENDMENTS
The Board of Trustees is authorized to make any changes or amendments to this Agreement that
would not fundamentally alter the substance of the contemplated Agreement. This Agreemenf may be
substantively amended after adoption of this Agreement by the Members by either 1) approval of the
specific amendment by the, Board of Trustees and approval in writing by a simple majority of the
Members, or 2) approval of the Board of Trustees of a revised Agreement and subsequent
presentation to Members for execution of a new Resolution during the renewal period.
ARTICLE V. SEVERABILITY AND CHOICE O~ LAW
This Agreement shalt be governed by the laws of the State of North Caroiina. The Members and the
Risk Pool agree that in the event there is a disagreement between them regarding this Agreement, or
its terms, any legal action shall be filed in the General Court of Justice, Superior Court Division, Wake
County, North Carolina. The Members and the risk Pool agree that the terms of this Agreement are
contractual and not a mere recital, and that its provisions are severable in nature such that if any
particular provision is stricken by a Court of competent jurisdiction, no other provision will be affected.
IN WITNESS WHEREOF, the undersigned signify their acceptance of this Agreemenf by executing
this Resolution by action of the Board of Commissioners or other Governing Board:
Interlocal Agreement Page 4 of 6
Amended December 2009
RES-ao~o-o~~
RESOLUTION TO ADOPT THE INTERLOCAL AGREEMENT AND TO JOiN
THE NCACC RISK MANAGEMENT POOL
WHEREAS, Orange County desires to pool the retention of their risks, liabilities andlor
payments, or for the group purchase of coverage, and has completed a Pre-Audit Certification in
compliance with N.C.G.S. § 159-28; and
WHEREAS, fhe North Carolina Counties Risk Management Agency d.b.a. NCACC Risk
Management Pools {hereafter called the "Risk Pool"), has been established pursuant to G.S. §153A-
445 (a)(1) and G.S. §160-A-460 through §160A-464; and
WHEREAS, it is desirable for Orange County to join the Risk Pool to obtain the opportunity
for risk sharing and/or group purchase of coverage;
NOW, THEREFORE, BE IT RESOLVED that the Board of Commissioners or Governing Board
of Orange County hereby adopts the foregoing Interlocal Agreement and hereby joins and agrees
to participate in the Risk Pool as indicated:
^ North Carolina Counties Liability and Property Joint Risk Management Agency d.b.a.
NCACC Liability and Property Pool
^ North Carolina Workers' Compensation Joint Risk Management Agency d.b.a.
NCACC Workers' Compensation Pooi
^ Health Insurance Trust d/b/a NCACC Group Benefits Poot
BE iT FURTHER RESOLVED that (authorized county
official) is duly authorized to execute fhe application to join the Risk Pooi and hereby executes the
Agreement on behalf of Orange County.
Witnessed wherefore, this the day of , 20,_.
Attest:
NORTH CAROLINA
COUNTY
Personally appearing before me this day of , 20`,
who, being first duly sworn, acknowledged the execution of
the foregoing Agreement for the purposes and considerations therein and herein expressed.
My Commission expires:
interlocal Agreement
Amended December 2009
Notary Public
Page 5 of 6
17
18
Pre-Audit Certification Pursuant to N.C.G.S: § 159-28
This foregoing Agreement has hereby been pre-audited in the manner required by the Local
Government Budget and Fiscal Control Act.
Finance Officer or Deputy Finance Officer
NORTH CAROLINA
COUNTY
Personaiiy appearing before me this day of _- , 20_, the Finance Officer
or Deputy Finance Officer, ,who, being first duly sworn,
acknowledged the execution of the foregoing Agreement for the purposes and considerations
therein and herein expressed.
My Commission expires:
Interlocal Agreement
Amended December 2009
Notary Public
Page 6 of 6
19
Attachment 4
Page
DENTAL INSURANCE OVERVIEW
Over the past few years, the County has been systematically improving claim reimbursements
to employees, rather than making a dramatic shift in costs. In 2009, Orange County increased
reimbursements for Diagnostic and Preventive Services. In 2010, reimbursements for Basic
Restorative Services (e.g., fillings) were increased.
The reimbursements -for major restorative services (e.g., crowns), Endodontics (e.g., root
canals), Periodontics (e.g., gum disease), and extractions still lag behind most other
organizations. Because of the difference between County reimbursements and actual charges,
employees pay a increasingly higher portion of charges as costs for these services increase.
