To: Honorable Mayor and Members of City Council
From: Jennifer Brizel, Human Resources Director
Prepared By: Jennifer Brizel, Human Resources Director
TITLE:
Title
Voluntary Time-Off Program
LABEL
RECOMMENDED ACTION:
Recommendation
Adopt a resolution authorizing the City Manager to Implement a Voluntary Time-Off Program.
Body
DISCUSSION:
The Voluntary Time-Off Program is designed to generate salary savings within the City's budget in response to the City’s Local Emergency and forecasted fiscal losses which, if not addressed, may require further reductions in staff and curtailment of needed public services. This program will repeal and replace any pre-existing programs.
"Voluntary Time Off'' (“VTO”) refers to a work schedule which less than eighty (80) hours per pay period, resulting in unpaid leave with the right to return to the same position). Through this program, employees agree to have a salary reduction for a specified period of time, through unpaid time off, equal to the number of hours approved in the individual employee's VTO agreement with the City.
The intent of the program is to designate a specific period of time when employees may volunteer to participate in order to generate salary savings. This program would exclude employees who are subject to mandatory staffing or 24/7 operations requirements.
Employees may request any variation of unpaid time on a regularly scheduled basis, as approved by their department director and City Manager.
Employees approved to work a reduced schedule will receive the same level of health benefits (medical, dental, deferred compensation) accrued benefits (vacation, sick leave, holidays) during the approved VTO period. Participation in the VTO program is not intended to affect vacation buy back or leave cash outs upon retirement.
Employees approved for a leave of absence will receive the same level of health benefits (medical and dental) during the approved VTO period, while accrued benefits (vacation, sick leave, holidays) as well as long-term disability, life insurance and optional benefits will be placed on hold during the leave period. CalPERS contributions will also be placed on hold during the leave period.
Other variable components, such as CalPERS retirement contribution, premium pay and other benefits calculated from an employee's salary will therefore be reduced by the decrease in work hours since these benefits are based on salary, as impact on retirement and other benefits will be determined by the application of actual work hours and rates of pay required under each of those programs. Employees are advised through the program that they are responsible for consulting their own financial planner, tax advisor and/or attorney as to potential tax consequences of choices of time off methods.
Once the employee receives approval from the Department Director and City Manager, the VTO program will be in affect the pay period following approval through the identified end date. After which, the employee must revert back to their original schedule, unless a request for extension is approved in the sole discretion of the Department Director and City Manager.
Participation in the VTO program will not constitute a break in City service for purposes of seniority, step or lifetime retiree medical reimbursement. However, based upon hours worked per year, there may be an impact to an employee’s CalPERS service credit.
Should the program fail to accomplish the stated goals of generating salary savings, or if it is found necessary for any other reasons, the City Manager will discontinue the program.
Staff recommends that the City Council adopt a resolution authorizing the City Manager to implement a Voluntary Time-Off Program.
FINANCIAL IMPACTS:
While the number of employees who will take advantage of the program is unknown, every employee who takes Voluntary Time-Off results in a net financial benefit to the City. Savings will be realized in the fund(s) that each employee is normally paid from.
CEQA:
The City Manager has determined that the recommended action described in this agenda report is not subject to CEQA, pursuant to CEQA Guidelines Section 15060(c).
DOCUMENTS ATTACHED:
ATCH 1 - Resolution
EX A - Voluntary Time-Off Program
NOTIFICATION:
City Employees