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Home My WebLink About09 - Creating the Human Capital and Compensation Ad Hoc CommitteeQ SEW Pp�T CITY OF z NEWPORT BEACH c�<,FORN'P City Council Staff Report September 10, 2024 Agenda Item No. 9 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Barbara J. Salvini, Human Resources Director - 949-644-3300, bsalvini@newportbeachca.gov PREPARED BY: Barbara J. Salvini, Human Resources Director Resolution No. 2024-69: Creating the Human Capital and TITLE: Compensation Ad Hoc Committee ABSTRACT: At its August 27, 2024, meeting the Newport Beach City Council unanimously voted, via a straw poll, in favor of staff bringing forward a resolution for the Council's consideration that, if adopted, would create a Human Capital and Compensation Ad Hoc Committee. RECOMMENDATIONS: a) Determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; and b) Adopt Resolution No. 2024-69, A Resolution of the City Council of the City of Newport Beach, California, Creating the Human Capital and Compensation Ad Hoc Committee. DISCUSSION: On August 27, 2024, Councilmember Lauren Kleiman requested the City Council consider creating a Human Capital and Compensation Ad Hoc Committee, pursuant to City Council Policy A-1. The City Council voted unanimously, via a straw poll, in favor of staff returning with a resolution to create said ad hoc committee. On June 14, 2011, the City Council adopted Resolution No. 2011-55 which outlined the City's total compensation philosophy ("Total Compensation Philosophy") and emphasized the City of Newport Beach's desire to attract, motivate and retain high quality employees while still maintaining a fiscally responsible budget. Resolution No. 2011-55 contemplated the use of municipal and private sector agencies to analyze employee compensation. Two years later, on August 13, 2013, the City Council approved a list of comparator agencies to use for employee pay and benefit surveys. Since 2013, the economic landscape has changed, and the City, like many other public and private employers, has experienced a plethora of recruitment and retention challenges, including but not necessarily limited to inflation, minimum wage increases, competition, employee retirements and relocations, and increasing workload demands. 9-1 Resolution No. 2024-69: Creating the Capital and Compensation Ad Hoc Committee September 10, 2024 Page 2 The City Council wishes to revisit the City's methodology for determining employee compensation, pay and benefits, including the selection of comparator agencies for survey purposes. This can be accomplished by creating a Human Capital and Compensation Ad Hoc Committee to conduct a review and provide recommendations to the full City Council. Should the Council adopt Resolution No. 2024-69, the Ad Hoc Committee will be comprised of Mayor Pro Tern Joe Stapleton, Councilmember Noah Blom and Councilmember Lauren Kleiman. FISCAL IMPACT: There is no fiscal impact related to this item. ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). ATTACHMENT: Attachment A — Resolution No. 2024-69 9-2 ATTACHMENT A RESOLUTION NO. 2024-69 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH, CALIFORNIA, CREATING THE HUMAN CAPITAL AND COMPENSATION AD HOC COMMITTEE WHEREAS, the City Council of the City of Newport Beach ("City Council") previously adopted Resolution No. 2001-50, the "Employer -Employee Relations Resolution," pursuant to authority contained in the Meyers-Milias-Brown Act, Government Code 3500, et seq.; WHEREAS, the City of Newport Beach ("City") promotes effective communication and collaborative working relationships with its employees while balancing good management practices; WHEREAS, on June 14, 2011, the City Council adopted Resolution No. 2011- 55, setting forth the City's total compensation philosophy ("Total Compensation Philosophy"), which emphasized the City's desire to attract, motivate and retain highly competent, efficient, and effective employees, while maintaining the City's strong financial position; WHEREAS, Resolution No. 2011-55 contemplated that the City's analysis of the compensation for individual positions would be measured with respect to market surveys, including both municipal and relevant private sector comparisons; WHEREAS, on August 13, 2013, the City Council approved a list of comparator agencies for purposes of conducting pay and benefit surveys; WHEREAS, over the last several years, the City has faced a variety of recruitment and retention challenges, including, but not limited to, inflationary pressures, minimum wage increases, competition with the private sector as well as other public sector agencies, employee attrition related to retirement and relocations, and increasing workload demands; and WHEREAS, the City Council desires to create the Human Capital and Compensation Ad Hoc Committee ("Committee") for the purpose of reviewing and providing recommendations to the entire City Council on the Total Compensation Philosophy, as well as the designated comparator public agencies that are used for purposes of conducting compensation, pay and benefit surveys. 9-3 Resolution No. 2024- Page 2 of 3 NOW, THEREFORE, the City Council of the City of Newport Beach resolves as follows: Section 1: The City Council hereby creates the Committee, which shall be comprised of Mayor Pro Tern Stapleton, and Councilmembers Kleiman and Blom. The term of the appointed members of the Committee shall be indefinite pending City Council action or expiration of the Committee as set forth in this resolution. Section 2: The sole purpose and responsibility of the Committee shall be to review and provide recommendations to the entire City Council on the Total Compensation Philosophy, as well as the designated comparator public agencies that are used for purposes of conducting compensation, pay and benefit surveys. Section 3: The Committee shall function as an ad hoc committee and shall not be subject to the Brown Act. Section 4: The Committee shall expire upon making its recommendations to the entire City Council, at a noticed public meeting of the City Council, or December 31, 2025, whichever is earlier. Section 5: The recitals provided in this resolution are true and correct and are incorporated into the operative portion of this resolution. Section 6: If any section, subsection, sentence, clause or phrase of this resolution is for any reason held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of the remaining portions of this resolution. The City Council hereby declares that it would have passed this resolution and each section, subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared invalid or unconstitutional. Section 7: The City Council finds the adoption of this resolution is not subject to the California Environmental Quality Act ("CEQA") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Division 6, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Resolution No. 2024- Page 3 of 3 Section 8: This resolution shall take effect immediately upon its adoption by the City Council, and the City Clerk shall certify the vote adopting this resolution. ADOPTED this loth day of September, 2024. Will O'Neill Mayor ATTEST: Leilani I. Brown City Clerk APPROVED AS TO FORM: CITY ATTORNEY'S OF ICE Aaron C. Harp City Attorney 9-5