HomeMy WebLinkAboutIR 9146 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9146
To the Mayor and Members of the City Council November 3, 2009
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SUBJECT: Update on the Reduction-in-Force and the Separation Pay Benefit
area Program
The purpose of this informal report is to update the City Council on the FY'10 reduction-in-force,
and the separation pay benefit program.
Reduction-in-Force - A total of 56 city employees received a letter from their department head
notifying them that their position will be eliminated effective November 6, 2009. These
employees receive preferential referral and consideration for positions which the employee meets
minimum qualifications. The table below presents the status of these employees.
# Employees who have accepted a job offer 33
# Employees who will retire on or before 12131/2009 8
# Employees who have applied for a job, but have 7
not received a job offer
# Employees who have not applied for a job 8
Total 56
Separation Pay Benefit Program - On August 14, 2009 a total of 254 non-civil service
employees who are eligible for normal, full retirement on or before December 31, 2009 received a
letter informing them of the separation pay benefit program. The letter stated that eligible
employees would receive a separation pay benefit of $10,000 by agreeing to separate from city
employment on or before December 31, 2009. The table below presents the results.
Employees accepting the separation pay benefit and will
separate_from city emplo ment on or before 1213112009:
General Fund employees 41
Target estimate of GF employees who may accept
the benefit and retire 42
Variance (1)
Non-General Fund employees 31
i Total 72
T he number of General Fund employees 41 j who actually accepted the separation: pay benefit
was one employee short of the target estimate (42).
The table below presents the potential swings generated by the separation pay benefit program
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if all positions being vacated by retiring employees remain vacant in fiscal 2010.
General Fund Saving $737,736
f nq nal Est ted Savings $1,333,436
Variance 5
Non-General d Savings 1 0_ .�_1 .
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS
INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9146
�Ij To the Mayor and Members of the City Council November 3, 2009
A , ,
Page 2 of 3
SUBJECT: Update on the Reduction-in-Farce and the Separation Pay Benefit
Program
The savings to the General Fund will fall short of the estimated savings presented during budget
deliberations by approximately $595,700. Reasons for this variance have been identified below:
(1) Target savings estimates were based on estimated savings for the entire fiscal year, or
12 months. However, most of these retirees will not separate from city employment
until December 31, 2009. Therefore actual savings will accrue only for 9 months,
rather than 12 months.
(2) The target savings estimate was based on an assumed average annual salary amount
that is higher than the actual average salary amount and rate of pay for employees who
accepted the separation pay benefit offer. The assumed average rate of pay for
General Fund employees was $27.75 per hour. The actual average annual salary of
General Fund employees who accepted the offer is $25.21. Therefore, more
employees in lower pay classifications than in higher classifications accepted the offer.
(3) A total of 6 general fund employees and 2 non-general fund employees who were also
on the reduction-in-force list were also retirement-eligible and accepted the separation
pay benefit offer. The savings for these 8 employees should not be double-counted in
both programs.
The above General Fund savings amount of $737,736 will be realized if all 41 general fund
positions remain vacant and are not filled. However, of the 41 general employees who accepted
the separation pay benefit, 7 non-civil service Police Department employees, 1 non-civil service
Fire Department employee, and 2 employees of appointed officials in the Law Department and
City Secretary's Office accepted this benefit. If these 10 positions are allowed to be filled after
the retirees separate from the city, the total General Fund savings further reduces as follows:
General Fund Savings if 41 positions remain $737,736
vacant
Less- 6 RIF positions to avoid double-counting ($42,923)
Less: 10 Positions allowed to be filled {$242,693
E
REVISED SAVINGS ESTIMATE L 4 52.120
If the 10 positions are died, then the General Fund swings variance from the original estimate ;
increases to $858,084:
General Fund Savings $452,120
Gri�inal Fstin ted Savirgs $1,333,436 I
d ze Sai�gs $881 316 ___5
ISSUED BY THE CITY MANAGER T WORTH, TEXAS
INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9146
To the Mayor and Members of the City Council
November 3, 2009
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SUBJECT: Update on the Reduction-in-Force and the separation Pay Benefit
Program
Staff desires to receive direction from the City Council regarding the filling of the 41 General Fund
positions, in particular the 7 non-civil service police department positions and 2 positions in the
appointed officials' departments.
Karen Marshall, Human Resources Director(phone: 817.392.7733) or Horatio Porter, Budget
Officer (817.392.2379) are the contacts for additional information.
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.male A. Fisseler, P.E.
City Manager
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