HomeMy WebLinkAbout2.a. Final Report on 2021 Compensation & Benefits Study 1
EXECUTIVE SUMMARY
City Council Work Session December 7, 2021
AGENDA ITEM: Final Report on 2021 Compensation &
Benefits Study
AGENDA SECTION:
Discussion
PREPARED BY: Logan Martin, City Administrator
Emmy Foster, Assistant City Admin.
Teah Malecha, Finance Director
AGENDA NO. 2.a
ATTACHMENTS: Compensation & Benefits Study
Executive Summary APPROVED BY: LJM
RECOMMENDED ACTION: None, work session discussion only
BACKGROUND
In March 2021, the City Council authorized a Compensation and Benefits Study with the firm Baker
Tilly. The intent of this study was to investigate the City’s current compensation structure and
methodology, the City’s benefit offerings, and the job descriptions for all regular part-time and full-time
positions. Completing this work has been a major undertaking, but it is a crucial step toward developing
and retaining a high-performing organization, which is a stated Council goal. Ensuring that we have
competitive wage and benefit offerings allows the City to remain on its upward trajectory and continued
expectation of high performance.
A total of 52 positions (all of the City’s regular part-time and full-time positions) were included in the
salary survey, and data was gathered from 22 comparable cities. In June, each employee (or position in
the case of multiple people serving the same position) was given an opportunity to complete a Position
Analysis Questionnaire (PAQ), which included questions regarding essential job duties, job
responsibilities and requirements, and characteristics applicable to each position. This data was reviewed
by supervisors and allowed the consultant to utilize their proprietary analytics to make classification
decisions. Comparisons to similar positions in the 22 other cities were then completed to confirm or
alter position classifications. A detailed description of the process is included in the Executive Summary
of the report.
The following key takeaways can be gleaned from this work:
• The City’s minimum salaries were an average of 7.35% below market.
• The City’s midpoint salaries were an average of 5.99% below market.
• The City’s maximum salaries were an average of 5.15% below market.
o Baker Tilly considers wages within 5% of market average to be competitive.
• 6 employees were found to be below the minimum starting point of the new pay scale.
• 104 employees were found to within the newly proposed range.
• 0 employees were found to be above the max (i.e. requiring a pay freeze).
2
• Benefit comparisons are challenging to complete due to the wide range of options in the
marketplace. The survey completed provides the following result:
o Holiday and sick leave accrual amounts are consistent with the survey.
o Annual leave (vacation) is slightly above average in the early years of service, and
normalizes to the survey results in the later years.
o Life Insurance and Dental Insurance contributions are slightly above average
o Health Insurance is hardest to compare. The City’s costs for single and family coverage
are slightly higher than comparables, likely due to the fact that our deductibles are slightly
lower than others. This is an issue that we are aware of and have actively discussed it
with the Insurance Committee and our insurance broker.
o Vision Insurance is provided by 10 survey respondents while Rosemount does not
provide.
o Short-Term and Long-Term Disability insurances are not employer paid in Rosemount.
The 2022 Budget presented for authorization on December 7 has fully funded the implementation costs
of this study. The total implementation cost of this study is $144,890. An estimated COLA has been
figured in to the salary scale, which is still pending negotiation with 4 union groups. As presented, the
average City employee would see a 6.42% cumulative wage change (COLA and Comp Study changes
combined) in 2022.
RECOMMENDATION
Informational update only. The authorization of the 2022 Budget will establish the implementation of
this compensation study.
The City of Rosemount,
Minnesota
Classification and Compensation Study
December 1, 2021
Baker Tilly US, LLP
380 Jackson Street, Suite 340
St. Paul. MN 55101
T: +1 (651) 223 3000
F: +1 (651) 223 3046
bakertilly.com
December 1, 2021
Mr. Logan Martin
City Administrator
City of Rosemount
2875 145th Street West
Rosemount, MN 55044
Re: Classification and Compensation Study
Dear Mr. Martin:
Baker Tilly Incorporated is pleased to provide the City of Rosemount with the City’s completed
Classification and Compensation Study. The study provides an overview of the City’s current
classification and compensation system as it relates to all of the City’s positions and our final report
including the methodology used to update the classification and compensation system, options for
implementing the compensation system and for addressing issues related to salary compression, and
other compensation pay issues.
The study represents a thorough and comprehensive review of the City’s compensation system. The
recommendations offered, we believe, will increase the market competitiveness of the City’s
compensation program within the regional marketplace and provide increased internal equity among City
positions. Implementation of these recommendations will assist the City in attracting new employees,
when necessary, and in retaining current employees needed to meet the City’s service demands.
Baker Tilly expresses its thanks to the City staff who completed Baker Tilly’s Position Analysis
Questionnaires as we worked to verify their current job responsibilities and requirements. We particularly
want to thank the members of the City’s staff who supplied us with data and answered numerous
questions, direction and feedback throughout the study. Baker Tilly appreciates the privilege of serving
the City and hope that we may be of assistance to you in the future.
Very truly yours,
BAKER TILLY VIRCHOW KRAUSE, LLP
Ann Antonsen
Ann Antonsen, Director
The City of Rosemount, Minnesota Page | 1
1.Executive Summary
Baker Tilly Incorporated completed a Classification and Compensation Study for the City
of Rosemount, Minnesota in the fall of 2021. The study represents a comprehensive
review of the components that affect an organization’s compensation program – job
descriptions, current compensation structure, the City’s compensation philosophy,
regional market competitiveness of City salaries, the internal equity of salaries paid to
comparable City positions and ongoing maintenance and administration of the
compensation system.
The City has encountered some situations that could be addressed by conducting a
comprehensive classification and compensation study and implementing an up to date
compensation system. Difficulty in recruiting and hiring new employees, candidate pools
lacking the skill sets required for the position being recruited, and employee turnover in
certain positions are all indications that the City’s classification and compensation
program may not be competitive within the regional market.
A classification and compensation system provides the framework for determining how
employees will be paid. As a general rule, most organizations conduct comprehensive
classification and compensation studies every five to seven years ensuring their ability to
hire and retain qualified employees and maintain equitable internal relationships. The
external market focus is important because it ensures that the compensation plan is
adequate to attract new employees and retain existing employees. If compensation levels
fall below those in the regional marketplace, the organization may experience difficulty
hiring people and increased employee turnover as employees seek jobs with other
organizations that will pay the market rates for their skills and abilities. In today’s
economy, it is imperative to remain competitive and, in order to do so, it is necessary to
monitor the regional marketplace. An organization must ensure market adjustments are
provided to the salary scale to maintain their competitive position when resources are
available. When a position is recruited several times due to a lack of qualified applicant
pools willing to work at an advertised salary, this leads to smaller and smaller pools and
breaks in service with responsibilities for the vacant position being assigned to other full-
time staff.
Organizations should expect some employee turnover, but when it becomes excessive,
turnover has a serious impact on the organization’s overall effectiveness. Advertising
costs are a measurable component of turnover, and as the City moves through the
selection process, the time spent by current employees covering the void left by the
departing employee often diverts their attention from their day to day responsibilities
creating overtime demands and often frustration on the part of the remaining employees
as they attempt to meet deadlines and maintain acceptable levels of service. These are
some of the hidden and non-quantifiable costs associated with turnover. There is also a
substantial cost for turnover that comes with training of new employees. Employees
receive on-the-job training which diverts the attention of other employees away from their
regular duties to assist in training. This is particularly true in the public safety area where
significant State mandated training is required before a provider can serve effectively and
to ensure quality services are provided to the citizens and visitors of the community.
1.Executive Summary
The City of Rosemount, Minnesota Page | 2
Organizational effectiveness is affected as current employees train new employees and
as those new employees endeavor to become proficient in their job. While these costs
are not necessarily visible in expenditure reports, they will be demonstrated in
performance data in the form of reduced service outcomes.
As the City continues to experience change, it will also be important to offer competitive
salaries to attract the best staff possible to serve the citizens of the City of Rosemount.
Competition for a wide range of professions in the local government marketplace is
becoming more intense each year as the private sector continues to attract workers to
higher paying jobs, local government curriculums are decreased at the college level,
benefit levels drop for local government employees, and other competing organizations
increase their salaries to remain competitive and to meet demands for service in their
communities and organizations.
The periodic review, which comes with completion of a comprehensive classification and
compensation update, also enables an organization to account for changes in use of
technology, changes in work processes, tools and equipment, and other factors that can
affect job responsibilities. In today’s fast paced world of technological change, this is
especially important as almost every governmental process is affected by advancements
in technology and, as this occurs, employee’s skills, knowledge, and abilities, as well as
their proficiency in the use of required tools and equipment, changes. Changes in job
requirements, such as addition of new programs or assumption of duties for a vacated
position, sometimes results in a new pay grade assignment. In order to properly maintain
the compensation system, an ongoing process is needed to review job responsibilities
and job class assignment to pay grades to ensure jobs are properly compensated.
The primary purposes of the study that were identified by the City included:
•To attract and retain qualified workers;
•To provide equitable and competitive salaries for all workers of the City;
•Develop a salary structure that provides for internal equity and ensures external
competitiveness with other municipalities in the City’s geographic area; and
•Review current compensation practices and policies and develop recommendations
for ongoing administration and maintenance of the proposed Classification and
Compensation Plan.
The following study documents the review and evaluation of the City’s existing
compensation system and the methodology used to develop more competitive
compensation levels. The study was conducted with extensive participation from City
management staff and input from department heads and employees.
A comprehensive compensation survey was developed and wage and benefits data was
collected from comparable regional employers. The results of the job evaluation and the
salary survey data were used to create a salary curve, which served as the foundation for
creating a revised compensation program. The compensation program structure relied
upon a review of compensation philosophy concepts that included:
•Providing fair and equitable compensation to employees in a competitive and
changing labor market
•Maintaining a competitive pay structure that takes into consideration the City’s fiscal
resources
•Ensuring that employee compensation reflects changing economic conditions
•Providing consistent administration of pay policies and procedures among all City
departments
1.Executive Summary
The City of Rosemount, Minnesota Page | 3
Major findings of the study can be summarized as follows:
•Fifty-one City positions were included in the survey. We were able to use the
information for forty-six City positions in the analysis of the data, five positions were
excluded from the overall analysis either due to insufficient responses or
inconsistency in responses. Information was collected on minimum, midpoint,
maximum and actual wages (if available) and comparisons of how the City’s wage
ranges compared to the established minimum, midpoint and maximum wage rates
per position with the survey respondents. Based on the analysis of the data, on
average the City’s minimum salaries are 7.35% below the average minimum salaries;
5.99% below average market midpoint salaries and 5.15% below the average
maximums reported by the survey participants. For comparison purposes, wages
which are within 5% above or below the market average, dependent on the
organizations pay philosophy regarding market relationship, are considered to be
competitive.
