Special Notice / Hearing: None__
Vote Required: Majority
To: Honorable Board of Supervisors
From: Rocio Kiryczun, Human Resources Director
Nicole McKay, Employee Relations Manager
Subject: Successor Agreement to the Memorandum of Understanding with the San Mateo County Council of Engineers (SMCCE)
RECOMMENDATION:
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Adopt a resolution authorizing approval of the tentative agreement establishing the terms and conditions of a successor agreement to the Memorandum of Understanding with the San Mateo County Council of Engineers, for the term of February 24, 2019 through February 19, 2022.
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BACKGROUND:
The current MOU expired on February 23, 2019. The County and SMCCE met and conferred in good faith and agreed to the terms as described in the Tentative Agreement on March 4, 2019. SMCCE’s membership has since ratified the County’s offer and the Tentative Agreement.
DISCUSSION:
This agreement covers all of the regular staff in classifications represented by SMCCE. The following summarizes the major changes.
Term
February 24, 2019 through February 19, 2022, three years.
Salary Adjustment
Classifications in this bargaining unit will receive Cost of Living Adjustment (COLA) increases as follows: 3% effective March 10, 2019; 3% effective February 23, 2020; and 3% effective February 21, 2021. In addition, employees in this bargaining unit will receive equity increases of 1% at the same time as the above described salary increases.
Other economic changes
Employees in this bargaining unit will receive 1% of longevity pay after the completion of the equivalent of five years, 2.5% after the completion of the equivalent of ten years, 4% after the equivalent of twenty years and those with 25 years of service shall receive 6% longevity pay. This longevity pay will be phased in over the life of the MOU as set forth in the tentative agreement. In addition, employees will begin to accrue vacation at higher increments beginning after the equivalent of five years of full time employment with incremental increases every five years through 25 years. Employees will also receive sixteen (16) hours toward a Winter Recess to be utilized during the winter holidays.
County Counsel has reviewed and approved the resolution as to form.
Approval of this resolution contributes to Shared Vision 2025 of a Collaborative Community by ensuring cost-effective compensation structures for County employees.
Financial Impact on County’s Retirement System
Government Code Section 31515.5 requires the County to provide the estimated financial impact that proposed benefit changes or salary increases would have on the funding status of SamCERA‘s retirement fund, the County’s retirement system. As reflected in the attached letter from SamCERA’s actuary, Milliman, the proposed salary increases for the SMCCE employees is greater than the actuarially assumed annual general wage increase, and the new, comparable longevity benefits are larger than the merit increase assumption and affect SamCERA’s future funded status. It is estimated that the present value of these future actuarial losses is equivalent to a reduction of 0.01% in SamCERA’s Funded Ratio (currently 87.5%), if the full estimated future impact had been reflected in the 2018 valuation. It is still projected that SamCERA’s Funded Ratio will increase in the future, just at a fractionally lower rate than projected in the 2018 valuation.
FISCAL IMPACT:
The cost of the salary and other changes will result in a net increase of approximately $650,000 over the 3-year term. The impact of the increases on the County’s required payments to SamCERA will be reflected in the actuarial assumptions in SamCERA’s 2020 triennial experience study and which in turn will be used to calculate the contribution rates for Fiscal Year 2021.