Palo Alto Weekly

News - May 10, 2013

Palo Alto to further debate manager salaries

City Council sends proposal to change compensation schedule to Finance Committee for more discussion

by Gennady Sheyner

Palo Alto's drive to give its group of managers of professionals a 2 percent raise this year hit a speed bump Monday night, May 6, when the City Council decided that the compensation level of these employees should be studied in greater detail before a final decision is made.

The council discussed an ongoing effort by the Human Resources Department to bring the salaries of this employer group in line with what they would get in other cities. The group of about 200 employees, which includes engineers, attorneys, department directors and mid-level managers, is the only major labor unit that does not belong to a union.

The group is slated for a 2 percent raise under a proposed 2014 budget that City Manager James Keene unveiled last week. Ultimately, staff hopes to find the median salary for each of the 114 classifications in the group and make sure that each employee falls within 20 percent of the median in his or her classification.

"We recognize that we do exist within a marketplace and we want to make sure we're able to recruit and retain capable staff to be able to work in the city," Keene told the council. "This is what the pay plan is designed to do."

An analysis that has already been conducted found that most of Palo Alto's managers and professionals already have compensation at or above the market median, particularly when their benefits are factored in (a few, however, fall below the median line). A study conducted by Koff & Associates, which collected data for 82 out of 114 classifications, found that Palo Alto's benefit package is greater by about 10 percent than the comparison cities group as a whole.

The group of 14 cities against which Palo Alto was compared includes Alameda, Anaheim, Berkeley, Burbank, Fremont, Hayward, Long Beach, Mountain View, Redwood City, Roseville, San Jose, San Mateo, Santa Clara and Sunnyvale.

The council didn't have any major issues with this rethinking of salaries, though members decided that the issue is sufficiently sensitive to merit further analysis before any decisions are made. The council voted 7-1, with Gail Price dissenting and Liz Kniss absent, to send the item to its Finance Committee for further discussion.

Price advocated approving the 2 percent increase for 2014, saying the adjustment was justified by the study.

"In the future, it would be important to bring it back to finance," Price said. "For this particular cycle, I don't think it's appropriate."

The Finance Committee is scheduled to consider the subject on June 10.

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