HomeMy WebLinkAbout06- Agreement to Conduct a Total Compensation Study for the City of Bozeman
NOVEMBER, 2006
CITY OF BOZEMAN
FOR THE
AGREEMENT TO CONDUCT A
TOTAL COMPENSATION STUDY
t
...
,
SUMMARY OF SERVICES FOR BOZEMAN
PUBLIC SECTOR PERSONNEL CONSULTANTS (PSPC) will conduct the following program of consulting services
and Implementation support to achieve all of the objectives stated In the CITY OF BOZEMAN (CITY) Verbal
Request for Quotation to provide total compensation consulting services.
Prolect Plannlna and Communication
1. Project planning and scheduling meeting with the Human Resources Director and Committee
2. policy Input and project direction meeting and briefing with City Officials
3. Project briefing presentatlori for City officials, and included City employees
4. Assistance with management and employee communication throughout project phases
5. Consultations with and progress reports for the Committee
Becomlna Familiar with the Cltv and the Occupations to Study
6. Review of class specifications containing employee and department feedback and comments
7. OptJonal job Information Interviews / desk audits with Incumbents based on class spec comments
8. Development of classification and title recommendations for affected positions based on review
9. Development of updated ADAlEEO~ompllant class specifications based on desk audit (variable cost)
10. Review of City's current salary administration and external salary consideration practices
11. Review of City's organizational structure for Insight Into reporting relationships and spans of control
12. Conference call with City's compensation committee to gather background and historical perspectives
Compensation Survey Tasks
13. Assistance with the Identification of the City's competitive employment areas for compensation surveys
14. Identification of City occupations to utilize as salary survey benchmark job classifications
15. Development of compensation survey data collection, tabulation, and quality control protocol
16. Solicitation of comparator employers and agencies for participation In external compensation surveys
17. Extraction of data from questionnaires, published public/private surveys and public employer pay plans
18. Consolidation of data from all sources and calculation of prevailing rates for benchmark jobs
19. Computation of extent City's salaries offerings vary from external prevailing rates and practices
20. Comparison of City's benefits and total compensation offerings to practices of external comparators
21. Review of competitiveness analysis with City Manager and/or Human Resources and/or Finance
Directors
Compensation Plan Development Task. (If desired)
22. Construction of optional salary range structures for review and selection by Human Resources Director
23. Development of Internal equity compartson protocol for use In salary range assignment development
24. Assignment of job classes to salary ranges by internal equity and external competitiveness
25. Assistance with City Manager Identification of desired salary competitiveness level policy (Ie 100%,
95%)
26. Fiscal Impact estimates at various levels of external prevailing rates competitiveness policies
27. Review and critique of draft salary plan with City Manager and/or Finance and/or Human Resources
Directors.
Final Report and Preaent.tlona
28. Preparation and presentation of a final project report for the City Manager.
29. Development of a plan for the Implementation of the City's updated compensation plan
30. Uploading of ez COMpTM program files on a City computer and staff training
31. Salary survey and compensation plan administration and maintenance training for City staff
32. Development and provision of process for ongoing plan maintenance and annual updates
33. Assistance with communicating City's updated plans for all City officials and Included employees
34. One year compensation plan (salary range assignment) maintenance assistance at no cost to City
CBMT
PUBLIC SECTOR PERSONNEL CONSULTANTS
10/06
~
PROJECT SCOPE AND METHODLOGY
Following Is our overall work plan and approach to achieving the City's objectives for the conduct of a total
compensation study and optional position classification / classlflcatlonspeclficatlon update study.
A. OBJECTIVES OF THE PROJECT
The recommended plans, programs, systems and administrative procedures will meet these ten most
Important criteria.
