IV.5. Approval of the Pay Equity Implementation Report; Genellie (CR2016-005)
January 19, 2016 Report 2016-005
APPROVAL OF THE PAY EQUITY IMPLEMENTATION REPORT
Proposed Action.
Staff recommends adoption of the following motion: Move that the Hopkins City Council approve the
attached Pay Equity Implementation Report.
Adoption of this motion will allow the City to submit its Pay Equity Implementation Report as required
by state law.
Overview.
In 1984 the Minnesota Legislature passed a "Comparable Worth" or Pay Equity law. The purpose of
this law was to reduce the perceived wage disparity between government jobs held largely by males and
those predominantly held by females. Each local government jurisdiction must periodically submit a
Pay Equity Implementation Report, as provided by Minnesota Statutes, section 471.9981, to determine
whether it is in compliance with the law. The City of Hopkins is required to submit a report to the
Department of Employee Relations (DOER) by January 31, 2016. This report must be based upon the
employees hired and salaries paid as of December 31, 2015.
Attached is a copy of the Compliance report that the City must send to DOER.
Primary Issues to Consider.
Is the City in compliance with the comparable worth law?
Has the City submitted reports to DOER in the past?
Supporting Information.
Pay Equity Compliance Report
Pay Equity Implementation Report
Pay Equity Background
_____________________________
James A. Genellie
Assistant City Manager
Council Report 2016-005
Page 2
Analysis of the Issues:
Is the City in compliance with the comparable worth law?
The City has entered data into the computer program that DOER uses to determine compliance with the
law. Based upon this program, the City should be found in compliance with the law. The program
compares salary data to determine if female classes are paid consistently below male classes of
comparable work value (job points). (There are also balanced classes which contain both males and
females. These classes are not used to determine compliance.)
There are two tests to determine whether a City is in compliance, the Underpayment Ratio and the T-
Test Results. The minimum requirement to pass the statistical analysis test is an underpayment ratio of
80%. The underpayment ratio is calculated by dividing the percentage of male classes below predicted
pay by the percentage of female classes below predicted pay. The City's Underpayment Ratio of 81.48%
is above 80%.
If the underpayment ratio is less than 80%, a jurisdiction may still pass the statistical analysis test if the
t-test results are not statistically significant. The t-test is a statistical measure of how significant is the
difference between two numbers. Although the City's value of T, 5.594, means that the difference in
predicted pay between male and female classes is statistically significant, Hopkins will still be in
compliance because of our underpayment ratio of 81.48%.
Two other tests are mentioned on the compliance report. The Salary Range Test examines how long it
takes male classes and female classes to get to the maximum salary. As you can see there is no
significant difference. The last test is the Exceptional Service Pay Test which examines additional pay
such as longevity. Only two unions receive longevity pay: the police officers and the sergeants.
Has the City submitted reports to DOER in the past?
The City last submitted a report in 2013. It was found to be in compliance with the law at that time.
Alternatives:
The City has no alternative at this time except to submit the report.
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BACKGROUND
The Minnesota Legislature passed the Local Government Pay Equity Act (Act) in 1984. The Act
requireed political subdivisions of the state to establish equitable compensation relationships between
female-dominated, male-dominated and balanced classes of employees in order to eliminate
sex-based wage disparities in public employment.
Federal law already prohibited employers from paying males and females different wages for the
same job. The Pay Equity Act required public employers in the State of Minnesota to develop pay
systems which would pay similar wages to males and females for different but equivalent jobs. In
other words the compensation for positions which require comparable skill, effort, responsibility,
working conditions, and other relevant work-related criteria should be comparable.
Every political subdivision had to use a job evaluation system in order to determine the comparable
work value of the work performed by each class of its employees. The system had to be maintained
and updated to account for new employee classes and any changes in factors affecting the
comparable work value of existing classes.
The City of Hopkins joined with a number of other cities to develop a methodology for comparing
different jobs in the organization. The cities ended up developing a system called HRFocus. Below is
a brief description on how the HRFocus system evaluates jobs.
Job Evaluation
Employees from a number of different cities helped put together Questionnaires detailing tasks
performed in their jobs. The Job evaluation technique was based on a process of assigning values to
all tasks defined within the Questionnaires.
Each task was assigned a numerical value to indicate its value. This value was determined by three
factors"
Complexity - skill, knowledge and creativity required to perform tasks
Importance/Responsibility - the significance, impact and consequence of error inherent in the task
Unfavorability - adverse working conditions, the level of effort or stress that may be present
Every task in the Questionnaires was assigned a total value based upon the three factors.
Once the Questionnaires were completed they were given to employees in each individual city.
Employees marked the tasks that they performed in their jobs and the approximate time spent on
each task. All the task values were added together to come with a total value for each job in the City.
This became the basis for comparing disimilar jobs, for example, a secretary's job could now be
compared to a maintenance worker's job.
Wage adjustments were made in the 1980s as a result of the initial study. Additional changes have
been made since that time with a major revision in 2000.
The City of Hopkins continues to use an offshoot of the original HRFocus system.