HomeMy WebLinkAbout18 - Citywide Classification & Compensation StudyCITY OF
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c9` oaN� City Council Staff Report Agenda Item No. 18
July 10, 2012
TO: HONORABLE MAYOR ANY MEMBERS OF THE CITY COUNCIL
FROM: City Manager's Officein%,,_,f
Dana Smith, Assistant City Manager
949 - 644 -3002, dsmith @newportbeachca.gov
PREPARED BY: Terri L. Cassidy, Human Resources Director
APPROVED:�lM,
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TITLE: Professional Services Agreement with Fox Lawson and Associates
to Conduct a City -wide Classification and Compensation Study
ABSTRACT:
The City of Newport Beach has never undertaken a city -wide comprehensive
classification and compensation study that we know of. The City Manager and City
Council have directed significant organizational change over the past several years and
further change is anticipated. To provide a framework for classifying and compensating
employees appropriately within a solid structure, it is proposed the City execute an
agreement with Fox Lawson and Associates to conduct this classification and
compensation study and make recommendations to be brought forward to City Council.
RECOMMENDATION:
Approve and execute the Professional Services Agreement with Fox Lawson and
Associates (Attachment A), a Division of Gallagher Benefit Services, Inc. (FLA) to
conduct a comprehensive city -wide classification and compensation study, not to
exceed $115,000.
FUNDING REQUIREMENTS:
The current adopted budget includes sufficient funding for this purchase. It will be
expensed to the Professional Services account in the Human Resources Department,
0410 -8080.
DISCUSSION:
All large corporations, private and public, utilize a systematic way to assess and
compensate employees. Classification and compensation structures are developed
partly in response to state labor laws, partly to stay competitive in the market to attract
and retain qualified staff. Job classifications, to which every employee is assigned,
Professional Services Agreement with Fox Lawson and Associates to Conduct a City-
wide Classification and Compensation Study
July 10, 2012
Page 2
define job duties and the parameters by which they are to be performed. Ideally, pay
assigned to each classification is based on comparisons with the labor market (external
equity) and the value of the job with respect to other positions within the organization
(internal equity). For large organizations internal equity is particularly critical to ensuring
jobs with similar responsibilities and duties across departments are consistently
compensated and create appropriate vertical separation within job series to avoid
compaction.
The City of Newport Beach has over 250 job classifications for 750 full -time employees,
with too many single classifications that are similar in scope and duties. This structure
is burdensome and lacks a broad, comprehensive approach. Additionally, it represents
old ways of doing business, where one employee is assigned one major function,
limiting the City's ability to adjust job assignments in an environment when adaptability
and flexibility are critical to promoting change.
In the past three years the City has undergone significant organizational restructuring.
The Early Retirement Incentive Program in 2010 and layoffs /department mergers in
2011 resulted in shifting duties to a smaller workforce (from 833 positions in 2009 to 750
positions in 2012 (an 11% reduction)). With the downturn in the economy, many private
and public organizations have similarly downsized and reassigned job duties to
maximize productivity with fewer employees. These actions, coupled with the fact that
the City has never undertaken a complete review necessitate that a comprehensive
study be conducted. This has been discussed previously with City Council in the course
of two prior FY budgets, as well as during several meet and confer briefings.
In August 2011, Fox Lawson and Associates was hired to assess the strengths and
weaknesses of the City's classification and compensation structure. This assessment
was a potential precursor to a full study and was used to determine whether it would be
feasible for the City to adopt an entirely new classification structure, based on FLA's
proprietary Decision Band TM Methodology (DBM). The DBM tool is a more objective,
quantifiable, and comprehensive approach toward classification and compensation. In
very simple terms, the DBM method assigns job classifications into one of six bands (A
— F) based on the classification's level of decision- making. Each classification is
analyzed further and sub - banded based on other measurable factors, such as
complexity of work, supervisory authority, and consequences of error. Staff reviewed
the merits of the DBM methodology and its applicability to the City's existing system and
believe it to be the best approach toward establishing a new classification and
compensation system.
Concurrent with the preliminary assessment, FLA conducted a review of executive
compensation. Executive recruitments for key director level positions conducted within
the past three years revealed possible structural inconsistencies in compensation and
benefits for that group. To create a valid and defensible classification and
compensation system, the City hired FLA to establish the new structure and assign all
executive level positions (department directors) a DBM rating. DBM ratings not only
Professional Services Agreement with Fox Lawson and Associates to Conduct a City-
wide Classification and Compensation Study
July 10, 2012
Page 3
ensure an objective evaluation that addresses the compensation inconsistencies, but
establishes the framework for applying DBM methodology city -wide. It is anticipated the
FLA executive compensation report will be presented for City Council consideration at
the first meeting in August.
Study Process and Outcomes
Given the broad scope and size of the study, it is estimated to take in excess of six
months to complete. Since the study will examine nearly all of the City's job
classifications, the City's bargaining units will be engaged in the process. Any resulting
outcomes that impact classification or compensation (increases or reductions) are
subject to meet and confer and will follow the provisions of the Meyers - Milias Brown Act
(MMBA).
Phase I of the study will include informational meetings to explain the study process and
DBM method. During Phase II consultants will meet with employees via occupational
panels (small group of employees from certain job classifications to discuss duties and
responsibilities), assess job classifications, develop new classification structures, and
revise or create new job descriptions. Phase III of the study analyzes the internal
alignment and assigns each classification a DBM rating, while Phase IV includes an
analysis of pay and benefits through a study of the labor market. Though the study is
designed to establish a system of classification and compensation for the City's full -time
positions, part -time positions will also be reviewed and any proposed changes in how
the City assigns or compensates part -time positions shall be incorporated.
Consistent with elements of the City's Council's Compensation Philosophy, Resolution
No. 2011 -55, the study will include the following outcomes:
• A job evaluation system with a reliable and objective methodology that is
internally equitable and consistent across all departments (philosophy #3)
• Market competitiveness that includes examination of public and private sector
data, as appropriate, and that generally compensates at market median (or within
the second and third quartile) (philosophies #1 and #2)
• A simplified job classification and pay structure that provides greater
management flexibility in job assignments and employee cross training, which
will be essential as the City continues to move to a smaller, more efficient
organization (philosophy #6)
• Job descriptions that are current, reflective of duties performed, and follow best
practice guidelines to include descriptive factors that conform to the Americans
with Disabilities Act (ADA)
Professional Services Agreement with Fox Lawson and Associates to Conduct a City-
wide Classification and Compensation Study
July 10, 2012
Page 4
Firm Qualifications
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc., is
experienced in conducting comprehensive classification and compensation studies for
both the private and public sector. Public sector clients include a host of California
cities, counties and special districts, and private sector clients include large and small
businesses in a variety of industries (Attachment B).
The attached FLA proposal (Exhibit A) outlines the objectives, process and anticipated
outcomes of the study. If the Professional Services Agreement with Fox Lawson and
Associates is approved, City Manager's Office and Human Resources staff will proceed
with implementing the city -wide study as soon as practicable. Upon study conclusion
the City Council will be presented with a final report and any corresponding
recommendations for their consideration, which staff anticipates to occur prior to FY13-
14.
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).
