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BACKGROUND <br /> Management and confidential employees are currently comprised of 64 classifications <br /> and 71 employees. Consistent with the City's practice each year, staff is bringing <br /> forward for Council consideration recommendations regarding the compensation and <br /> benefits for the City's management and confidential employees. <br /> DISCUSSION <br /> In accordance with the Meyers-Milias-Brown Act, parties are required to meet and <br /> confer in good faith over items covered within the scope of representation, including <br /> wages, hours and other terms and conditions of employment. As the management and <br /> confidential employees are not represented by a Union, and therefore not covered <br /> under a collective bargaining agreement, negotiations are not appropriate. Instead staff <br /> is making the following recommendation for wage adjustments and amendments to the <br /> Management/Confidential Employee Performance Compensation Plan: <br /> Wage Adiustments: Historically, the two primary factors considered in wage adjustment <br /> discussions are: market data obtained from neighboring agencies that are similar in size <br /> and the consumer price index (CPI), which reflects the general cost-of-living increase in <br /> the San Francisco-Oakland-San Jose area (approximately 2.5% in August 2015). The <br /> proposed wage adjustment of 3% is consistent with market, CPI and the City's internal <br /> equity with labor. <br /> Benefits: Modifications to benefits include the following: <br /> Deferred Compensation: All non-sworn management and confidential "Classic <br /> Members" under CaIPERS currently possess a 2.7°/055/single highest year <br /> retirement formula. With the passage of PEPRA effective January 2013, non- <br /> sworn management and confidential employees new to the CaIPERS system <br /> receive a benefit of 2% @62 based on the average of the highest three years' <br /> earnings. In view of these adjustments, and in an effort to provide employees <br /> with more post retirement saving options, the proposed amendment to the <br /> Management and Confidential Employee Performance Compensation Plan <br /> includes a 0.5% City contribution to employees' deferred compensation program <br /> effective January 2, 2016. Currently, approximately 60% of management and <br /> confidential employees contribute to the deferred compensation program without <br /> a City contribution or match. This contribution is not subject to CaIPERS <br /> contributions, and does not impact other personnel expenses that are calculated <br /> based on salary. <br /> Page 2 of 4 <br />