HomeMy WebLinkAboutAgenda - 11-03-1997 - 10b Orange County
Board of Commissioners
Action Agenda Item Abstract
Meeting Date: November 3, 1997
Action Agenda
Item No. /o-b
Subject: Work Session - Employee Compensation Items
Department: County Manager/Personnel Public Hearing: Yes No X
Budget Amendment
Needed: Yes No X
Attachment(s): Information Contact:
John Link, County Manager,
See list on page 2. Extension 2300
Elaine Holmes, Personnel Director
Extension 2550
Telephone Number:
Hillsborough 732-8181
Chapel Hill 968-4501
Durham 688-7331
Mebane 227-2031
Purpose: To have a Board of Commissioners' work session to discuss
employee compensation items.
Background: In the June 1997 Board of Commissioners' budget work
sessions, the Board had requested a work session be scheduled
for the Board to discuss employee compensation. This work
session had been scheduled for October 30, 1997. Because of
the need to use the October 30 work session to discuss solid
waste issues, the employee compensation work session
discussion has been rescheduled to the November 3 regular
meeting.
Attached is the planned agenda for the employee compensation
discussion and background information developed by staff
related to each of the agenda items.
Recommendation: The Manager recommends the Board discuss the employee
compensation items and provide direction, as appropriate, to
staff on these.
Orange County
Employee Compensation
Work Session
Orange County Board of Commissioners
November 3, 1997
Agenda
November 3, 1997 Pay Work Session
1. Elements of the Pay Plan
Does the Board of Commissioners wish to address the current three elements of the pay
plan? The attachment describes these elements as approved for 1997-98:
• Cost of Living Adjustment
• Career Growth Recognition Awards
• Performance Awards
2. Salary Progression
What types of salary progression does the Board wish to provide for employees from one
step to another within the salary range?
In this connection,does the Board wish to address the salary compression issue;that is,
new employee salaries which are close to or higher than the salaries of longer service
employees? If yes, in what way?
3. Merit Pay
Does the Board wish to retain a merit pay element in the pay plan? If yes, in what way?
4. Employee Benefits
• Does the Board wish to consider incorporating in the compensation plan an employer
paid supplemental retirement contribution to the 401(k)plan?
• Are there other employee benefits needs/issues which the Board wishes to discuss?
5. Incentives -Employee and Organizational
Does the Board wish to provide additional direction on the planned employee and
organizational incentive programs?
6. Other Needs/Issues
• Does the Board wish to consider On Call and Call Back compensation for employees
assigned to these schedules?
• Are there other pay needs/compensation issues which the Board wishes to discuss?
f:\e\paywk.doc
1
Contents-
Background Information
Employee Compensation Work Session
Tab Relates to Agenda Item Attachments/Charts
A Elements of the Pay Plan A-1 Pay Elements 1997-98 Approved Budget
A-2 1997-98 Approved Area Local Government Pay
Plans
A-3 Orange County Cost of Living Increase Compared
to Increases in the Consumer Price Index
B Salary Progression B-1 Employee Progression in the Salary Range
B-2 Orange County New Hires
B-3 Current Employees Compared to New Hires
B-4 Current Employees By Step In Salary Range
B-5 Employee Steps By Years of Service
B-6 Salary Compression Definition and Impacts
C Merit Pay C-1 WPPR Related Awards for 1995-96 and 1996-97
C-2 Salary Examples Under 1997-98 Pay Plan
D Employee Benefits D-1 Supplemental Retirement Plans
E Incentives - Employee and E-1 Employee and Organizational Incentives
Organizational
E-2 Pilot Employee Incentive Programs Report
E-3 Pilot Incentive Program Awards
E4 Proposed Department Based Employee Incentive
Awards
F Other Needs/Issues F-1 On Call and Call Back Compensation
F-2 On Call Compensation Cost Estimate
Appendix Employee Compensation Appendix from Manager's
Recommended Budget
f:\e\paywk2.doc
October 24, 1997
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Attachment A-2
1997-98 Approved Area Local Government Pay Plans
COLA/Market
Employer* Adjustm€nts Performance-Related Additional Notes
Carrboro 2.0% for all 2.5% if below midpoint, meets standards in all Increase health insurance dependent
employees functions and exceeds in 25% subsidy from 25% to 33%.
7-1-97 2.5% if above midpoint, meet standards in all
functions and exceeds in 50%
Cary 2.6% Adjustment Depending on location of salary in salary range Salary increase may be granted in
to Salary Ranges and performance rating of: combination of base salary&lump sum
Only Standard-0-4% depending on place in salary range.
Proficient-0-6.5% Salary increases budgeted at 4.1% of
Exemplary-0-9% payroll. Lump sum payments budgeted
at 1.25%of payroll.
In addition, for special significant contribution
possible lump sum award up to 5% of salary. Also implementing classification and pay
study results budgeted at 2% of payroll.
Chapel Hill 2.5% Adjustment If rated as meets or exceeds standards, 3.5% of Outstanding is about 11% of employees
to all salary ranges salary range midpoint. If outstanding,4.5%
10-1-97 Changing vacation leave to provide more
In addition,all employees with acceptable for employees with 5 and more years of
performance rating and at least two years service service.
will have salaries raised to 10% above salary
range minimum. (This provided additional Increasing longevity pay by$100 to$350
increases for 160 employees.) depending on service.
Durham City None If performance is "good"or higher: Departments directed to develop
•below market rate, 3% incentive plans to reward employees for
•at market rate up to 10% above,2% additional achievements. Department
• 10 percent or above market rate, 1% allocation is based on 1% of salary.
Durham 3% for all None Proposing pay plan which provides for
County employees faster progression to salary range
7-14-97 midpoint. Will consider implementing
merit increases in January 1998.
Raleigh 3.75% in-range In addition to 3.75% in-range increase: As of April 1996,the performance
increase to all If in lower 213 of range: rating distribution was
employees rated Standard 2.5%,Above Standard, 3.75%; Outstanding-30%
standard or higher Outstanding 5% Above Standard-51%
awarded on Standard- 17%
employee's If in upper 113 of range: Other-2%
anniversary date Standard 0%,Above Standard, 1.25%,
Outstanding 2.5%
Wake None If"meets expectations" and "below midpoint", Increase amounts are budgeted at an
County 2.5% to 5.5% and"above midpoint", 2% to 4%. average of 4% for each employee.
If"exceeds expectations"and "below midpoint", Each department has an allocation from
4% to 10% and"above midpoint", 3% to 7%. which increases may be awarded.
Increases effective 9-16-97.
Orange 2.5% for all If performance is "effective"or higher, 1.25%
County employees career growth award.
7-14-97
Lump sum performance award, if highly
effective, $400 or 1%, whichever is larger
If outstanding, $800 or 2%, whichever is larger
* Cary, Chapel Hill, Durham City, Durham County and Wake County also provide a 5%401(k)plan contribution to all employees.
Carrboro provides a 3%401(k)contribution to general employees. Raleigh provides general employees up to a 1.75% match in
deferred compensation. Orange County provides no employer contribution to 401(k)or deferred compensation for general employees
and does provide a 5%401(k)contribution to sworn law enforcement officers,as required by State law.
(10-21-97 f:pers\comp\PAYSVI.DOC)
4
Attachment A-3
-Orange County Cost Of Living Increases
Compared To Increases In The Consumer Price Index
Orange County Consumer
Fiscal Year Cost of Living Price Index Year
Increase
1997-98 2.5% 3.3% 1996
1996-97 2.5% 2.5% 1995
1995-96 2.4% 2.7% 1994
1994-95 2.25% 2.7% 1993
1993-94 2% 2.9% 1992
1992-93 2% 3.1% 1991
1991-92 -0- 6.1% 1990
f:\e\cola.doc
October 23,1997
5
Attachment B-1
Employee Progression In The Salary Range
From Step 1 To Years Required* Total Percentage
Change in Salary
Step 2D 4 5%
Step 3D 8 10%
Step 5D 16 22%
(End of Hiring Range)
Step 7A 21 29%
(Middle of Salary Range)
Step 11B 38 59%
(End of Salary Range)
*If work performance is effective or higher
Explanation:
The above chart shows the rate at which an employee may progress from one step to a
higher step within the same salary range under the current pay plan, if work performance
is effective or higher.
For example, if an employee is hired at Step 1, he or she may progress to Step 2A at the
end of the first year of employment if work performance is effective or higher. This is
about 1.25 percent above Step 1, the salary range minimum. After four years, the
employee could reach Step 2D which is five percent above the minimum. After eight
years, the employee could reach Step 3D which is 10 percent above the minimum. The
remainder of the chart shows the time required to progress to other levels within the pay
plan from Step 1, if work performance is effective or higher.
f:\e\salprog.doc
October 24, 1997
6
Attachment B-2
Orange County New Hires
Hires By Step In Salary Range
60 55
48
50 43
40 34
■9485
■95-96
30 22
o 96-97
20
10
0
At Stop 1 Above Stop 1
Percentage of Hires Above Step 1
60%---' 52•ti 53%
50%
40•/0
29%
30%
20%
10%
0%
9485 95-96 96-97
7
Attachment B-3
Current Employees Compared To New Hires
Current Employees In
Relation To Hiring Range
In Hiring Range(Steps 1-5D)
358
Employees
Above Hiring Range(Steps 5A-118)
Impacts
Over one half of new hires are at salaries
above Step 1.
e Over 60 percent of current employees are at
salaries in the "hiring range" (Steps 1-5D).
