HomeMy WebLinkAbout137-02 RESOLUTION•
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RESOLUTION NO. 137-02
A RESOLUTION APPROVING A CONTRACT AMENDMENT
WITH HAY GROUP, INC. IN AN AMOUNT NOT TO EXCEED
FIFTY THOUSAND DOLLARS ($50,000.00) TO COMPLETE A
BENEFIT VALUATION REPORT AND REVIEW CURRENT PAY
PLAN PROCESSES AND PROCEDURES; AND APPROVING A
BUDGET ADJUSTMENT IN THE AMOUNT OF THIRTY-FIVE
THOUSAND TWO HUNDRED SEVEN DOLLARS ($35,207.00)
FOR SAME.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1. That the City Council of the City of Fayetteville, Arkansas
hereby approves a contract amendment with Hay Group, Inc. in an amount not
to exceed Fifty Thousand Dollars ($50,000.00) to complete a Benefit Valuation
Report and review current pay plan processes and procedures. A copy of the
contract amendment, marked Exhibit "A" is attached hereto, and made a part
hereof.
Section 2. That the City Council of the City of Fayetteville, Arkansas
hereby approves a budget adjustment in the amount of Thirty -Five Thousand
Two Hundred Seven Dollars ($35,207.00) for same.
PASSED and APPROVED this 3rd day of September, 2002.
•Vi oma')
=SER WOODRUFF ity Clerk
direr L
APPROVED:
By:
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NAME OF FILE:
CROSS REFERENCE:
Resolution No. 137-02
09/03/02
Resolution No. 137-02
Amendment to the Contract with the Hay Group, Inc., a consulting firm
located in Dallas, Texas, and Attachment Exhibit "A"
08/12/02
Urban Development Department Correspondence to Committee
Members - Hay Plan Analysis, from Hugh Earnest, Urban Development
Director, regarding Hay Group Scope of Work
03/05/02
Copy of Resolution No. 32-02
04/23/02
Copy of the Contract from Res. 32-02; Hay Group, Inc.
08/07/02
Letter to Mayor Coody and City Council, from Hugh Earnest, Urban
Development Director, regarding Hay Group Consultant Status
Urban Development Department Correspondence to Mayor and Council
from Hugh Earnest, Urban Development Director, regarding Internal
Oversight Committee Recommendation
08/08/02
Copy of the Budget Adjustment Form
Copy of the Purchase Requisition
09/03/02
Staff Review Form
09/06/02
Memo to Hugh Earnest, Urban Development, from Heather Woodruff,
City Clerk
NOTES:
• • SLE — act} o J
L/4s. /37 -OL
AMENDMENT TO %- ZS -o Z
THE CONTRACT ORIGINAL
BETWEEN
CITY OF FAYETTEVILLE AND HAY GROUP •
This Amendment to the Contract is made as of the date it is executed by both
parties, by and between the City of Fayetteville, a municipal corporation, hereinafter
referred to as the "City," and Hay Group, Inc., a consulting firm located in Dallas,
Texas.
WHEREAS, City has engaged Hay Group, Inc. to perform certain services
relating to the Pay Plan for employees of the City; and,
WHEREAS, the City now desires that Hay Group, Inc. evaluate the Benefits
Plan, and the City's internal processes and procedures related thereto .
NOW, THEREFORE, in consideration of the mutual covenants and conditions
hereinafter provided, the City and Hay Group, Inc. agree as follows.
1. Professional Services. Hay Group, Inc. shall furnish amended services to City as
set forth in Exhibit "A," which is attached hereto and incorporated herein by
reference.
2. Compensation and Hourly Rates. For amended services provided by Hay
Group, Inc., City shall compensate Hay Group, Inc. as set forth in Exhibit "A".
3. Non -waiver. It is agreed that the failure of any party to invoke any of the
available remedies under this agreement or under law in the event of one or
more breaches or defaults by any party under the agreement shall not be
construed as a waiver of such provisions and conditions and shall not prevent
the parties from invoking such remedies in the event of any future breach or
default.