Submitted by:
W
Dana Smith
Assistant City Manager
Attachments: A. Professional Services Agreement with Fox Lawson and
Associates
B. Fox Lawson and Associates Client List
ATTACHMENT A
PROFESSIONAL SERVICES AGREEMENT
WITH FOX LAWSON AND ASSOCIATES, A DIVISION OF GALLAGHER
BENEFITS SERVICES, INC. FOR
A CITY -WIDE CLASSIFICATION AND COMPENSATION STUDY
THIS AGREEMENT FOR PROFESSIONAL SERVICES ( "Agreement') is made
and entered into as of this day of July, 2012 ( "Effective Date ") by and between the
CITY OF NEWPORT BEACH, a California Municipal Corporation ( "City "), and Fox
Lawson and Associates, a Division of Gallagher Benefits Services, Inc., a Delaware
corporation ( "Consultant'), whose address is P.O. Box 32985, Phoenix, AZ 85064 -2985
and is made with reference to the following:
RECITALS
A. City is a municipal corporation duly organized and validly existing under the laws
of the State of California with the power to carry on its business as it is now being
conducted under the statutes of the State of California and the Charter of City.
B. City desires to engage Consultant to conduct a comprehensive city -wide
classification and compensation study ( "Project ").
C. Consultant possesses the skill, experience, ability, background, certification and
knowledge to provide the professional services described in this Agreement.
D. The principal member of Consultant for purposes of Project shall be Bruce G.
Lawson.
E. City has solicited and received a proposal from Consultant, has reviewed the
previous experience and evaluated the expertise of Consultant, and desires to
retain Consultant to render professional services under the terms and conditions
set forth in this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
1. TERM
The term of this Agreement shall commence on the Effective Date, and shall
terminate on December 31, 2013 unless terminated earlier as set forth herein.
2. SERVICES TO BE PERFORMED
City and Consultant acknowledge that the above Recitals are true and correct
and are hereby incorporated by reference into this Agreement. Consultant shall
diligently perform all the services described in the Scope of Services attached hereto as
Exhibit A and incorporated herein by reference ( "Services" or "Work "). The City may
elect to delete certain Services within the Scope of Services at its sole discretion.
3. TIME OF PERFORMANCE
3.1 Time is of the essence in the performance of Services under this
Agreement and Consultant shall perform the Services in accordance with the schedule
included in Exhibit A. In the absence of a specific schedule, the Services shall be
performed to completion in a diligent and timely manner. The failure by Consultant to
strictly adhere to the schedule set forth in Exhibit A, if any, or perform the Services in a
diligent and timely manner may result in termination of this Agreement by City.
3.1.1 Notwithstanding the foregoing, Consultant shall not be responsible
for delays due to causes beyond Consultant's reasonable control. However, in the case
of any such delay in the Services to be provided for the Project, each party hereby
agrees to provide notice within two (2) days of the occurrence causing the delay to the
other party so that all delays can be addressed.
3.2 Consultant shall submit all requests for extensions of time for performance
in writing to the Project Administrator (as defined in Section 6 below) not later than ten
(10) calendar days after the start of the condition that purportedly causes a delay. The
Project Administrator shall review all such requests and may grant reasonable time
extensions for unforeseeable delays that are beyond Consultant's control.
3.3 For all time periods not specifically set forth herein, Consultant shall
respond in the most expedient and appropriate manner under the circumstances, by
fax, hand - delivery or mail.
4. COMPENSATION TO CONSULTANT
4.1 City shall pay Consultant for the Services on a time and expense not -to-
exceed basis in accordance with the provisions of this Section and the Schedule of
Billing Rates or Progress Payments Schedule attached hereto as Exhibit B and
incorporated herein by reference. Consultant's compensation for all Work performed in
accordance with this Agreement, including all reimbursable items and subconsultant
fees, shall not exceed One Hundred Fifteen Thousand Dollars and 00 1100
($115,000.00) without prior written authorization from City. No billing rate changes shall
be made during the term of this Agreement without the prior written approval of City.
4.2 Consultant shall submit monthly invoices to City describing the Work
performed the preceding month. Consultant's bills shall include the name of the person
who performed the Work, a brief description of the Services performed and /or the
specific task in the Scope of Services to which it relates, the date the Services were
performed, the number of hours spent on all Work billed on an hourly basis, and a
description of any reimbursable expenditures. City shall pay Consultant no later than
thirty (30) days after approval of the monthly invoice by City staff.
4.3 City shall reimburse Consultant only for those costs or expenses
specifically identified in Exhibit B to this Agreement, or specifically approved in writing in
advance by City.
4.4 Consultant shall not receive any compensation for Extra Work performed
without the prior written authorization of City. As used herein, "Extra Work" means any
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 2
Work that is determined by City to be necessary for the proper completion of the
Project, but which is not included within the Scope of Services and which the parties did
not reasonably anticipate would be necessary at the execution of this Agreement.
Compensation for any authorized Extra Work shall be paid in accordance with the
Schedule of Billing Rates as set forth in Exhibit B.
5. PROJECT MANAGER
5.1 Consultant shall designate a Project Manager, who shall coordinate all
phases of the Project. This Project Manager shall be available to City at all reasonable
times during the Agreement term. Consultant has designated Bruce G. Lawson to be its
Project Manager. Consultant shall not remove or reassign the Project Manager or any
personnel listed in Exhibit A or assign any new or replacement personnel to the Project
without the prior written consent of City. City's approval shall not be unreasonably
withheld with respect to the removal or assignment of non -key personnel.
5.2 Consultant, at the sole discretion of City, shall remove from the Project
any of its personnel assigned to the performance of Services upon written request of
City. Consultant warrants that it will continuously furnish the necessary personnel to
complete the Project on a timely basis as contemplated by this Agreement.
5.3 If Consultant is performing inspection services for City, the Project
Manager and any other assigned staff shall be equipped with a cellular phone to
communicate with City staff. The Project Manager's cellular phone number shall be
provided to the City.
6. ADMINISTRATION
This Agreement will be administered by the City Manager's Office. Dana
Smith, Assistant City Manager or his /her designee, shall be the Project Administrator
and shall have the authority to act for City under this Agreement. The Project
Administrator or his /her designee shall represent City in all matters pertaining to the
Services to be rendered pursuant to this Agreement.
7. CITY'S RESPONSIBILITIES
To assist Consultant in the execution of its responsibilities under this Agreement,
City agrees to provide access to and upon request of Consultant, one copy of all
existing relevant information on file at City. City will provide all such materials in a
timely manner so as not to cause delays in Consultant's Work schedule.
S. STANDARD OF CARE
8.1 All of the Services shall be performed by Consultant or under Consultant's
supervision. Consultant represents that it possesses the professional and technical
personnel required to perform the Services required by this Agreement, and that it will
perform all Services in a manner commensurate with the highest professional
standards. For purposes of this Agreement, the phrase "highest professional
standards" shall mean those standards of practice recognized by one (1) or more first -
class firms performing similar work under similar circumstances.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 3
8.2 All Services shall be performed by qualified and experienced personnel
who are not employed by City. By delivery of completed Work, Consultant certifies that
the Work conforms to the requirements of this Agreement; all applicable federal, state
and local laws; and the highest professional standard.
8.3 Consultant represents and warrants to City that it has, shall obtain, and
shall keep in full force and effect during the term hereof, at its sole cost and expense, all
licenses, permits, qualifications, insurance and approvals of whatsoever nature that is
legally required of Consultant to practice its profession. Consultant shall maintain a City
of Newport Beach business license during the term of this Agreement.
8.4 Consultant shall not be responsible for delay, nor shall Consultant be
responsible for damages or be in default or deemed to be in default by reason of strikes,
lockouts, accidents, acts of God, or the failure of City to furnish timely information or to
approve or disapprove Consultant's Work promptly, or delay or faulty performance by
City, contractors, or governmental agencies.