. Internally equitable
- Externally competitive
- Readily I.mderstood
~ Easily updated & maintained
- Legally compliant & defensible
- Financially responsible
~ Efficiently administered
. Inclusive of employee Input
- Reflective of City's values
- Reflective of prevailing ~best practices"
B. SCOPE OF THE PROJECT
The project Includes a management and employee communication plan; partnership with the Committee,
the City Manager and/or the Finance and Human Resources Directors; occupational, organizational, and
operational familiarization; review of classlflcatlon speclflcatlons Inclusive of employee and department
comments, optional works\te job Information Interviews and position classification for select job classes;
FLSA status determinations; updated ADAlEEO-compllant class specifications, If warranted (variable cost),
EZ COMPTM; compensation survey and competitiveness analysis; salary range assignments; fiscal impact
estimates; compensation plan and one year of plan Implementation support for approximately 60 positions
and occupational job classes.
C. PROJECT METHODOLOGY
1. Qual/tv Assurance
To ensure a high quality project, we have built In several layers of procedural and statistical controls, In
addition to those already In EZ COMpTM. Internally, we follow a prescribed series of steps In each
project phase, which are reviewed by our Project Director. We request that the Committee review our
work to minimize the chance of errors and to ensure that It reflects the City's organizational values.
2. Pro/eet Plann/no Meet/no. and communlc.Uon Plan Deve/oDm.nt
We will consult with the Committee and City Manager on a communication strategy, plan, and materials,
beginning prior to the project and extending to the post-project Information meetings. We plan to
conduct group pre-project meetings for all Included City officials and employees where we will discuss
the project's scope, answer questions, and distribute and explain the class speclflcatlon review/revision
process.
See ~Commun/cBting the Project to the Employees" In the Appendices for additional information
regarding our approach to employee Inclusion and communication.
CBMT
PUBLIC SECTOR PERSONNEL CONSULTANTS
1 0106
.~
D. REVIEW OF CLASS SPECIF/CA TION CONTENT
1. Review of "Mark..:l UD" Cia.. So.c.
We will revIew the CIty's current class specs containing comments and revisions froin employees and
departments, aM analyze the Current essential tasks, duties and responsibilities, and minimum
quallflcatlons of every posItion.
2. EmDlov.. Worlc5lt. Job Information Interviews (optJonal)
As needed based on the results of the class speclflcation review, or as requested by the employee
and/or his/her supervisor, we will conduct workslte job Information Interviews. The purpose of these
interviews Is to verify the data on the revised class spec, obtain addltlonal'nslght Into the scope and
complexity of the job duties, observe technical processes and working conditions, and to provide
employees with an additional method of participation In the project. This process also ensures that we
make alllnlernal and external comparisons on the basis of actual Job content and not merely job title.
3. FLSA St.tus DetermlnatJon
We will review the essential tasks and minimum qualifications of each of the City's job classlflcatlons
and subject them to the Fair Labor Standards Act tests to determine their exempt or non-exempt status.
4. Class SD,clncstlon Content UDdstn
PSPC will provide, by class specification, the Committee a list of any recommended changes to the
class specification. PSPC will Indicate whether It believes each of these changes to be minor or major
In nature. Wherever the Committee and PSPC agree that the needed changes are major In nature,
PSPC will prepare an updated ADAlEEO-compllant class speclflcatlon In the City's standard format.
E. EXTERNALL Y COMPETITIVE COMPENSA TION PLAN
1. Cltv Involvement In Sa/arv Plan Oeve/ODment
We will obtain policy direction from the Committee and/or the City Manager on the following key
components of the salary plan development process:
- Comparator Employer Selection
- Benchmark Job Class Selection
- Salary Competitiveness Policy
- Salary Structure Selection
- Total Compensation Components to Include
- Draft Salary Plan Review and Critique
- Linkage of Plan to Performance
- Project Implementation Plan
2. Comorehenalve Como.nut/on Survev
a. D.t. CollectJon Protocol will be developed In consultation with the Committee and City Manager
and/or the Human Resources and Finance Directors to determine which salary data elements to
Include, such as:
BaBe Salary Information
Salary grade/step or open range salary plan structure
Salary range structure Minimum, Midpoint, and Maximum
Average actual salary of all Incumbents In the job class
Method of salary administration -longevity, merit, or skill
CBMT
PUBLIC SECTOR PERSONNEL CONSULTANTS
1 0/06
Total CompensatJon InformaUon
Supplemental pay Items for special qualifications/certifications
Individual or group Incentive plans, bonus, awards, stipends
Pay for time not worked, ala vacation, holidays, sick leave
Overtime policy, shift differentials, standby and/or recall pay
Insured benefits, s/a medical, dental, life, vision, L TD etc.