4. Severability. Each paragraph of this agreement is severable from all other
paragraphs. In the event any court of competent jurisdiction determines that any
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paragraph or subparagraph is invalid or unenforceable for any reason, all
remaining paragraphs and subparagraphs shall remain in full force and effect.
5. Governing Law. This agreement shall be interpreted according to and enforced
under the laws of the State of Arkansas.
6. Supplemental Nature of the Amendment. The parties agree and understand
that this Amendment is supplemental to the original Contract, and that it does
not alter, amend or abridge any of the rights, obligations, or duties of the parties
not expressly addressed herein.
_ IN WITNESS WHEREOF, the City and Hay Group, Inc. have caused this instrument to
be signed by their respective duly authorized officers, on the date subscribed below.
ATTEST.
AlTEST•
AUL GLO ''GO KI
Date: `(`ZZ/p)--
CITY 0E4 • YETTE LLE
�./tati _
HEATHER WOODRUFF, City Jerk DAN COODY, May 5
By:
2
Date:
HayGroup
Hay Group
8350 North Central Exptilay
Suite 825
Dallas, TX 75206
Tel: (469) 232-3800
Fax (469) 232-3888
August 8, 2002
Confidential
Mr. Hugh Eamest
City of Fayetteville
113 W. Mountain
Fayetteville, AR 72701
Dear Hugh:
•
EXHIBIT A
We are excited to begin working with the City of Fayetteville to conduct a Benefit
Valuation Study. This letter is to re -confirm the project scope, and to obtain your
signature of agreement prior to commencement of this project.
Please review the project scope and terms, and if you agree with the terms and
conditions, sign this letter and fax to our office, 469/232-3888.
Project Scope
Hay will compare the City of Fayetteville benefits to two different comparitor groups
within our database: Govemment/Non-Profit and General Industry. Based on these
comparisons, we will write and present a comprehensive report to include:
1. Prevalence (by type of benefit) of City compared to market(s) — types of coverage, co -
pay information, in -network vs. out -of network, eligibility periods, cost sharing, etc...
2. Overall benefit analysis and recommendations
3. Analysis and recommendations by benefit type (Healthcare, Death, Disability,
Retirement, Holiday/Vacation, Perquisites — education reimbursement programs,
flextime, day care, etc...
In order to compare the City's benefits to the markets, we will need you to provide
the following information and forward to me as soon as possible:
• Complete the attached questionnaires as completely as possible (if questions are not
relevant to the City, please note this on the forms).
• Provide two (2) copies of all you SPD booklets, including any retirement plans and
executive type programs.
• Provide two (2) copies of all your personnel policies (jury duty, sick pay/short term
disability, vacation, holiday, take home vehicles, flextime, education programs,
etc.), including graphical depiction of percentile ranking.
•
August 9, 2002 •
Page 2
Timing
EXHIBIT A
It will take approximately four (4) weeks to complete the study once we have
received the requested information from the City of Fayetteville.
Project Fees
Consulting fees are based on our best estimate of the time and consultant level
required to deliver quality results as defined in our proposal. Estimated consulting
fees for this project will be $30,000.
Invoicing for this project has been scheduled as follows:
t Timing
Invoice Amount
Commencement of Project:
$15,000
Completion
of Project:
$15,000 plus expenses
All out-of-pocket or project -related direct expenses such as consultant travel, meals,
lodging (not to exceed $1,000/trip), and support service such as graphics, production,
clerical overtime, photocopies, transparencies, data processing, express mail, etc. are
billed additionally at cost or standard labor rates. At this time we do not anticipate
any out-of-pocket expenses for this project. If this changes it will be discussed with
you prior to incurring charges.
Should the scope of the project be reduced or expanded, we will discuss this with
you in advance and modify our budget (in writing) accordingly.
If at any time during the course of the assignment you find it necessary or desirable to
terminate our services, you are quite free to do so and are only obligated to pay fees
and expenses incurred or committed up to that point. We would appreciate this
request in writing.