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9.1 To the fullest extent permitted by law, Consultant shall indemnify, defend
and hold harmless City, its City Council, boards and commissions, officers, agents and
employees (collectively, the "Indemnified Parties ") from and against any and all claims
(including, without limitation, claims for bodily injury, death or damage to property),
demands, obligations, damages, actions, causes of action, suits, losses, judgments,
fines, penalties, liabilities, costs and expenses (including, without limitation, attorney's
fees, disbursements and court costs) of every kind and nature whatsoever (individually,
a Claim; collectively, "Claims "), which may arise from or in any manner relate (directly or
indirectly) to any breach of the terms and conditions of this Agreement, any Work
performed or Services provided under this Agreement including, without limitation,
defects in workmanship or materials or Consultant's presence or activities conducted on
the Project (including the negligent and /or willful acts, errors and /or omissions of
Consultant, its principals, officers, agents, employees, vendors, suppliers, consultants,
subcontractors, anyone employed directly or indirectly by any of them or for whose acts
they may be liable or any or all of them).
9.2 Notwithstanding the foregoing, nothing herein shall be construed to
require Consultant to indemnify the Indemnified Parties from any Claim arising from the
sole negligence or willful misconduct of the Indemnified Parties. Nothing in this
indemnity shall be construed as authorizing any award of attorney's fees in any action
on or to enforce the terms of this Agreement. This indemnity shall apply to all claims
and liability regardless of whether any insurance policies are applicable. The policy
limits do not act as a limitation upon the amount of indemnification to be provided by the
Consultant.
10. INDEPENDENT CONTRACTOR
It is understood that City retains Consultant on an independent contractor basis
and Consultant is not an agent or employee of City. The manner and means of
conducting the Work are under the control of Consultant, except to the extent they are
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 4
limited by statute, rule or regulation and the expressed terms of this Agreement. No
civil service status or other right of employment shall accrue to Contractor or its
employees. Nothing in this Agreement shall be deemed to constitute approval for
Consultant or any of Consultant's employees or agents, to be the agents or employees
of City. Consultant shall have the responsibility for and control over the means of
performing the Work, provided that Consultant is in compliance with the terms of this
Agreement. Anything in this Agreement that may appear to give City the right to direct
Consultant as to the details of the performance of the Work or to exercise a measure of
control over Consultant shall mean only that Consultant shall follow the desires of City
with respect to the results of the Services.
11. COOPERATION
Consultant agrees to work closely and cooperate fully with City's designated
Project Administrator and any other agencies that may have jurisdiction or interest in the
Work to be performed. City agrees to cooperate with the Consultant on the Project.
12. CITY POLICY
Consultant shall discuss and review all matters relating to policy and Project
direction with City's Project Administrator in advance of all critical decision points in
order to ensure the Project proceeds in a manner consistent with City goals and
policies.
13. PROGRESS
Consultant is responsible for keeping the Project Administrator and /or his /her
duly authorized designee informed on a regular basis regarding the status and progress
of the Project, activities performed and planned, and any meetings that have been
scheduled or are desired.
14. INSURANCE
Without limiting Consultant's indemnification of City, and prior to commencement
of Work, Consultant shall obtain, provide and maintain at its own expense during the
term of this Agreement or for other periods as specified in this Agreement, policies of
insurance of the type, amounts, terms and conditions described in the Insurance
Requirements attached hereto as Exhibit C, and incorporated herein by reference.
15. PROHIBITION AGAINST ASSIGNMENTS AND TRANSFERS
Except as specifically authorized under this Agreement, the Services to be
provided under this Agreement shall not be assigned, transferred contracted or
subcontracted out without the prior written approval of City. Any of the following shall
be construed as an assignment: The sale, assignment, transfer or other disposition of
any of the issued and outstanding capital stock of Consultant, or of the interest of any
general partner or joint venturer or syndicate member or cotenant if Consultant is a
partnership or joint- venture or syndicate or cotenancy, which shall result in changing the
control of Consultant. Control means fifty percent (50 %) or more of the voting power, or
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 5
twenty -five percent (25 %) or more of the assets of the corporation, partnership or joint -
venture.
16. SUBCONTRACTING
The subcontractors authorized by City, if any, to perform Work on this Project are
identified in Exhibit A. Consultant shall be fully responsible to City for all acts and
omissions of any subcontractor. Nothing in this Agreement shall create any contractual
relationship between City and any subcontractor no shall it create any obligation on the
part of City to pay or to see to the payment of any monies due to any such
subcontractor other than as otherwise required by law. The City is an intended
beneficiary of any Work performed by the subcontractor for purposes of establishing a
duty of care between the subcontractor and the City. Except as specifically authorized
herein, the Services to be provided under this Agreement shall not be otherwise
assigned, transferred, contracted or subcontracted out without the prior written approval
of City.
17. OWNERSHIP OF DOCUMENTS
17.1 Each and every report, draft, map, record, plan, document and other
writing produced (hereinafter "Documents "), prepared or caused to be prepared by
Consultant, its officers, employees, agents and subcontractors, in the course of
implementing this Agreement, shall become the exclusive property of City, and City
shall have the sole right to use such materials in its discretion without further
compensation to Consultant or any other party. Consultant shall, at Consultant's
expense, provide such Documents to City upon prior written request.
17.2 Documents, including drawings and specifications, prepared by
Consultant pursuant to this Agreement are not intended or represented to be suitable
for reuse by City or others on any other project. Any use of completed Documents for
other projects and any use of incomplete Documents without specific written
authorization from Consultant will be at City's sole risk and without liability to
Consultant. Further, any and all liability arising out of changes made to Consultant's
deliverables under this Agreement by City or persons other than Consultant is waived
against Consultant and City assumes full responsibility for such changes unless City
has given Consultant prior notice and has received from Consultant written consent for
such changes.
18. COMPUTER DELIVERABLES
All written documents shall be transmitted to City in formats compatible with
Microsoft Office and /or viewable with Adobe Acrobat.
19. CONFIDENTIALITY
All Documents, including drafts, preliminary drawings or plans, notes and
communications that result from the Services in this Agreement, shall be kept
confidential unless City expressly authorizes in writing the release of information.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 6
20. INTELLECTUAL PROPERTY INDEMNITY
The Consultant shall defend and indemnify City, its agents, officers,
representatives and employees against any and all liability, including costs, for
infringement or alleged infringement of any United States' letters patent, trademark, or
copyright, including costs, contained in Consultant's Documents provided under this
Agreement.
21. RECORDS
Consultant shall keep records and invoices in connection with the Services to be
performed under this Agreement. Consultant shall maintain complete and accurate
records with respect to the costs incurred under this Agreement and any Services,
expenditures and disbursements charged to City, for a minimum period of three (3)
years, or for any longer period required by law, from the date of final payment to
Consultant under this Agreement. All such records and invoices shall be clearly
identifiable. Consultant shall allow a representative of City to examine, audit and make
transcripts or copies of such records and invoices during regular business hours.
Consultant shall allow inspection of all Work, data, Documents, proceedings and
activities related to the Agreement for a period of three (3) years from the date of final
payment to Consultant under this Agreement.
22. WITHHOLDINGS
City may withhold payment to Consultant of any disputed sums until satisfaction
of the dispute with respect to such payment. Such withholding shall not be deemed to
constitute a failure to pay according to the terms of this Agreement. Consultant shall
not discontinue Work as a result of such withholding. Consultant shall have an
immediate right to appeal to the City Manager or his /her designee with respect to such
disputed sums. Consultant shall be entitled to receive interest on any withheld sums at
the rate of return that City earned on its investments during the time period, from the
date of withholding of any amounts found to have been improperly withheld.