•Internal pay relationship inequities exist within the City. This occurs in all
organizations as position responsibilities change over time and compensation levels
don’t always keep up with those changes. Positions that require similar minimum
qualifications and have comparable responsibilities should be compensated at
comparable levels. We reviewed all positions and then evaluated each position
against standard criteria. Each position was then assigned to a pay grade that
reflected its internal relationship to other City positions thereby ensuring equitable
internal pay relationships.
•The study offers a recommended compensation plan and recognizes an
implementation schedule that would be effective upon City Council adoption. The
implementation schedule provides a strategy that ensures that all employees are paid
at least at the minimum of their assigned pay grade.
2. Introduction
The City of Rosemount, Minnesota Page | 4
2. Introduction
The City of Rosemount, Minnesota retained Baker Tilly Incorporated to conduct a Classification and
Compensation study in the winter of 2021. Completion of this study reflects a significant effort by City staff
to provide polices and human resources related data, complete questionnaires and review information.
A comprehensive salary and benefits survey was conducted as part of this study with the City reviewing
and approving the proposed jurisdictions to be surveyed. Survey recipients were selected based on
demographics, comparable levels of services provided by the entity surveyed, geographic proximity to the
City of Rosemount and competition for employees. Twenty-two (22) cities listed below, were invited to
participate in the survey. We were able to collect information from all cities:
•City of Andover
•City of Champlin
•City of Chanhassen
•City of Chaska
•City of Cottage Grove
•City of Farmington
•City of Forest Lake
•City of Hastings
•City of Inver Grove Heights
•City of Lino Lakes
•City of Mendota Heights
•City of Northfield
•City of Oakdale
•City of Prior Lake
•City of Ramsey
•City of Roseville
•City of Savage
•City of Shoreview
•City of South St. Paul
•City of Stillwater
•City of West St. Paul
•City of White Bear Lake
Survey respondents were asked to provide information on only those benchmark
positions which they considered to be comparable to positions in their organizations.
Therefore, survey respondents did not provide data for every position surveyed.
The City of Rosemount, Minnesota Page | 5
3.Methodology
Baker Tilly Incorporated used the following methodology to develop a new and revised
classification system and compensation program for The City of Rosemount:
1.Baker Tilly staff met with the City Administrator, Assistant Administrator and
members of the Human Resources department to establish a working
relationship, review current policies and practices relating to the City’s existing
pay practices, and to collect data on organizational structure, operations, and
staffing in addition to identifying any specific departmental needs and concerns
related to this study. This meeting also provided an opportunity to discuss the
City’s goals in conducting this study.
2. The City provided copies of existing job descriptions, the City’s current pay scale,
union contracts and policies.
3.A meeting was also conducted with all department heads to discuss the project ,
their responsibilities during the project, answer questions and discuss the
questionnaire to be completed by all department heads to collect information on
department structure, operations, and staffing, along with identifying any specific
departmental needs and concerns related to this study.
4.Employee orientation sessions were conducted by Baker Tilly to introduce the
study, explain the study process and to answer questions. These meetings also
provided an opportunity for employees to voice concerns and have input into the
study.
5.At this meeting Baker Tilly provided information on completing a Position Analysis
Questionnaire (PAQ). Employees were encouraged to participate in the study by
using the PAQ to respond to questions regarding essential job duties, job
responsibilities, job requirements and characteristics applicable to each position.
Each employee’s supervisor then reviewed the completed questionnaires for
completeness and accuracy and provided any additional information they felt was
relevant to the position.
6.The Baker Tilly consultant team reviewed the PAQs completed by City
employees upon their receipt and made preliminary classification decisions.
7.Baker Tilly conducted a comprehensive market survey that requested information
from twenty-two (22) organizations identified in consultation with the City to
determine the market for benchmarked positions. Salary data for benchmarked
positions were solicited. Information was gathered on minimum, maximum, and
actual salaries for all positions surveyed. Comprehensive benefit information
was also collected as a part of the survey.
3.Methodology
The City of Rosemount, Minnesota Page | 6
8.All City positions were evaluated using Baker Tilly’s Systematic Analysis and
Factor Evaluation (SAFE®) system to assist in assuring that the internal
relationships of positions within the City were equitable. The evaluation ensured
each position was assigned to the appropriate salary grade in the proposed
compensation plan.
9.Utilizing the salary data supplied by comparable organizations and the SAFE job
evaluations factors for each position a compensation plan was developed,
positions were assigned to the pay plan and implementation options were
developed.
10.Guidelines for implementation and ongoing administration of the compensation
program were developed. These guidelines provide for annual adjustments to the
salary schedule ensuring that the City’s pay scales stay current with changing
economic and market conditions. The implementation options and the estimated
costs are provided as part of this study.
The City of Rosemount, Minnesota Page | 7
4.Findings and recommendations
Developing a classification system and compensation program involves the analysis of
substantial quantities of data collected from employees, supervisors, comparable
employers, and the City. We have evaluated the City’s existing compensation program
based on our analysis of the study data and the survey results. Using this information, we
have developed a compensation program for The City of Rosemount, which is described
below. Options for implementing the recommended changes conclude this section.
A. Evaluation of the current compensation program
Discussions with City personnel and review of compensation data indicate that
some employees of the City may be under-compensated in relation to other
comparable regional organizations when comparing actual salaries. Other
findings discussed earlier in the study indicate a wage problem demonstrated by:
•Difficulty recruiting employees in various positions
•Concerns about possible employee turnover because employees may leave
to take higher paying jobs with other employers
•Positions with comparable responsibilities requiring comparable education and
experience that are assigned to different pay grades resulting in pay
differences
B. Compensation philosophy
A compensation philosophy guides the design of a pay plan and answers key
questions regarding pay strategy. It generally takes a comprehensive, long term
focus and explains the compensation program’s goals and how the program
supports the employer’s long-range strategic goals. Without a compensation
philosophy, compensation decisions tend to be viewed from a short-term
standpoint apart from the organization’s overall goals.
In addition, movement of positions through the pay grades is an important topic
for consideration of local governments. An organization’s desired market position
involves defining the market and identifying where the organization wants to be
positioned within that market. Market position should balance what it takes to
attract new employees and to retain skilled employees (in other words,
eliminating higher pay as the reason employees leave the organization) with the
organization’s financial resources. Internal equity expresses an organization’s
desire to provide comparable pay to positions with comparable duties and
responsibilities.
Movement of positions through the assigned salary grade is also an important
consideration for employees and their supervisors to understand. Employees
should have an understanding of how they may obtain pay increases whether it
is by merit or some other form, so that they believe that they have a future in the
community that they serve.
The City of Rosemount, Minnesota Page | 8
Findings and Recommendations
In consultation with the City’s Management Team , Baker Tilly staff developed a
compensation philosophy framework guiding the compensation program
development and the direction of this study. As part of this study, we recommend
that the City consider these concepts in the adoption of a formal compensation
philosophy:
•Providing fair and equitable rates of pay to employees
•Developing a system of pay grades that state the minimum and maximum
rates that the City will pay individuals within a job class and identify the
midpoint of the range as the “market” rate
•Defining the City’s market area based on the nature of the job class
requirements and the availability of potential candidates locally or state-wide
•Establishing rates of pay that allow the City to compete successfully for new
employees within its market area
•Establishing a market position that is fiscally responsible with public resources
•Ensuring that pay rates for employees reflect changing economic conditions
•Developing pay administration policies and procedures that ensure their
consistent application between departments
•Ensuring that the compensation program is understandable to employees, the
City Administrator, City Council, and the public
C. Evaluating positions
City employees completed individual Position Analysis Questionnaires (PAQs).
Supervisors reviewed the PAQs and provided information for each position.
Employees and supervisors both responded to questions regarding job
requirements, factors which apply to their position, working conditions and the
physical requirements of each job in compliance with the Americans with
Disabilities Act (ADA). Based on the information provided in the PAQs and the
City’s updated job descriptions, Baker Tilly’s SAFE® job evaluation system was
utilized to evaluate, rate and rank each position in the City’s workforce to
establish preliminary class assignments. The factors considered in determining
the relative value of positions are:
•Training and Ability •Experience Required
•Level of Work •Human Relations Skills
•Physical Demands •Working Conditions/Hazards
•Independence of Actions •Impact on End Results
•Supervision Exercised
D. Developing a salary schedule
The process of developing a salary schedule draws substantially from market
data obtained in a compensation and benefits survey. This data is obtained by
conducting a comprehensive survey of other comparable employers within the
City’s defined market area; that is, who does the locality compete with for
employees when vacancies occur? Respondents are asked to provide
information about the structure of their pay plans and the minimum, maximum,
and actual salary rates of their corresponding benchmark positions, hours
worked, number of employees, and information on additional compensation.
The City of Rosemount, Minnesota Page | 9
Findings and Recommendations
Salary Survey Results. The survey included benchmarked positions covering a
full range of positions from administrative support and maintenance positions to
professional employees and department heads. A general summary of survey
results appears in Appendix II. Job titles marked ‘DNU’ on the Salary Survey
Summary were not used in developing the salary curve because positions did not
match the position being surveyed or data received was inconsistent or
inadequate.
Designing the Salary Schedule. The first step in designing a compensation
plan is to create a salary curve using the salary survey data for the City’s
benchmark positions and the corresponding job evaluation point factors for each
benchmark position. This data produced the salary curve shown below. Any
given point on the salary curve identifies where the market salary rate and the job
evaluation point factors intersect.
The proposed compensation plan has 25 pay grades with a 6% spread between
grades (it should be noted that not all grades are currently utilized in the plan).
The compensation plan is designed as a step system. Each grade in the pay
plan has 8 steps with 3.25% between steps. Each position was then assigned to
the appropriate salary grade based on the job evaluation points of the position
(internal equity). The List of Positions and Assignment to Salary Grades is
shown in Appendix III.
It is recommended that as part of this compensation plan, individual employee
movement within the range incorporate individual employee performance.
Employees should only receive wage increases if their performance is
satisfactory or better.
y = 150.56x + 32062
R² = 0.985
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
0 100 200 300 400 500 600 700 800 900Survey Mid-Point (y)SAFE Total Points (x)
City of Rosemount, Minnesota
Compensation Survey
The City of Rosemount, Minnesota Page | 10
Findings and Recommendations
Fringe Benefit Comparison. The survey also included a comprehensive
benefits questionnaire, a summary of the findings are:
•Holidays: The number of recognized holidays and floating holidays are
consistent with the average number provided by the survey respondents,
as is the compensation for employees working on a holiday
•Annual Leave: Fifteen of the respondents provide vacation and sick
leave, six respondents provide paid-time-off (PTO). The City of
Rosemount provides above average annual vacation time until the 20+
year mark at which time the leave is consistent with the average.