Staff reviewed dental claims and determined that reimbursements for Endodontics,
Periodontics, and Oral Surgery can be increased to the Delta Dental rates with little impact to
the Dental Fund balance. Reimbursements for Major Restorative Services can be increased by
15%, with little effect. Employees can minimize their out of pocket dental expenses by using
providers within the Delta Dental Premier network. Employees can further reduce costs by
using providers in the newly created Delta Dental Preferred Option network.
At the end of FY 2009-10, the dental plan's fund balance was in excess of $300,000 after
paying claims of nearly $400,000. By making the changes to reimbursements, the County can
expect an increase of $38,000-$45,000 in claims in 2011. The administrative fee of $2.25 will
increase to $2.55 per member per month (a total increase of $2,200/year) effective January 1,
2011. The fund will be able to absorb this budgeted increase of $.23 per employee per month
as well as the anticipated increase in claims.
Recommended Changes to the Orange County Table of Allowances includes:
• Increasing reimbursement for Endodontics, Periodontics, and Oral
Surgery to Delta Dental rates
• Increasing reimbursements for Major Restorative Services by 15%
20
Attachment 5
Page
FLEXIBLE SPENDING ACCOUNT OVERVIEW
Employees may contribute a maximum of $3,000 to the Medical Spending Account and up to
$5,000 to the Dependent/Child Care Spending Account each plan year. Employees may
contribute to one or both accounts.
Participation nearly doubled since 2008, due largely to the addition of a pre-paid debit card for
the Medical Spending Account in 2008.
Number of Participating Employees
Type of Account 2008 2009 2010
Child Care Spending 12 12 12
Account
Medical Spending 95 138 178
Account
The Affordable Care Act will impact the medical spending account when over-the-counter
medications will require a prescription effective January 1, 2011.
Administrative costs for the Flexible Spending Accounts may be waived, for a cost savings of
approximately $15,000.
21
Attachment 6 Page
SUPPLEMENTAL BENEFITS OVERVIEW
County employees have been able to purchase supplemental insurance to protect their income
through Colonial Life. No contract exists with Colonial Life. In 2010, the County increased
employee access to Colonial representatives, and employees increased participation by
enrolling in 31 additional policies for all types of voluntary benefits. This increased participation
was much lower than anticipated, with fewer than 12% of employees enrolling in short term
disability policies.
By working with another vendor, Staff will be better able to communicate the value of these
benefits. After consultation with Mark III, Staff has determined the best products and developed
a communication plan to inform County employees regarding the value of supplemental
benefits. Employees are "guaranteed issue" for each benefit; each employee who enrolls
during Open Enrollment is guaranteed coverage, regardless of pre-existing conditions. Carriers
selected represent the best value and best service, and were recommended based on
comparison of approximately twenty vendors. Any change(s) in carriers will allow employees to
enroll in identical or better coverage at the same or lower cost effective January 2011.
Number of Supplemental Benefits Policies
Colonial Product 2009 2010
Short Term Disabili 62 91
Cancer Insurance 16 20
Life Insurance Universal Life 4 2
Life Insurance Term Life 16 9
Accident Insurance 9 16
Critical Illness Insurance 1 1
Hos italization 2 2
Total Policies 110 141
New Product New Carrier
Short Term Disabili AUL American United Life
Accident Insurance Continental American
Critical Illness Insurance
includes Cancer Continental American
Permanent Life To Be Determined
Term Life MetLife current rovider
22
Attachment 7 Page
OVERVIEW OF PAID LEAVE ACCRUALS
Orange County permanent employees earn the following types of leave:
T e of Leave Accrual Rate
Vacation Leave Monthly accrual based on years of service for each month the employee
is in pay status for % of the month, ranging from 96 to 230.4 hours a
ear
Pe Leave 1.17 hours 70 minutes er month;
Personal Leave Two days per year received in January (one day for new employees
hired Jul 1 or later
Currently, Personal Leave is awarded January 1 of each year and must be used by December
31 of that year. Petty leave accrues on a monthly basis and must be used during that fiscal
year. Petty leave may be used in increments of 15 minutes up to two hours; Personal Leave
may be used only in increments of two hours or more.
Personal and Petty Leave accruals are currently tracked by departments on a monthly basis to
ensure employees earn leave appropriately. Employees accrue vacation and petty leave in any
month in which he or she is in pay status for at least one-half the month. This will be
administratively burdensome when the County transitions to a bi-weekly timekeeping system
because many pay periods overlap two months. The County timekeeping system will be able
to automatically calculate leave accruals each pay period without any manual calculations.
Employees earn Personal Leave according to their regular work day. Employees in some
positions and departments (e.g., Telecommunicators in Emergency Services, some Solid
Waste employees) currently accrue. two days based on an 11 or 10 hour work day.
