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CR 06-088 Approve 2006 HMEA ContractAugust 2, 2006 Council Report 2006-088 APPROVE 2006 HMEA CONTRACT Proposed Action Staff recommends that the Council approve the following motion: Move approval of the 2006 Contract with the Hopkins Municipal Employees Association (HMEA). This action will ratify the 2006 contract with the clerical and technical employees. Overview The contract calls fora 2.5% wage increase effective January 1, 2006, a 1 % wage increase effective June 25, 2006. The contract also provides for an increase in the City's contribution for insurance of $200.00/month for 2006. The increase will apply for employees with family, Single +l, or Single + Children group health insurance. This increase will bring the insurance contribution for HMEA employees in line with that of the other unions. There is no increase for employees with single coverage. Primary Issues to Consider What other economic issues are included in the new contract? How does this agreement fit in with the 2006 budget? How does this agreement compare to other contract settlements for 2006 in terms of wage and benefit increases? J s A. Genellie sistant City Manager Financial Impact: $ X67, ODO in 2006 Budgeted: Y/N Yes Source: General Fund & other funds Related Documents (CIP, ERP, etc.): Notes: Council Report 2006-088 Page 2 Analysis of the Issues What other economic issues are included in the new contract? HMEA employees will receive $30 per month toward a Post Employment Health Plan. This is a tax-free account that the employee can use for health related expenses after they have left employment with the City. How does this agreement fit in the budget? The City budgeted approximately 3% for wage increases in 2006. The cost of the split increase between January 1 and June 25 is approximately the same as a straight 3% effective January 1. The cost of the insurance increase is within the budget. How does this agreement compare to other contract settlements for 2006 in terms of wage and benefit increases? 2006 settlements for other cities have generally been coming in at 3% or above. Alternatives 1. Approve the contract. Retroactive pay and benefit increases will be included in the next payroll. 2. Do not approve the contract. Staff would have to renegotiate the contract. Staff recommends Alternative #1.