Results in new hire salaries being close,
equal to or in some cases greater than
salaries of current employees.
s
Attachment B-4
Current Employees By Step In Salary Range
Employee Step Distribution
45%-// 41%
40%
35°k 30%
30%
25%-//
5% 19%
20%
15% 10%
10%
5%
0%
Steps Steps Steps Steps
1-3 4-6 7-9 10-11
Employees By Step
120
100
W.
60
40
20
0
1 2 3 4 5 6 7 8 9 10 11
Steps
9
Attachment B-5
Employee Steps By Years Of Service
Median Employee Step by Years of Service
Years Service
<1
1 20
2 2
3 C
4 2D
S C
6 C
7
8
B
9
8A
10+
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% Say 119
save
Salary Range From Stop 1 Through 116
Above Chart Shows
a Employees with 2, 3 and 4 years service
have the same or less median salary than
employees with one year of service.
e Only at seven years of service and more
does the median employee salary exceed 10
percent above Step 1, the salary range
minimum.
10
Attachment B-6
Salary Compression
Definition
New employee salaries which are close,
equal to or greater than the salaries of
current employees with comparable work
experience
Impacts
• Employee relations with current employees
• Employee retention
• Ability to hire new employees
Attachment C-1
WPPR Related Awards For
Fiscal Years 1995-96 and 1996-97
1995-96* 1996-97*
Category Number Percent Number Percent
Effective 77 13% 78 12%
Highly Effective 392 63% 395 62%
Outstanding Achievement 38 6% 31 4%
None** 110 18% 126 20%
Total 617 100% 630 100%
* Through 6-30
** None Includes:
1995-96 1996_97 5=
12 6 Needs Improvement or Unsatisfactory work
performance rating
65 80 Not eligible(new employee or promoted)
32 37 Leaving employment prior to review(separated
employees whose reviews were completed prior to
separation date are included in above awards)
0 2 Reviews not yet completed
1 1 Salary Frozen
f:\pers\wppr\awards.doc
October 24, 1997
12
Attachment C-2
Salary Examples Under 1997-98 Pay Plan
Example- Effective Performance-No Performance Award
Sally Smith is a Social Worker II in the Social Services department at Salary Grade 67, which has a
salary range of$27,905 - $44,370. On January 1, 1998, Sally's performance is evaluated as"Effective"
since she achieved all of the stated objectives on her workplan.
Scenario 1:
Sally has been employed since January 1, 1995. As of June 30, 1997,she is at Step 2B,annual salary
$27,905.
Effective Date Pay Element Bi-Weekly 1997-98 Annual
Increase Amount Salary
Amount
7/14/97 2.5%COLA $26.85 $698 $28,603
1/1/98 1.25%Career Growth Award $13.38 $174 $28,951
Total $872 $28,951
Scenario 2
Sally has been employed since January 1, 1986 and is at Step 7A,annual salary$35,181.
Effective Date Pay Element Bi-Weekly 1997-98 Annual
Increase Amount Salary
Amount
7/14/97 2.5%COLA $33.85 $880 $36,061
1/1/98 1.25%Career Growth Award $17.12 $223 $36,506
1/1/98 Longevity Pay $548
(1.5%of salary)
Total $1,651 $36,506
Scenario 3•
Sally has been employed since January 1, 1983 and is at Step 10A,annual salary$40,724.
Effective Date Pay Element Bi-Weekly 1997-98 Annual
Increase Amount Salary
Amount
7/14/97 2.5%COLA $39.19 $1,019 $41,743
1/1/98 1.25%Career Growth Award $19.77 $257 $42,257
1/1/98 Longevity Pay $634
(1.5%of salary)
Total $1,910 $42,257
13
Example-Highly Effective Performance- With $400 Performance Award
Sally Smith is a Social Worker II in the Social Services department at Salary Grade 67, which has a
salary range of$27,905 - $44,370. On January 1, 1998, Sally's performance is evaluated as"Highly
Effective" since she achieved or exceeded all of the stated objectives on her workplan, including creating
a training program for family care home providers and doing an exceptional job in counseling families
through crisis situations.
Scenario 1:
Sally has been employed since January 1, 1995. As of June 30, 1997, she is at Step 2B,annual salary
$27,905.