23. ERRORS AND OMISSIONS
In the event of errors or omissions that are due to the negligence or professional
inexperience of Consultant which result in expense to City greater than what would
have resulted if there were not errors or omissions in the Work accomplished by
Consultant, the additional design, construction and /or restoration expense shall be
borne by Consultant. Nothing in this Section is intended to limit City's rights under the
law or any other sections of this Agreement.
24. CITY'S RIGHT TO EMPLOY OTHER CONSULTANTS
City reserves the right to employ other Consultants in connection with the
Project.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 7
25. CONFLICTS OF INTEREST
25.1 The Consultant or its employees may be subject to the provisions of the
California Political Reform Act of 1974 (the "Act "), which (1) requires such persons to
disclose any financial interest that may foreseeably be materially affected by the Work
performed under this Agreement, and (2) prohibits such persons from making, or
participating in making, decisions that will foreseeably financially affect such interest.
25.2 If subject to the Act, Consultant shall conform to all requirements of the
Act. Failure to do so constitutes a material breach and is grounds for immediate
termination of this Agreement by City. Consultant shall indemnify and hold harmless
City for any and all claims for damages resulting from Consultant's violation of this
Section.
26. NOTICES
26.1 All notices, demands, requests or approvals, including any change in
mailing address, to be given under the terms of this Agreement shall be given in writing,
and conclusively shall be deemed served when delivered personally, or on the third
business day after the deposit thereof in the United States mail, postage prepaid, first -
class mail, addressed as hereinafter provided. All notices, demands, requests or
approvals from Consultant to City shall be addressed to City at:
Attn: Dana Smith, Assistant City Manager
City Manager's Office
City of Newport Beach
3300 Newport Boulevard
PO Box 1768
Newport Beach, CA 92658
Phone: 949 - 644 -3003
Fax: 949 - 644 -3020
26.2 All notices, demands, requests or approvals from City to Consultant shall
be addressed to Consultant at:
Attn: Bruce G. Lawson
Fox Lawson and Associates, a Division of Gallagher Benefits
Services, Inc.
P.O. Box 32985
Phoenix, AZ 85064 -2985
Phone: 602 - 840 -1070
Fax: 602 - 840 -1071
27. CLAIMS
Unless a shorter time is specified elsewhere in this Agreement, before making its
final request for payment under this Agreement, Consultant shall submit to City, in
writing, all claims for compensation under or arising out of this Agreement.
Consultant's acceptance of the final payment shall constitute a waiver of all claims for
compensation under or arising out of this Agreement except those previously made in
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 8
writing and identified by Consultant in writing as unsettled at the time of its final request
for payment. The Consultant and the City expressly agree that in addition to any claims
filing requirements set forth in the Agreement, the Consultant shall be required to file
any claim the Consultant may have against the City in strict conformance with the Tort
Claims Act (Government Code sections 900 et seq).
28. TERMINATION
28.1 In the event that either party fails or refuses to perform any of the
provisions of this Agreement at the time and in the manner required, that party shall be
deemed in default in the performance of this Agreement. If such default is not cured
within a period of two (2) calendar days, or if more than two (2) calendar days are
reasonably required to cure the default and the defaulting party fails to give adequate
assurance of due performance within two (2) calendar days after receipt of written
notice of default, specifying the nature of such default and the steps necessary to cure
such default, and thereafter diligently take steps to cure the default, the non - defaulting
party may terminate the Agreement forthwith by giving to the defaulting party written
notice thereof.
28.2 Notwithstanding the above provisions, City shall have the right, at its sole
and absolute discretion and without cause, of terminating this Agreement at any time by
giving no less than seven (7) calendar days prior written notice to Consultant. In the
event of termination under this Section, City shall pay Consultant for Services
satisfactorily performed and costs incurred up to the effective date of termination for
which Consultant has not been previously paid. On the effective date of termination,
Consultant shall deliver to City all reports, Documents and other information developed
or accumulated in the performance of this Agreement, whether in draft or final form.
29. STANDARD PROVISIONS
29.1 Compliance with all Laws. Consultant shall at its own cost and expense
comply with all statutes, ordinances, regulations and requirements of all governmental
entities, including federal, state, county or municipal, whether now in force or hereinafter
enacted. In addition, all Work prepared by Consultant shall conform to applicable City,
county, state and federal laws, rules, regulations and permit requirements and be
subject to approval of the Project Administrator and City.
29.2 Waiver. A waiver by either party of any breach, of any term, covenant or
condition contained herein shall not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant or condition contained herein, whether
of the same or a different character.
29.3 Integrated Contract. This Agreement represents the full and complete
understanding of every kind or nature whatsoever between the parties hereto, and all
preliminary negotiations and agreements of whatsoever kind or nature are merged
herein. No verbal agreement or implied covenant shall be held to vary the provisions
herein.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 9
29.4 Conflicts or Inconsistencies. In the event there are any conflicts or
inconsistencies between this Agreement and the Scope of Services or any other
attachments attached hereto, the terms of this Agreement shall govern.
29.5 Interpretation. The terms of this Agreement shall be construed in
accordance with the meaning of the language used and shall not be construed for or
against either parry by reason of the authorship of the Agreement or any other rule of
construction which might otherwise apply.
29.6 Amendments. This Agreement may be modified or amended only by a
written document executed by both Consultant and City and approved as to form by the
City Attorney.
29.7 Severabilitv. If any term or portion of this Agreement is held to be invalid,
illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining
provisions of this Agreement shall continue in full force and effect.
29.8 Controlling Law and Venue. The laws of the State of California shall
govern this Agreement and all matters relating to it and any action brought relating to
this Agreement shall be adjudicated in a court of competent jurisdiction in the County of
Orange, State of California.
29.9 Equal Opportunity Employment. Consultant represents that it is an equal
opportunity employer and it shall not discriminate against any subcontractor, employee
or applicant for employment because of race, religion, color, national origin, handicap,
ancestry, sex, age or any other impermissible basis under law.
29.10 No Attorney's Fees. In the event of any dispute or legal action arising
under this Agreement, the prevailing party shall not be entitled to attorney's fees.
29.11 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which shall be deemed an original and all of which together shall
constitute one (1) and the same instrument.
[SIGNATURES ON NEXT PAGE]
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 10
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFIC
Date: Z: ,
Aaron C. Harp
City Attorney
ATTEST:
Date:
By:
Leilani I. Brown
City Clerk
CITY OF NEWPORT BEACH,
A California municipal corporation
Date:
By:
Nancy Gardner
Mayor
CONSULTANT: Fox Lawson and
Associates, a Division of Gallagher
Benefits Services, Inc., a Delaware
Corporation
Date:
By:
Bruce G. Lawson
Managing Director
[END OF SIGNATURES]
Attachments: Exhibit A — Scope of Services
Exhibit B — Schedule of Billing Rates
Exhibit C — Insurance Requirements
A 12- 00476f.-1 appslcat I cycomlwpdocsld0291 p005100011385. docx
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page 11
EXHIBIT A
SCOPE OF SERVICES
[Contractor Firm Name] Page A -1
avle,� Fox Lawson &Associates
nr 'r a Division of Gallagher Benefit Services, Inc.
Compemation and Hunion Resources Specialises
June 22, 2012
Sent via e-mail to: dsmith @newportbeachca.gov
Ms. Dana Smith
Assistant City Manager
City of Newport Beach, CA
3300 Newport Blvd.
Newport Beach, CA 92663
P.O. Box 32985
Phoenix, A2 85064 -2985
Phone 60M40 -1070
Fax 602. 840.1071
%mwfoxlawson.com
Re: Proposal to Conduct a Job Classification and Compensation Study
Ladies and Gentlemen:
In response to your request, Fox Lawson & Associates, a Division of Gallagher
Benefit Services, Inc. (FLA), is pleased to provide the following approach and cost
estimate to conduct a job classification and compensation study covering all City
positions in approximately 200 current job classifications. The objective of this study
will be develop a new job classification structure that is simpler and broader in
order to provide both greater flexibility in terms of organizational change and
greater opportunity for employees to grow and develop. The study will also include
assessment of total compensation through a market compensation and benefits
study. Ultimately, the new system should be easier to manage than the current
system, as well as provide for appropriate internal alignment of positions and jobs
throughout the City organization.
