Staff Report
Reviewed by: Town Attorney and Finance Director
110 E. Main Street Los Gatos, CA 95030 ● 408-354-6832
www.losgatosca.gov
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
MEETING DATE: 04/04/2017
ITEM NO: 7
DATE: MARCH 23, 2017
TO: MAYOR AND TOWN COUNCIL
FROM: LISA VELASCO, HUMAN RESOURCES DIRECTOR
SUBJECT: APPROVE AN AMENDMENT TO THE EMPLOYMENT AGREEMENT BETWEEN
THE TOWN OF LOS GATOS AND THE TOWN MANAGER
RECOMMENDATION:
Approve an amendment to the Employment Agreement (Attachment 1) between the Town of
Los Gatos and the Town Manager.
BACKGROUND:
As an appointee of the Town Council, the Town Manager is employed under an Employment
Agreement specifying the terms and conditions of employment. The terms and conditions of
employment include items such as base pay, basic and optional benefits, covered expenses,
parameters for annual performance review, and conditions for termination/severability.
Senate Bill 1436, effective January 1, 2017, requires an oral summary of a recommendation
related to modifying the salary, salary schedule, or fringe benefits of any person employed
under an Employment Agreement with a local agency.
DISCUSSION:
The Town Manager’s performance and compensation, as outlined in the Employment
Agreement, is reviewed on an annual basis in conjunction with a performance evaluation. The
review of the Employment Agreement is conducted to ensure legal compliance and to provide
for any adjustments in the terms and conditions of employment.
The original Employment Agreement for the appointment of Town Manager Laurel Prevetti was
approved by the Town Council effective September 1, 2015. In accordance with the contract
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SUBJECT: APPROVE AN AMENDMENT TO THE EMPLOYMENT AGREEMENT BETWEEN
THE TOWN OF LOS GATOS AND THE TOWN MANAGER
DATE: MARCH 23, 2017
S:\COUNCIL REPORTS\2017\04-04-17\Town Manager Compensation\Staff Report FINAL.docx 3/30/2017 3:45 PM LV
DISCUSSION (cont’d):
terms, the Town Council completed the evaluation process for the Town Manager for her
second year in the position, from September 2015 through September 2016. Although the
Employment Agreement permitted for a review of compensation concurrently with
performance, Ms. Prevetti requested to defer compensation review until the Town’s three
bargaining units concluded labor negotiations. Labor negotiations concluded in February.
Council appointees do not receive across-the-board increases that bargaining units,
unrepresented management and confidential employees are eligible to receive, instead, base
pay adjustments are limited to periodic review by Council and are awarded based on
performance.
CONCLUSION:
Based upon the satisfactory completion of the Town Manager’s performance review in closed
session, it is recommended that the Town Manager’s annual base salary increase to $212,000
effective April 4, 2017. In addition, the Town Manager’s proposed salary is still well below
other City Managers within the Town’s comparable survey agency pool and it is recommended
that the Town Manager receive a one-time lump sum performance bonus of $3,000.
FISCAL IMPACT:
Funding to support the Town Manager’s Employment Agreement is authorized in the annual
budget each fiscal year along with all other Town employee compensation and benefits.
The additional fiscal impact for the remainder of 2016/2017 is $6,300. The total salary and
benefits cost for a full year is approximately $319,000.
The increased base salary will be included in the base budget for future fiscal years. The total
cost impact will be absorbed in the Town’s existing operating budget.
Attachments:
1. Amendment to the Employment Agreement – Town Manager