Effective Date Pay Element Bi-Weekly 1997-98 Annual
Increase Amount Salary
Amount
7/14/97 2.5%COLA $26.85 $698 $28,603
1/1/98 1.25%Career Growth Award $13.38 $174 $28,951
1/1/98 $400 Performance Award $400 $28,951
(1.4%of salary)
Total $1,272 $28,951
Scenario 2•
Sally has been employed since January 1, 1986 and is at Step 7A,annual salary$35,181.
Effective Date Pay Element Bi-Weekly 1997-98 Annual
Increase Amount Salary
Amount
7/14/97 2.5%COLA $33.85 $880 $36,061
1/1/98 1.25%Career Growth Award $17.12 $223 $36,506
1/1/98 $400 Performance Award $400 $36,506
(1.1%of salary)
1/1/98 Longevity Pay $548
(1.5%of salary)
Total $2,051 $36,506
Scenario 3•
Sally has been employed since January 1, 1983 and is at Step 10A,annual salary$40,724.
Effective Date Pay Element Bi-Weekly 1997-98 Annual
Increase Amount Salary
Amount
7/14/97 2.5%COLA $39.19 $1,019 $41,743
1/1/98 1.25%Career Growth Award $19.77 $257 $42,257
1/1/98 $400 Performance Award $400 $42,257
(.09% of salary)
1/1/98 Longevity Pay $634
(1.5%of salary)
Total $2,310 $42,257
14
Example- Outstanding Performance- With$800 Performance Award
Susan Jones is a Social Worker II in the Social Services department at Salary Grade 67, which has a
salary range of$27,905 - $44,370. On January 1, 1998, Susan's performance is evaluated as
"Outstanding"since she exceeded expectations in all of the stated objectives on her workplan. In
addition, Susan developed a highly successful program for recruiting foster parents which resulted in a
70% increase in foster homes in Orange County. Susan received a$800 performance award for her
outstanding accomplishment.
Scenario 1:
Susan has been employed since January 1, 1995. As of June 30, 1997, she is at Step 2B,annual salary
$27,905.
Effective Date Pay Element Bi-Weekly 1997-98 Annual
Increase Amount Salary
Amount
7/14/97 2.5%COLA $26.85 $698 $28,603
1/1/98 1.25%Career Growth Award $13.38 $174 $28,951
1/1/98 $800 Performance Award $800 $28,951
(2.8%of salary)
Total $1,672 $28,951
Scenario 2:
Susan has been employed since January 1, 1986 and is at Step 7A,annual salary$35,181.
Effective Date Pay Element Bi-Weekly 1997-98 Annual
Increase Amount Salary
Amount
7/14/97 2.5%COLA $33.85 $880 $36,061
1/1/98 1.25%Career Growth Award $17.12 $223 $36,506
1/1/98 $800 Performance Award $800 $36,506
(2.2%of salary)
1/1/98 Longevity Pay $548
(1.5%of salary)
Total $2,451 $36,506
Scenario 3•
Susan has been employed since January 1, 1983 and is at Step 10A,annual salary$40,724.
Effective Date Pay Element Bi-Weekly 1997-98 Annual
Increase Amount Salary
Amount
7/14/97 2.5%COLA $39.19 $1,019 $41,743
1/1/98 1.25%Career Growth Award $19.77 $257 $42,257
1/1/98 $800 Performance Award $800 $42,257
(1.9%of salary)
1/1/98 Longevity Pay $634
(1.5%of salary)
Total 1 $2,710 $42,257
f.\pers\comp\examples
15
Attachr2enc D-L
Supplemental Retirement Plans
Area Employer Contributions
5% 401(k) Plan 3% 401(k) Plan Other
Cary Carrboro Raleigh
Chapel Hill (Up to 1.75%
Durham (City) of salary to
Durham County 457 Plan)
Wake County
$30,000 Salary
Additional Supplemental Retirement Dollars
$1,600
$1,400 - -------
------------
- -
------------
---
$1,200
$1,000
............. ---------
$800 --------------
-------------
$600
.... .... ...
$400 1 . .... -
.... . ....
.... .... .........
z ..
---- ------
$o
. .. .. ..
$200
.... .....
L
0 A\
do 6 0 e 0?1�1 cp.
o cp. dip
e le
16
Attachment E-1
Employee and Organizational Incentives
Background
The Managers Recommended Budget for fiscal year 1997-98 included$25,000 in
funding for employee incentives and $25,000 for new organizational incentives. In the
1997-98 budget process,the Board of Commissioners approved the recommended
funding and placed it in reserve pending:
• A report on the two pilot employee incentive program implemented earlier and
• Board discussion and consideration of the recommended directions for employee and
organizational incentives in 1997-98.
