City Council - Special Meeting

Good afternoon, everyone.

This is Councilman Michael Holmes calling to order the special meeting of High Point City Council today. With me are all members of council except for the mayor and Mayor Pro Tem. At this time, I will entertain a motion to adopt our agenda. So moved. Second. Got a motion by Councilman Moore, second by Councilman Andrew. Any discussion on the motion? Hearing none, all those in favor, please signify by saying aye. Aye. THE AGENDA IS ADOPTED. GOT TWO ITEMS TODAY. WE'RE GOING TO START WITH ITEM 2026-249, EVERGREEN SOLUTIONS CLASSIFICATION AND COMPENSATION FINAL REPORT PRESENTATION, AND I WILL TURN IT OVER TO MANAGER TASHA LOGAN.

THANK YOU, COUNCILMEMBER HOMES. GOOD AFTERNOON, COUNCILMEMBERS, AND THANK YOU ALL FOR JOINING US. I KNOW IT'S QUITE WARM OUTSIDE. We have the phase two of our compensation and classification study where we'll present the results to council today. Just as a little bit of history, the city of High Point traditionally has looked at a third of our workforce each year, looking at pay, compensation, and trying to address those systematically. Three years ago, I believe it was three, three, four years ago, we transitioned to using different consultant based on concerns that we were hearing in the organization around issues of compression and primarily individuals that have been working for the city for quite a while we're not progressing in the ranges as we had hoped the city also had a philosophy of where we would typically make adjustments to our pay plan trying to make sure that our starting salaries were competitive and we had done that for a number of years probably eight years or more and where we would adjust our minimums in our pay plan, but we realized that that was also exacerbating the issues that we were having with compression in our ranges. So when we decided to start with our current pay study, we wanted to make sure we were addressing starting salaries, making sure the city was competitive, but also looking at how individuals were actually moving through their ranges. And we were able to successfully implement phase one, and then transition to phase two. Typically, this would have been done in three phases, but we decided to lump all of the remaining employees into phase two and then use the last year to thus reassess, kind of retool, see how things were settling, if we needed to then make smaller changes throughout year three versus having to look at an entire group of positions being studied. So phase one, we looked at roughly, I think, 400 positions. ABOUT A THIRD OF THOSE RECEIVED SOME LEVEL OF ADJUSTMENT OR MOVEMENT. OTHERS THAT DID NOT RECEIVE MOVEMENT DID NOT RECEIVE MOVEMENT BECAUSE THEY WERE BEING PAID APPROPRIATELY. PHASE TWO TOOK US QUITE A BIT LONGER, AND FOR TWO REASONS. I WANT TO TAKE A MOMENT TO COMMENT OUR STAFF, BECAUSE PHASE TWO, WE HAD OVER 1,000 POSITIONS THAT WE WERE STUDYING AS PART OF THIS PHASE, BUT ALSO WE WENT THROUGH A TRANSITION OF USING A NEW ENTERPRISE SYSTEM OF TRANSITION FROM LAWSON TO WORKDAY. And you all laugh, but I've talked to you all about that. We did that, combining several systems into one, but doing that at the same time that you're doing a study this large also creates challenges. So I just want to commend our HR staff, our finance team, and our IT teams, because it took a lot of behind-the-scenes work to make sure that we were preserving the integrity of this information. And we realize that we're going to have to do some slight adjustments as we're moving forward with this, but we are comfortable that we're at a place now where we can go ahead and implement THE RESULTS OF THIS STUDY, SHARE THIS REPORT. IT'S A DRAFT. AT THIS POINT, WE'LL GET THAT FINALIZED, AND THEN WE'LL HAVE TO SPEND KIND OF THAT THIRD PHASE, MAKING SURE THAT WE DON'T NEED TO DO ANY KIND OF SPOT CHECKING AND ADJUSTING TO MAKE SURE THAT IT'S ACCURATE. SO WITH THAT SAID, I WANT TO INTRODUCE TO YOU MS. ANGELA PERKWOOD, OUR HR DIRECTOR, WHO'S BEEN SHEPHERDING THIS INTERNALLY FOR US. I APPRECIATE ANGELA AND HER TEAM. And then also our consultant with Evergreen, Mark, will be handling the presentation today. And then also after this presentation today with council, we have information sessions that are set up with our employee population that will be taking place this week as well. Those have already been announced and employees are aware of how they can tune into those. Those are also recorded so they're available after the presentations if someone is not able to attend. We want to make sure that just as we had information sessions for employees on the front end of the process, that once the results are coming out, that we also have the opportunity for employees to understand how this information was gathered, how we handled the benchmarking, and then how the calculations were developed that led to the increases. So with that, I will kick it off to Mark, and we will get started with the presentation. Thank you, Mark.