The City Council has recently adopted a compensation philosophy. Subsequently,
we conducted an executive compensation study, and also assessed the current job
classifications to identify potential opportunities to simplify the job classification
system. Based on that review, it is clear that there are numerous opportunities to
simplify and streamline the job classification system. To accomplish the stated
objectives, the project will have three components: Classification, Job Evaluation,
and Total Compensation, as follows:
Classification is the process of understanding, verifying, and describing the nature
and level of work of each job in the organization. This is done by asking employees
to describe their work, including the duties, responsibilities, knowledge, skills,
physical requirements, and working conditions required for their job. During Phase
I of the study, classification data will be collected from existing job descriptions,
employee Position Description Questionnaires (PDQs), and individual or group
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employee interviews to assess the type and level of work performance. This will
allow us to outline a proposed classification structure for the City that is consistent
with the Compensation Philosophy that has been adopted by the Council. In
addition, the classification system will help the City define career progressions for
current and future employees.
Internal Equity (job Evaluation) - The purpose of job evaluation is to establish the
internal worth of all job classes. The basic premise of job evaluation dictates that the
more a job is valued internally, the more it should be compensated. Furthermore, it
is a valuable tool for slotting classifications into appropriate salary grades when
market data are not available for certain classifications, or for classifications that are
not benchmarked.
Internal equity is established with a formal job evaluation methodology, such as
banding, point factoring or whole job ranking. Having implemented a variety of job
evaluation methods in hundreds of organizations over the past 30 years, we
understand the desire some organization may have to examine alternative job
evaluation methods when faced with general classification and compensation
challenges. We will work with the City in Phase II to develop and implement a job
evaluation methodology such as the Decision BandTm Method that we believe is well
suited to the broad job classification concept that the City is seeking.
Market Parity (Total Compensation) - The purpose of the compensation study is to
ensure that your pay structure and benefits offerings are competitive with the
relevant labor markets in which you compete for qualified personnel. We will work
with you to identify benchmark organizations and job classifications on which to
collect comparable market salary data.
We will collect market data through data mining from web - sites, utilizing either
currently available data or via a data collection form customized to meet the needs of
the City, as necessary to obtain the needed information. If a custom survey is used,
our data collection form follows standard compensation guidelines and is an
effective and efficient form of collecting salary information. Our questions are posed
in a fashion that is easy for participants to answer, as well as being easy to quantify
and analyze. Participants can complete our data collection forms in either hardcopy
or electronic formats.
FLA abides by WorldatWork guidelines in the collection and analysis of pay and
benefits data. In order to encourage responses from organizations, we pledge that
data provided will be treated as confidential and that only summary or aggregate
results will be made public. Consequently, specific responses identified by
participants will not be provided to the City. This policy abides by the guidelines
set forth by the Federal Trade Commission and the United States Department of
justice relative to the Sherman Antitrust Act in regards to the sharing of salary data.
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While we use proven procedures to maximize participation, we ultimately have no
control over other organizations' work schedules, and/or their desire or ability to
participate in a salary survey. We make no guarantee that we will obtain good data
for all jobs from each of the organizations that we invite to participate in the survey.
In our experience, we have found that private organizations do not typically
participate in smaller, customized surveys sponsored by government organizations.
Therefore, with the City's approval, we will draw information from published data in
order to provide a representation of the private market. This will assure that
accurate and valid private sector data is utilized in a cost efficient manner.
If we are able to use available published data, we will use data from our extensive
database including published data sources such as Mercer, Towers Watson and
other commercially available surveys of public and private sector jobs to obtain
market information for the City. For local agencies, we will obtain as much of the
information as possible from information provided on their web - sites.
We will analyze the market data using standard analytical tools such as regression
analysis. In addition, we will integrate the job evaluation results with the labor
market survey analysis to develop a salary structure that reflects the proper balance
of internal and external equity.
During this Phase, the City will be responsible for assisting FLA in selecting
organizations to survey and benchmark jobs to include in the survey.
In order to accomplish your stated objectives for this compensation system review,
we will need to do at least the following:
Review of class structures for discussion within a series of occupational focus
groups comprised of employees and managers regarding type and level of
work performed by employees within the occupational group.
Synthesis of best practices, current City structures and occupational panel
feedback to result in recommendations for the new class structure.
• Development of new or revised job descriptions, including identification of the
essential duties for the class, appropriate minimum qualifications, distinguishing
characteristics between class levels within a job family or series, and physical
requirements in order to comply with the American's with Disabilities Act.
• Determination of the appropriate FLSA exemption status for each job
classification.
Provision of an appropriate job evaluation methodology to assess and maintain
internal equity for all job classifications within a broad classification concept,
including training for City HR staff so that the City can maintain the system once
implemented.
Recommendation of an appeal process regarding classification allocation and, if
requested, administration of the appeals process (Optional Activity).
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Recommendations for methods to implement the findings of the study and
options and direction, given current and recommended personnel policies and
procedures.
Transition plans for implementing the findings of the study. Our
recommendations will take into consideration the culture and financial resources
of the City.
Study Phase
SununaI7 Tasks /Deliverables
I. Study Initiation
• Organization & current employee classification
and compensation information collected.
• Conduct of employee orientation sessions.
[Includes 2 days on site to
• Presentation of DBM, FLA's proprietary internal
conduct project initiation and
equity tool/]E alternatives and decision
employee orientation
regarding approach to determining internal
meetings.]
alignment.
• Employee communication plan confirmed.
• Client communication process confirmed.
• Project timetable confirmed.
H. Classification Study
• Conduct of occupational panels and/or
interviews of a sample of
[Includes 5 days of
employees /managers to assess type and level
occupational panels and/or
of current work performed within each
interviews.]
occupational grouping.
• Review of current organization material and
job descriptions in concert with
interview /occupational panel outcomes and
best practices to recommend revised class
structures.
• Based on management feedback, development
of updated class structure recommendations
for City review.
• Development of new or updated job
descriptions as desired by the City to conform
to approved structure changes, including
appropriate competencies for each job
classification.
• Recommendation of employee allocations.
• Analysis of employee appeals as appropriate;
this is an optional task and is priced
separately.
G' j For Lawson & Associates
M. Job Evaluation Study
• Application of DBTTMM or alternative job
evaluation tool in use or otherwise selected to
the City's jobs.
• Discussion of the internal hierarchy resulting
and development of modifications to finalize
the job evaluation ratings for use in
determining internal equity within the class
and pay systems.
• Training for HR and management personnel on
site or by webinar in the use of the DBT*lM
stem.
IV. Total Compensation
• Labor market confirmed and survey
Study
participants identified.
• Benchmark jobs identified and summarized.
• Data collected through a custom survey and
from published sources, as appropriate, and
verified.
• Identification of hard to recruit positions and
assessment of the relevance of compensation
for recruiting.
• Competitive analysis performed of City
compensation and benefits.
• Diagnostic review of current salary structure to
identify opportunities for simplification.
• Recommended pay structure or update of
existing structure.
• Best practices reviewed.
• Transition options, next steps /costs outlined.
• Compensation guidelines developed.
• Draft report.
• Quality assurance reviews.
• City review and feedback.
