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Home My WebLink About11 FOURTH AMENDMENT TO CITY MANAGER EMPLOYMENT AGREEMENTAgenda Item 11 Reviewed: 0 AGENDA REPORT City Manager Finance Director N/A MEETING DATE: AUGUST 2, 2016 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: DAVID E. KENDIG, CITY ATTORNEY DERICK YASUDA, DIRECTOR OF HUMAN RESOURCES SUBJECT: FOURTH AMENDMENT TO CITY MANAGER EMPLOYMENT AGREEMENT SUMMARY Adoption of the attached Resolution will amend the terms and conditions of employment for the City Manager. RECOMMENDATION It is recommended that the City Council adopt Resolution 16-42 approving Amendment No. 4 to the Employment Agreement with the City Manager and authorize the Mayor to execute the Amendment. FISCAL IMPACT The terms of the City Manager's amended Agreement will result in an additional cost of $20,000 in FY 2016-17 and a savings of $16,818 in FY 2017-18, for a total net cost of $3,182 over the next two fiscal years. 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, Amendment No. 2 to the Agreement on October 7, 2014, and Amendment No. 3 to the Agreement on November 3, 2015. The City Council's authorized labor negotiators and the City Manager have now reached a tentative verbal agreement to amend the City Manager's employment agreement for a fourth time. The proposed amendment to the City Manager's employment agreement would eliminate the one-time lump -sum payment of $16,818 scheduled to be paid on the pay period that includes July 1, 2017. The City Manager would instead be provided with one-time lump sum payments of $10,000 effective the pay period that includes July 22, 2016 and $10,000 effective the pay period that includes January 1, 2017. These lump sum payments are one-time, non -base -building compensation adjustments that are not City Council Agenda Report August 2, 2016 Fourth Amendment to Employment Agreement with City Manager Page 2 reportable to CalPERS as pensionable income. In addition, the proposed amendment would provide the City Manager with an additional accrual of five (5) hours of paid Administrative Leave once per month over the next twelve (12) months, for a total additional accrual of sixty (60) hours of Administrative Leave. All other terms and conditions of employment would remain as described in the previously amended Agreement. 70 �i David E. Kendig' i "')� -�. vyl"-- Derick Yasud City Attorney Attachments: Director of Human Resources 1. City Council Resolution No. 16-42 2. Amendment No. 4 to City Manager Employment Agreement RESOLUTION NO. 16-42 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN APPROVING AMENDMENT NO. 4 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, Amendment No. 3 to Employment Agreement was approved by the City Council on November 3, 2015 (the "Third Amendment") which adjusted the compensation for the City Manager and extended the term of the Agreement to June 30, 2018; and WHEREAS, the Council desires to amend the Agreement to modify the compensation for the City Manager and provide additional accrual of paid Administrative Leave. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Tustin hereby approves Amendment No. 4 attached hereto and incorporated by reference, and ratifies the Agreement as amended by Amendment No. 1, Amendment No. 2, Amendment No. 3, and Amendment No. 4. PASSED AND ADOPTED at a regular meeting of the City Council of the City of Tustin held on the 2"d day of August 2016. JOHN NIELSEN Mayor Resolution 16-42 Page 1 of 2 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. 16-42 was duly passed and adopted at a regular meeting of the Tustin City Council, held on the 2nd day of August 2016, by the following vote: COUNCILMEMBER AYES: COUNCILMEMBER NOES: COUNCILMEMBER ABSTAINED: COUNCILMEMBER ABSENT: ERICA N. RABE City Clerk Resolution 16-42 Page 2 of 2 CITY OF TUSTIN AMENDMENT NO.4 TO EMPLOYMENT AGREEMENT This Amendment No. 4 to the EMPLOYMENT AGREEMENT ("Agreement") is made effective as of August 2, 2016, 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, Amendment No. 2 to Employment Agreement effective October 7, 2014, and Amendment No. 3 to Employment Agreement effective November 3, 2015; and WHEREAS, the parties desire to further amend the Employment Agreement in order to eliminate a previously scheduled one-time lump -sum cash payment, authorize two one-time lump -sum cash payments, and provide additional accrual of paid Administrative Leave. NOW, THEREFORE, it is mutually agreed by and between the City and Employee as follows: Section 1: One -Time Lumn-Sum Cash Payments Section 5 of the Agreement (Benefits and Leaves of Absence), shall be modified to eliminate the one-time lump -sum cash payment of $16,818.00 that was due to be paid effective the pay period that includes July 1, 2017, as provided in Amendment No. 3 to the Employment Agreement. In addition, 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 July 22, 2016, Employee shall receive a one-time lump -sum cash payment of $10,000.00. In addition, so long as Employee is employed by the City under the terms of this Agreement on January 1, 2017, effective the pay period that includes January 1, 2017, Employee shall receive an additional one-time lump -sum cash payment of $10,000.00." Section 2: Administrative Leave 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 July 22, 2016, Employee shall receive an additional accrual of 5 hours of paid Administrative Leave once per month for twelve consecutive months, for a total additional accrual of sixty (60) hours of Administrative Leave. This additional monthly accrual of Administrative Leave will automatically cease after a total of sixty (60) additional hours of leave have been credited to Employee's Administrative Leave bank. This additional accrual of Administrative Leave is in addition to any accrual of Administrative Leave provided under the terms of the Executive and Management Salary Resolution (Resolution No. 16-38 or a subsequent succeeding Resolution) and shall not count towards the maximum accrual specified in said Resolution. Section 3: 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: JOHN NIELSEN JEFFREY C. PARKER Mayor Employee DATE: DATE: ATTEST: - ERICA N. RABE City Clerk 2 APPROVED AS TO FORM: DAVID E. KENDIG City Attomey DATE: