The City Council postponed a vote this week that would have suspended bonuses for city executives and mid-level managers and directed officials to explore alternatives to the program.
A yes vote on the measure Tuesday would have suspended the merit-based bonus program indefinitely, effective at the start of the new fiscal year in July. It also would have instituted employee contributions to pensions and lowered the bottom of executive salary ranges by 10%.
The council also tabled a proposal that would give City Manager Mike Flad broad discretion in granting mid-level managers up to 25 additional hours of paid time off that could be cashed out for up to $2,800 for those on the higher-income scale.
The additional cash-out hours were drafted in response to the possibility of bonuses or salaries being cut, according to a city report.
City Councilman Dave Golonski called for the vote to be postponed and offered an alternative proposal that included cutting the salaries of employees by the amount of possible merit-based bonus pay, and then have them strive for bonuses to make up the difference.
“I think we’re going in the wrong direction,” Golonski said. “We’re not just slightly going in the wrong direction, we’re going in a very strong way.”
Golonski argued the $8.7-million budget deficit, about $7 million of which officials say is tied to rising pension costs, was a problem created by all employees, regardless of performance levels.
“The suspension of the merit pay piece in particular places the burden of fixing that problem that was created across everybody and places the bulk of the burden on the highest performing employees,” Golonski said.
Although his proposal did not receive the support of the council — Gary Bric and David Gordon said they were prepared to pass the resolution as presented — the dais voted unanimously to direct city officials to return with alternatives.
Councilwoman Emily Gabel-Luddy questioned even considering distributing bonuses given the effects of the economic downturn on revenues.
“When the economy is bad, how can you even consider merit pay or bonuses, or whatever you want to call it?” she asked.
Any of the proposals would affect only executives and mid-level managers. Changes to the current bonus system for other more rank-and-file employees would require renegotiating their contracts.