Employee Incentives
Attachment E-2 is a brief report on the two pilot employee incentive programs already
implemented. It includes the findings and recommendations from the two year pilot
program evaluation. Attachment E-3 shows the awards granted under each of the two
pilot programs in the two year pilot period.
In summary,as a result of the evaluation of the two pilot employee incentive programs,
the committees involved recommended that the County continue the two programs with
modifications:
• The Savings Count employee suggestion program be revised to focus on employee
cost savings suggestions for areas outside the employee's department.
• For cost saving suggestions, innovation or efficiency improvements related to the
employee's department,the department head be provided with funding for incentive
awards to give immediate recognition for such employee contributions.
The $25,000 in the approved 1997-98 budget included funding to continue the current
programs and to establish funding to be used for incentive awards to employees for cost
saving, innovation or efficiency improvements in his or her department.
For the Board's consideration, Attachment E-4 outlines the overall approach for the
proposed department based incentive awards. Further program details and administration
would be developed by an employee committee if the Board authorizes use of the funding
and proceeding with the program direction outlined.
Organizational Incentives
The 1997-98 budget also included $25,000 in funding for a one year organizational
incentives pilot program. This program would provide "seed"or start up money for
departments to implement cost saving ideas. A County department interested in such
17
Attachment E-1
funding would submit a proposal. Proposals would be reviewed by a committee made up
of representatives from a range of County departments. Grants would be awarded with
specific agreement as to the funding and terms of such funding.
If the program is continued after the pilot year, consideration will be given as to whether
any future year funding may be partly from cost savings realized from efficiencies
implemented through this program.
Next Steps
If the Board wishes to pursue the proposed employee and organizational incentives for
1997-98, it is recommended that the Board:
• Authorize the staff to complete the employee and organizational incentive program
development and implementation.
• Approve the use of funds included in the 1997-98 budget for incentives.
• Request staff to report back to the Board on program development, implementation
and outcomes to date during the 1998-99 budget process.
f.\e\incent.doc
October 24, 1997
18
Attachment E-2
Pilot Employee Incentive Programs Report
1. Background
The Board of Commissioners has adopted a goal "to develop strategies which will promote
more efficient County operations, which will ultimately result in financial savings." As one
of the strategies to promote more efficient operations, the County has pursued the concept of
employee incentives.
In 1994-95,the County implemented two employee incentive programs on a two year pilot
program basis. These are the:
• Savings Count employee suggestion program to encourage, recognize and reward
employee cost saving ideas and the
• You Can Count On Us team achievement awards to recognize and celebrate effective
teamwork and through this to promote the use of teams and the sharing of resources.
2. Savings Count-Brief Program Description
Through the Savings Count program,an employee may:
• Submit a cost savings suggestion or a suggestion related to an increase in productivity,
improved efficiency in service delivery or increase in revenue.
• Assure that a suggestion is systematically reviewed and considered
• Make a suggestion related to any area of County operations.
• For suggestions not related to the employee's job duties,receive a cash award based on
five percent of the first year net annual cost savings or an award based on the
suggestion's impact on productivity, efficiency and revenue. For a suggestion related to
the employee's job duties,receive a non-monetary recognition award.
3. You Can Count On Us -Brief Program Description
Through the You Can Count On Us program, a work team may:
• Nominate itself for team recognition when it completes a clearly defined outcome which
results in service improvement.
• Receive the team achievement award when the outcome is achieved.
19
Attachment E-2
• As the team achievement award, receive a gift certificate for a team lunch at an Orange
County restaurant and recognition by the County Manager.
4. Pilot Incentive Program Evaluation
The two employee incentive programs were implemented with the plan that these programs
would be evaluated at the end of the two year pilot program period and recommendations
made as to continuation, modification or next steps. During 1996-97, the Savings Count and
You Can Count On Us committees completed this program evaluation, including obtaining
feedback from employees and department heads.
The Attachment E-3 chart shows the awards granted under each program. In summary, the
Savings Count program received 44 suggestions. Of these, 31 were eligible for review and
seven received a suggestion award. The estimated cost savings from the suggestions is abort
$6,700 annually. The You Can Count On Us team awards recognized 10 teams made up of
about 90 staff from 16 departments.
5. Savings Count Evaluation Findings and Recommendations
The Savings Count committee found the program has served the general objectives of
communicating about and increasing employee awareness of the need for cost savings and
efficiency. However,the committee also found that, while the Savings Count program
attracted suggestions, it did not generate many usable cost saving suggestions despite
extensive communication. For example, many of the suggestions were not eligible because
they related to items already in progress or implemented.