Consequently, these employees currently earn more leave than all other County employees.
Implementing the recommendations will result in the same amount of leave for all employees.
Combining Vacation, Personal and Petty Leave will result in one accrual rate (increments of 15
minutes) and one usage requirement (15 minute increments). Converting these three paid
leave types into one Annual Leave will have no impact on employees' ability to convert hours
exceeding 240 hours to "roll" into sick leave as of January 31 each year.
Years of Orange
County Service Current
Accruals
per Year New
Accruals
Per Year
Less than 2 96.00. 125.90
2 but less than 5 115.20 145.10
5 but less than 10 144.00 173.90
10 but less than 15 172.80 202.70
15 but less than 20 201.60 231.50
20 or more 230.40 260.30
O(Z~- ao10-Ogg
Orange County Personnel Ordinance
Article IV, Employee Benefits, Section 5.0 Employee heave
5.1 General
5.1.1 The County providesn Annual Leave with pay for
Permanent Provisional, Time-Limited employees, both Full Time
and Part Time (regularly, scheduled at least 20 hours each
workweek). This includes an employee appointed to a permanent
position serving a probationary period.
C 1 7 T 1 a + ~ T.,,..,+; ~,,,. T o 0
~ Y .7
Repealed December 31, 2010
5.1.E Employees of the Sheriffs and Register of Deeds'. Amenaea
departments are covered by the tae-atlen Annual Leave o~~0~~92
section of the Personnel Ordinance pelic-y in the same
manner as other County employees. The Sheriff and Register of
Deeds themselves may voluntarily elect to be covered by the this
Section of the Ordinances L~7. Such election
maybe made upon initial adoption of this paw} Section of the
Ordinance or upon election to a term of office and is in effect for
the term of office. If the Sheriff or Register of Deeds elects to be
covered and exhausts available~~ Annual Leave then his or
her compensation is reduced by being placed on leave without pay
for any additional Annual Leave period. This constitutes
a voluntary reduction in compensation under G.S-1~A 153A -
92b(1).
5.2 T Tom:.,.. ~7.,.,..+;..,~ T o 0
tT +' +l,o....o«~.,.,.,1 ro~ron~
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23
Repealed Effective December 31, 2010
24
5.3
5.4
5.5
Earning Vacation Leave
5.3.1 Each Permanent, Provisional or Time-Limited employee earns
t Annual Leave based on the regular work schedule and
the total years of Orange County service as a Permanent1
Provisional or Time-Limited employee.
5.3.2 The earning rate for a Permanent, Provisional or Time-Limited
Full Time employee regularly scheduled to work 40 hours each
workweek is as follows:
Total Years of Orange County
Service
Less than 2
2 but less than 5
5 but less than 10
10 but less than 15
15 but less than 20
20 or more
;i Annual Leave Hours Earned
Per 1~4e~k Pay Period Per Year
S:9 4.84 96:9 125.9
9~ 5.58 44~ 145.1
4~8 6.69 4448 173.9
444 7.80 4~?8 202.7
46:5 8.90 ~6 231.5
49~ 10.01 2-39:4 260.3
5.3.3 ~iac-atien Annual Leave earning is prorated for a Permanent
employee working a regular work schedule other than 40 hours.
'T'L. D of Tlo„.,,.+.„o,,.+ ...,1..,,1.,+0~ ~ ,..1, ~ r.,+o.l lo.,..o 0
5.3.4 mac-ate Annual Leave is earned in any month during which the
employee works or is on paid leave one-half or more of the work
days in the ~ in the pawperiod.
Accumulating ~atier~ Annual Leave
Earned;i Annual Leave may be accumulated without a Amended
maximum until January 31 of each year. On that date, any 01/18/94
accumulated-gin Annual Leave in excess of 240 hours is
converted to Sick Leave. The maximum amount of ~zacatien Annual
Leave that can be carried forward to February 1 is 240 hours.
6~-sae-ater~--beaa3~-be-taker~e~~~n~ ,~l „~ +1,
1 ~ o Tb.o .lo.,.,,-+,Y, r,+ l,o~~ ,Y, ~ rnmi;ro hir_..« L,o
25
Repealed Effective December 31, 2010.
5.6 Aesse~i~iliEv
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Repealed Effective December 31, 2010.
5.7
Repealed Effective December 31, 2010.
5.8 Effect of Separation on ~zae-mien Annual Leave
5.8.1 Resignation, Layoff, Probationary Termination or Dismissal
The employee is paid in a lump sum form Annual Leave
accumulated to the date of separation, not to exceed a maximum of
240 hours. ~~e-e~uple3~e°e~~-acatie~beavt.-
eamed~l3e-elay°° ° .,.,~.,,_..°~ tie--Eeuu~-fer '-an-~u^~~.
