HomeMy WebLinkAboutContract 28248 STATE OF TEXAS §
COUNTIES OF TARRANT,
DENTON AND WISE § Ci ` SE '
CONTRACT
AGREEMENT
This engagement agreement ("Agreement") sets forth the terms of the
contractual relationship between Buck Consultants, Inc. ("Buck") and City of Fort Worth
("(;bent") tivith regard to Buck's provision to Client of certain employee benefit consulting
services for or on behalf of the Client, all of which services are more particularly
described in Exhibit A attached hereto (the "Services").
1. The Services; Provision of Client's Data. In consideration for, and
subject to, the mutual undertakings set forth herein, Buck agrees to provide the
Services described in this Agreement. Exhibit A ("Scope of Services") identifies the
scope of the Services Client has requested, the time frames within which the Services
are to be provided, the deliverables Buck is expected to produce and various other
details of the Services. It is acknowledged and understood that the description of the
Services set forth in Exhibit A hereto, including the timeframes for performance and
delivery, represent good faith estimates and assume that Client will take or provide
whatever actions may be necessary on Client's part to support and facilitate the
Services
The Services to be pro%.,+dud by Suck may require, Client to deliver to Buck
certain data, documents or other information, all it a timely and accurate manner. Buck
will have no obligation to test or othemise verify the. accuracy or completeness of any
such data, documents, or other information, and Buck will not be responsible for any
errors or omissions contained therein or for the modification or correction of such errors
or omissions. Buck shall be fully protected in relying upon the accuracy and/or veracity
of all information supplied by Client or Client's agents and shall have no responsibility or
liability for any errors, delays, or additional costs resulting from the receipt of
incomplete, inaccurate or untimely information or data or information or data provided in
an unacceptable manner, format or media from Client or Client's agents.
2. Term and Termination. The initial term of this Agreement will be 12
months beginning December 1, 2002 and ending November 30, 2003. This Agreement
may be terminated by Client upon a material breach of the Agreement by Buck that has
not been cured within thirty (30) days following its receipt of written notice of such
breach. This Agreement may be terminated by Buck upon a material breach of the
Agreement by Client (including without limitation failure to pay all fees and expenses
when due) which has not been cured within thirty (30) days following its receipt of
written notice of such breach.
3. Fees and Expenses, Invoicing and Payment. For and during the
term of this Agreement, the Client will pay Buck the Fees specified ode'
("Schedule of Fees") based on the completion of all of the services in atep c
fee schedule. In the event the scope of services is modified, the City and Buck shall
mutually agree in writing of the cost for such modified services.
4. Independent Contractor-, Service Provider; Fiduciary Status.
Nothing in this Agreement is intended or shall be construed to give Buck discretionary
authority or discretionary responsibility in the management of the Client's business
operations or administration of Client's Plan. The relationship of Buck (or any of its
officers, directors, or employees) to Client (or any of its officers, directors, or
employees) is intended to be only that of an independent contractor and service
provider and not employee, agent, fiduciary or other similar relationship.
5. Limited Warranty. Buck warrants to Client that the Services
performed under this Agreement will be performed in accordance with generally
accepted industry standards. EXCEPT FOR THIS EXPRESS LIMITED WARRANTY,
BUCK MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED,
STATUTORY OR OTHERWISE, WITH RESPECT TO THE SERVICES TO BE
PROVIDED UNDER THIS AGREEMENT. ANY CLAIMS SHALL BE MADE WITHIN
ONE (1) YEAR FROM THE DATE THE ALLEGED FAULT OR ERROR WAS MADE OR
SHALL BE FOREVER BARRED.
6. Limitation on Liability. Buck will be responsible to Client only for
Buck's negligence, recklessness, or willful misconduct in the performance of Services
Linder this Agreement and for breach of the limited warranty set forth in this Agreement.
Buck will not be responsible to Client for Buck's (i) failure to perform any Services other
than those agreed to pursuant to this Agreement or-, (ii) actions or failures to act based
on instructions or directions from Client, or from its agents; or (iii) failure to provide the
Services listed on Exhibit A primarily because of (a) any error or omission in the data,
documents, or information provided by or on behalf of Client or (b) any event of force
majeure as set forth in the last sentence of paragraph 8 below.