In the feedback process,the Savings Count committee, among other things,heard from
employees and department heads that:
• The matters about which employees are most knowledgeable and have the most ideas are
in their own departments and related to their own jobs. (While these suggestions are
eligible for recognition under the program,they were not eligible for a cash award.)
• It is important to provide a means for more immediate recognition of employee
suggestions.
As a result of the pilot evaluation, it is recommended that:
• The Savings Count program continue but focus only on suggestions outside the
employee's department.
• To encourage Savings Count participation,that the program communication be focused
on quarterly(rather than on-going)communication and that each quarterly
communication approach be different to help keep the program fresh and draw attention
to it.
20
Attachment E-2
• An additional incentive program be established to recognize employee cost saving
suggestions related to the employee's own department and that this be in the form of
awards from the department head to provide immediate feedback and recognition when
usable suggestions are received.
6. You Can Count On Us Evaluation Findings and Recommendations
The team achievement award committee found the program had been an effective tool in
recognizing and rewarding team accomplishment. It recommended the program continue
with some modification to the nomination process to rely less on self nomination by the
team.
f.\e\incentl.doc
October 24, 1997
21
Attachment E-3
Pilot Incentive Program Awards
Savings Count Employee Suggestion Program*
Suggestions Received: 44
Suggestions Eligible: 31
Suggestions Awarded: 7
Examples of Suggestions:
• Discontinue billing taxes under$5.00
• Use plain white envelopes (rather than letterhead) for distributing pay checks
• Discontinue banner printing on network printers
• Change effective date of new employee health insurance
Cost of Suggestion Awards: $495
$155 total awards for submitting eligible suggestions
$385 for seven cost saving suggestions adopted
(Three of seven received certificates only)
Estimated Cost Savings: $6700
You Can Count On Us Team Achievement Awards*
Teams Nominated: 11
Teams Recognized; 10
Examples of Team Accomplishments:
• Automation of Accounts Payable System
• 1995 Project KIDS
• 1997 Revaluation Process
• Development/Delivery of Food Safety Program for Restaurant Managers
Cost of recognition: $760
f:\pers\incentiv.doc
June 1997
22
Attachment E-4
Proposed Department Based Employee Incentive Awards
1. Purpose
To encourage and-recognize employee cost saving, innovation, productivity/efficiency, customer
service and response to special work challenges within the department.
2. Definitions
Cost Savings
Suggestions by a department employee affecting the department which are adopted and result in
real continuing cost savings for the County
Innovation/Productivity/Efficiency
Suggestions by a department employee for new or different approaches within the department to
addressing service needs which result in significant enhancement of customer service or increased
productivity or efficiency(that is, the accomplishment of more work with existing resources or
the same work with fewer resources)
Customer Service
The demonstration of exceptional service to customers which goes significantly beyond work
expectations
Special Work Challenge
Completing an unusually demanding work assignment which arises outside of the normal scope
of the employee's duties and responsibilities and requires exceptional skill and effort to
accomplish. Examples: Bond education, Hurricane Fran relief and recovery
3. Awards
An"Orange Buck"in amounts from$25 up to $200 which may be exchanged in the Finance
Department for a gift certificate to an Orange County business.
4. Responsibility for Determining the Award
The Department Head
5. Timing
Could be granted"on the spot"to provide immediate employee recognition.
23
Attachment E-4 '
6. Department Allocation
Each department head would receive an allocation of Orange Bucks. For this allocation, each
department would receive a base of a$200 and then an additional $25 for each position over four
positions. On thisbasis the total funding for the program is about $20,000.
Examples of department allocations under this plan are:
Sim Department Employees Allocation
Small Budget 3 $200
Medium Planning 23 $675
Large Social Services 116 $3,000
7. Employee Eligibility
Any Permanent or Temporary employee. An award could be given individually or as recognition
of members of a department work team
8. Program Name,Details and Communications
Recommendations to be developed by an employee committee.
f:\e\incent2.doc
October 24, 1997
24
Attachment F-1
On Call and Call Back Compensation
1. Definitions
• On Call Time
Any time when the employee is not required to remain on County premises and is
required to:
0 Leave a telephone number where he or she can be reached or to carry a
pager/beeper(but is able to come and go freely), and
0 Be available to report back to work when contacted by the County's
representative.
Under wage-hour law, on call time is not treated as work time.
• Call Back
Time when the employee is required to return to work,before or after regularly
scheduled hours,outside of the regular work schedule.
