2 - AFSCMECOUNCIL AGENDA REPORT
DATE: November 1, 2011
TO: MAYOR AND TOWN COUNCIL
FROM: GREG LARSON, TOWN MANAGER
MEETING DATE: 11/7/11
ITEM NO. a,
SUBJECT: APPROVE THE MEMORANDUM OF UNDERSTANDING BETWEEN
THE TOWN OF LOS GATOS AND THE AMERICAN FEDERATION OF
STATE, COUNTY AND MUNICIPAL EMPLOYEES (AFSCME) LOCAL
101, RETROACTIVE TO SEPTEMBER 1, 2011 AND EXTENDING
THROUGH JUNE 30, 2013 AND AUTHORIZE THE TOWN MANAGER
TO EXECUTE THE MEMORANDUM
RECOMMENDATION:
Approve the Memorandum of Understanding (MOU) between the Town of Los Gatos and the
American Federation of State, County and Municipal Employees (AFSCME) Local 101,
retroactive to September 1, 2011 and extending through June 30, 2013 and authorize the Town
Manager to execute the memorandum.
BACKGROUND:
In accordance with the Town's Employer -Employee Relations Resolution No. 1974-41,
representatives of the Town and AFSCME have met and conferred in good faith and within the
scope of representation. Negotiating teams for the Town and AFSCME have reached a tentative
agreement and the employees represented by AFSCME have ratified the proposed agreement in
accordance with AFSCME bylaws.
DISCUSSION:
The existing Memorandum of Agreement which sets forth the wages, terms and conditions of
employment for maintenance employees represented by AFSCME, was originally scheduled to
expire on June 30, 2010. At AFSCME's request, Council approved the MOU to be extended
PREPARED BY: RUMI PORTILLO
Human Resources
for
Reviewed by: l Assistant Town Manager
Revised: 11/01/2011 3:09 PM
Town Attorney f(n Yinance
Reformatted: 5/30/02
N:\MGR\AdminWorkFiles\2011 Council Reports\AFSCME Council Report Nov 1 2011.doc
PAGE 2
MAYOR AND TOWN COUNCIL
SUBJECT: APPROVE THE MEMORANDUM OF UNDERSTANDING BETWEEN THE
TOWN OF LOS GATOS AND THE AMERICAN FEDERATION OF STATE,
COUNTY AND MUNICIPAL EMPLOYEES (AFSCME) LOCAL 101,
RETROACTIVE TO SEPTEMBER 1, 2011 AND EXTENDING THROUGH JUNE
30, 2013 AND AUTHORIZE THE TOWN MANAGER TO EXECUTE THE
MEMORANDUM
November 1, 2011
through August 31, 2011 to allow additional time for negotiations. The negotiations were
completed in early October and the AFSCME membership approved the agreement by a secret
ballot vote. The tentative agreement (summarized in Attachment A) establishes a new MOU
with a term through June 30, 2013. The agreement does not include any pay increases for the
term of the MOU. The agreement includes a two-tier retirement plan to increase the retirement
age and reduce the pension formula for new hires after July 1, 2012. The agreement also
includes a provision for employees to pay a share of medical premiums for their dependents,
effective with the plan year that begins January 1, 2013.
CONCLUSION:
This agreement is the outcome of collaborative efforts by the Town and AFSCME. This
agreement assists in containing benefits costs that are increasing due to rising pension and
medical costs. Upon the adoption of this agreement with AFSCME, the Town will initiate a
contract amendment with Ca1PERS to establish a two-tier retirement plan for all non -sworn
employee groups. The Town will also align all other non -sworn groups to begin medical cost-
sharing for dependents effective with the 2013 plan year.
FISCAL IMPACT:
This agreement will provide future savings as a result of the two-tier pension formula and
medical cost sharing. Projected savings will not be known until the Ca1PERS actuarial reports
are adjusted to incorporate these changes. Items that add cost in the AFSCME MOU include an
additional hour of pay for employees who return to work for an emergency and an increase of
$20 per employee per year for their safety shoe allowance. These items are not a significant cost
and do not increase the percentage of payroll for AFSCME.
Attachments:
AFSCME Local 101 and Town of Los Gatos October 3, 2011 Tentative Agreement
AFSCME Local 101 and Town of Los Gatos
October 3, 2011 Tentative Agreement
2.0 TERM: September 1, 2011 through June 30, 2013
10.0 COMPENSATION: No salary increases are scheduled for the term of the agreement.
13.0 PERS (TWO TIER RETIREMENT): Employees hired on or after July 1, 2012 will be provided
2%@60, 36-month Final Salary, optional pre -retirement death benefit is eliminated. The Town
and AFSCME agree to explore voluntary retirement savings plans that do not have associated
costs to the Town.
14.0 HEALTH AND WELFARE BENEFITS AND RATE OF TOWN CONTRIBUTION: Effective January
2013, Town will pay Kaiser North based on level of participation (Employee, Employee Plus One,
Employee Plus Two or More). Town will pay the full cost of Kaiser Employee Only. For
dependents, employee will contribute per pay period for the first two pay periods of each
month, the following:
a.) $20/pay period for Employee Plus On-e
b.) $50/pay period for Employee Plus Two or More
21.1 OVERTIME: Rotation for special events overtime by seniority. When special skills are required,
seniority will be used among those with the special skills.
22.0 CALL BACK:
1) Mileage will be reimbursed
2) Rotation determined by seniority.
3) The method for contacting employees for call-back is subject to procedures agreeable to the
Dispatch Supervisor.
4) An employee on standby will earn a minimum of 3 hours for call-back.
5) An employee not on standby will earn a minimum of 4 hours for call-back.
6) When additional help is needed for call back, supervisor approval is required to call in more
than one additional employee.
23.2 STANDBY SCHEDULING: Rotation determined by seniority. Standby scheduled November
through February, time extended as needed.
49.0 CONTRACTING OUT: Within 60 days of this agreement, the Town shall meet with the Union to
discuss contracts currently in place to discuss the Union's ideas to better use bargaining unit
employees to reduce the Town's contracted work.
FURLOUGHS: Incorporate the prior sideletter with the following changes --
1) Permit "rolling" furloughs scheduled as a minimum of four hours
2) Spread reduction over the fiscal year.
3) No additional furloughs through June 30, 2012
PRIOR SIDELETTER AGREEMENTS INCORPORATED
4) Holiday Closure Sideletter Agreement
5) PERS 2.5% at 55 effective July 1, 2008
TENTATIVE AGREEMENTS
18.1 Steel -Toed Safety Shoes: Per Tentative Agreement with amendment to allow employee to use
full value of the voucher for expenses related to safety footwear (e.g., insoles, laces, socks).
New Release Time: Per Tentative Agreement
New Voluntary Time Off: Per Tentative Agreement
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