Notwithstanding any other provision hereof or of applicable law,
Buck and the Client agree that the liability of Buck in connection with the provisions of
the Services pursuant hereto will be limited to direct losses you suffer as a result of the
negligence or willful misconduct of Buck, up to, but in no event to exceed, the amount of
the initial annual fee paid to Buck pursuant hereto or $1,000,000 whichever is greater.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
AGREEMENT, IN NO EVENT WILL BUCK BE LIABLE TO THE CLIENT, THE PLAN
ADMINISTRATOR (IF APPLICABLE), TO THE PLAN (IF APPLICABLE) OR TO ANY
BENEFICIARY OF THE SERVICES HEREUNDER, FOR INDIRECT, INCIDENTAL,
EXEMPLARY, SPECIAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES (INCLUDING,
WITHOUT LIMITATION, DAMAGES RELATING TO LOSS OF PROFITS, INCOME,
GOODWILL, OR DATA) ARISING OUT OF PERFORMANCE OR NOW
PERFORMANCE HEREUNDER WITHOUT REGARD TO THE LEGAL THEORY OF
SUCH DAMAGES, WHETHER SUCH DAMAGES ARE BASED UPON BREACH OF
CONTRACT, BREACH OF WARRANTY, INDEMNITY, NEGLIGENCE, GROSS
NEGLIGENCE, STRICT LIABILITY OR OTHERWISE.
7. Dispute Resolution; Arbitration. In the event of a breach of this
Agreement, or a dispute as to the meaning of this Agreement or any of its terms which the
parties cannot resolve by themselves amicably through direct discussions, the parties
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agree to Submit any such dispute to resolution in the following manner. The parties shall
endeavor to resolve the dispute in good faith through the use of non-binding mediation as
administered by the American Arbitration Association and under its Commercial Mediation
Rules. If within ninety (90) days after one party notifies the other in writing of the existence
of a dispute and the relief requested which it desires to be resolved by mediation, and
provided the dispute is not resolved within such ninety (90) day period through such
mediation, then the dispute shall be resolved by arbitration in Fort Worth, Texas in
accordance with the Commercial Arbitration Rules of the American Arbitration Association.
Within ten (10) days after the failure to agree to an acceptable resolution
through mediation, either party may submit the dispute to arbitration and each party will
select an arbitrator and notify the other party of its selection. Within fifteen (15) days
d
after such notice, the respective arbitrators will select a third (3`d) arbitrator as Chairman
of the panel. A hearing by the arbitration panel must be held within sixty (60) days after
the selection of the Chairman and no discovery will be permitted in connection with the
arbitration unless it is expressly authorized by the arbitration panel upon a showing of
substantial need by the party seeking discovery.
Judgment upon the arbitration award may be entered in any court having
jurisdiction. All mediation or arbitration hearings shall be held in Fort Worth, Texas and
all aspects of the same shall be treated as confidential to the extent authorized by
applicable law. Each party shall bear its own cost of presenting its case, including one-
half (1/2) the cost of mediation. In the event of arbitration, or litigation to enforce the
terms of this Agreement or any arbitration award, the prevailing party will be entitled to
recover its reasonable attorney fees and related court and/or arbitration costs.
8. Force Majeure. Notwithstanding the foregoing, a party's failure to
perform any of its obligations under this Agreement (other than any obligation for the
payment of money) shall be excused if and to the extent (and only for so long as) such
failure arises out of causes beyond the reasonable control and without the fault or
negligence of the non-performing party including, but not restricted to, (a) failure of
Internet or communication lines, telephone or other interconnect problems, errors,
configuration problems or incompatibility of computer hardware or software; (b)
voluntary shutdown of the server to address computer viruses, or other similar
problems; or (c) severe weather, earthquakes, labor disputes, fire, flood, explosion, act
of God, terrorist act, war, insurrection, riot, government regulation or act, vandalism, strike,
quarantine, failure of transmission or power supply.
9. Confidentiality. Both Buck and Client recognize that in the course
of this Agreement, information will be exchanged consisting of confidential trade secret
or business information ("Confidential Information"). Each party shall treat the other
party's Confidential Information as it would treat its own confidential trade secret or
business information. Except as otherwise provided in this paragraph, each party
agrees not to disclose the other party's Confidential Information to anyone except their
own respective employees who have a need to know such information, which
employees will be instructed to maintain the confidentiality of the Confidential
Information in the same manner as they would the confidential trade secret or business
information of their own company.
