The Burbank Management Assn. this week became the latest group of city employees to forgo bonuses and contribute to their pensions.
The City Council on Tuesday approved the new contract, which runs through June and will require managers to start paying 1% of the city’s 8% share of their contribution to the California Public Employees’ Retirement System. New hires will pay 4% of the contribution.
Eventually, the city’s goal is to have all city managers cover half the cost.
Calling the negotiations a “give and take,” Councilman Gary Bric thanked the union “for stepping up and accepting some of the concessions we asked for.”
The deal will save the city roughly $463,000 in bonus pay alone, and the employee contributions to benefits could save up to $616,600 for the fiscal year, according to the city.
Mayor Jess Talamantes thanked the union “for working so well with us and coming to some sort of conclusion.”
The latest round of employee concessions follows the deal struck earlier this year with the city’s largest union, the Burbank City Employees’ Assn., which claims roughly 740 workers.
Union members in that deal agreed to pay an increasing share of their pension contributions and give up bonuses for three years. By 2014, members will be contributing 4% of the city’s share of the pension cost, according to Management Services Director Judie Wilke.
The city has already suspended bonuses for managers and executives who aren’t represented by unions.
Millions of dollars in bonuses were handed out in the last few years despite the fact that the city was struggling to close a budget gap. The majority of the roughly $8-million budget gap that had to be closed this fiscal year — about $7 million — was due to rising pension costs, which in turn were impacted by bonuses driving up total employee compensation.
Council members also voted this year to pay 2% of their own share for retirement benefits. The council, like the other employee groups, will also be contributing 4% to their retirement plans in the next few years.
Agreements are pending with the unions representing firefighters and their chief officers and utility workers, Wilke said in an email.
Police union members and the city recently reached a tentative agreement, but details won’t be disclosed until the City Council publicly discusses the proposed contract in mid-January, officials said.