•Sick Leave: Annual accrual is consistent with the survey respondents;
maximum accumulation is slightly below the average and allowable use
of sick leave is consistent with the survey respondents.
•Life Insurance: Employer contribution towards employee life insurance
is slightly above average.
•Short-Term and Long-Term Disability Insurance: The City does not
contribute funds towards the cost of coverage for either of these options.
Employees pay all premiums towards short-term and long-term disability
insurance.
•Health Insurance: This has become an increasingly difficult benefit to
compare, therefore a review of costs and contributions is included. The
City, consistent with survey respondents provides more than one plan for
employees. For both plans offered by the City of Rosemount the City’s
costs for both single and family coverage are higher than the average,
the deductible is lower than average and the City’s contribution
(percentage of premium) is slightly above the average.
•Dental Insurance: The City’s costs for employee and family coverage
are slightly above the average. The City’s contribution towards single
coverage is above the average and the contribution towards family
coverage is consistent with the average.
•Vision Insurance: Ten of the organizations have a separate vision
insurance plan, the City of Rosemount does not.
•Deferred Compensation: Consistent with the survey respondents.
A detailed summary of the fringe benefit survey can be found in attached Appendix.
The City of Rosemount, Minnesota Page | 11
5.Implementation
To estimate implementation costs, Baker Tilly used the most recent employee salaries
supplied by the City for all departments and prepared three (3) implementation options.
Implementation of the proposed compensation plans is effective at a time to be
determined by the City Administrator and the City Council. Each option is explained in
greater detail below.
The first step in implementation was to provide all employees with a base cost of living
increase of 2.5%. The annual cost of the base increase is $267,591.65.
# of Staff Current Salary Proposed Salary Difference % Increase
Totals 110 $7,894,486.08 $8,091,848.23 $ 197,362.15 2.50%
The total costs of all options include moving employees below the minimum to the
minimum. These costs are for wages only.
Option 1. This option moves employees who have a current wage below the minimum of
the proposed grade for their position to the minimum of the range. Of the City’s 110
employees, 6 (5% of City employees) have a current wage which falls below the
proposed minimum of the range. The annual cost to move these 5 employees to the
minimum is $30,668.17.
# of Staff Current Salary Proposed Salary Difference % Increase
Totals 110 $8,091,848.23 $8,122,516.40 $ 30,668.17 0.38%
Employee Below Min 6 $ 336,301.68 $ 366,969.85 $ 30,668.17 9.12%
Employee Within Range 104 $7,631,621.92 $7,631,621.92 $ -
Employee Above Max 0 $ - $ - $ -
Option 2. This option provides adjustments for employees whose current wage falls
within the range to which their position has been assigned. Employees are moved to the
step closest to their current wage which provides an increase to the employee. This
option impacts all employees. The cost to move these employees onto a step in the
proposed pay scale is $110,443.37. The total cost of moving these employees as well
as the six employees below the minimum onto the pay scale is
$144,890.07, which is 1.79% of the City’s total payroll.
# of Staff Current Salary Proposed Salary Difference % Increase
Totals 110 $8,091,848.23 $8,236,738.30 $ 144,890.07 1.79%
Employee Below Min 6 $ 336,301.68 $ 366,969.85 $ 30,668.17 9.12%
Employee Within Range 104 $7,631,621.92 $7,742,065.29 $ 110,443.37 1.45%
Employee Above Max 0 $ - $ - $ -
6.Implementation
The City of Rosemount, Minnesota Page | 12
Ongoing Administration
After initial implementation is achieved, the City should develop administrative
procedures that provide for annual market analyses and salary adjustments based on
market and economic conditions and the City’s ability to pay. It should be recognized that
as the market shifts, employee’s base salaries should shift with adjustments in the City’s
compensation schedule to maintain market competitiveness.
Base adjustments. It will be necessary for the City to adjust the salary schedule and
grades based on market adjustments and other factors such as recruitment and
retention. The City can establish a guideline for determining annual base adjustments.
For example, the City could base its adjustment on the Consumer Price Index (CPI). The
City should also contact comparable jurisdictions to find out what percentage adjustment
they are making to their pay scales as a second level of verification of the pay range
adjustment. This would also ensure that the City maintains marketability among
comparable regional organizations.
If the CPI, for example, is 2.5, a 2.5% increase would be applied to the wage rates of
each pay grade. In addition, all employees with performance that meets or exceeds job
expectations would receive the 2.5% increase applied to their base salary. By making this
base adjustment to all employee salaries, the City ensures that employees will not fall
behind the market.
Recommendations
The City of Rosemount is a service-oriented organization. The City delivers services
through its employees who are a major investment in the organization’s infrastructure.
The report that precedes these recommendations contains significant amounts of
information, which has been gathered from a variety of sources, carefully and objectively
analyzed, and structured in a way that will provide a sound and fair system of
compensating employees if followed carefully. It is our independent judgment that has
resulted in the following recommendations.
We urge the City to:
1.Approve the proposed salary schedule as recommended. Adoption of the revised
salary schedule, developed utilizing market data, will result in an up to date
compensation schedule which will better equip the City to recruit for vacant positions,
retain existing employees, and provide for flexibility in hiring, promotions and annual
increases.
2.Approve the recommended position assignments, which assigns positions to the
proposed salary grades. The schematics developed, utilizing objective analysis of
data, will allow for establishment of internal equity among the various positions of the
City.