The Hay Group prides itself on our long-term relationships with clients, and we look
forward to continuing a strong relationship with the City of Fayetteville. If you have
any questions about the project, or wish to modify the terms and conditions prior to
signing below, please call me at 469/232-3862.
Sincerely,
Q,4eiehniaddi
Jodi L. McFadden
Consultant
Hay Southwest Region
HayGroup
August 9, 2002 •
Page 3
Approval:
•
-Thrr A
Name and Title (Printed)
Signature
Date:
HayGroup
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FAYETTEVILLE
THE CITY OF FAYETTEVILLE, ARKANSAS
EXHIBIT A
113 W. Mountain St
Fayetteville, AR 72701
Telephone: (501) 5754330
URBAN DEVELOPMENT DEPARTMENT CORRESPONDENCE
To:
From:
Committee Members - Hay
Rick Hoyt
Jason Alvarado
Kathy Stocker
Greg Boettcher
Richard Cochran
Randy Patrick
Gary Dumas
Jason Drummond
Jamie Bytheway
Plan Analysis:
Ted Webber
Don Osborne
Constance Butler
Chris Bosch
Demos Ledbetter
Dean Matthews
Louise Schaper
Kim Rogers
Heather Woodruff
I3ugh'Eamest-y
Hugh Earnest
Urban Development Director
Subject: Hay Group Scope of Work
Date:
August 12, 2002
Attached is a copy of the proposed Scope of Work for the Benefit Valuation Study.
Please review and have any comments and/or suggestions back to me by 8/19/02. I will
also be asking you for comments and suggestions on the review of our process and
procedures at a later date.
As always, thanks for your help.
Enc.
RESOLUTION NO. 32-02
•••
MICROFILMED
A RESOLUTION APPROVING A CONTRACT WITH HAY
GROUP, INC IN AN AMOUNT NOT TO EXCEED TWENTY-FIVE
THOUSAND DOLLARS ($25,000.00) TO ACCOMPLISH THE
COMPENSATION ANALYSIS PROJECT STEPS.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1. That the City Council hereby approves a contract with Hay.
Group, Inc. in an amount not to exceed Twenty -Five Thousand Dollars
($25,000.00) to accomplish the Compensation Analysis Project Steps. A copy of
the contract, marked Exhibit "A" is attached hereto, and made a part hereof.
Section 2. That the City Council authorizes the Mayor to sign such a
contract with Hay Group, Inc.
PASSED and APPROVED this 5th day of March, 2002.
APPROVED:
By
DAN COODY, Mayo
CONTRACT
411/
Res. 32-02
ORIGINAL,
OA),
The City of Fayetteville, Arkansas (hereinafter "Fayetteville") and Hay
Group, Inc. agree as follows:
The City of Fayetteville agrees to hire the Hay group, Inc. to accomplish
the Compensation Analysis Project Steps as set forth in the letter of December 13,
2001, to Mayor Dan Coody from Mr. Paul Glogowski of the Hay Group, Inc.
(attached as Exhibit A to this Contract).
The City of Fayetteville agrees to pay and the Hay Group, Inc. agrees to
accept the sum of Twenty -Five Thousand Dollars ($25,000.00) as full payment to
accomplish all Compensation Analysis Project Steps outlined in the December
13th letter (Exhibit A).
The City of Fayetteville will pay the Hay Group, Inc. Twelve Thousand
Five Hundred Dollars ($12,500.00) upon full execution of this contract by both
parties Fayetteville will pay Hay Group, Inc. the second Twelve Thousand Five
Hundred Dollars ($12,500.00) payment upon its satisfactory completion of all
Compensation Analysis Project Steps as stated in Exhibit A including receipt by
Fayetteville of the Hay Group, Inc 's final report with recommendations.
