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CR 2000-080 Authorize Expenditures To update The City's Job Evaluation System .' May 10, 2000 ~..orc , ~..-"~"'" ...........~ ...~~, ".., .. ... .....~~.. '.~. .--::iii Council Report 2000-80 . AUTHORIZE EXPENDITURES TO UPDATE THE CITY'S JOB EVALUATION SYSTEM Proposed Action Staff recommends that the Council approve the following motion: Move approval of using contin,gency funds to finance an update to the City's job evaluation system. This action will begin the process of updating the City's job evaluation system. Overview State law requires every political subdivision to use a job evaluation system in order to detemline the comparable work value of the work performed by each position. The system must be maintained and updated to account for new employee positions and any changes in factors affecting the comparable work value of existing positions. The City's current system is over 14 years old. Jobs have changed significantly during that time. The City has added new positions that did not exist at the time the original study was completed. . Primary Issues to Consider . How much will it cost to do the new study? . What will be the effect of the new study on employees? Supporting Information . Pay Equity Background. //7 / ...;...-0""-- J 951\. Genellie ifsistant City Manager , /&.Jf! Financial Impact: $ $8,000-$18,000 Budgeted: YIN No Source: General & Utility Funds Related Documents (CIP, ERP, etc.): Notes: Costs will be split amongfimds according to the number of employees . . u . Council Report 2000-80 Page 2 Analysis of the Issues . How much will it cost to do the new study? The cost of updating the system would be between $8,000 and $18,000. The actual cost depends on whether every employee has to complete a Job Analysis Questionnaire (JAQ). The high estimate assumes every employee completes a JAQ and each JAQ has three revisions. If the City uses the same procedure as it did the last time, only representative employees of larger job classes, such as Maintenance Worker II and police officer, will complete JAQs. This will serve to keep the cost down. The cost estimate does not include the cost of implementing any changes to the City's salary structure. These costs are extremely difficult to estimate. They will depend on whether there are any wage adjustments that have to be made and the size of any adjustments. Money should be budgeted in 2001 for wage adjustments. . What will be the effect of the new study on employees? Employees can experience one of three outcomes: 1. The point value of their position can rise in relation to other positions 2. The point value of their position can decline in relation to other positions 3. The point value oftheir position can remain the same in relation to other positions Employees whose position values rise or decline in relation to that of other positions mayor may not experience a change in salary. The change in point value may be small and not justify a change. Any large changes may have to be phased in to accommodate the budget. Alternatives 1. Approve the expenditure of funds for a new job evaluation study. 2. Do not approve the expenditure. No study would be undertaken. Staffrecommends Altemative #1. BACKGROUND . 1984 PAY EQUITY ACT PASSED 471.992 - 471.999 The Local Government Pay Equity Act requires 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. A primary consideration in negotiating, establishing, recommending, and approving compensation is comparable work value in relationship to other employee positions within the political subdivision. Compensation for positions within the employer's work force bear reasonable relationships among related job classes and among various levels within the same occupational group. Compensation for positions bear "reasonable relationships" to one another if the .~ompensation for positions which require comparable skill, effort, responsibility, working .,..onditions, and other relevant work-related criteria is comparable. Every political subdivision shall 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 must be maintained and updated to account for new employee classes and any changes in factors affecting the comparable work value of existing classes. ORIGINAL OBJECTIVES OF JOINT COMPENSATION STUDY: . Consistent results across cities . High level of participation in the study . Maximum self-sufficiency for each city . Employ system that meets statutory requirements . Accurate, up-to-date job descriptions . Include market data for the 29 Benchmark jobs . Compare job evaluation to current compensation and market compensation . Provide strategies for establishing equitable compensation relationships for benchmark jobs . Enable cities to meet statutory reporting requirements . Maximize acceptance of results . JOB EVALUATION ~Ob evaluation technique is based on a process of assigning values to all tasks defined within the Questionnaires. Each task is assigned a numerical value to indicate its value Job values are computed by multiplying each task's value by time spent and then summing those values DETERMINATION OF COMPENSABLE FACTORS Compensable factors are the dimension of work that contributes to its value HRFocus uses four compensable factors The four compensable factors are: Complexitv - skill, knowledge and creativity required to perform tasks Importance/Responsibilitv - the significance, impact and consequence of error inherent in .the task Unfavorabilitv - adverse working conditions, the level of efforl or stress that may be present Overall - the total contribution of the task in terms of its complexity, imparlance and un fa varability Values of tasks on each of the factors are used in the computation of factor weights and total job value DETERMINING COMPENSABLE FACTOR WEIGHTS Overall ratings together with component values on each compensable factor were used to mathematically determine the extent to which each factor -- Complexity, Importance and Unfavorability contributes to overall task value judgments The computation of factor weights was performed using a statistical formula similar to multiple regression to measure how raters weighted the contribution of Complexity, Importance and Unfavorablity to the overall value of tasks . The computed factor weights for the Joint Compensation Study are: .comPlexity =.42 Importance = .31 Unfavorability =.27 Each task's rating on each of the factors was multiplied by the respective weights of those factors The products were totaled to compute a total overall value for each task UPDATE OF THE HRFOCUS SYSTEM Control Data Business Advisors sold its HRFocus program to Personnel Decisions, Inc. (POI) . Basic framework and methodology of original HRFocus kept intact . The questionnaires were reorganized . . Obsolete questions were deleted . Items that were similar both in content and value were bulleted . A generic section that is common to all jobs was added to all the questionnaires . Some new items were added and valued due to changes in technology . The Police/Fire Questionnaire was separated . The Office Questionnaire was renamed Administrative Support .