Transition Task Force Personnel Recommendations to Joint Governing Bodies July 30, 2012 4/4/2019

Recommendations of Benefits Provisions Medical Benefits Township Borough Recommendation Comment Privately placed – 4 choices State Plan – 14 choices   Move to state plan State Plan approx. 20% less expensive Overall savings for active employees is $300K Benefits are largely comparable with potential small impact on network coverage 4/4/2019

PERS – Public Employees Retirement System Pension Township Borough Recommendation Comment PERS – Public Employees Retirement System PFRS – Police and Firemen’s Retirement System   No change recommended Coverage is the same in both municipalities. Administered by State. Current pension accounts combined and service credit combined. 4/4/2019

25 years of pension service required, regardless of age Retiree Medical Township Borough Recommendation Comment 25 years of pension service required, regardless of age Benefit is reimbursement up to set dollar amounts   Benefit is continuation in State medical plan Current retirees remain in current program. Future retirees in state plan, with new municipality considering reimbursement when PPACA Health Care Exchanges are established (due 1/1/14) Private insurance industry is currently uncertain, which may leave retirees in difficult position finding coverage. With establishment of exchanges, substantial savings can be realized and retirees will have guaranteed coverage. 4/4/2019

Absence not counted as time worked Overtime Provisions Township Borough Recommendation Comment 1.5X over 40hours Straight time 35 – 40 hours Absence not counted as time worked Holiday pay – 2X plus holiday pay Absence counted as time worked Holiday pay – 1.5X plus holiday pay   4/4/2019

Tracked, but not fully used up Eliminate policy, but maintain practice Compensatory Time Township Borough Recommendation Comment With Manager Approval Tracked, but not fully used up   Eliminate policy, but maintain practice Eliminate tracking Occasional non-accruing and not hour for hour More respectful way of managing time 4/4/2019

If hired after 2003, percentage of salary Longevity Township Borough Recommendation Comment If hired after 2003, percentage of salary If hired before 2003, percentage of salary or $ amount, whichever is higher   n/a if hired after 1/1/2000 If hired before 2000, $ amount Eliminate longevity pay Roll amount that would have been in place on 12/31/2013 into base pay Amount rolled in will increase with future adjustments to salary, but will not increase based on longevity schedule 4/4/2019

5 days off for listed family members Bereavement Township Borough Recommendation Comment 5 days off for listed family members Two day extension may be granted for travel 5 days off for certain family members 2 days off for certain other family members May take one of those days at future date (w/in 3 mos) for bereavement related business Utilize Township policy   4/4/2019

25 years of local service required 2 days per year of service Terminal Leave Township Borough Recommendation Comment 25 years of local service required 2 days per year of service 1 day per year of service, capped at 30   Eliminate after 1/1/2015 Until 1/1/2015, utilize Boro policy 2 months notice required (for smooth transition) 4/4/2019

Employer and Employee paid Short Term Disability Township Borough Recommendation Comment State Insurance Plan Employer and Employee paid 2/3 salary replacement capped at $572 per week Sick bank must be used prior to collecting state benefits Self funded plan Boro pays 100% of salary for 6 months after 44 days of disability Sick bank or unpaid for first 44 days   Utilize Borough Plan, per administrator recommendation 4/4/2019

Time Off Township Borough Recommendation Comment Sick Time Holidays Floating Holiday Personal Days Vacation Varying rules for whether they are paid out upon termination   Implement Time Off proposal made by administrators on June 25, 2012, which harmonizes the benefit between the municipalities. Conduct PTO pilot in 2013 to determine future viability. 4/4/2019

Medical Benefits Four options - 1 – Current Employees with State Plan, Retirees on State Plan 2 – Current Employees with Private Plan, Retirees on Stipend 3 – Current Employees on State Plan, Retirees on Stipend 4 – Current Employees on State Plan, Current retirees remain on current plan, future retirees on State Plan Considerations – Current Plan – cost difference with no discernible coverage difference Retirees – Lack of clarity of health exchanges mandated by PPACA make private insurance market to uncertain to direct retirees into, but savings of moving Retirees to stipend are significant Subcommittee recommends option #4 pending implementation of health exchanges which are legislated to begin on 1/1/ 2014. If/when viable exchanges exist, move to option #3. 4/4/2019

