The URL can be used to link to this page

Home My WebLink About11 THIRD AMENDMENT TO CITY MANAGER EMPLOYMENT AGREEMENTAgenda Item 1 1 Reviewed: AGENDA REPORT City Manager IV � finance Director MEETING DATE: NOVEMBER 3, 2015 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: DAVID E. KENDIG, CITY ATTORNEY DERICK YASUDA. DIRECTOR OF HUMAN RESOURCES SUBJECT: THIRD AMENDMENT TO CITY MANAGER EMPLOYMENT AGREEMENT AND AMENDMENT TO RESOLUTION REGARDING COMPENSATION TO CERTAIN EXECUTIVE MANAGEMENT AND MANAGEMENT EMPLOYEES SUMMARY Adoption of the attached Resolutions will amend the terms and conditions of employment for the City Manager as well as modify compensation for designated unrepresented Executive Management and Management employees. RECOMMENDATION It is recommended that the City Council: 1. Adopt Resolution 15-78 approving Amendment No. 3 to the Employment Agreement with the City Manager and authorize the Mayor to execute the Amendment; and 2. Adopt Resolution No. 15-79 to amend compensation provided to certain Executive Management and Management employees. FISCAL IMPACT The terms of the City Manager's amended Agreement will result in an additional cost of approximately $19,957 in FY 2015-16 and a total of $84,901 over the next three fiscal years (an average of $28,300 per year). In addition, the terms of the amended Resolution for Executive Management and Management employees will result in an additional cost of $14,000 in Fiscal Year 2015-16. BACKGROUND AND DISCUSSION The City Council entered into an employment agreement with Jeffrey C. Parker to serve as Tustin's City Manager beginning December 29, 2011, and approved Amendment No. 1 to the Agreement on July 2, 2013 and Amendment No. 2 to the Agreement on October 7, 2014. The City Council's authorized labor negotiators and the City Manager City Council Agenda Report November 3, 2015 Third Amendment to Employment Agreement with City Manager Page 2 have now reached a tentative verbal agreement to amend the City Manager's employment agreement. Resolution No. 15-78 The proposed amendment to the City Manager's employment agreement would provide the City Manager with salary increases of 4% effective July 1, 2015 and 3.5% effective July 1, 2016. The City Manager would also be provided with one-time lump sum payments of $7,500 effective November 3, 2015 and $16,818 (an amount equivalent to 6% of base salary) effective July 1, 2017. These lump sum payments are one-time, non - base -building compensation adjustments that are not reportable to CalPERS as pensionable income. In addition, the proposed amendment would extend the term of the Agreement by approximately six months, to June 30, 2018. All other terms and conditions of employment would remain as described in the previously amended Agreement. Resolution No. 15-79 As part of these labor negotiations, the City Manager also requested that each of the six current Executive Management employees, in addition to the Deputy Director of Economic Development, receive a one-time lump sum payment of $2,000 (not reportable to CalPERS as pensionable income). Approval of Resolution No. 15-79 would authorize these one-time payments. ; � David E. .. City Attorney F -Art 7 i _010 Derick Yasu a Director of Human Resources 1. City Council Resolution No. 15-78 2. Amendment No. 3 to City Manager Employment Agreement 3. City Council Resolution No. 15-79 RESOLUTION NO. 15-78 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN APPROVING AMENDMENT NO. 3 TO THE EMPLOYMENT AGREEMENT WITH THE CITY MANAGER WHEREAS, the City Council of the City of Tustin, California (the "City") approved an Employment Agreement ("Agreement') with Jeffrey C. Parker to serve as City Manager effective December 29. 2011: and WHEREAS, Amendment No. 1 to Employment Agreement was approved by the City Council on July 2, 2013 (the "First Amendment') which adjusted the compensation for the City Manager but which did not limit the term of the Agreement; and WHEREAS, Amendment No. 2 to Employment Agreement was approved by the City Council on October 7, 2014 (the "Second Amendment') which established a fixed term expiring on December 29, 2017, to make revisions to the severance provisions to limit the potential duration of severance and benefit payments in the event of termination, and to authorize additional accrued General Leave to be cashed out; and WHEREAS, the Council desires to amend the Agreement to adjust the compensation for the City Manager and extend the term of the Agreement to June 30, 2018. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Tustin hereby approves Amendment No. 3 attached hereto and incorporated by reference, and ratifies the Agreement as amended by Amendment No. 1, Amendment No. 2, and Amendment No. 3. PASSED AND ADOPTED at a regular meeting of the City Council of the City of Tustin held on the 3'd day of November 2015. CHARLES E. PUCKETT Mayor ATTEST: ERICA N. RABE City Clerk Resolution 15-78 Page 1 of 2 STATE OF CALIFORNIA ) COUNTY OF ORANGE ) SS CITY OF TUSTIN ) I, Erica N. Rabe, City Clerk and ex -officio Clerk of the City Council of the City of Tustin, California, do hereby certify that the whole number of the members of the City Council of the City of Tustin is five; that the above and foregoing Resolution No. 15-78 was duly passed and adopted at a regular meeting of the Tustin City Council, held on the 31d day of November 2015, by the following vote: COUNCILMEMBER AYES: COUNCILMEMBER NOES: COUNCILMEMBER ABSTAINED: COUNCILMEMBER ABSENT: ERICA N. RABE City Clerk Resolution 15-78 Page 2 of 2 CITY OF TUSTIN AMENDMENT NO. 3 TO EMPLOYMENT AGREEMENT This Amendment No. 3 to the EMPLOYMENT AGREEMENT ("Agreement") is