2005 AGN AUG 30 Misc 1 - Laserfiche WebLink

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COMPENSATION PHILOSOPHY WORKSHOP AuGuST 30, 2005 Local governments can lead, match or lag behind in regard to employee compensation. Because pay represents a powerful symbol of an organization's overall beliefs, employees need to know that the organization is looking out for their interests as well as its own. Therefore, pay systems must support and be consistent with all other aspects of the organization as well as aspects outside of the organization. Employers need to be able to demonstrate that compensation systems are managed effectively and treat people fairly. As pictured below, compensation is comprised of three areas, which define a compensation philosophy (this is merely an example of some of the aspects). Level of Pay Decisions Pay Adjustments Decisions A compensation philosophy is a precedent to how the city will present itself to its employees; it is directly related to retention, labor relations, the economy, and it defines the city within the market. By assessing the information below and discussing what is presented, the goal of this workshop is to set guidelines for future negotiations. Retention: Historically, the city hasn't had any problems retaining employees. This could be attributed to the benefits, the work schedule, or even to the close knit community that exists within the work force. Once employees find themselves working here, they typically do not leave the city even if there are opportunities in localities that pay more or are closer to one's residence. Labor Relations: With a compensation philosophy in place, the various labor groups will realize the standards the city has set to treat its employees. Once in place, bargaining groups will know their membership will be provided the best possible salary that is comparable and fair within one's respective industry and the market. Economy: A compensation philosophy will take into consideration the economy. The city realizes that the cost of living is increasing and, as such, salaries should increase to offset the higher cost of living. However, employees must realize that the economy also affects the city. The city, as a business, has to