10-06-1987 WS
.... .,I ..~
SPECIAL COUNCIL WORKSHOP MEETING - 6:30 OCTOBER 6, 1987
~ SUBJECT: Comparable Worth
A special Council meeting was held at Hopkins ci ty Hall in the
Community Room at 6:30 p.m. October 6, 1987.
Th purpose of this meeting was to discuss the pay equi ty study
completed for the City by Arthur Young & Company.
The city Manager explained that this study was done as a result of a
mandate by the State of Minnesota. This required that public
jurisdictions establish reasonable compensation relationships between
mployee classifications. The City has been involved along with 135
jurisdictions in a job evaluation study. The Metropolitan Managers
Association hired Control Data Business Advisors to study the job
evaluation system. Every job was broken down into its individual
tasks, and these individual tasks were assigned a value.
It was required that a report be filed with the State of Minnesota by
October of 1985 showing that the City had initiated a study. The City
hired Arthur Young and Company to prepare an implementation plan and
show how the relationships relate both internally and externally.
Mark Christianson, representing Arthur Young & Company, explained
that, following the development of Time Spent Profiles and position
point values they began translating these result into a proposed
salary structure. The structure considers the internal job values as
w 11 as pay levels for similar municipalities in the metropolitan
area.
First they condensed individual position point values into values
which would represent the job classifications in the City. The next
step was to group the classification points into a series of what
would become salary grades. They determined to set up a structure
with 13 salary grades. They then calculated a trend line through the
ci ty' s jOb classes. The trend line represented the relationships
between the City'S jOb values and pay levels. The line depicts the
City'S policy with respect to how salaries increase as
responsibilities become greater.
.
They then gathered current salary range information for a sample group
of jobs from a local survey of municipalities. When this data was
gathered, they developed a trend line to determine the relationship
between job value and pay for this set of labor market data. Since
the pay equity statute allows compensation relationships to be
contingent upon both the internal trend in pay and the trend in pay
for similar organizations, they merged the two trend lines . They used
70% of the result from the internal trend line and 30% from the
xternal trend line. This set out a series of dollar values to be
used as midpoints in the construction of a salary structure.
.. ,
~
.
,..
Minutes of Special Worksession 10/6/87
The next step was to determine salary grade ml.nl.mums and maximums.
Typically, organizations strive to keep pay rates within established
minimums and maximums with pay rates for average satisfactory
p rformers grouped around the midpoint. After a midpoint salary was
determined, it was necessary to establish a high and low range. The
minimums are the lowest pay rate that an organization is likely to pay
for a particular salary grade. Salary grade maximums are typically
d fined as the highest rate which an organization will pay for a jOb
at a given level.
Organizations must consider the width of the salary grades, also
r ferred to as the range spread. The range usually widens as jobs
b come more complex, responsible, etc. The reason for this is that
employees in less complex jobs usually do not require as long a time
to become proficient as compared to more complex jobs. In addition,
organizations require more flexibility to recruit individuals to more
complex jobs due to more widely differing skills of applicants for
these jobs. For that reason, they formed ranges which vary from 30 -
50%. Grades 1-4 are 30% from minimum to maximum, grades 5-9 are 40%,
and grades 10-13 are 50%.
The Council will study the information furnished to them. The City
Manager will set up meetings to explain the proposed compensation
system to the employees. The plan will be brought back to the Council
at the October 20 meeting for approval.
Respectfully submitted,
J~g~
ATTEST:
~ JJ1~
Donald Mll~ert. Mayor