• Final report and presentation.
Deliverables
Deliverables include:
• New/Revised job classification structure.
• New/Revised job descriptions.
• Recommended position allocations.
New job evaluation system to address issues related to internal equity.
• Recommended salary structure.
• Recommended changes to the City's benefits program and pay practices
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• Recommended salary scales.
• Summary report including recommended implementation and maintenance costs
and options.
In conducting salary studies, we follow professionally accepted compensation
principles and practices as outlined by WorldatWork, SHRM, the U.S. Department of
Justice and the Federal Trade Commission. We have also authored many articles on
various aspects of conducting salary studies; please refer to our website
www.foxlawson.com for these specific articles.
FLA has comprehensive quality and performance standards. Each deliverable is
reviewed by two individuals in the firm for quality control. If clients have issues that
need to be addressed, the first contact is the project manager who will attempt to
resolve the issues with, as necessary, the assistance of one of the Managing
Directors.
Project Schedule
The schedule following is predicated on an effective start date in later August with
completion in approximately five to six months.
Project Cost
We understand the importance of this study as one of many strategies to address
current human resource issues and realize the delicate nature of City spending.
Therefore, we have proposed a sensible fee schedule that generates project results
destined to add value to the City. It will provide the flexibility necessary to attract,
retain, and motivate employees to provide quality services and ensure the system is
not an administrative and/or costly burden to the City, now or in the future.
We would not like fees to be the major impediment to acquiring the most
experienced provider to address these important needs during this unprecedented
time period. We would be pleased to explore options that may reduce the fees to fit
your budget.
Our fees to conduct the project outlined (including out of pocket expenses) will not
exceed $115,000.
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FOX LAWSON AND ASSOCIATES
QUALIFIED CONSULTANTS
BRUCE G. LAWSON, MPA, CCP, IPMA -CP — PROJECT DIRECTOR
Mr. Lawson is a Managing Director of the firm. In this capacity, Mr. Lawson serves as the project
director and /or technical advisor, providing technical direction and quality assurance. He is responsible
for all consulting activities in the areas of job evaluation and compensation, organization analysis,
personnel systems and policy development. Mr. Lawson has been directing classification and
compensation studies for more than 30 years. Prior to forming Fox Lawson, he spent 15 years with the
firm of Ernst & Young LLP where he served as the national director of their public sector compensation
consulting practice. He also served as City Manager in two California cities (Los Altos Hills and
Belvedere), was the County Administrative Officer in Multnomah County (Portland) Oregon, Assistant
City Manager /Personnel Director in Corvallis, Oregon, and Assistant to the City Administrator /Personnel
Director in Placentia, CA. Mr. Lawson served on the City of Phoenix (AZ) Public Safety Employees
Retirement Board for 12 years. Mr. Lawson has a Master's Degree in Public Administration from the
California State University at Fullerton and is a.b.d. in Public Administration from Golden Gate University
in San Francisco, and has earned his CCP certification from WorldotWork. He is also an active member
of several professional associations including the College & University Professional Association for
Human Resources, the International City & County Management Association, International Public
Management Association for Human Resources, the Society for Human Resources Management, and
WorldotWork.. Mr. Lawson co- authors a monthly compensation article called the CompDoctor'". Bruce
is located in Phoenix, AZ.
JAMES C. FOX, Ph.D., IPMA- CP — TECHNICAL ADVISOR AND ALTERNATE PROJECT DIRECTOR
Dr. Fox is a Managing Director of the firm. In this capacity, he serves as project director and /or technical
advisor on all projects, providing technical direction and quality assurance. He is responsible for all
consulting activities in the areas of personnel management, job evaluation and compensation,
organization and management analysis, executive compensation, and survey research. Dr. Fox has been
directing classification and compensation studies for more than 25 years. Prior to forming the firm, he
was a Partner in the firm of Ernst & Young LLP and headed up the firm's regional compensation practice,
with national responsibility for the public sector compensation practice. Dr. Fox holds both M.A. and
Ph.D. Degrees in Sociology from the University of Minnesota. He has been an instructor at Metropolitan
State University and the University of Minnesota, and has been a guest lecturer at regional conferences
and meetings. He is a member of the Society of Human Resource Management, WorldatWork,where he
is on the faculty, and was the Professional Development Coordinator of the Compensation Council of the
Twin Cities Personnel Association. He is the Chairman of the Human Resources Committee of the Board
of the Northern Star Council of the Boy Scouts, the past Chairman of the Board of Project Pathfinder and
is a member of the Ramsey County Personnel Review Board. Dr. Fox co- authors a monthly
compensation article called the CompDoctor". Jim is located in St. Paul, MN.
HEIDI NELSON, CCP, CBP, IPMA -CP — SENIOR CONSULTANT
Ms. Nelson is a Senior Consultant of the firm. She is responsible for leading and conducting
compensation consulting projects. She has been conducting compensation studies for our firm for over
20 years andspecializes in base pay compensation, total compensation, survey research, pay
administration planning, and executive compensation. Ms. Nelson has worked with all types of
organizations, including states, cities, counties, colleges, school districts, universities, special districts,
and private sector organizations includingconducting two prior studies for the City of Kansas City. Prior
to joining the firm, Ms. Nelson spent 6 years serving in a similar capacity with Ernst & Young. Ms.
Nelson attended the University of Minnesota specializing in Business Management and has completed
FOX LAWSON AND ASSOCIATES
QUALIFIED CONSULTANTS
continuing education coursework from the same institution in Industrial Relations, Methodology and
Design of Salary Surveys, and Compensation Administration, and has earned her CCP and CBP
certifications from WorldotWork. She is a member of the International Public Management Association
for Human Resources, and WorldotWork. Heidi is located in St. Paul, MN.
MIKE VERDOORN, MA -HRIR, CCP, IPMA -CP— SENIOR CONSULTANT
Mr. Verdoorn is a Senior Consultant with the firm. He is responsible for conducting classification and
compensation consulting projects. He has been conducting classification and compensation studies for
our firm for 6 years and specializes in the areas of classification, job evaluation and compensation,
survey research, executivecompensation, and statistical analysis. Mr. Verdoorn has worked with various
types of organizations including states, cities, counties, school districts, colleges, universities,
specialdistricts, and private sector organizations. Prior to joining the firm Mr. Verdoorn was a
compensation analyst with Imation, a computer disk storage manufacturer. Mr. Verdoorn has a
Bachelor's Degree in History from the University of Minnesota and a Master's Degree in Human
Resources and Industrial Relations from the same institution, and has earned his CCP certification from
WorldatWork. He is a member of the International Public Management Association for Human
Resources, and WorldotWork. Mike is located in St. Paul, MN.
GAIL MERIWEATHER, MBA
Ms. Meriweather is an Area Vice President for Human Resources Consulting Services. She will
assist with the market analyses and salary structure design. Prior to joining Gallagher in
2001, she was a partner with Burgess & Associates, a consulting firm located in Lenexa,
Kansas. She has extensive training and experience in designing and implementing
compensation systems including executive compensation, incentives, traditional and
alternative rewards. She has assisted clients with job analysis, job evaluations, external
market analysis, and salary structure design and administration. Ms. Meriweather provides
develops employee handbooks, affirmative action plans, job descriptions, performance
management systems and management training programs. She has BA in Business
Administration fromthe University of Missouri Kansas City and an MBA from the same
institution. Gail is based in our Kansas City, MO office.