Medical Benefits Figures below reflect budget numbers. Actual savings from stipends for retirees are larger based on not full utilization of budgeted amounts.   Cost for all Active Employees (187) Cost for all Retired Employees (72) Budgeted Costs % Difference Current Costs: Twp: Private Plan w/Retiree Stipend Boro: SBHP for active & retirees Boro: SHBP: 1,735,017.00 Boro: Retirees: 627,782.00 Twp: Private: 1,982.800.00 Twp: Stipend: 260,324.00 Total Cost 3,717,817.00 888,105.00 4,605,922.00 Option 1: SHBP for active EEs and SHBP for Retirees State Health Benefit Program Retiree State Health Benefit Program 3,429,531.00 1,142,467.00 4,571,998.00 Difference in Cost from Current (288,286.00) 254,362.00 (33,924.00) -1% Option 2: Twp Private for active EEs and Twp Retiree Stipend Current Township Plans Retiree Township Stipend Plans 4,235,531.20 590,490.00 4,826,021.20 517,714.20 (297,615.00) 220,099.20 5% Option 3: SHBP for active EEs and Twp Retiree Stipend 4,020,021.00 (585,901.00) -13% Option 4: SHBP for active EEs; Keep current Retirees Boro SHBP & Twp Retiree Stipend Retiree: Boro - SHBP & Township Stipend Plans 4,317,636.00 - -6% NOTE: There is NOT an option to have the Twp private plan for active EEs and the SHBP retirees since the State does not allow retirees only. 4/4/2019

Time Off Benefits Four alternatives – Personnel Subcommittee endorsed #4 Administrator proposal that leaves current system intact and harmonizes number of days, with Boro Short Term Disability Paid Time Off (PTO) utilizing same number of days as administrator proposal, with revised Short Term Disability Plan Paid Time Off (PTO) utilizing same number of days as administrator proposal for current employees and reduced number for future employees, with revised Short Term Disability Plan Alternative #1 with recommendation that the new governing body study the PTO system and conduct a pilot program next year for possible change to PTO system in the future. 4/4/2019

NOTE – Purple and Red Bars Should all be at same height (technical difficulty) 4/4/2019

PTO pluses and minuses Pluses Protects current employee time off amounts vis a vis administrator proposal Simplified administration – no need to keep track of separate types of time off. Perpetual calendar so no need for carryover provisions Employee Flexibility – not constrained by types of time off Simple methodology for transitioning future employees to lower level Will increase service provided and reduce cost over time Disability coverage enhanced Provides more generous benefit when it is needed most Eliminates need for banked time, as it was formerly used for extended time off Employees save $60/year in state disability payments, Employer savings as well Replicable change methodology for contract negotiations Widely used in private industry – a proven approach 4/4/2019

PTO pluses and minuses Minuses Change to current system – first in state to implement Unless unscheduled time is limited, can create managerial difficulty based on uncertainty limiting unscheduled time is recommended for this reason May lead to initial increase in time off taken, as employees with carryover approach annual accrual limit Lower benefit than neighboring municipalities may lead to competitive disadvantage for labor Only impacts when two municipalities directly competing for labor – amount is not likely to be reason to switch employers, since service time already built up. Disability paid at 75% may net slightly lower take home pay for certain low paid Township employees for period of disability However, period of time at 100% should make up for difference 4/4/2019

Rationale for future consideration of PTO Consistent with goals of Consolidation Commission: Cost control and savings Enhanced services More effective government Indirect Savings : Reduced overtime to replace employees taking time off Reduced per-diem coverage to replace employees taking time off (dispatch) More work accomplished by employees that have reduced number of days off – Billable in departments in which residents pay for service Less use of outside resources 4/4/2019

Personnel Subcommittee Completed all recommendations/reviews: Separation agreements Organizational structure Personnel selection process Reconciliation of employee benefits (manual to be revised) Cross-pollination Guidelines for reconciling salary discrepancies Ongoing: Merging of union contracts (responsibility of PERC) Drafting of benefits manual 4/4/2019

Other personnel matters Salary harmonization Administrators reviewing all salary discrepancies, recommend to governing bodies guidelines (10% or more?) Job descriptions Administrators and department heads reviewing and revising all job descriptions Classification system Administrators will recommend a single job classification system to governing bodies 4/4/2019

Personnel Subcommittee Thea Berkhout Jim Levine Jo Butler Gary Patteson Jill Jachera Shirley Meeker Bruce Topolosky Sue Nemeth 4/4/2019