Financial Security, s/a retirement contributions, deferred comp, savings plans
b. Benchmark Job Se/ecUon will be made by Identifying City job classes common to its employment.
competitive public and private employers In the region and throughout Montana, clearly identifiable.
and representative of standard occupational job groups.
c. Comparator Employers IdentJncatlon will be made in consultation with the Committee and City
Manager and Cal:lngll. Criteria Include their degree of competition to the City In obtaining and
retaining high quality staff, their location In the City's traditional recruitment areas, and their
organizational size and complexity.
d. CompensatJon Data CollecUon will be made by one or more of the following methods.
Pre.survey contact with the selected comparator employers to solicit participation In the Clty's
compensation survey(s)
Customized salary and benefits survey questionnaires local governments and other public and
private employers, distrtbuted by mall, fax, and e.mall.
Data extraction from PSPC national public and private sectors compensation database.
Data extraction from established salary surveys such as ICMA, BLS, and commercial survey
sources such as Hay or Mercer.
Extraction from the pay plans of designated public employers.
e. Data Quality Control Includes editing data for accuracy and proper matching to the City's survey
benchmark jobs. and phone/faxlE-mall follow-ups for data clarification and to obtain comparators'
benchmark job descriptions.
3. Prevail/no Rat.. Calculation
We will consolidate the compensation data from all sources, enter the Information Into the EZ COMpTM
program, and compute the prevailing rates as the statistical mean of the survey data for each
benchmark job class. Data will be projected forward from the date of collection to a common date
relating to the City's salary plan year by the annual Prevailing Rate Increase Factor (PRI) applicable at
that time.
4. ComDensatJon ComoetltJveneaa ComDarlson
We will provide the City Manager with charts comparing Its current salary and benefits structures to
those of the selected public and private comparator employers. We will calculate the extent that the
City's offerings vary from the prevailing rates and practices of other relevant employers.
5. ComD.nsatlon ComD.tlt/venN. Pollcv
We will assist the City Manager to select a compensation competitiveness policy which best fits Its
compensation strategy and financial resources, by providing fiscal Impact estimates at various
percentage relationships to the prevailing rates and benefits.
CBMT
PUBLIC SECTOR PERSONNEL CONSULTANTS
10106
..
6. Sa/arv Plan Structure Oev./ooment
We will review the City's current salary provision practices and prepare alternative salary range
structures and schedules for the Committee and City Manager to select the best fit for Its
competitiveness strategy, with these optional criteria:
Method of administration, I.e.: measured job performance, longevity, or skill
Width of the salary ranges, grades, or broad bands, from Minimum to Maximum
Varying salary range widths for FLSA non-exempt or exempt positions
Open salary ranges for pay-for-performance or variable compensation plan
If steps within the salary ranges, number of steps, percentage separation
Number of salary ranges, grades, or broad bands In the salary schedule
Percentage of separation between salary ranges, grades or broad bands
Recognition for longevity, unique assignments, and special skill requirements
Remuneration for required special licenses, certifications and registrations
Linkage of performance evaluations to merit Increase opportunities
T. Sa/arv Ranae Asslanm.nt Deve/ooment
We will assign each job classification to a salary range on a new salary structure on the basis of a
combination of factors. Including:
the prevailing rates for the benchmark job classes
its quantitative evaluated Internal job worth value Gob evaluation points)
Its current relationship to similar or occupationally related job classes
The Input received from the City Manager and/or Finance and Human Resources Directors
regarding the City's compensation policy;
8. Imo/ement.tlon Plan Deve/ODm'nt
We will consult with the City Manager and/or Human Resources Director and/or Finance Director on a
plan for transition to the recommended plan, Including a timetable for the principal activities. employee
communication, and estimates of required financial resources.