Absolutely. Thank you all very much for having me. My name is Mark Holcomb, project manager at Evergreen Solutions. I'm looking forward to having the chance to run through the presentation today. In the presentation, I'm going to talk about the study goals and project phases, really addressing what is it that we were asked to do when we came in for this engagement, just as some recap if anybody didn't have as much experience or exposure to sort of the steps that we went along the way. We will talk about the employee meetings and the current system findings, which both detail information that we gathered about how you all are operating currently. The employee meetings obviously being perceptional information gathered by employees. So what did they tell us? What were their concerns? The current system findings being our data-driven review. So we'll touch on things like the compression that were mentioned a moment ago. Then the market results and recommendations will be, I know of great interest here, but kind of talking about how did y'all relate to the market, what were the recommendations that we have to address those items. And then lastly would be the next steps, which is just the last couple things to close out, including this presentation, the employee meetings, and we'll go from there. So with a study like this, There's really two main goals, and that third goal being leading into the recommendations. But goal number one is you want to be able to look at a system and review classifications for internal equity. So when we say internal equity, what that means is how do positions relate to one another within the city? So that equity could mean that if two different people are performing the same exact work in different departments, but we want to make sure they're looked at the same way. They have the same duties, responsibilities, et cetera. We want to make sure they have the same compensation available to them, the same job title, et cetera. But it also could refer to employees who are not doing the same work. If you have two people categorized at the same level right now, but one of them has a significantly more complex job or significantly more leadership in their role, we want to make sure that's reflective as well. So that internal assessment, therefore, really is about aligning employees properly versus other classifications here within the city. The second bullet is the external assessment then. So the external equity assessment would be related to comparing you to the labor market that you compete in for talent and really understanding how do you compare with other organizations. Once again, looking at the duties and responsibilities of the job. So if you had somebody who works for the city now, if they went somewhere else and performed that exact same job, Would they be paid more, would they be paid less, or would it be about the same? So we wanted to answer that question as well. Then number three is to produce recommendations that maximize both of those two items, is that internal and external alignment. So it is not so simple as saying if you're 6% below the market, you get exactly a 6% increase, because of course it could be that we find that the city of High Point operates slightly differently. Piece could cause that position to only move up by three or four percent or it could cause it to move by eight or nine percent So the market is a very important factor, but the internal piece is critical as well So in order to conduct this study here are the phases that we went through in this phase two study And so phase one was the outreach portion, which is kicking off really getting to know the classifications that would be involved in this phase two study and collecting information both from HR and from your employees. That outreach included us coming on site, meeting with employees, hosting meetings, and collecting survey data from employees where they were able to indicate where is it that their jobs align with the job descriptions that are in place currently and where have they maybe evolved a little bit and that needed to be looked at as well. So phase one was all about collecting data. Phase two is that internal analysis portion. So all of the data that we collected in phase one is then reviewed and analyzed in phase two. The data review refers to the compensation information collected from HR, org charts, job descriptions, et cetera, looking for things like that compression. It also includes reviewing the job surveys from employees, again, to flag and highlight the areas where we saw differences between current job descriptions and the actual duties that employees told us they performed. That all culminates in something called our assessment of current conditions, which is just the name for our set of analyses that we always like to look for. And so we did identify a few things. I'll show those in the upcoming slides that we wanted to talk about, both in terms of strengths that we said, hey, this is what the city is doing really well, and also on some of the weaknesses or challenges that we said, hey, maybe in an ideal world we'd be able to address these. Phase three is that external analysis. So it is a compensation survey. We'll show you the details of who did we look at, what was the response rate, what did the data actually show in terms of you all compared to the market. And that market positioning is an important takeaway from there is where are you positioned now, but also where would you like to be aligned to that market going forward. So the solution, the implementation options, there were several that we looked through. We obviously understood in this phase two study of this would be making sure that nobody felt like they were treated better or worse in the phase one versus the phase two so we did have a couple opportunities to basically look back at the phase one and say hey what did we do there is there something else we should have done and bring those two things into alignment so I'll touch on that as well with those implementation options then lastly is the reporting so that includes both The