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It is understood that the foregoing obligations of confidentiality do not
apply to (a) information already lawfully known to recipient prior to the date of this
agreement and which is not known by the recipient to be subject to any non-disclosure
covenants, (b) information publicly available or which becomes publicly available
without a breach of this or any other agreement by recipient (including its directors,
officers, employees, agents or advisors), (c) information rightfully received from a third
party who is not known by the recipient to be bound by non-disclosure covenants with
the discloser, or another party, with respect to the confidential information, (d)
information independently developed by the recipient prior to receipt of such confidential
information, or (e) any confidential information required to be disclosed by law, legal
process or regulatory authority having jurisdiction over the disclosing party.
10. Buck's Proprietary Rights-, Work Product. Client acknowledges and
agrees that all proprietary rights (including, but not limited to, 'trade secrets, copyrights,
trademarks, service marks, trade names, specifications, data base structures,
techniques, know-how, methods, procedures and documentation) in or relating to the
Services or other products used by Buck to perform the Services, including all additions,
improvements and modifications made thereto in the course of Buck performing
Services, hereunder and hereafter ("Proprietary Information"), are proprietary in nature
and belong exclusively to Buck. The work product Buck delivers to Client in connection
with this engagement is intended for the Client's internal use and Client will retain
ownership of the work product and any information specific to Client's employees or
business, and as such, Client shall have the exclusive right to use, reproduce and adapt
it for internal purposes within its organization as Client deems appropriate.
11. Complete Agreement; Governing Law; Compliance with Laws; No
Assignment; Amendment. This writing contains the entire agreement of the parties with
respect to the matters dealt with herein, supercedes all previous agreements between
the parties with respect to the matters dealt with herein, and there are no promises,
understandings, or agreements of any kind pertaining to this Agreement other than
stated herein. This Agreement will be construed and enforced in accordance with the
laws of the State of Texas. The parties agree to comply with all provisions of law
applicable to this Agreement and the services to be performed hereunder and with all
applicable rules, regulations, orders, and directives of all governmental bodies having
jurisdiction. Client may not voluntarily or involuntarily assign its rights or delegate its
duties under this Agreement to any person without the prior written consent of Buck.
This Agreement may be amended only in writing and signed by the parties hereto.
12. Post Termination Provisions. Paragraphs 3, 5, 6, 7, 9, 10, and 11
shall survive termination of this Agreement.
13. HIPAA Privacy Rule. Buck also agrees to protect the privacy rights
of any Personal Health Information that may be revealed though the course of the study
as it relates to "health plans" as such term is defined by the HIPAA Privacy Rule. For
purposes of this Section, the term "protected health information" shall have the meaning
set forth in the HIPAA Privacy Rule. The provisions of this Section are intended to
comply with the HIPAA Privacy Rule effective the date set forth in subpart 164.534
thereof and shall be construed solely for that purpose, "Summary Health Information"
may be disclosed to Buck and may be used for the purpose of plan analysis and
comparison. Buck agrees not to use or further disclose the protected health information
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other than as permitted or required by law. Buck will report to the City any use or
disclosure of the protected health information that is inconsistent with the designated
uses as permitted by the City and the law.
Please indicate your agreement to and acceptance of the terms set forth
in this Agreement by signing below.
The Agreement set forth herein is hereby agreed to and accepted this day of
2002.
Ll
City Manager or Designee Tamara R. Shelton, F.S.A.
City of Fort Worth Principal, Consulting Actuary
Buck Consultants, Inc.
ATTESEE) BY
b, K,
Contract Authorization
pate
.......... ...............
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5 IVIVI"
Exhibit A
Scope of Services
During the term and subject to -the conditions set forth in the accompanying Agreement,
Buck will provide the following services to the City of Fort Worth.