• Standby Time
Time when a wage-hour non-exempt employee is required to remain at or so near the
place of work that he or she cannot use the time effectively for his or her own
personal pursuits and may not come and go freely. (Under wage-hour law Standby
Time is work time and paid as such. It is not included in this proposal.)
2. P=ose of On Call and Call Back Com .a ion
On Call and Call Back compensation provide an incentive for employees to remain available
when scheduled to be on call or return to work when called and also recognizes the
inconvenience involved.
3. Coverage/Departments Affected
Orange County has four departments which regularly require employees to be on call. These
are:
• Public Works,
• Health Department Animal Control Division,
25
Attachment F-1
• Social Services Child Protective Services and
• Emergency Management Communications Division.
4. Proposed Compensation for On Call Time
That an eligible employee who is on call but is not called back to work receive $1.00 per
hour for each hour of on call duty for the inconvenience involved.
5. Proposed Compensation for Call Back
That each eligible employee called back to work be guaranteed a minimum of two hours pay
provided the work which led to the call back is reasonably completed. The call back
guarantee could be compensated as pay or as time off, as determined by the department head.
6. Estimated Cost of On Call Pay
See Attachment F-2 cost estimate.
f.\e\oncall.doc
October 24, 1997
26
Attachment F-2
On Call Compensation
Cost Estimate At $1 For Each On Call Hour*
Number of
Employees On Call At
Department Estimated Annual Cost
Any One Time
Animal Control 1 $7,200
Emergency 2 $17,400
Communications
Public Works 3 $21,602
(2 in Buildings and
Grounds and 1 in Motor
Pool)
Social Services 2 $14,700
Total 8 $60,902
* Payment for on call time includes matching social security(7.65%)and retirement
contribution(4.93%). It does not include pay for hours worked while on call or
compensation for any call back guarantee
f.\pers\comp\oncallco.doc
October 24, 1997
27
Appendix
Employee Compensation
Background
Since 1994-95, the Orange County employee pay plan has included three components:
1. A cost of living adjushnent for County employees to recognize changes in the cost of living and the
labor market.
2. A career growth recognition award to provide a means for employees whose performance is rated
"effective" or higher to progress to higher levels in the salary range.
3. A performance award as a one time, lump sum payment which does not become a part of
permanent salary for an employee whose work performance is rated "highly effective" or
"outstanding" to recognize specific work performance accomplishments and achievements during
the year.
1997-98 Pay Objectives
The Manager's Recommended Budget for 1997-98 continues the three pay components with
modification to the Career Growth and Performance Awards to respond to concerns expressed by the
Board of Commissioners and by County department heads. The objectives we are seeking to
accomplish through the recommended changes include the following:
• Address the Board's concern as to the relative number of employees receiving highly effective
Performance Awards and variability by department in the proportion of highly effective
Performance Awards.
• Give department heads more flexibility in recognizing the accomplishments and contributions of the
department's employees.
• Recognize the needs of lower salaried employees.
• Maintain a competitive pay plan in relation to other area local government employers.
• Respond to salary compression (that is, new employee salaries which are close to the salaries of
longer service employees).
Pay Plan As Proposed In Manager's Recommended Budget
The table below shows the pay components in the Manager's Recommended Budget and projected cost.
Projected FY
Com neat Amount Effective 97-98 Cost*
Cost of Living 2.5% 7-14-97 $527,000
Career Growth Salary increase if performance"Proficient"or"Exemplary;" With perfor- $261,000
Recognition Award If in lower 3/4 of salary range,2.5%, mane review
If in top 1/4 of range, 1.25%
Performance Award Lump sum awarded by department head from department With perfor- $160,000
allocation mane review or
later
*Includes about$200,000 in continuation funds for Performance Awards from FY 96-97
28
Employee Compensation - Continued
The recommended changes to the Career Growth and Performance Awards are as follows:
Career Growth Recognition Award
To address salary compression, maintain competitive employee salaries, and recognize the needs of
lower salaried employees:
• Provide for a relatively faster rate of progression in the salary range for employees in the lower 3/4
of the range than employees in the top 1/4.
• For employees in the lower 3/4 of the range whose performance is "Proficient" or "Exemplary,"
increase the Career Growth amount from 1.25 percent to 2.5 percent.
Per Award
To address the Board's concern as to the relative number of employees receiving highly effective
Performance Awards and variability by department in the proportion of highly effective awards as well
as to give department heads more flexibility in recognizing employee accomplishments:
• Establish a funding limit for Performance Awards for each department.
• Set the funding limit as the equivalent of the dollar amount required to grant 60 percent of
employees with one year of service an award of $400 or 1 percent, whichever is larger. (This
would replace the amount expended in the past for highly effective and outstanding achievement
performance awards.)
