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HomeMy WebLinkAboutR-2020-044 Payment of Accrued Compensatory Time Balances for Exempt Staff Members RESOLUTION NO. R-2020-044 A RESOLUTION AUTHORIZING PAYMENT OF ACCRUED COMPENSATORY TIME BALANCES FOR EXEMPT STAFF MEMBERS OF THE CITY OF RIVERSIDE, MISSOURI. WHEREAS, the City is carrying a growing liability in accrued compensatory time balances of exempt staff; and WHEREAS, the City has discontinued the practice of allowing exempt staff to accrue compensatory time; and WHEREAS, the City has the option at any time to pay these employees for their accrued compensatory time balance; and NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE CITY OF RIVERSIDE, AS FOLLOWS: Section 1. That the Board of Aldermen authorizes a one-time lump sum payment of all accrued compensatory time balances of exempt staff members. Section 2. The Mayor, City Administrator, HR Manager, and all other appropriate City officials are authorized to take such other actions and/or execute and deliver for and on behalf of the City all certificates, instruments, agreements and other documents as may be deemed necessary or convenient to carry out and comply with the intent of this Resolution. Section 3. That this Resolution will be effective from and after the date of its approval. PASSED AND ADOPTED by the Board of Aldermen of the City of Riverside, Missouri, the day of June 2020. Kathleen L. Rose, Mayor ATTV o - , Robin"KM*'ra d; City Clerk CITY OF RIVERSIDE MEMORANDUMUpstream from ordinary. To: Mayor& Board of Aldermen CC: Brian Koral, City Administrator& Nate Blum, Finance Director From: Amy Strough, Human Resources Manager Date: 6/12/19 Re: Compensatory Time Payout Overtime is time worked by an employee that is above and beyond the Fair Labor Standards Act (FLSA) threshold for a defined work period. While typically the threshold is forty (40) hours in a week, there are different work period exceptions for public safety positions. For non-exempt employees, an employer is required to pay employees time and a half for every hour worked beyond the applicable threshold. For example, if a Public Works Maintenance Worker was paid $10/hour and worked forty-four (44) hours in a week, they would be entitled to forty (40) hours of regular pay at $10/hour and then four (4) hours of pay at $15/hour. Employers have the option to allow for the accrual of compensatory or "comp" time instead of direct overtime compensation — but both have to be at a time and a half rate. So in the above example, the employee could take forty(40) hours of regular pay and accrue six(6) hours of comp time to be used later. Prior to 2013, the City allowed exempt staff to accrue compensation time but specified that those hours would be accrued at a one-to-one rate. This means that if I, as the Human Resources Manager worked forty-four hours a week, I would be paid my salary for the week and accrue four (4) hours of time. This was a very generous policy that created a substantial amount of accrued time for exempt employees. Additionally, it appears that these exempt employees were allowed to accrue this time above the thresholds in place for non-exempt employees. Current City policy allows for the accrual of "a maximum of one hundred and twenty (120) hours of compensatory' time...by any non-exempt employee". Beginning when the City had an employee move from a non-exempt to exempt position in 2018, accrued comp time has been paid out prior to a promotion so as to limit the cost to the City and to keep clear the distinction between non-exempt and exempt employees when it comes to accrued time off. Once the practice of exempt accrual of hours was discontinued, the employees with accrued time were allowed to carry their balances for future use. These hours were tracked in the same manner as comp time tracking for non-exempt employees and the City has, since 2013, paid out the accrued time when an exempt employee has left the organization. Since accrued time eventually is paid at an hourly rate at the time of payment, every year that employees receive a raise simply increases the liability and future cost of those hours. For the seven exempt employees currently with a total of 3,014.50 accrued comp time on the books, that liability is currently $145,353.16. After July 1, that liability will increase by an additional $2,900. The City has the option to, at any time, pay the employee for accrued compensatory time. Instead of maintaining these balances on our books and allowing them to further increase in cost to the City, I would recommend cashing out these balances this fiscal year. If approved, these balances will be paid out on June 19 to remove the liability from our books.