3.Approve an Implementation Option which meets the goals of the City and falls within
the financial resources available to the City. Adoption of one of the recommendations
will establish more equitable compensation levels for all employees, address
compressions issues, and bring those employees that are below the market up to
market standards. Baker Tilly recommends adoption of Option 2 to ensure market
competitiveness of employee salaries.
4.Provide support for ongoing administration of the program via a system of market
adjustments.
The City of Rosemount, Minnesota
Glossary
Annual Salary Adjustment – A salary increase based on changes in a price index, such as the Consumer Price Index
(CPI), designed to help salaries keep pace with market changes. Other factors may be considered in annual salary
adjustments, including the anticipated increases in the salary schedules of comparable employers. The adjustments are
applied to the minimum, midpoint, and maximum rate of each pay grade and to employee salaries so their position within
their assigned pay grades is maintained.
Benchmark Jobs – A group of jobs used as reference points for making pay comparisons with other organizations.
Class Description – A summary of the essential duties performed within a job class and examples of the specific tasks
and employee knowledge, skill and abilities required to perform the job.
Classification – The assignment of positions to appropriate positions and pay grades based on the results of a job
evaluation.
Internal Equity – Fair and consistent pay relationships among jobs or skill levels within a single organization that
establishes equal or comparable pay for jobs involving comparable work and utilization of comparable skills.
Job Class – A grouping of jobs that is considered to be substantially similar for pay purposes.
Job Evaluation – A systematic procedure designed to make classification decisions by applying standard criteria to a
review of all positions.
Line of Best Fit – In regression analysis, the line fitted to a scatter plot of coordinates measuring pay and job evaluation
factors. The line is used to develop the salary structure.
Occupational Group – Jobs involving work of the same nature but requiring different skill and responsibility levels.
Pay Grade – A level within a salary schedule into which positions with similar job evaluation factors are placed for
compensation purposes. Pay grades have a minimum rate, a midpoint rate, and a maximum rate and define what an
employer is willing to pay for a particular job. The midpoint of the pay grades approximates the market salary rate which
would be paid for satisfactory performance.
Compensation Philosophy – Decisions about employee compensation that address the relative importance of internal
equity, external competitiveness, employee contributions or performance, and administration of the pay system.
Performance Evaluation – The process of determining the extent to which a worker’s assigned task outcomes meet
employer performance expectations and performance standards.
Position Analysis Questionnaire (PAQ) – A structured job analysis technique that classifies job information based on
such factors as information input, mental processes, work output, relationships with other persons, job context, and other
job characteristics. The PAQ analyzes jobs in terms of worker-oriented data.
Progression through Pay Grades – Strategies that move employees through the pay grade.
Salary Survey – The systematic process of collecting information and making judgments about the compensation paid by
other comparable employers. Salary data are useful in designing pay grades and salary structures.
The City of Rosemount, Minnesota
Compensation Plan
% Between Grades:6%
% Between Steps:3.25%25.09%
Starting midpoint:38,175
Grade 1 2 3 4 5 6 7 8
1 34,127.80 35,236.95 36,382.16 37,564.58 38,795.34 40,056.19 41,358.02 42,702.15
2 36,175.47 37,351.17 38,565.08 39,818.45 41,123.06 42,459.56 43,839.50 45,264.28
3 38,346.00 39,592.24 40,878.99 42,207.56 43,590.45 45,007.14 46,469.87 47,980.14
4 40,646.76 41,967.78 43,331.73 44,740.01 46,205.88 47,707.57 49,258.06 50,858.95
5 43,085.56 44,485.84 45,931.63 47,424.41 48,978.23 50,570.02 52,213.55 53,910.49
6 45,670.70 47,154.99 48,687.53 50,269.88 51,916.92 53,604.22 55,346.36 57,145.12
7 48,410.94 49,984.29 51,608.78 53,286.07 55,031.94 56,820.47 58,667.14 60,573.82
8 51,315.59 52,983.35 54,705.31 56,483.23 58,333.85 60,229.70 62,187.17 64,208.25
9 54,394.53 56,162.35 57,987.63 59,872.23 61,833.88 63,843.49 65,918.40 68,060.75
10 57,658.20 59,532.09 61,466.89 63,464.56 65,543.92 67,674.09 69,873.50 72,144.39
11 61,117.69 63,104.02 65,154.90 67,272.43 69,476.55 71,734.54 74,065.91 76,473.05
12 64,784.76 66,890.26 69,064.19 71,308.78 73,645.15 76,038.61 78,509.87 81,061.44
13 68,671.84 70,903.68 73,208.05 75,587.31 78,063.85 80,600.93 83,220.46 85,925.12
14 72,792.15 75,157.90 77,600.53 80,122.54 82,747.69 85,436.98 88,213.69 91,080.63
15 77,159.68 79,667.37 82,256.56 84,929.90 87,712.55 90,563.20 93,506.51 96,545.47
16 81,789.26 84,447.41 87,191.95 90,025.69 92,975.30 95,997.00 99,116.90 102,338.20
17 86,696.62 89,514.26 92,423.47 95,427.23 98,553.82 101,756.82 105,063.91 108,478.49
18 91,898.41 94,885.11 97,968.88 101,152.87 104,467.05 107,862.22 111,367.75 114,987.20
19 97,412.32 100,578.22 103,847.01 107,222.04 110,735.07 114,333.96 118,049.81 121,886.43
20 103,257.06 106,612.91 110,077.83 113,655.36 117,379.17 121,194.00 125,132.80 129,199.62
21 109,452.48 113,009.69 116,682.50 120,474.68 124,421.92 128,465.64 132,640.77 136,951.59
22 116,019.63 119,790.27 123,683.45 127,703.16 131,887.24 136,173.57 140,599.21 145,168.69
23 122,980.81 126,977.68 131,104.46 135,365.35 139,800.47 144,343.99 149,035.17 153,878.81
24 130,359.66 134,596.35 138,970.73 143,487.28 148,188.50 153,004.63 157,977.28 163,111.54
25 138,181.24 142,672.13 147,308.97 152,096.51 157,079.81 162,184.91 167,455.91 172,898.23
Step
The City of Rosemount, Minnesota
Fringe Benefits (i)
Least Reported Most Reported Average Reported
City of
Rosemount,
MN
Holidays (Days/Year)10 12 11 11
Floating Holidays No (4)Yes (15)Yes Yes
If yes, how many?0.50 2.00 1 1
Holiday on Regular Days Off Other (0)Fri-Mon (21)Fri-Mon Fri-Mon
Comp on Holidays Worked T&½ (17)
Time and a ½T&½ (17)17 T&½ (17)x
Double Time Dbl (2)2
Double Time and a ½DT&½ (1)1
Other Other (0)0
Annual Leave (Days/Year)
Vacation/Sick or PTO PTO (6)Vac-Sick (15)Vac-Sick Vac-Sick
Vacation - days or hours?