written report that we've now submitted, this presentation here, employee presentations and conversations happening tomorrow, and making sure we really communicate how the study went and what were the takeaways from that. So for the employee meetings, in terms of the positives, so the comments that we heard that, again, employees said, hey, here are some of the reasons why I wanted to work at the city or why I've stayed here over time. One of the top ones was job security and benefits. So again, we understand a lot of employees will have somewhat of the mindset of, hey, if I'm looking for the absolute top dollar, maybe I'll go to the private sector somewhere. But if I want a nice, stable career, if I want something that's going to take care of me, I can actually have a life outside, I can have some of that work-life balance, this is a great place to work. And that's something that employees shared with us. Another item that they mentioned was that community purpose. So again, Employees talking about, hey, I'm here and I actually get to feel good about being here. I'm not working for somebody else to make a profit or somebody else to make money. I'm working to give back to the community that I live in. So that's another item that employees shared. Structure and consistency. Employees did value the work that the city has done to make sure that they understand what are the policies, how would they promote, are they treated fairly? Employees did mention that and did appreciate that. And then lastly, the culture. which really gets into the people they work with and the relationships they have here. So collaborative, service-oriented, again, are some of the words that people mentioned. Being able to work together as part of a team on a shared goal. And some of the concerns, however, when we talk to employees, keep in mind these are perceptional, but here's what employees said. Compensation competitiveness. Of course, we're here to do a compensation survey. It's natural that that's going to be top of employees' mind, but that was something that a lot of people said. Sometimes it was, as we've noted here, specific comparisons with the private sector. So again, recognizing, as I mentioned a moment ago, public sector and private sector are not always in alignment there with compensation. Some of your employees felt that way and said, hey, we feel like we could be paid a little bit more if we're going to be as competitive as we would like to be. Another item, this kind of goes, you know, pairs up with that last one we mentioned is clear policies, understanding what, you know, how things work. But in a large organization, there were some that were a little frustrated by the policies, that rigidity where there's sort of that trade-off or that tension where if you've got clear policies and they're supposed to work a certain way, sometimes employees said, hey, we'd like to have a little bit more flexibility with those policies. Recruitment and staffing, so employees did talk about, hey, We've got vacancies. We've had people leave. I feel like my job is more difficult as a result of somebody else leaving. I'm having to cover their work and cover their job. And then lastly, performance management, employees talking about, I don't think the high performers are always paid as much as they should be relative to the low performers. It's a relatively common thing we hear going around and working with cities and counties across the country. But that perception that, hey, if somebody just shows up as long as they do the minimum, they felt like they were rewarded maybe a little bit too closely with those high performers. So those are some of the concerns and perceptions that employees did have. With the current system findings in terms of the strengths, you all do have a good looking, consistent, easy to understand pay structure. You typically have done a pretty good job of spacing employees and their supervisors. So about 95% of employees have at least 5% difference between themselves and their supervisor. Obviously, depending on the supervisor and employee roles that they're in, the difference in salaries there, you typically, you could see a larger or a smaller difference, again, depending on how related those roles are, but at least 5% is something we typically look for that really there shouldn't be any classifications that are closer than that, at least that you would like to see in an ideal world. With some of the weaknesses, however, we did see some compression basically that existed the longer employees stayed at the organization. I'll show this on the next slide. There's a graph coming up to show you. And about 90% of your employees are paid below the midpoint. and about two-thirds of those employees, or two-thirds of the total rather, are in the first quartile of the pay range. So the quartiles of pay range is if you divide the range into four equal pieces, that first 25% is that first quartile. You have about two-thirds of your employees in that pay range. Now, that does not mean every single one of those employees is compressed or should have moved further, et cetera. If you have a new hire, particularly a new hire who's coming in at the beginning of their career, it can be very appropriate for them to be placed near the minimum of the range. So I don't want anyone to leave here thinking 90% of people are underpaid or 2 thirds are underpaid or anything like that. But it does represent a little bit of an imbalance. Typically, you wouldn't want to see that number because the more employees you have at the minimum of the pay range, the more at risk you are to losing employees for compensation related concerns. Even if you're below market, if your employees have advanced to the midpoint or above, they might feel like they're losing something if they had to go somewhere else. But if they're making the minimum here or just above the minimum, they might feel like, well, I could go make the minimum somewhere else. If they're going to pay me more, they're not going to feel like they're missing out on anything. So we do want to indicate that and