5.8.2 Death
A payment for accumulated ~aeatien Annual Leave is made in a
lump sum, not to exceed 240 hours, to the estate of a deceased
employee.
5.8.3 Final Pa,, check
26
If the employee has either been advanced or taken more leave than
earned, the employee or the estate of the employee the employee or
estate of the emplovee shall reimburse the County for the final
paycheck of the emplovee.
10.0 Petty Leave
10.1 ~4-pe~~~-time-en~l~~ee--e€-t-he-Ee ~n „+~~er
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Repealed Effective December 31, 2010
23. D Personal Leave Days
27
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i~°ccci'u'°c3tnrgs~iicci~`tt~~VL~-xuu~T d~9-`ao-uiid~2E-~ioli~~`~~~~c~E4 `.~-.»
£~c'~'bLe~~e}Ii$tt'tt8i~3~'ii~-Buz-ix6~i 6ii~5--c'hi-cmpivTcc-2~igivicco~
ro..o;,,o .Y, o +l,n,.. +., .. Do .,1 T o o Tl., .,lo..rl.,
Repealed Effective December 31, 2010.
Orange County Personnel Rules and Regulations Effective Date: January 1, 2011
Annual Leave
I. ORDINANCE
Article IY, Section 5.0 Annual Leave
5.1 General
5.1.1 The County provides Annual Leave with pay for Permanent~Provisional,
Time-Limited employees, both Full Time and Part Time (regularly,
scheduled at least 20 hours each workweek). This includes an employee
appointed to a permanent position serving a probationary period.
5.1.2 Repealed Effective December 31, 2010.
Amended
5.1.3 Employees of the Sheriffs and Register of Deeds' departments olioli92
are covered by the Annual Leave section of the Personnel
Ordinance in the same manner as other County employees. The Sheriff
and Register of Deeds themselves may voluntarily elect to be covered by
this Section of the Ordinance. Such election maybe made upon initial
adoption of this Section of the Ordinance or upon election to a term of
office and is in effect for the term of office. If the Sheriff or Register of
Deeds elects to be covered and exhausts available Annual Leave then his
or her compensation is reduced by being placed on leave without pay for
any additional Annual Leave period. This constitutes a voluntary reduction
in compensation under G.S. 153A -92 b(1).
5.2 Using Leave
Repealed Effective December 31, 2010
5.3 Earning Leave
5.3.1 Each Permanent, Provisional or Time-Limited employee earns Annual
Leave based on the regular work schedule and the total years of Orange
County service as a Permanent, Provisional or Time-Limited employee.
5.3.2 The earning rate for a Permanent, Provisional or Time-Limited Full Time
employee regularly scheduled to work 40 hours each workweek is as
follows:
Total Years of Orange County
Service
Less than 2
2 but less than 5
5 but less than 10
Annual Leave Hours Earned
Per Pa~Period Per Year
4.84 125.9
5.58 145.1
6.69 173.9
29
Issue Date: January 1, 2011 Page 1
Orange County Personnel Rules and Regulations Effective Date: January 1, 2011 3 0
10 but less than 15
15 but less than 20
20 or more
7.80 202.7
8.90 231.5
10.01 260.3
5.3.3 Annual Leave earning is prorated for a Permanent employee working a
regular work schedule other than 40 hours.
5.3.4 Annual Leave is earned in any pay period during which the employee
works or is on paid leave one-half or more of the work days in the pay
period.
5.4 Accumulating -Annual Leave
Earned Annual Leave may be accumulated without a maximum until Amenaea
January 31 of each year. On that date, any accumulated Annual Leave oing~a
in excess of 240 hours is converted to Sick Leave. The maximum
amount of Annual Leave that can be carried forward to February 1 is 240 hours.
5.5 Approvin L
Repealed Effective December 31, 2010.
5.6 Responsibility
Repealed Effective December 31, 2010.
5.7 Advancing Leave
Repealed Effective December 31, 2010_
5.8 Effect of Separation on Annual Leave
5.8.1 Resignation, Layoff, Probationary Termination or Dismissal
The employee is paid in a lump sum for Annual Leave accumulated to the
date of separation, not to exceed a maximum of 240 hours.
5.8.2 Death
A payment for accumulated Annual Leave is made in a lump sum, not to
exceed 240 hours, to the estate of a deceased employee.