Agreed to and accepted by:
City of Fayetteville
Date Date
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FAYETTEVIPLE •
THE CITY OF FAYETTEVILLE, ARKANSAS
Date: August 7, 2002
To: The Mayor and City Council
From: Hugh Earnest
Urban Development Director
Subject: Hay Group Consultant Status
I have attached the memo detailing the recommendations from the Internal Oversight
Committee that were discussed with the Council on July 30th. The resolution in front of
the Council recommends that the monies needed for this important analysis of our benefit
package and assistance from the consultant on improving our internal process and
procedures in Human Resources be approved.
Work is continuing on defining and dealing with the scope of work for this effort. No
authorization to begin this project will be issued until the scope for both efforts is
complete and approved by the Internal Oversight Committee and signed by the Mayor.
There is a clearer understanding among all parties as to what is expected from a Benefit
Valuation Report and it is probable that we will commence that work prior to the internal
analysis of our current system.
We are recommending that the funding for this project be accomplished in the following
manner. Each of the principal funds for the City has monies allocated for Worker
Compensation claims. We have been relatively successful in managing this area and are
recommending that the funds be budgeted as listed below.
General
Street
Park Development
Water and Sewer
Solid Waste
Airport
Shop
Total
Attachment
113 WEST MOUNTAIN 72701 479621-7700
FAX 479675-8257
$35,197.00
3,104.00
1,152.00
4,967.00
3,756.00
582.00
1.242.00
$50,000.00
Attachment
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FAYETTEVILLE
THE CITY OF FAYETTEVILLE, ARKANSAS
113 W. Mountain St.
Fayetteville, AR 72701
Telephone: (501) 575-8330
URBAN DEVELOPMENT DEPARTMENT CORRESPONDENCE
To: The Mayor and Council
From. Hugh Earnest
Urban Development Director
Subject Internal Oversight Committee Recommendation
Background
During the budget process for the 2002 budget, the council, in responding to concerns
raised by employees, authorized an evaluation of the processes used by the city in
determining salary level adjustments for employee grades. In order to accomplish this
task, the following steps were taken. A mneteen member employee committee was
formed with representation from all departments and divisions of the city In addition ,
the Hay group, a Human Resource consulting firm from Dallas that has been working
with the city since the late 1980 s, was employed to assist in the evaluation of the city's
methodology for salary level adjustments. That task, after considerable effort and
excellent work by all concerned was completed and presented to the council on June 25
by Jodie McFadden and Paul Glogowski with the Hay Group.
It should also be noted that the city committee, after numerous discussions, has
concluded that there are two issues that are relevant to this topic of Human Resource
management/employee relations. They are the salary compensation issue and at least in
the opinion of the committee of equal importance, the issue of process and procedure in
the management of our Pay Plan. While this was not the original charge to the
committee, there is consensus that both issues are important and should be addressed.
Current situation
The Mayor and Council remanded the report on salaries back to the committee and asked
the committee to provide a recommendation or recommendations on steps to be taken in
addressing this important issue. The committee has developed a recommended plan of
action.
Recommendation
It is the feeling of the committee that pay adjustments justified by the survey are the
ultimate responsibility of Human Resources and the City Council. Changes in the pay
plan should be incorporated into the budget process for the 2003 budget. However, the
conunittee believes that the following action steps should be taken by the city as part of
• •
its ongoing effort to improve the management of its most important resource, its
employees.
A. A Benefit Valuation Report should be commissioned
It is the committee's opinion that such a report will provide all parties with
a complete picture of the compensation package provided to city
employees.
B. Review of current city process and procedures in its pay plan administration.
It has been several years since the basic framework of the pay plan has
been evaluated, rendering certain mechanisms outdated and inequitable.
The technical support from the Hay Group, over an estimated 6 months
will identify needed pay plan updates and assist Human Resources in the
implementation of needed pay plan changes.