made effective as of November 3, 2015, and is entered into by and between the CITY OF TUSTIN, a California municipal corporation (the "City") and Jeffrey C. Parker, an individual ("Employee"). WHEREAS, the City and Employee have entered into the Agreement effective December 29, 2011; WHEREAS, the parties entered into Amendment No. 1 to Employment Agreement effective July 1, 2013, approved by the City Council on July 2, 2013 (the "First Amendment"), but which did not limit the term of the Agreement; WHEREAS, the parties entered into Amendment No. 2 to Employment Agreement effective October 7, 2014, which established a term expiring on December 29, 2017, made corresponding revisions to the severance provisions to limit the potential duration of severance and benefit payments in the event of termination, and to authorize additional accrued general leave to be cashed out; and WHEREAS, the parties desire to further amend the Employment Agreement in order to provide for increases in Employee's salary based on merit and tenure in the position and extend the term of the Agreement. NOW, THEREFORE, it is mutually agreed by and between the City and Employee as follows: Section 1: Term Section 1 of the Agreement (Term) shall be modified such that it reads, in its entirety, as follows: "The City hereby appoints Employee and Employee hereby accepts employment with the City beginning December 29, 2011. This Agreement shall be reviewed at least once every year by the City Council or at the request of the City Manager. The Term of this Agreement shall expire on June 30, 2018. This Agreement may be extended by written amendment to this Agreement." Section 2: Salary A sentence shall be added to Section 4 of the Agreement (Salary), to read as follows: 1 "Effective the pay period that includes July 1, 2015, Employee's annual base salary shall be increased by 4%, to $270,816.00. In addition, effective the pay period that includes July 1, 2016, Employee's annual base salary shall be increased by 3.5%, to $280,295.00." Section 3: One-Time Lump-Sum Cash Payment A sentence shall be added to Section 5 of the Agreement (Benefits and Leaves of Absence), to read as follows: "Effective the pay period that includes November 3, 2015, Employee shall receive a one-time lump-sum cash payment of $7,500.00. In addition, so long as Employee is employed by the City under the terms of this Agreement on July 1, 2017, effective the pay period that includes July 1, 2017, Employee shall receive a one-time lump sum cash payment of$16,818.00." Section 4: Other Terms and Conditions Except as expressly amended herein, all other terms and conditions of the Agreement shall remain in full force and effect. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on the dates reflected below each signature. CITY EMPLOYEE CITY OF TUSTIN A Municipal Corporation By: By: CHARLES E. PUCKETT JEFFREY C. PARKER Mayor Employee DATE: DATE: 2 ATTEST: ERICA N. RABE City Clerk APPROVED AS TO FORM: DAVID E. KENDIG City Attorney DATE: 3 RESOLUTION NO. 15-79 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN RELATING TO COMPENSATION AND BENEFITS FOR CERTAIN UNREPRESENTED EXECUTIVE MANAGEMENT AND MANAGEMENT EMPLOYEES, AND AMENDING RESOLUTION 15-44 WHEREAS, Resolution No. 15-44 specifies compensation and benefits for Executive Management and Management personnel; and WHEREAS, the City Manager desires to amend Resolution No. 15-44 to provide certain Executive Management and Management employees with additional compensation; and WHEREAS, the City Council has consulted with the City Manager concerning the proposed employment terms contained herein; NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Tustin (the "City") authorizes staff to implement the provisions of this Resolution and modify the City's Classification and Compensation Plans to reflect the changes approved in this Resolution, and that the wages, hours and conditions of employment be adopted and set forth as follows: Section 1: Salary A sentence shall be added to Section 3 of Resolution No. 15-44 (Salary), to read as follows: "With the paycheck issued for the pay period which includes November 3, 2015, each Executive Management employee as well as the Deputy Director of Economic Development will receive a one-time lump sum payment of two thousand dollars ($2,000.00), provided the employee is employed by the City on the effective date. In accordance with the California Public Employees' Retirement System regulations and definition of Special Compensation (2 CCR §571), this lump sum payment will not be reported to CalPERS for purposes of retirement." Section 2: Other Terms and Conditions Except as expressly amended herein, all other terms and conditions of employment for Executive Management and Management employees, as described in Resolution No. 15-44, shall remain in full force and effect. PASSED AND ADOPTED at a regular meeting of the City Council of the City of Tustin held on the 31d day of November 2015. Resolution 15-79 Page 1 of 2 CHARLES E. PUCKETT Mayor ATTEST: ERICA N. RABE City Clerk STATE OF CALIFORNIA ) COUNTY OF ORANGE ) SS CITY OF TUSTIN ) I, Erica N. Rabe, City Clerk and ex -officio Clerk of the City Council of the City of Tustin, California, do hereby certify that the whole number of the members of the City Council of the City of Tustin is five; that the above and foregoing Resolution No. 15-79 was duly passed and adopted at a regular meeting of the Tustin City Council, held on the 3rd day of November 2015, by the following vote: COUNCILMEMBER AYES: COUNCILMEMBER NOES: COUNCILMEMBER ABSTAINED: COUNCILMEMBER ABSENT: ERICA N. RABE City Clerk Resolution 15-79 Page 2 of 2