Process Timeline
(week of)
Step I Inventory all Benefits January 6 - 20
Step 2 Conduct a Market Survey of Benefits January 13 —
➢ assumes 16 participants (10 cities, 6 private sector) March 17
➢ to include the following benefits:
• health: active and retiree medical, dental, vision,
wellness
• welfare: disability, life, AD&D, long term care
• paid time off-, sick pay, vacation, holidays, personal
days
• retirement: pension and defined contribution
• other: parking, tuition reimbursement, EAP
Step 3 Conduct a Market Survey of Supplemental January 13 —
Compensation Policies March 17
➢ assumes 16 participants (10 cities, 6 private sector)
➢ to include the following policy areas:
• compensatory time
• longevity pay
• shift differential
• acting pay
• duty officer pay
• educational incentive pay
• certification incentive pay
• assignment pay
• safety awards
• bilingual pay
• merit bonus
• gainsharing bonus
• referral bonus
• project bonus
• sign-on bonus
• skills bonus
Process Timeline
(week of)
Step 4 Conduct a Market Survey of Direct Compensation January 13 -
assumes 6 private sector participants March 17
assumes 25 general industry benchmark positions
covers base salaries, incentives, total cash
assumes City staff prepares capsule descriptions
Step 5tPrepare a Total Compensation Comparison March 10 - 31
includes review of market analysis of public sector for
45 total benchmark positions conducted by City HR
staff
Direct Compensation will be added to Benefits and
Supplemental Compensation in order to report on Total
Compensation for each benchmark position for all
participants
Step 6 Develop and Administer Internal Employee Survey March 31 — May 12
Survey will consist of a Total Compensation trade-off
exercise for active employees.
Hard Copy Survey Only
assumes hard copy survey to 5,500 active employees
assumes survey includes 25 — 30 questions with
quantitative response scales and one open-ended
question allowing for write-in comments
assumes response rate of 40% and verbatim
responses from 50% of respondents
Printing and folding of hard copy surveys (black and white,
folded 11 X 17 paper)
Step 7 Develop Value versus Cost of each Benefit May 5 — June 2
Step 8 Recommend a Benefit Philosophy
Step 9 Prepare and Present Final Report June 9
includes presentations to HR/Staff, Benefits
Committee, Executive/Management Team, and assist
with Council presentation
Step Ensure that City Staff can Maintain Plans Going June 9
10 Forward
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Exhibit B
Schedule ofFees
In consideration of the Services provided pursuant to this Agreement, the City of Fort
Worth shall pay to Buck the following consulting fees:
Process Consulting Fees
..............
Step 1 Inventory all Benefits Included in
Steps below
Step 2 Conduct a Market Survey of Benefits $41,000
assumes 16 participants (10 cities, 6 private sector)
to include the following benefits:
• health: active and retiree medical, dental, vision,
wellness
• welfare: disability, life, AID&D, long term care
• paid time off: sick pay, vacation, holidays, personal
days
• retirement: pension and defined contribution
• other: parking, tuition reimbursement, EAP
Step 3 Conduct a Market Survey of Supplemental $16,000
Compensation Policies
➢ assumes 16 participants (10 cities, 6 private sector)
to include the following policy areas:
• compensatory time
• longevity pay
• shift differential
• acting pay
• duty officer pay
• educational incentive pay
• certification incentive pay
• assignment pay
• safety awards
• bilingual pay
• merit bonus
• gainsharing bonus
• referral bonus
• project bonus
• sign-on bonus
• skills bonus
8
Process Consulting Fees
Step 4 Conduct a Market Survey of Direct Compensation $10,000
assumes 6 private sector participants
assumes 25 general industry benchmark positions
covers base salaries, incentives, total cash
assumes City staff prepares capsule descriptions
Step 5 Prepare a Total Compensation Comparison $8,000
includes review of market analysis of public sector for
45 total benchmark positions conducted by City HR
staff
Direct Compensation will be added to Benefits and
Supplemental Compensation in order to report on Total
Compensation for each benchmark position for all
participants
Step 6 Develop and Administer Internal Employee Survey
Survey will consist of a Total Compensation trade-off $32,000
exercise for active employees.
Hard Copy Survey Only
assumes hard copy survey to 5,500 active employees
assumes survey includes 25 — 30 questions with
quantitative response scales and one open-ended
question allowing for write-in comments
assumes response rate of 40% and verbatim
responses from 50% of respondents
Printing and folding of hard copy surveys (black and white,
folded 11 X 17 paper)
Step 7 Develop Value versus Cost of each Benefit $8,000
Step 8 Recommend a Benefit Philosophy
Step 9 Prepare and Present Final Report $6,000
includes presentations to HR/Staff, Benefits
Committee, Executive/Management Team, and assist
with Council presentation
9
Process Consulting Fees
Step 10 Ensure that City Staff can Maintain Plans Going Included in
Forward Steps above
Total Consulting Fees $121,700
The mailing, distribution and postage for outgoing and return surveys is not included in
the fees quoted.