9. Draft and Final ReDort Preoaratlon
We will provide the Committee, Human Resources Director, and City Manager with a draft of our report
for review and critique, Including and title, classification or FLSA designation changes, compensation
market data, salary and benefits comparison tables, fiscal estimates, salary range listings, and
Implementation procedures. We will Incorporate their critique Into the development of a final report
summarizing the project's findings, recommendations, and detailed description of the City's updated
compensation plan.
10. Final ReDort Presentations
We will conduct a workshop or formal presentation of our final report and recommendations to the
Human Resources Director, City Manager, and employees.
CBMT
PUBLIC SECTOR PERSONNEL CONSULTANTS
10/06
.
1
11. EZ COMpTM Proaram InstallatJon
We will Install our EZ COMpTM program and project files on one of the Human Resources
Department's computers and provide training to key staff In the maintenance and update of the
compensation plan.
Please see a demo of EZ COMPTM on our webslte at www.comoensatlonconsultina.com.
12. Img/.mentatlon Wa",ntv
To ensure effective Implementation of the new plan, we will analyze, evaluate, and provide a salary
range recommendation for any new or changed job class, at no cost to the City for one year.
F. ENSURING THE CITY'S SELF-SUFFICIENCY
The City will be self.sufficlent In all aspects of maintenance of the updated compensation plan through these
services
1. Procedure Manuals
. PSPC Salary AdmInIstratIon Procedure GuIde
. City of Bozeman EZ COMpTM Procedure GuIde
2. Tra/nlna WOrk.hOD - for Human Resources and other staff in position classification, job evaluation,
compensation surveys, and compensation plan design and administration.
3. Electronic C/as. SDeclflcatlon Llbrarv - we will provide the City with all of the updated final
ADAlEEO~ompllant class specifications In hard copy and electronic library format for Internal
maintenance.
4. EZ COMpTM - program and project files on one of the Human Resources' Department's computers, a
users manual, and system training.
~. InltJal Year'. ImDI.mentatlon W,rrantv SUDDort - we will analyze, evaluate, classify, and provide a
salary range recommendation for any new or changed position or entire job classification, at no cost to
the City for one year.
G. EXTENSIVE EMPLOYEE INCLUSION AND COMMUNICA TION
Very Important factors for successful Implementation of the new compensation plans are 1) extensive
employee Inclusion, and 2) extensive employee communication. City officials and employees will participate
In one or more of the following activities:
Attending pre-project briefings and question and answer sessions
Providing feedback and comments on current class spec content and accuracy;
Elaborating on their jobs in Individual or group job Information Interviews
Requesting a second review of their position's occupational job classification
Receiving Information pamphlet/booklet describing the updated salary plan
Participating In a technical plan maintenance and administration workshop
H. MINIMAL CITY SUPPORT REQUIRED
We are completely self.sufficlent In projects of this nature and do not require any substantive staff support
from the City other than payroll data, comparator employer contact Information, and arrangements for group
and Individual meetings and Interviews. We appreciate, but do not require, any office space, telephone,
clerical assistance, computers. or office equipment. We will provide all data entry, data processing,
duplicating, and related report preparation functions.
CBMT
PUBLIC SECTOR PERSONNEL CONSULTANTS
1 0106
t
PROJECT TIME AND COST ESTIMATES
A. PROJECT TIME ESTIMA TE
Depending on the City's selected project options, the total project can be completed within ninety (90) to
one hundred twenty (120) day. of the Initial on-site project planning and briefing meetings for the City
officials and employees. A Gantt chart illustrating the estimated sequence and duration of the project's
principal tasks follows this page.
B. PROJECT COST ESTIMA TE
We estimate that the project's total cost, Including all fees for professional services and reimbursement for
out-of-pocket expenses, will not exceed the Indicated amounts.