6 months - 15.00 9 10.00
1 year 10.00 15.00 10 12.00
2 years 10.00 15.00 11 12.00
3 years 10.00 15.00 11 12.00
4 years 10.00 15.00 11 18.00
5 years 10.00 15.00 13 18.00
6 years 13.00 20.00 15 18.00
7 years 14.00 20.00 15 18.00
8 years 15.00 20.00 15 18.00
9 years 15.00 20.00 16 18.00
10 years 15.00 20.00 16 18.00
11 years 15.00 20.00 18 21.00
12 years 17.00 20.00 19 21.00
13 years 18.00 21.00 19 21.00
14 years 19.00 21.00 20 21.00
15 years 19.00 25.00 21 21.00
16 years 19.00 25.00 21 24.00
17 years 19.00 25.00 22 24.00
18 years 20.00 25.00 22 24.00
19 years 20.00 25.00 22 24.00
20 years 20.00 25.00 23 24.00
20+ years 20.00 25.00 24 24.00
PTO - days or hours?
6 months 18.00 19.00 18
1 year 18.00 19.00 18
2 years 18.00 19.00 18
3 years 18.00 19.00 19
4 years 18.00 19.00 19
5 years 18.00 24.00 21
6 years 20.00 24.00 22
7 years 22.00 24.00 23
8 years 22.00 24.00 23
9 years 22.00 24.00 23
10 years 22.00 25.00 24
11 years 23.00 26.00 24
12 years 23.00 29.00 25
13 years 23.00 29.00 26
14 years 23.00 29.00 26
15 years 27.00 30.00 29
16 years 28.00 30.00 29
17 years 28.00 30.00 29
18 years 28.00 30.00 29
19 y ears 28.00 30.00 29
20 years 28.00 35.00 31
20+ years 28.00 35.00 31
Carried into Next Year 20.00 Unltd (1)37 35.00
Max Accumulation 20.00 62.50 36 35.00
Comp after Max Accumulation Yes (6)No (12)No No
Sick Leave (Days/Year)12.00 12.00 12.00 12.00
Carried into Next Year 60.00 Unltd (2)118.89 100.00
Max . Accumulation 60.00 180.00 120.00 100.00
Paid at Termination/Retirement No (1)Yes (11)Yes Yes
Use for Medical Appointments No (0)Yes (12)Yes Yes
Use for Dental Appointments No (0)Yes (12)Yes Yes
Use for Family Illness No (0)Yes (12)Yes Yes
Sick Leave Bank Yes (3)No (10)No No
The City of Rosemount, Minnesota
Fringe Benefits (ii)
Least Reported Most Reported Average Reported
City of
Rosemount,
MN
Pension and Retirement
Other Than Social Security No (0)Yes (21)Yes Yes
State Sponsored No (1)Yes (20)Yes Yes
Employer Paid 7.50%8.50%7.55% 7.50%
Employee Paid 6.50%7.50%6.55% 6.50%
Death Benefit No (0)Yes (2)Yes
Life & Disability Insurance
Life Insurance No (0)Yes (20)Yes Yes
Employer Paid 0%100%95%100%
AD&D No (0)Yes (16)Yes Yes
AD&D Double Indeminity Yes/No (1/1)Yes/No (1/1)
Employer Paid 100%100%100%0%
Short Term Disability No (7)Yes (8)Yes No
Employer Paid 0%100%38%
Long Term Disability No (0)Yes (17)Yes No
Employer Paid 0%100%69%
Health Insurance No (0)Yes (20)Yes Yes
Different Types of Coverage?No (2)Yes (9)Yes Yes
100% FTE participation required Yes (5)No (7)No No
Not participating No (5)Yes (6)Yes Yes
Employee Only 499.10$ 914.89$ 691.66$ 818.53$
Employer Paid 85%100%98%100%
Employee Paid 0%15%2%0%
Max out of pocket 1,000.00$ 6,900.00$ 3,100.00$ 1,200.00$
Standard Office Visit Co-pay 30.00$ 30.00$
Employee/Spouse 995.45$ 2,191.38$ 1,465.87$
Employer Paid 60%87%69%
Employee Paid 13%40%31%
Max out of pocket 1,000.00$ 9,913.80$ 5,982.76$
Standard Office Visit Co-pay 30.00$ 30.00$
Employee/Child 948.25$ 1,810.00$ 1,363.72$
Employer Paid 60%87%70%
Employee Paid 13%40%30%
Max out of pocket 1,000.00$ 9,409.80$ 5,881.96$
Standard Office Visit Co-pay 30.00$ 30.00$
Employee/Family 1,381.81$ 2,564.26$ 1,893.93$ 2,516.76$