Buck will invoice Client on a monthly basis for all fees and expenses incurred and
payable by Client. The Client shall pay all invoiced amounts within thirty (30) days of the
receipt by Client of Buck's invoice. Any amount not paid by the Client when due shall
bear interest at the rate of one percent (1%) per month or the highest permissible rate
under applicable law, whichever is less, until paid.
/dw/mis/engagement agreement final—city of fort worlh.doc 1 0
City of Fort Worth, Texas
Mayor and Cau rici I Com m u rl icat ion
DATE REFERENCE NUMBER LOG NAME PAGE
10/22/02 C-19315 14STUDY 1 of 2
SUBJECT AWARD OF CONTRACT TO BUCK CONSULTANTS, INC. TO CONDUCT A
COMPREHENSIVE BENEFITS STUDY FOR THE CITY OF FORT WORTH
RECOMMENDATION:
It is recommended that the City Council authorize the City Manager to execute a contract with Buck
Consultants, Inc., in the amount of $121,800, to conduct a comprehensive benefits study for the City of
Fort Worth.
DISCUSSION:
During recent years, many issues have arisen concerning the competitiveness, equity and value of the
total benefits package that the City of Fort Worth offers its employees. Realizing that benefit
comparison is a complex process and that changing the benefits package requires that the process be
perceived as credible, staff determined that an outside consultant could provide an objective, broader,
and more balanced review and evaluation of the City's benefits, and could better lead and facilitate the
discussions regarding revisions to the benefits package. Therefore, the decision was made to hire an
outside consultant to conduct a comprehensive review of all benefits.
A Request for Proposal was submitted on February 20, 2002. Nine companies submitted proposals.
Human Resources staff, in conjunction with Sandra Henderson (representing the general employees),
John Kerr (representing the Police Officers Association), and Don Westmoreland (representing the
Firefighters Association) evaluated the consultants based upon the proposed approach and
methodology, the firm's qualifications and previous experience, the quality of the proposal, and the
proposed fee for services. Buck Consultants, Inc. was selected by the selection committee as the firm
that would best be able to complete the scope of work outlined below. The selected consultant will
work collaboratively with the Human Resources staff to:
• Inventory all benefits;
• Conduct a market survey of private and public firms in order to determine competitiveness;
• Develop and administer an internal survey of employees to determine which benefits are of
value to employees;
• Develop a cost or value of each current benefit; and
• Recommend a benefit policy and strategy that will be aligned with strategic objectives of the
organization and compliment the compensation plan/philosophy.
The recommendation to contract with Buck Consultants, Inc. is based upon the firm's prior experience
in conducting comprehensive benefit studies of comparable size and scope as the study for the City of
Fort Worth. The evaluation committee also received positive feedback from recent clients regarding the
firm's knowledge and ability to produce desired outcomes within established time frames and budgetary
constraints.
City of Fort Worth, Texas
Mayor and Cou nci f Communication
DATE REFERENCE NUMBER � LOG NAME PAGE
10/22/02 C-19315 14STUDYI 2 of 2
SUBJECT AWARD OF CONTRACT TO BUCK CONSULTANTS, INC. TO CONDUCT A
COMPREHENSIVE BENEFITS STUDY FOR THE CITY OF FORT WORTH
PROPOSAL RESPONSES - The following companies submitted proposals:
• AON Consulting
• Buck Consultants, Inc.
• Deloittee and Touche
• Fox, Lawson & Associates
• Mercer Human Resources Consulting
• MGT of America, Inc.
• Romine Group
• Segal Company
• Whitney Smith Company, Inc.
RATINGS SUMMARY Three members of the Employee Insurance and Benefits Committee were
appointed to serve on the selection committee chaired by Human Resources staff. A summary of the
ratings for each -firm is attached.
M/WBE - Buck Consultants, Inc. is in compliance with the City's M/WBE Ordinance by committing to
7% M/WBE participation and good faith effort. The City's goal on this project is 20%.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that funds are available in the current operating budget, as appropriated,
of the General Fund.
CB:n
Submitted for City Manager's FUND ACCOUNT CENTER AMOUNT CITY SECRETARY
Office by: (to)
Charles Boswell 6183
Originating Department Head:
Linda Cobb 7783 (from) APPROVED 10/22/02
0001 539120 0905500 $121,800.00
Additional Information Contact:
Linda Cobb 7783