5.8.3 Final Paycheck
If the employee has either been advanced or taken more leave than earned,
the employee or the estate of the employee the employee or estate of the
employee shall reimburse the County for the fmal paycheck of the
employee.
Issue Date: January 1, 2011 Page 2
Orange County Personnel Rules and Regulations Effective Date: January 1, 2011
II. AUTHORITY
The purpose of this rule is to implement and give effect to Article IV, Section 5.0 of the Orange
County Personnel Ordinance, Annual Leave. These Administrative Rules and Procedures
provide for consistent application of the Ordinance to ensure that Orange County employees are
treated in a consistent manner.
III. RULE
• Orange County provides paid Annual Leave to eligible County employees in each pay
period in which the employee is on active pay status based on their regular work schedule
and total years of Orange County Service.
IV. ADMINISTRATIVE RULES AND REGULATIONS
A. Eligibility.
1. County Employees. Permanent, Provisional and Time-Limited employees, both full
and part-time (regularly scheduled at least 20 hours each workweek). This includes
employees appointed to a permanent position serving a probationary period.
2. Employees of the Sheriff's and Register of Deeds' Offices are covered by this Section
of the Personnel Ordinance in the same manner as other County employees.
3. The Sheriff and Register of Deeds may
covered either upon the initial adoption
election to a term of office.
B. Using Annual Leave
be covered if they voluntarily elect to be
of this section of the Ordinance or upon
1. Annual leave may be used for the following reasons:
a. Vacation or other personal reasons;
b. Sick Leave with the approval of the supervisor;
c. Absences due to adverse weather conditions if the County .Manager does not
authorize the use of Administrative Leave;
d. Funeral Leave for relatives not covered by the Funeral Leave provision of the
Personnel Ordinance;
e. Religious observance; and
f. Any other reason approved by the County Manager.
2. Annual leave may be taken only with the approval of the department director or
their designee.
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Issue Date: January 1, 2011 Page 3
Orange County Personnel Rules and Regulations Effective Date: January 1, 2011
a. The scheduling of Annual Leave must take the department's operating
requirements into account.
b. Annual Leave may be taken in increments of 15 minutes or greater.
c. A holiday is not charged as Annual Leave when it occurs during a period
of scheduled Annual Leave.
3. Responsibility. The Department Director is responsible for maintaining accurate
annual leave records and for the application of the annual leave provision of the
Personnel Ordinance.:
C. Earning and Accumulation of Annual Leave.
1. Eligible employees will earn annual leave based on their regular work schedule
and years of county services. Eligible full-time employees shall earn annual leave
as provided in Article IV, Section 5.3.2 of the Orange County Personnel
Ordinance.
2. Eligible part-time employees annual leave earnings will be prorated. The Human
Resources Department shall calculate the prorated earning rate and provide it to
the operating department of the part time employee.
3. There is no maximum amount of earned annual leave that may be accumulated up
to January 31 of each year; however, on January 31St any accumulated annual
leave in excess of 240 hours will be converted to sick leave.
D. Advancing Annual Leave. Annual leave may not be advanced before it is earned;
however, in hardship situations annual leave may be advanced with the approval of the
County Manager.
An employee shall forward a request to advance annual leave to their Department
Director.
2. The Department Director shall forward the annual leave request to Human
Resources with a memorandum indicating the impact of the request on County
operations.
3. Human Resources shall forward the request to the County Manager with a
recommendation and the impact statement from the Department.
4. The County Manager shall make a decision of the request for advancing annual
leave within five business days of receipt.
5. If leave is approved, the Human Resource Department will prepare an
"Authorization to Withhold Wages" to be signed by the employee authorizing the
County to deduct wages from the employee's final paycheck if the employee is
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Orange County Personnel Rules and Regulations Effective Date: January 1, 2011 3 3
separated from employment with the County prior to reimbursing County for
leave advanced.
E. Effect of Separation of Annual Leave.
1. Resignation, Layoff, Probationary Termination or Dismissal. In the event of a
resignation, layoff, probationary termination or dismissal an employee shall be
paid accumulated annual leave up to the date of separation in a lump sum, not to
exceed a maximum of 240 hours.
2. Death. In the event of an employee's death, the estate of the deceased employee
shall be paid accumulated annual leave up the date of death in a lump sum, not to
exceed a maximum of 240 hours.
4. Advanced Leave. In the event that a separated employee has been advanced or
taken more annual Teave than earned, the employee (or estate of the employee)
shall reimburse the County for all annual leave taken from the employee's final
paycheck.
This Policy will be effective: January 1, 2011
Frank W. Clifton, County Manager
Issue Date: January 1, 2011 Page 5