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City wage study gets council vote

 

Move brings worker pay in line with comparable communities

By John McLoone

The Hastings City Council was expected at its meeting Tuesday, Sept. 6 to act on implementation of a new compensation plan for its employees. The meeting was held after press time of this week’s Hastings Journal, so a full report with council feedback will be reported at hastingsjournal.news and our next edition.

The total cost to the general fund for enacting the new plan would be $181,018 against the 2022 budget and $561,661 for fullyear implementation in 2022. The city budgeted $200,000 for the wage increases this year.

The study, conducted by Abdo Solutions, found that similar wage classifications at comparable communities throughout the Twin Cities and neighboring cities, found that Hastings was not paying its employees competitively enough to retain workers. The city last studied its wages and job classifications in 19992000.

Under the study, no employees will have their pay cut, and wage increases will be retroactive to July 4, 2022, which was the start of a pay period, Wietecha told the city council. When the council authorized the study early this year, it was noted that some employees have left for competitive wage reasons. It also has been difficult for the city to attract new hires when nearby municipalities pay better.

Findings of the Abdo study stated, ““The city last conducted a formal independent position classification and compensation study many years ago and has experienced changes in its workforce and operations, challenges finding and retaining skilled employees and increased market competition for employees from neighboring cities. In recent years, the city has experienced a change in workforce and challenges finding skilled workers which have impacted both the job duties and wage demands for many positions. Also, current market wage pressure and competitive recruiting offers in many positions contributes toward an employee perception that the city may not be offering wages in line with the comparable market. In light of these organizational changes and challenges, the City of Hastings determined that a formal, independent, systemwide position reclassification and market wage analysis was necessary to assist executive leadership in establishing a new, logical and justifiable employee wage and salary framework to build upon into the future.”

As part of the study, each position was scored and ranked on knowledge required for the position, problem solving skills required, accountability and special conditions.

“These categories are intended to measure and rank the level of knowledge, skills, influence and impact on city operations for each position,” the study states.

The 65 ranked positions earned scores of 97 for a building services worker on the low end to 736 for the city administrator position.

The city has an ordinance on file that identifies comparable government entities for looking at wages. The ordinance states, “City of Hastings employee compensation schedule will be based upon a comparison of cities with populations from 15,000 to 35,000 in the sevencounty Metro region and the cities of Cannon Falls, Cottage Grove, Northfield and Red Wing.”

“The City of Hastings is within 40 miles of both St. Paul and Minneapolis and in close proximity to many other large metro cities. As a result, the city is actively competing for talented employees with these larger southeast metro communities. The city should consider a competitive compensation scale to attract and retain qualified employees that have the knowledge, skills and abilities to provide service levels expected within the community, particularly considering the current labor market,” the study states.

The recommendation to approve the study came after two meetings of the council’s Administration Committee, made up of Trevor Lund, Jen Fox and Lisa Leifeld. The city council also discussed it as a whole in a workshop Aug. 17.

In a memorandum to the council in advance of Tuesday’s meeting, Wietecha enactment of the study brings city wages in line with its competitors and is manageable within the tight city budget.

“I believe the recommendation fairly balances several priorities: making sure that the city is paying wages competitive with neighboring communities, providing a formalized structure for internal consistency and legal compliance and maintaining a payroll that is affordable for the city’s budget. This positions the city to retain highperforming employees, while also being able to recruit top talent to meet future needs,” he said.

The new schedule does include a few positions “above the new market range.”

“They are recommended to keep their current pay rate. No one has a cut in pay,” Wietecha wrote.

He said that the pay increase for most positions is between 20 cents and $1.56 per hour.

“There is one considerably below market currently, which is recommended for $3.84 to get into the market range. There are also several positions already above the market range, which would remain at their current wage,” according to Wietecha.

So as not to sound “selfserving,” Wietecha recommended his wage not receive an increase when converted to the new range and also not to receive a step increase at the start of 2023.

In addition to the new step system, employees would receive a 3 percent cost of living adjustment in January 2023.

Contracts with the five city unions will need to be negotiated following implementation of the study as well, and Wietecha told the council, “I expect these negotiations to be similar and consistent with this overall implementation plan.”

Upon approval by the city council, meetings are set with employees Sept. 7 and 13.

September 7, 2022