Employer Paid 60%87%71%75%
Employee Paid 13%40%30%25%
Max out of pocket 1,000.00$ 13,800.00$ 7,559.43$ 2,400.00$
Standard Office Visit Co-pay 30.00$ 30.00$
HEALTH INSURANCE TYPE 2 -
Employee Only 464.16$ 779.87$ 607.87$ 791.37$
Employer Paid 60%100%92%100%
Employee Paid 0%40%8%0%
Annual Deductible 2,500.00$ 4,500.00$ 3,080.00$ 1,400.00$
Standard Office Visit Co-pay -$ -$
Annual Maximum Out-of-Pocket 500.00$ 5,600.00$ 3,350.00$
Employee/Spouse 918.58$ 1,874.52$ 1,286.19$
Employer Paid 50%100%74%
Employee Paid 0%50%26%
Annual Deductible 2,800.00$ 9,000.00$ 5,600.00$
Standard Office Visit Co-pay -$ -$
Annual Maximum Out-of-Pocket 2,800.00$ 11,200.00$ 7,906.75$
Employee/Child 881.88$ 1,339.50$ 1,155.91$
Employer Paid 51%100%74%
Employee Paid 0%49%26%
Annual Deductible 2,800.00$ 9,000.00$ 5,600.00$
Standard Office Visit Co-pay -$ -$
Annual Maximum Out-of-Pocket 2,800.00$ 11,200.00$ 7,666.67$
Employee/Family 1,263.48$ 2,193.45$ 1,632.29$ 2,433.25$
Employer Paid 45%100%73%75%
Employee Paid 0%55%27%25%
Annual Deductible 2,800.00$ 9,000.00$ 5,600.00$ 2,800.00$
Standard Office Visit Co-pay -$ -$
Annual Maximum Out-of-Pocket 2,800.00$ 11,200.00$ 8,136.00$
The City of Rosemount, Minnesota
Fringe Benefits (iii)
Least Reported Most Reported Average Reported
City of
Rosemount,
MN
Supplemental program for HDP?No (0)Yes (9)Yes
Type of Program
Employer Paid 1,400.00$ 4,000.00$
Retirees No (1)Yes (4)Yes
Years of Service Required Yes/No (0/0)Yes/No (0/0)
If yes, how many?- -
Employer Paid 0%100%33%
Dental Insurance No (0)Yes (17)Yes Yes
Part of Health Plan Yes (7)No (10)No No
Employee Only 30.20$ 51.74$ 43.26$ 45.76$
Employer Paid 0%100%70%100%
Employee/Family 90.20$ 177.91$ 127.37$ 130.36$
Employer Paid 0%100%36%36%
Vision Insurance No (2)Yes (10)Yes No
Part of Health Plan Yes (1)No (8)No
Employee Only 4.61$ 8.49$
Employer Paid 0%0%0%
Employee/Family 13.55$ 23.30$ 17.46$
Employer Paid 0%0%0%
Deferred Compensation No (0)Yes (11)Yes Yes
Available to all Employees No (1)Yes (8)Yes Yes
Type of Plan Nationwide/MN
CDP/ICMA
Employer Contribution Yes (0)No (6)No No
Other Benefits Program
Other Benefits No (1)Yes (4)Yes
Cell Phone Stipends Yes (0)No (2)No
Post Retirement Hlth Care Svgs No (1)Yes (3)Yes Yes
Call Back Pay No (1)Yes (5)Yes Yes
On Call/Stand By Pay No (0)Yes (5)Yes
Clothing Allowance Yes (1)No (2)No
Mgr/Administrator Compensation
Years in Current Position 2 18 6
Years in Management 22 30 25
Car or Vehicle provided Yes (2)No (4)No Yes
Personal Use Yes (0)No (3)No
Vehicle Allowance No (1)Yes (3)Yes Yes
Annual Allowance 3,600.00$ 7,100.00$ 4,766.67$ 3,600.00$
Employer Contribute to Deferred Comp Yes (0)No (4)No
Amount -$ -$ #DIV/0!
Receives Health Insurance No (0)Yes (4)Yes
Percentage Employer Pays 100.00%100.00%100.00%
Receives Family Health Insurance No (1)Yes (2)Yes
Percentage Employer Pays 0.00%0.00%#DIV/0!
Accrues Leave Differently Yes (0)No (6)No No
Explanation
State Professional Organizatoin No (1)Yes (3)Yes
ICMA No (1)Yes (3)Yes
Other (please list)
Moving Expenses Yes/No (2/2)Yes/No (2/2)Yes
Employer Paid 2,000.00$ 10,000.00$ 6,000.00$ 5,000.00$
Additional Benefits Yes/No (0/0)Yes/No (0/0)Yes
Explanation