The committee recommended the relationship with the Hay Group be continued at least
through completion of the current activities for purposes of continuity and credibility. To
accomplish the remaining pay plan analysis, the city will need to approve the expenditure
of up to $50,000 with the Hay Group. The break down of expenses by issue area is as
follows:
Benefit Valuation Report: $30,000 product delivered in four weeks
Review of current process and procedures: $18,000 ($3,000 a month retainer to not
exceed 6 months)
Contingency: $ 2,000
The committee requests that the Council consider this item as part of its agenda meeting
on July 30th. Four committee members are prepared to summarize the committee's
findings and conclusions at the meeting.
• City of Fayetteville, Arkansas
Budget Adjustment Form
Es, 13yoz
Budget Year
2002
Department Urban Development
Division: Urban Development Director
Program: Urban Development Director
Project or Item Requested:
Increase of $35,207 in contract services.
Dam Requested
08/08/2002
it
Adjustment #
Cas% rni
4
Project or Item Deleted:
None. Fund balance is being proposed.
Justification of this Increase:
To fund a benefit valuation and other services study
with the Hay Management Consultants.
ustification of this Decrease:
Sufficient reserves exist to fund this request and maintain a
minimum of 60 days expenses in cash and investments for
General Fund.
Account Name
Contract Services
Account Name
Use of Fund Balance
Increase Expense (Decrease Revenue)
Amount
35,207
Account Number Project Number
1010 1210 5315 00
Decrease Expense (Increase Revenue)
Amount Account Number
35,207
1010 0001 4999 99
Project Number
Approval Signatures
Date
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Date
Date
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Type: A B
Date of Approval
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Posted to General Ledger
Posted to Project Accounting
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STAFF REVIEW FORM
X Agenda Request
_ Contract Review
Grant Review
For the Fayetteville City Council meeting of September 3, 2002.
FROM:
Hugh Earnest
Name
Division
Urban Development_
Department
ACTION REQUIRED:
A Resolution amending the 2002 Budget authorizing the employment of the Hay Group for work associated with personnel issues
and for other purposes. Appttencti 06 a budSve ._ aj-inuk- is a is o i e t0 -es tel.
COST TO CITY:
$ 5010o De.
Cost of this Request
SP c�- a
Account Number
Project Number
BUDGET REVIEW:
$ g e e- A, a -c t.J-
Category/Project Budget
$see o LcLur.J
Funds Used to Date
$ SQ e_ }aLe w J --
Remaining Balance
JG Budgeted Item
Category/Project Name
Program Name
Fund
iQ Budget Adjustment Attached
Bud et Manager Administrative Services Director
CONTRACT/ /LEASE REVIEW:
•
Accounting Manager
Date
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Citymey AAfJd n
ate 4fj
GRANTING AGENCY:
ADA Coordinator
Purchasing Officer Date
Internal ditor
STAFF RECOMMENDATION: Approval of the Resolution and Budget Adjustment
•
Division Head
Date
9jbrov
Date
Date
?I (310a -
Date
Cross Reference
New Item: Yes No
Prev Ord/Res #:
Orig Contract Date:
•
•
• •
STAFF RUIN PORN
Description
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Meeting Date
Comments: Were= Certs:
Budget 1Coordinator ff I
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City Attorney
Purchasing Officer
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ADA Coordinator
Internal Auditor
•
FAYETTEVILLE
THE CITY OF FAYETTEVILLE, ARKANSAS
DEPARTMENTAL CORRESPONDENCE
•
To: Hugh Earnest, Urban Development
From: Heather Woodruff, City Clerk
Date: September 6, 2002
Please find attached a copy of Resolution No. 137-02 approving a Contract Amendment with
Hay Group, Inc. to complete a benefit valuation report and review current pay plan processes and
procedures. The original will be microfilmed and filed with the City Clerk.
I am forwarding the Purchase Requisition to the Internal Audit Division.
I am forwarding the Budget Adjustment Form to the Budget and Research Division.
cc:
Nancy Smith, Internal Audit
Peggy Vice, Purchasing Division
Stephen Davis, Budget & Research
Note: I returned the Original Contract Amendment to Kay Swanner to send for an
original signature, Friday, September 6, 2002.
Note: Resolution No. 32-02
March 5, 2002