ANNETTE HOEFER, MBA, CCP
Ms. Hoefer is a Senior Consultant. She is responsible for conducting classification and
compensation consulting projects. She has been conducting classification and compensation
studies for our firm for 5 years and specializes in the areas of classification, job evaluation and
compensation, personnel systems and policy development, performance management systems,
employee communications, strategy discussions, pay administration planning, and focus group
facilitation. Ms. Hoefer has worked with various types of organizations including states, cities,
counties, colleges, universities, special districts, and private sector organizations. Prior to
joining the firm, Ms. Hoefer worked for 9 years in the same capacity at Lee and Burgess
Associates, a consulting firm based in Colorado, and prior to that, had held human resources
positions in energy and insurance companies. Ms. Hoefer has a Bachelor's Degree in Business
Administration from the University of Iowa and a Master's Degree in Business Administration
with an emphasis in Human Resources from same institution, and has earned her CCP
certificationfrom WorldatWork. Annette is located in Cedar Rapids, IA.
FOX LAWSON AND ASSOCIATES
QUALIFIED CONSULTANTS
LORI MESSER, MA, CCP
Ms. Messer is a Senior Consultant of the firm. She is responsible for conducting classification
and compensation consulting projects. Ms. Messer has worked with and for a variety of public
and private sector organizations, including states, cities, counties, school districts, colleges,
universities, and special districts. Prior to joining the firm, Ms. Messer held a variety of
consultative human resources and compensation positions in high tech, distribution, healthcare
and local government organizations. Ms. Messer has a Bachelor's Degree in Business
Administration from Arizona State University and a Master's Degree in Education from the
University of Phoenix. She is also a member of WorldotWork and has earned her CCP
certification. Lori is based in Phoenix, AZ,
SANDRA SPELLMAN, MPA, IPMA -CP
Ms. Spellman is a Senior Consultant with the firm. She is responsible for conducting classification, job
evaluation, and human resource process consulting projects. She has been conducting studies for our
firm for 4 years and specializes in the areas of classification, communications, human resource strategy
and process, and employee and management focus group meetings. Ms. Spellman has worked with
various types of organizations including states, cities, counties, colleges and universities, and the federal
government. Prior to joining the firm, Ms. Spellman spent 18 years with Ernst & Young's consulting
practices where she was responsible for client and internal change management, communications, and
training strategies. She has also held state executive and legislative positions addressing a wide range of
human resource and related issues. Ms. Spellman has a Bachelor's Degree in Sociology /Political Science
from Arizona State University and a Master's Degree in Public Administration with an emphasis in
Organizational Development from the same institution. She is a member of several professional
associations, including the College & University Professional Association for Human Resources,
International Public Management Association for Human Resources, and WorldotWork. Sandy is located
in Washington, DC.
CHELSEA CHRISTIE, BS -HRIR, CCP, GRP
Ms. Christie is a Consulting Associate with the firm. She is responsible for providing supportduring all
phases of classification and compensation studies. She has been supporting classification and
compensation studies for our firm for 2 years and specializes in the areas of classification, job evaluation
and compensation, survey research, and job description preparation. Ms. Christie has worked with
various types of organizations including states, cities, counties, school districts, colleges, universities,
and special districts. Prior to joining the firm Ms. Christie worked at Aramark as a Student Hiring
Manager and also completed a competitive internship with Cargill, Inc. Ms. Christie has a Bachelor's
Degree in Human Resources and Industrial Relations, and Insurance /Risk Management from the
University of Minnesota, and has earned her CCP certification from WorldotWork. She is a member of
the Twin Cities Compensation Network (TCCN) and WorldotWork. Chelsea is located in St. Paul, MN.
EXHIBIT B
SCHEDULE OF BILLING RATES
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page B -1
I
DESCRIPTION
Study Initiation
:Cs
$10,000
II
Classification Study
$60,000
III
job Evaluation Study
$10,000
IV
Compensation Study
$35,000
Total Cost:
$115,000
Includes approximately 11 onsite days during the project devoted to meetings with employee
groups, management, and, if appropriate, the City Council.
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EXHIBIT C
1. INSURANCE REQUIREMENTS — PROFESSIONAL SERVICES
1.1 Provision of Insurance. Without limiting Consultant's indemnification of
City, and prior to commencement of Work, Consultant shall obtain, provide and maintain
at its own expense during the term of this Agreement, policies of insurance of the type
and amounts described below and in a form satisfactory to City. Consultant agrees to
provide insurance in accordance with requirements set forth here. If Consultant uses
existing coverage to comply and that coverage does not meet these requirements,
Consultant agrees to amend, supplement or endorse the existing coverage.
1.2 Acceptable Insurers. All insurance policies shall be issued by an
insurance company currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California, with an assigned policyholders' Rating
of A- (or higher) and Financial Size Category Class VII (or larger) in accordance with the
latest edition of Best's Key Rating Guide, unless otherwise approved by the City's Risk
Manager.
1.3 Coverage Requirements.
1.3.1 Workers' Compensation Insurance. Consultant shall maintain
Workers' Compensation Insurance, statutory limits, and Employers Liability Insurance
with limits of at least one million dollars ($1,000,000) each accident for bodily injury by
accident and each employee for bodily injury by disease in accordance with the laws of
the State of California, Section 3700 of the Labor Code.
1.3.1.1 Consultant shall submit to City, along with the certificate
of insurance, a Waiver of Subrogation endorsement in favor of City, its officers, agents,
employees and volunteers.
1.3.2 General Liability Insurance. Consultant shall maintain commercial
general liability insurance, and if necessary umbrella liability insurance, with coverage at
least as broad as provided by Insurance Services Office form CG 00 01, in an amount
not less than one million dollars ($1,000,000) per occurrence, two million dollars
($2,000,000) general aggregate. The policy shall cover liability arising from premises,
operations, products - completed operations, personal and advertising injury, and liability
assumed under an insured contract (including the tort liability of another assumed in a
business contract) with no endorsement or modification limiting the scope of coverage
for liability assumed under a contract.
1.3.3 Automobile Liability Insurance. Consultant shall maintain
automobile insurance at least as broad as Insurance Services Office form CA 00 01
covering bodily injury and property damage for all activities of the Consultant arising out
of or in connection with Work to be performed under this Agreement, including coverage
for any owned, hired, non -owned or rented vehicles, in an amount not less than one
million dollars ($1,000,000) combined single limit each accident.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page C -1
1.3.4 Professional Liability (Errors & Omissions) Insurance. Consultant
shall maintain professional liability insurance that covers the Services to be performed
in connection with this Agreement, in the minimum amount of one million dollars
($1,000,000) per claim and in the aggregate. Any policy inception date, continuity date,
or retroactive date must be before the effective date of this agreement and Consultant
agrees to maintain continuous coverage through a period no less than three years after
completion of the services required by this agreement.
1.4 Other Insurance Requirements. The policies are to contain, or be
endorsed to contain, the following provisions:
1.4.1 Waiver of Subrogation. All insurance coverage maintained or
procured pursuant to this agreement shall be endorsed to waive subrogation against
City, its elected or appointed officers, agents, officials, employees and volunteers or
shall specifically allow Consultant or others providing insurance evidence in compliance
with these requirements to waive their right of recovery prior to a loss. Consultant
hereby waives its own right of recovery against City, and shall require similar written
express waivers from each of its subconsultants.
1.4.2 Additional Insured Status. All liability policies including general
liability, excess liability, pollution liability, and automobile liability, but not including
professional liability, shall provide or be endorsed to provide that City and its officers,
officials, employees, and agents shall be included as insureds under such policies.
1.4.3 Primary and Non Contributory. All liability coverage shall apply on
a primary basis and shall not require contribution from any insurance or self- insurance
maintained by City.
1.4.4 Notice of Cancellation. All policies shall provide City with thirty (30)
days notice of cancellation (except for nonpayment for which ten (10) days notice is
required) or nonrenewal of coverage for each required coverage.
