, Muskogee, OK

June 12, 2013

City workers pay rate below median

Study finds matching compensation could cost $1.5M

By D.E. Smoot

— It could cost taxpayers up to $1.5 million to raise the compensation rate for the city’s non-uniform employees to the median rate for comparable jobs in similar markets.

That finding was included in a progress report for an employee reclassification and compensation study approved in November 2011. The update did not include the projected cost of raising wages for uniform employees, but administrators expect it to be about the same.

The study, spearheaded by Hay Group Inc. at a cost of $44,000 plus project-related expenses, was expected to take about nine months to complete. Michael Bates, the city’s labor relations director, said the reorganization of the non-uniform employees and other issues contributed to significant delays.

Bates, during an update of the project presented Monday for city councilors, said the reclassification of non-uniform employees is taking longer than anticipated. The process included getting input from workers in the field about the duties they are expected to perform on a daily basis.

Once that information is gathered it will be presented to department heads, who will review the class descriptions and make recommendations for possible changes. Employees will have a chance to appeal any changes that might be recommended.

As part of the study, consultants and city administrators have been evaluating city jobs and pay schedules and comparing those with comparable positions in external markets. The goal is to make sure that the city remains competitive with other municipalities and the private sector, officials say.

The city’s nearly 200 sworn police officers and firefighters were excluded from the classification process. Those uniform employees are part of a comprehensive compensation review for all full-time city employees.

City Manager Greg Buckley said the goal is to raise all employees compensation packages to the median of workers’ peers in similar markets. Buckley said similar markets would include cities of comparable size outside metropolitan areas.

The median is a point that equally divides a range of numbers — in this case the value of an employee’s compensation rate. Bates used the term P-50 to represent the median point at which half of a designated class’ compensation rate is higher and the other half is lower.

Bates said the study found compensation rates for the city’s non-uniform employees fell below P-25 with regard to wages. That means more than 75 percent of their peers in similar markets earn higher wages for performing comparable work.

“As a rule, you never want to fall below P-35 or P-40,” Bates said, noting the market rates are beginning to tick upward. “When you get below P-35 or P-40, that’s when you will see a lot of turnover, and there is some dysfunction that comes along with that.”

Bates said pay raises proposed for the fiscal year 2014 budget should keep wages from slipping lower from the median, but they won’t be enough to gain any ground toward reaching the median compensation rate. Buckley has proposed pay raises that would include a 2 percent increase from the general fund and increased contributions from a dedicated sales tax for to buoy employee wages.

Buckley said the $1 million to $1.5 million needed to adequately boost wages for non-uniform employees — plus a comparable amount for uniform employees — would be a recurring expense. Keeping up with the market would require a commitment of even more funding on a regular basis.

Bates said there has been no comprehensive review for about 30 years. Ideally, Bates said, these evaluations should be done every five to 10 years.

Reach D.E. Smoot at (918) 684-2901 or