mention that for you all to see. So here is essentially a graph that shows a little bit of that compression. I know there's a lot of colors, but just to sort of point y'all to the right direction of this is, on the left-hand side are your employees with less than one year of tenure with the city, so zero at the bottom. That left-hand column are your new hires. Every tick that you move is an additional year of experience, so one, two, three, four, five, all the way up to 30. So the right-hand side shows your long-tenured employees. The orange and blue then at the bottom show the compression that y'all have in place. So the orange obviously being the more dramatic compression, the blue being starting to develop there. You will notice as you move to the right, you see that color of both of those colors increasing. And over at those, you know, 10 plus year employees, you see the majority of those have at least 10% compression, some of them going up as high as, you know, 20 or 30%. So again, just a way to read that, let's pick, you know, year number 19 as an example, about 30% of your employees who've been here 19 years are experiencing some compression. So again, We do dive in individually in our recommendations. We don't treat employees as that group anymore. But just to showcase to you all with a quick and easy way to notice it, that orange and blue does represent the compression that we would like to address. So with the market information then, the market survey that we did, we have 17 different organizations that we were able to solicit and collect data from. They are listed over on the right-hand side. Those do match the organizations from the phase one a study that we conducted. We did address cost of living with these responses. So understanding that some organizations on this list have a little bit higher cost of living than y'all do. A few are lower as well. So we didn't want to penalize or reward anybody for comparing to a high or low cost of living area. So everything would have been put back into your local cost of living here when we return that salary from your competitors. We did look at 259 different positions, which is a very large sample. We do like to focus on the classifications that get at least five responses from the market though, to avoid the outliers having an outsized impact in this. So 159 of those 259 did have at least five responses, which gave us a very robust sample to compare to. And the average match rate overall was nine and a half matches per position. Again, just going up once you exclude those outlier classifications that were removed. So looking at the data here and understanding what the actual results show, on the left-hand side, you'll see you all are about 3.5% below the market average. before you adjust for cost of living at the entry level of your pay. I do mention the entry level first, particularly because with about 90% of your employees below the midpoint, about two-thirds in that first quartile, that minimum is a critical number to understand. Now, y'all are above the market by about 1% at the maximum of your range. So the longer somebody stays, if they do achieve that maximum rate, that does mean they're able to be more competitive. But again, with that compression building over time, That means that employees sometimes have fallen below that progression rate that they would expect. If you move over to the right-hand side of the table at the top, that shows you your cost of living adjusted numbers. So notice that 3.5%, it does get a little bit better, only about 1% below the market at the minimum on the right-hand side. So again, I won't call that a major gap, but keep in mind, this is the average classifications. About half of your positions fared a little bit worse than this. About half your positions fared better. So you overall are close to your target, but there are some classifications for sure that did show some market differentials and some gaps that we want to address with this. This is talking about your pay range data, that compression comparison that we showed earlier. We'll get into more of the individual pay. But these specific numbers here are talking about the pay ranges. So with the information there then, what do we actually do about that? What are our recommendations to address that? So with the key recommendations, number one is to adjust the pay plan with your pay scales, ensuring that we're able to bring those to the market placement that we'd like to see. We do want to maintain that consistent range spread and consistent progression between the ranges. As we mentioned before, you all did already have a good looking pay plan, so this is just an adjustment to bring that within the market ranges. However, number two is to reassign pay grades as needed for those classifications that had fallen further below the market. So while we do propose a small market adjustment, ensuring that you actually look at individual classifications is how you make sure that that market gap is closed most effectively. So for example, if you have two different positions, one of them is 10% below the market, one of them might be 5% above the market, applying a flat adjustment to both of them doesn't exactly help because that one that's 10% below might still be below, the one that's 5% ahead, of course, they don't need that additional adjustment. So that number two, reassign the pay grades, could have caused that classification to be 10% below market. They could have been bumped up to a higher pay grade in order to close their market gap instead of moving the entire scale by a uniform number. We did take a look at internal alignment when we did that. So of course, when we move classifications, We were careful to consider are they being placed into the appropriate grade relative to others who perform the similar level of work inside the organization, but also to their supervisors as well. So that is just an important thing to note on that second bullet. And then lastly on that third bullet is making a recommendation to adjust individual employees based on the philosophy and financial means of the organization. In that adjustment there, there are a few different adjustments that we'll highlight and kind of talk through. We've got the highlighted hybrid period that y'all may remember from phase one that we utilized there as well. But just as a brief reminder, bring to minimum is the cost just to put employees into the new pay scale. So if you're paid at the minimum of your range and your range moves, of course you have to move as well to stay above the minimum range. The bring to minimum is very low, that cost though, because if you're at the midpoint and your grade moves you, of course you don't need to move at all. That does cause additional compression. And so again, it wasn't something we recommended, but we do always like to show what is just the cost of turning this system on, for example. Then the class, hybrid, and tenure parity approaches are three different approaches to address compression. The class parity approach only addresses compression based on time in current classification. So if you just promoted last year, you would essentially only have one year or zero, whatever that promotion time was, that's all the credit that you would get. The unfortunate reality of the class parity is it can therefore penalize employees who are high performers who have gotten promotions. Whereas if they had just stayed in their current position instead of promoting, they might have gotten some additional increases. So the class parity approach, while it does good things for some employees, that's the major limitation there. The tenure parity approach, on the other hand, gives everybody full credit for every single day they've spent at the city. The sort of unfortunate reality of that is when you give full credit for every single day, take that same employee example who just promoted. They might be brand new for the first time in a manager role or a director role or wherever they've promoted into. But if they've spent 20 years with the city, they would be getting 20 years of credit into that classification. So the 10-year parity approach, instead of penalizing those employees who promoted, it actually can sometimes shoot them up past the incumbents who've been in those roles for a long time. So you might have a brand new manager making more than the other managers who've been in the role for five or ten years. So the hybrid parity, that's the reason why we like that approach. It's not perfect. I don't want to sit here and say any approach is perfect when applied to a thousand different employees, but the hybrid parity does do a better job of closing both of those loopholes that we saw there. It gives an employee full credit for their time in classification, and then it gives that employee half credit for the time with the city overall. So that ensures that if you have just promoted, you still get that partial credit for the time you spent at the city. And then likewise, again, you're not getting full credit, which would have then shot you up past the other people in that classification. So this is one of the items that we looked at here. With that hybrid parity adjustment, it is a very similar approach that we did for the phase one. However, we did look at a 50% credit for employees in the phase two. So we did a review of those phase one employees to ensure none of them were going to be left behind and none of them would have been penalized by going with this version of the hybrid with that 50% credit. So that's something I do want to indicate here and mention. That is flagged on this slide right here. On the next step, sort of that implementation and finalization of the project, finalizing the solution, up until even the last couple weeks here, I've been getting questions of, hey, well, what about this or this piece of employee data? Somebody just promoted or changed. So we are working with your HR department to answer any of those questions. Those are in the one-off examples now. We have the implementation approach going forward, and your HR and IT teams are working on implementation, so we'll address any of those questions that may come up. Final reporting and employee meetings including obviously again this presentation providing the written document which we have provided that draft subject just to the city accepting that for finalization and then lastly the employee meetings tomorrow would be that last sort of portion of that sharing that information there. Reviewing the additional phase one adjustments I did want to flag that here as well I already mentioned that but we did a couple things to address those phase one employees We did look at the hybrid calculation. There was a subset of employees in that phase one who would have received additional adjustments if they had gotten the same approach here. So we did look at an adjustment for them, again, costing somewhere in the neighborhood of $300,000, you know, again, give or take once you factor in benefits and taxes and all those kinds of things. And then we also included those phase ones. We did some compression adjustments based on supervisors. As I mentioned, the supervisory compression was not the main concern that we have, but we did see certain instances, particularly in some departments, where you would have a long-tenured employee who the hybrid parity would have moved past an employee who had been in a higher classification. We did look at those as well, bringing in the phase one employees as well. Again, so no one was left out by that. Lastly, I do want to indicate Evergreen is available for the next year to assist at no charge if any questions or concerns or any other needs come up with that. You know, we do value our long-term partnerships with our clients So, you know, I don't want anyone to think well what happens in three months if something comes up or we don't know what to do Whatever so I have you know, we've communicated that to HR and they know that as well that if anything comes up, please let us know So that's the presentation any questions or comments or anything I can address for y'all today We have any questions for members of council?

Yeah, I have a few Yeah, where did we go? Which slide was that? We should have bookmarked this slide. One of the weakness slide, slide five. Almost 90% of employees are below the midpoint, and two-thirds of employees are paying within the first quartile. So you showed that there was a distribution that skewed more toward the lower pay rate, pay scales. Is that a function of more employees being relatively new to the organization?

That was one component of that for sure. So the organizational tenure, I believe it's only, I think, five to seven years was the average tenure. I know we looked at that and talked about that. So that organizational tenure is going to mean that a good chunk of those employees are supposed to be, if you take that expected pay, they are supposed to be paid there. However, again, that 90% is still a big number. We want y'all to be aware of it. Even if it's not something that every one of them gets addressed, we want y'all to know, because that sort of underlies and highlights how important it is for y'all to be competitive at the minimum of the pay range. Because, as I said, those employees If they're going to get paid more elsewhere, they don't have anything to lose, you know, compensation-wise by going somewhere else. So it's definitely something we want you all aware of.

Is there a distribution that's sort of like a benchmark on what the ideal organization is supposed to look like?

I wouldn't say there's one distribution that is the ideal, but I would say we typically don't see a lot of organizations with more than about two-thirds of their employees below the midpoint. Probably the most common distribution I would say in the studies that I've done is about 60-40, 60% below, 40% above, and that's the midpoint. So again, we do see a little bit, some organizations might skew one way or another, that's no problem. The age of the organization, if you've expanded, if you've had turnover, all those things can impact numbers. But I would say 90% is one of the higher that we've seen below the midpoint. Again, it doesn't necessarily indicate an issue, but it does indicate an imbalance that we should at least be aware of and be able to look to.

Okay.

In our recently passed budget, there were raises for employees. That in and of itself doesn't affect any of the compression problems or anything that you've seen in the study, is that correct?

By recently passed, I guess if you could maybe help me understand, is that across the board, are you saying the implementation of this study with the hydrants?

The implementation study of the hybrid plan was included in the budget. Perfect. And so that will be applied to the employees there. And the market adjustment of 2.5%, that was part of the budget as well. The reason we did the market adjustment for every employee versus just raising the minimums was so that once we do these adjustments for the hybrid parity model, then we weren't creating compression again by only raising minimums. So every employee will get the 2.5%. So both of those items were included as part of the budget adopted by council.

that question, but that was an excellent answer. Thank you very much. And then, it's probably not in this presentation, but does education factor at all, like somebody gets like an extra certification or whatever that applies to the job, does that take into account into this study, or is it a separate question?

Yeah, it's a little bit of a separate question. It would not be addressed directly by the hybrid, because the hybrid does focus on experience with the organization and classification. In terms of education, though, just in general, broadly speaking with HR, what we would say is education can have an impact for certain roles, particularly when you're looking at hiring and promoting. If somebody has education or experience that would take them significantly beyond the minimum qualifications, that can be something that you factor in. But we do recommend that it is done in a targeted way. While education is great and we support anybody having higher levels of education, if it's not going to directly impact the job that somebody's serving in, an organization, it's really a decision you'll have to make.

Is it something to pay for? Yeah, I was more thinking of certification or whatever that applies to the specific job, not just education.

Yeah, that would apply more on a case-by-case basis. And again, that's one of the questions as a great example that if that comes up during the project maintenance, we're more than happy to weigh in. We're happy to let you all know what have we seen other places. If we've got that market data on hand, again, we're happy to share that based on what we collected. But it wouldn't be a holistic hybrid applies to every role type of thing.

Okay, thank you. Absolutely. Any other questions? Mark, one quick one from my side. Coming out of the pandemic, we saw and then the onset of inflation. When you did your external market comparison, how did that affect our study?