1.5 Additional Agreements Between the Parties. The parties hereby agree to
the following:
1.5.1 Evidence of Insurance. Consultant shall provide certificates of
insurance to City as evidence of the insurance coverage required herein, along with a
waiver of subrogation endorsement for workers' compensation and other endorsements
as specified herein for each coverage. Insurance certificates and endorsement must be
approved by City's Risk Manager prior to commencement of performance. Current
certification of insurance shall be kept on file with City at all times during the term of this
Agreement. City reserves the right to require complete, certified copies of all required
insurance policies, at any time.
1.5.2 City's Right to Revise Requirements. The City reserves the right at
any time during the term of the Agreement to change the amounts and types of
insurance required by giving the Consultant sixty (60) days advance written notice of
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page C -2
such change. If such change results in substantial additional cost to the Consultant, the
City and Consultant may renegotiate Consultant's compensation.
1.5.3 Enforcement of Agreement Provisions. Consultant acknowledges
and agrees that any actual or alleged failure on the part of the City to inform Consultant
of non - compliance with any requirement imposes no additional obligations on the City
nor does it waive any rights hereunder.
1.5.4 Requirements not Limiting. Requirements of specific coverage
features or limits contained in this Section are not intended as a limitation on coverage,
limits or other requirements, or a waiver of any coverage normally provided by any
insurance. Specific reference to a given coverage feature is for purposes of clarification
only as it pertains to a given issue and is not intended by any party or insured to be all
inclusive, or to the exclusion of other coverage, or a waiver of any type.
1.5.5 Self- insured Retentions. Any self- insured retentions must be
declared to and approved by City. City reserves the right to require that self- insured
retentions be eliminated, lowered, or replaced by a deductible. Self- insurance will not be
considered to comply with these requirements unless approved by City.
1.5.6 City Remedies for Non Compliance If Consultant or any
subconsultant fails to provide and maintain insurance as required herein, then City shall
have the right but not the obligation, to purchase such insurance, to terminate this
agreement, or to suspend Consultant's right to proceed until proper evidence of
insurance is provided. Any amounts paid by City shall, at City's sole option, be
deducted from amounts payable to Consultant or reimbursed by Consultant upon
demand.
1.5.7 Timely Notice of Claims. Consultant shall give City prompt and
timely notice of claims made or suits instituted that arise out of or result from
Consultant's performance under this Agreement, and that involve or may involve
coverage under any of the required liability policies.
1.5.8 Consultant's Insurance. Consultant shall also procure and
maintain, at its own cost and expense, any additional kinds of insurance, which in its
own judgment may be necessary for its proper protection and prosecution of the Work.
Fox Lawson and Associates, a Division of Gallagher Benefits Services, Inc. Page C -3
ATTACHMENT B
Fox Lawson and Associations, a Division of Gallagher Benefits Services Inc.
Client List
Public Sector— California (partial list)
Cities
• City of Beverly Hills
• City of Carlsbad
• City of Carson
• City of Davis
• City of Desert Hot Springs
• City of Encinitas
• City of Fremont
• City of Fresno
• City of Hanford
City of Healdsburg
• City of Hercules
City of Larkspur
City of Mountain View
• City of Newport Beach
• City of Oceanside
City of Orinda
• City of Palo Alto
• City of Rancho Cucamonga
City of Sacramento
City of San Clemente
• City of San Francisco
• City of San Jose
City of San Jose Redevelopment
Agency
• City of San Ramon
• City of Santa Ana
• City of Santa Cruz
• City of Walnut Creek
City of West Hollywood
• Town of Windsor
Counties
• Alameda County Office of Education -
Oakland
• California State Association of Counties
• Contra Costa County
•
El Dorado County
• Kern County, CA - Bakersfield, CA
Los Angeles County Department of
Health Services
• Los Angeles County Office of the Chief
Administrative Officer
• Los Angeles Free Clinic
• Marin County
• Monterey County
• Sacramento County
• San Francisco County
Santa Cruz County
Colleges
• University of CA, Berkley
• University of California at Los Angeles
(UCLA)
Public Schools
• Beverly Hills Unified School District
• Coachella Valley Water District
• Compton Unified School District
• Elk Grove Unified School District
• Los Angeles Unified School District
• Orange Unified School District
• Sacramento City Unified School District
Santa Clara Valley Transportation
Authority
Santa Clara Valley Water District
• Yuba City Unified School District
Other
• Association of Bay Area Governments -
Oakland, CA
Contra Costa Retirement Assoc
CSAC — Excess Insurance Authority
• Desert Hospital — Palm Springs
• Irvine Ranch Water District - Irvine, CA
• Law Firm of Carroll, Burdick, &
McDonough
• Long Beach Transit
• Los Angeles City Housing Authority -
Los Angeles, CA
• Los Angeles Regional Family Planning
Council, Inc.
The Law Office of Mark Merin
• Menlo Park Fire District
North County Transit District
• Orange County Fire Authority - Orange,
CA
Orange County Superior Court
Orange County Transit Authority
Orange County Water District -
Fox Lawson and Associations, a Division of Gallagher Benefits Services Inc.
Private Sector (partial list)
Advertising and Public Relations
• Carmichael Lynch
• MIVA
• Shark Radio
Young and Laramore
Business and Professional Services
•
Calence
•
CASHFLOW Technologies, Inc.
•
CAT Auctions
•
Corvu Technologies
•
Grant Thornton, LLP
•
Great Clips
•
IC Systems
•
JUUT Salonspa
•
Maxsys, Inc
•
Med Management
•
Meritex Enterprises
•
Nelson, Tietz & Hoye
•
PDW
•
PriceWaterhouseCoopers
•
Space Center Enterprises
•
Tesseract Group
•
The Registry
•
The Structure Group
•
Value Rx
Communication
• Industrial Motion, Inc.
Construction
• Kraus - Anderson Companies
Engineers, Architects and Planners
• Bonestroo, Rosene, Anderlik & Associates
• Moore Engineering
• Olsson Associates
• Schafer, Kline, and Warren, Inc.
• Willdan Associates
Finance
Banking and Insurance
•
Anchor Bancorp
•
Blue Cross /Blue Shield of Minnesota
•
J.G. Kinnard & Co.
•
Little Six, Inc, MN
•
Mark Twain Bancshares
•
Midwest Security
•
Olympic Financial
•
Tucson Federal Credit Union
•
United Healthcare Corporation
Client List
Food and Agriculture
• GFI America
• Michael Foods, Inc.
Gamina /Entertainment/Hosoitality
• Black Angus Steakhouse
• Burke Williams Spa
• Southwest Casino
• Sportsman's Recipes
• Win -River Casino
Manufacturing
• Andersen Corporation
• Appleton Paper
• BMC Industries Inc.
• Computype
• Cretex
• Dahlberg, Inc.
• Douglas Machine, Inc.
• Dura Supreme
• Federal Mogul Corporation
• Lake Region Manufacturing Co.
• LubeTech
• Magnequench International, Inc.
• Micro Dynamics
• Mobile Mini
• Prosthetic Laboratories
• Tescom
• Tioga, Inc
• Valspar Corporation
Pharmaceuticals
• CIMA Labs
• Collagen Corporation
Retail and Wholesale Trade
• Kohl's Department Stores
• Marshall Field's
• Northern Hydraulics, Inc.
• Schneiderman's
• Target Stores
Transportation and Communication
• Badlands Power Fuels, Inc
• Frontier Communications
• Matanuska Telephone Association, AK
• Northwest Airlines
• Southwestern Bell Telephone Company
• Sprint