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6c. Consider adopting a Resolution amending Compensation for Management and Confidential Employees (SR 06:253) City Manager Fialho gave an overview of the process and introduced Acting Human Recourses Director Denyce Holsey, who would be giving the presentation. He noted unlike previous years, staff is introducing the proposed resolution amending compensation for management and confidential employees in two steps. The first step was an introduction of the matter at the October 17th City Council meeting, with no formal action being requested by staff. The second step involves forma' action at tonight's meeting. This provides an opportunity for staff and the Council to openly discuss the matter in two sessions, rather than just one. The thought here was to .sunshine" the proposed action during the first meeting and to receive input from the City Council and/or public prior to formal action. Acting Director Holsey noted the proposed resolution authorizes a 4.0% performance-based salary increase for management and confidential employees. The entire group is comprised of approximately 55 middle managers and department heads, who serve at will. The confidential unit, comprised of eight employees, is distinguished by the confidential nature of the work performed (e.g., payroll, human resources, etc.) and also serve at will. The at-will nature of these positions means they serve at the pleasure of the City Manager and are not represented by a formal bargaining group or union. Compensation of the City Manager and the City Attomey is handled separately by the City Council and is not part of this recommendation. She further noted the City's Management and Confidential Employee Compensation Plan provides for control points to be adjusted annually, taking into consideration market and other influences such as increases granted managers among other benchmark agencies, internal relationships between supervisory positions and across departments, and the Consumer Price Index. Ms. Holsey commented on the bench mark agencies, their selection process, and assumptions made. Management and confidential salaries are comprised of two major components; a control point and a compa ratio. Should the Council at a future meeting approve the proposed resolution, there would be a 4.0% adjustment in classification control points. However, the actual salary increase to any given employee might be less or more than the 4.0%, based solely on performance. There are no automatic increases in compensation under the Plan; rather the driving factor in the consideration of a salary increase is whether the agency's goals and objectives for which that employee is responsible are being completed in a timely and productive manner. This and the employee's overall performance are reviewed annually by the City Manager. In conclusion, she noted that the total cost of the proposed 4.0% increase on salaries for managers and confidential employees, including the total cost of this increase on benefit premiums that are directly ties to wages is approximately $397,000. There are sufficient funds in the City's two-year operating budget to cover this expense. Mayor Hosterman opened the item for comment, hearing no requests to speak, she closed public comment. Council member McGovern stated her appreciation for using the .sunshine" technique regarding this issue. City Council Minutes 6 November 7,2006