So the organizations that we looked at in the external market, of course, we're looking at them as a snapshot right now. So we are essentially factoring in any adjustments and changes that they've made in response to the pandemic over time as well. One of the things that I do like to remind my clients, and I'll kind of stay in this room for your context as well, one of the things we hear a lot of from employees at outreach, that perceptional feedback they share, I think came into play here for you all. As they said, we don't think we're being paid enough. We have concerns. Our salaries haven't kept up with inflation. That conflates a little bit of, Market competitiveness, which is how competitive are you versus your peers versus, you know, are you keeping up with the cost of living? If the market itself is in a little bit of a less, I guess a little bit of a weaker position versus inflation, which it is across the country. Employees everywhere are in a little bit worse position. Employees feel that, you know, and we're quick not to minimize that. We don't want to say to employees that, oh, no, it's imagined, it's not real. It is real. But when you compare to your peers, if inflation, for example, moved to 20% and the market moved 15%, that's essentially a decision that y'all would have to make is, are we market competitive or do we adjust for that inflation? 99.9% of our clients are going with that market approach. I literally think there's a small handful of two or three that have basically said, we're going to ignore the market and try to do the inflation. Again, those are special circumstances. So I think what y'all have done here is directly in line with what the vast majority of clients are doing. I do think it matters. I think it's important. But I think it's a longer term thing. It's not just... Right now, do we snapshot versus, you know, where we paid at 2019, for example, versus that inflation? Does that make sense? It does.

Thank you, Mark. Thank you. Any other questions? Go ahead.

I'm just curious if there are any classifications that were way below market.

In the final report, it does indicate there the specific differences that certain classifications saw. Off the top of my head, I don't want to call it a classification incorrectly. I would direct you, I think, to that written report. But I would say overall, y'all did not have, again, a huge number of classifications that were 20%, 30% behind. Your overall positioning was good, but what we did end up seeing is y'all had a pretty good handful of classifications that had fallen five to 10 or so percent beyond. We did raise those classifications typically by one or two pay grades, but I don't recall any that were significant where we were moving them four or five pay grades. Those are the more dramatic examples, and y'all had done a pretty good job of avoiding those.

at any point has hybrid remote schedules or just generally remote? Have you factored that into your study, sir?

So in this study specifically, we did not address salaries or adjust them or move them at all to factor in the hybrid remote. We have looked at that for organizations across the country. That was an extremely popular question in probably 2022 and 2023 is where that peaked. The ultimate answer from most of the clients that we saw was, isn't that a great thing to do, but how can we really implement that for everybody? So, I mean, there's kind of this mixed reality of, well, you might have a finance or an IT position that could work remote, you know, great. But if they're supposed to be serving the community, if they have to be here on site, if they have to work with, you know, et cetera, it's just something most organizations have struggled to put into place. So I think, There's a minority of organizations that have kept that going. I think the trend is back the other way now. In 2022 and three, it was in favor of that. It was moving that direction. And I think a lot of organizations have moved back the other way. Again, understanding in local government and city government, there's just many of your classification is just not possible for. So I think that's where most cities have kind of fallen is, It's not something they want to entertain or want to go forward with for that subset of classifications if it's going to create an imbalance between the larger portion of the workforce.

I'm not going to promote that at all. I was just kidding. All right.

Thank you, Mark.

Can we go back to the slide that showed the different models, the green one and the purple? Yeah. This one here? Yeah. So this hybrid parity that's highlighted is what you've landed on as your recommendation. Correct. That we're implementing. Correct. And a hybrid would address the question.

And the cost to implement it is $2.92 million. That's the salary-only cost. So your finance team would have added in, again, fringe benefits, taxes, et cetera, those kind of additional costs. But the salary-only cost for your Phase 2 employees is $2.9 million.

And, Councilmember Moore, the hybrid parity model, the model was determined when we did Phase 1. So phase two is consistent in using that same hybrid parity model.

I just want to be clear, so it's going to be $2.9 million one time to get us to the start base to move forward.

Once we factor in our benefits, it was roughly $3.3 million, and then that becomes a recurring part of our budget each year in addition to the market adjustment that we'll do. Yes, sir.

ALL RIGHT. THANK YOU, MARK, FOR THAT. FOR THOSE LISTENING, ONE OF THE BIGGEST INVESTMENTS THAT THE CITY MAKES IN ORDER TO PROVIDE YOU WITH GREAT SERVICE IS OUR PEOPLE. AND SO THAT IS A MAJOR FACTOR IN OUR BUDGET. THANK YOU, MARK AND ANGELA, FOR A GREAT PRESENTATION AND THE HARD WORK THAT YOU PUT INTO THIS. AT THIS TIME, WE WILL NOW MOVE INTO CLOSED SESSION. ITEM 2026-267 FOR PERSONNEL AND ECONOMIC DEVELOPMENT. I WILL MAKE A MOTION TO GO INTO CLOSED. SO MOVED. SECOND. We've got a motion by Councilman Moore, second by Councilman Johnson. Any discussion on the motion? Hearing none, all those in favor please simplify by saying aye. Aye.