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Ms. Host,m~an mentioned the newspaper reported that every person in a management position would be receiving a five percent raise. She asked for an explanation, as she believed Council had discussed a salary increase that could be granted in a not-to-exceed pool equal to five percent of management compensation. Ms. McKeohan noted that the salary increase would be from a pool of cash and from that, she decides what increases she would grant to the employees. They may receive more or less than five percent. She noted that some individuals have received more in the past. She pointed out that there are employees all over the pay continuum in terms of what they are actually receiving. Any pay increase is based on the employee's individual performance. A small number of employees may receive increases above the pool percentage. An increase is not based on seniority. In response to an inquiry by Ms. Hostcmsan, Ms. McKeehan stated staff's recommendation is to suspend the City's bonus program for one year in recognition of fiscal concerns. She pointed out the bonus program is a pool of $75,000 in cash, with the maximum bonus at $5,000. She has never spent all of the cash and noted that most employees do not receive a bonus. In the past, bonuses granted have been as low of $250 and as high as $5,000. Ms. Host~m~an asked for distinction between at-will employees and other employees. Ms. McKeehan informed her that management employees are considered at-will and may be terminated at any time. Typically, the employees they oversee have vested employment rights and the City has to show cause before termination. Ms. Hosterman believed that at-will employees were more at risk for their job. Ms. McKeehan believed the Pay for Performance plan had been very effective. She has been able to set compensation rates for managers to compensate those who are doing an outstanding job. There have been employees over periods of time where their compensation is not going up as they had envisioned. In those situations, their relationship with the City is not working. She then begins to work with the employee to determine whether the employee will remain with the organization. As to termination, there is a different process for at-will employees versus someone who has a property right. In response to an inquiry by Ms. Hosterman, Ms. McKeehan mentioned the salary control point for each management classification changes. The employee is then placed at a new compa ratio, which can be higher or lower than where they were before. Ms. Hosterman was unclear about the pay relationship between union employees and non-union employees and the equity between the classifications. She asked for further explanation with regard to differentials and the policy issues behind it. Pleasant City Council 15 10/21/03 Minutes