1. Fixed Pro/ect Cost.
Total ComDensatlon Studv - Including:
o Management and employee communication plan;
o Partnership with Committee, and the City Manager;
o Occupational, organizational, and operational familiarization;
o Review of classification specifications Inclusive of employee and
department comments
o Summary of changes needed, by class specification;
o FLSA status determinations;
o EZ COMpTM;
o compensation survey and competitiveness analysis;
o salary range assignments;
o fiscal Impact estimates;
o compensation plan; and
o one year of plan Implementation support for approximately 60 positions
and occupational job classes.
$35,000
2. ODtlonal Prefect Costs
Classification Workslte Job Information and Dosltlon classification Interviews
(per 15)
$2,000
Updated ADAlEEO Compliant Class Specifications (as warranted), each
$80
C. FLEXIBLE WORK PLAN AND NEGOTIABLE TOTAL COST
Our work plan Is flexible and total project cost negotiable, and we will discuss, modify, add or delete, any
work task to Increase the project's responsiveness to the City's needs and financial resources.
CBMT
PUBLIC SECTOR PERSONNEL CONSULTANTS
PSPC
1 0106
D. PROJECT BILLING AND PA YMENT
Upon receipt of a valid Invoice, the City agrees to pay PSPC as per the following schedule, for
professional services provided.
Completion of Project briefing and Initial meetings with
Committee and affected employees (not to exceed)
5,000.
Acceptance, review, analysis of class specs
Solicitation of market data from comparators
Analysis of market data per benchmark job
Calculation of prevailing rates and practices
Draft review with committee (not to exceed)
$25,000.
Final Report preparation
Final presentation (not to exceed)
Total not to exceed
$ 5.000.
$35,000.
· These figures Include all out of pocket expenses.
.t
MEMORANDUM OF AGREEMENT
This Agreement Is entered Into by the City of Bozeman, Montana ("the CIty"), 411 E. Main Street, Bozeman, MT
59715, and Public Sector Personnel Consulhlnt. (PSPC) 4110 N. Scottsdale Road #140, Scottsdale, AZ 85251
(National Office).
This Agreement Is for PSPC to conduct a total compensation study and incorporates PSPC's November 2006
agreement by reference.
SCOPE OF SERVICES TO BE PROVIDED TO THE CITY
The project Includes a management and employee communication plan; partnership the Management
Compensation Committee, the City Manager and/or the Finance and Human Resources Directors; occupational,
organizational, and operational familiarization; review of classification specifications Inclusive of employee and
department comments, optional workslte job Information Interviews and position classification for select job
classes; FLSA status determinations; updated ADAlEEO-compllant class specifications, If warranted (variable
cost); EZ COMpTM; compensation survey and competitiveness analysis; salary range assignments; fiscal impact
estimates; compensation plan and one year of plan Implementation support for approximately 60 positions and
occupational job classes.
ESTIMATED PROJECT DURATION
PSPC and the City will work together to complete the study within 90-120 days of authorization to proceed.
PROJECT COST AND PAYMENT
The City agrees to pay PSPC a sum not to exceed $35,000 for all fixed-price consulting fees and travel
expenses. Additional services can be negotiated Including the conduct of desk audits for an additional $2,000
per 15 desk audits, and updated class specifications for $80 each. Upon receipt of a valid Invoice, the City
agrees to pay PSPC as per the following schedule, for professional services provided.
Completion of Project briefing and Initial meetings with
Committee and affected employees (not to exceed)
5,000.
Acceptance, review, analysis of class specs
Solicitation of market data from comparators
Analysis of market data per banchmark job
Calculation of prevailing rates and practices
Draft review with committee (not to exceed)
$25,000.
Final Report preparation
Final presentation (not to exceed)
$ 5.000.
$35,000.
Total not to exceed
· These figures Include all out of pocket expenses.
The City agrees to pay the Invoices within thirty (30) days of their receipt.
"'
.
APPROVED FOR APPROVED FOR
CITY OF BOZEMAN
By:(~l~
(Signature)
Chris A. Kukulski
Name:
(Typed)
~ "
Title:
Date:
City Manager
December 6, 2006
NEL CONSULTANTS
By:
Name:
(Typed)
Title:
Matthew Weatherly
President
Date:
~...\.......41.toc