• Subject to the funding limit, provide that a Performance Award may be any amount not to exceed a
maximum of $800 or two percent of salary, whichever is larger. (This is the equivalent of the
previous pay plan's outstanding achievement award).
• Provide that an employee is eligible for a Performance Award if the employee receives a Work
Planning and Performance Review (WPPR) rating of"Proficient" or "Exemplary."
• In support of the Performance Award related changes, replace the existing five performance rating
levels (Outstanding, Highly Effective, Effective, Needs Improvement and Unsatisfactory) with four
levels (Exemplary, Proficient, Needs Improvement, Unsatisfactory).
Current Pay Plan
For comparison, the table below shows the current pay plan components and the projected cost if these
continue in fiscal year 1997-98 as presently constituted.
Projected FY
Component Amount Effective 97-98 Cost*
Cost of Living 2.5% 7-14-97 $527,000
Career Growth 1.25% salary increase if performance effective or higher With perfor- $144,500
Recognition Award mance review
Performance Award Lump sum of$400 or 1%, if highly effective, $800 or 2%, if With perfor- $217,000
outstanding mance review
*Includes about$200,000 in continuation funds for Performance Awards from FY 96-97
Appendix A - 2
29
Employee Compensation - Continued
Additional Information Related to 1997-98 Pay Objectives
• As a general note,the area labor market has become increasingly tight over the past several years
since adoption of our current pay plan. It's now characterized by the lowest unemployment in
decades in Orange County and in the region. Over the past three years since the County adopted
the current pay plan, unemployment in the five county region of Alamance, Chatham, Durham,
Orange, and Wake Counties has declined from 3.2 percent in March 1994 to 1.87 percent in March
1997. Over the same three year period, employment in the five county area has grown by about
10 percent or by about 51,350 employees. The County is experiencing this tight labor market in
recruitment, particularly for more technical positions.
• The attached chart shows the recommended 1997-98 pay plans for area local government
employers.
• In terms of the cost of living, the table below shows the increases in the consumer price index and
Orange County cost of living increases over the past six years.
Orange County Cast of Consumer Price
Fiscal Year Living Increase Index Year
1997-98* 2.5% 3.3% 1996
1996-97 2.5% 2.5% 1995
1995-96 2.4% 2.7% 1994
1994-95 2.25% 2.7% 1993
1993-94 2% 2.9% 1992
1992-93 2% 3.1% 1991
1991-92 -0- 6.1% 1990
*Proposed
• As to salary compression, the salaries of current employees are concentrated in the lower portion of
the salary range. For example, Step 3D is 10 percent above the salary range minimum. About 40
percent of all permanent
employees or about 225 Number
employees are at or below Employees Employees By Step In Salary Range
Step 3D. Of these 225, 140
about 150 have more than
two years service and 50 120
have more than five years 100
service. The chart below
shows the distribution of 80
employees by step in the 60
salary range.
40
At present to fill positions, 20
about 50 percent of new
employees are hired at 0
salaries above the salary 1 2 3 4 5 6 7 8 9 10 11
range minimum (Step 1). Steps in Salary Range
This means new employees
are coming in at the same salary or salaries close to those of longer service employees.
Appendix A - 3
30
Employee Compensation - Continued
Given the continuation of the present tight labor market and the rate of salary progression (1.25
percent) provided by the current pay plan, this situation will continue to worsen. The chart below
shows the time required for a current employee to progress to higher steps in the salary range.
Progression in the Salary Range
Years Total Percentage
From Step 1 To Required* Change in Salary
Step 2D 4 5%
Step 3D 8 10%
Step 5D(End of Hiring Range) 16 22%
Step 7A(Middle of Salary Range) 21 29%
Step I IB(End of Salary Range) 38 59%
*If performance is effective or higher
• As to Performance Awards, in 1995-96, about 63 percent or about 390 employees received the
highly effective performance award and about six percent or about 38 received the outstanding
achievement award. Because fiscal year 1996-97 still is in progress, the data for 1996-97 is not
available at this time and will be available in the budget work sessions. Based on the 1995-96 data,
the proposed 60 percent limit for Performance Awards (including those for outstanding) reduces the
overall availability for Performance Awards.
• An additional impact of the application of the funding limit for Performance Awards by department
is that it gives each department, on a proportional basis, the same relative level of funding. The
impact on the department will vary depending on the department's history in granting highly
effective or outstanding awards.
• As an additional note, the recommended budget also provides for elimination of the lowest salary
grade for permanent employees (salary grade 56) and reassignment of the eight Solid Waste Center
Operator positions affected to salary grade 57.
Appendix A - 4
31