On November 19, 2013, City Council reviewed a tentative side letter agreement with Fullerton Management Association (FMA). The proposed side letter agreement is available at this link for public review prior to the December 3, 2013 City Council meeting when it will be brought back for final consideration.
The total cost of the proposed side letter is estimated to be approximately $116,000 over the next two fiscal years, requiring budget adjustments of $76,000 in 2013-14 and $40,000 in 2014-15.
The FMA represents approximately 40 employees, assigned to various non-sworn management positions in all departments of the City. Classifications represented by this unit include those such as: Community Center Supervisor, Utility Services Supervisor, Senior Librarian, Sewer Supervisor, Plan Check Engineer, Airport Manager, Building and Code Enforcement Manager, and Water System Engineer/Assistant City Engineer.
The City negotiated an agreement with the FMA with a three year term in late 2011. Like the Fullerton Municipal Employees Federation agreement, the agreement with the FMA included no provision for a specified cost of living increase, although it did allow for one mutual agreement reopener to discuss salary increases after the first year. The substantive changes in the agreement included exchange of the five percent pay reduction implemented in 2009 for implementation of a seven percent employee cost sharing of CalPERS retirement costs as well as a provision instituting 50% employee cost sharing of medical premium increases beginning in 2013, reduced retirement benefits for new hires and phasing out of the City's "furlough" program introduced with the 2009 pay reduction. This concession-based agreement was reached with the bargaining unit through the meet and confer process. Employees in this unit have had no across-the-board salary increases or cost of living increases since 2007.
In July, the FMA invoked the salary reopener provision in the agreement. In early November, the City and the FMA reached a tentative agreement satisfying this reopener the terms of which provide limited cash payments, equivalent to 3% total of past compensation, in a fashion that does not increase the City's CalPERS liability.
The payments, rebates from City funds of amounts paid by employees towards CalPERS costs since 2012, will be paid out in three installments in December 2013, June 2014 and June 2015. The rebate installments will be based on 1% of compensation in payroll year 2012, 1% of compensation in payroll year 2013 and 1% of pay in payroll year 2014 respectively.
This agreement will not alter the current provision regarding CalPERS cost sharing. Employees will continue to contribute seven percent of their compensation to CalPERS on an ongoing basis.
The tentative agreement includes agreement by the FMA to extend the existing Memorandum of Agreement through June 2015.