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HomeMy WebLinkAbout06-25-2026 Personnel Board Meeting MinutesCITY OF FAIRHOPE Personnel Board Meeting 7:00 A.M. June 25th, 2026 161 N. Section Street Fairhope, AL 36532 Present were: Members: Jake O’Neil; Stephanie Sandefur; Terry Ullrich; Human Resource Director Hannah Noonan; Councilman Andrea Faust; Evergreen Solutions, LLC Project Manager Stasey Whichel The Fairhope Personnel Board meeting was called to order. The minutes from the April meeting were reviewed and approved unanimously. There was no old business to discuss, so the Board moved directly into new business concerning the City’s compensation and classification study being conducted by Evergreen Solutions. Stasey, the City’s consultant from Evergreen Solutions, presented a high-level overview of the study, which has been underway since January. She explained that the purpose of the study was to evaluate the strengths and weaknesses of the City’s current compensation system, identify salary compression and internal-equity concerns, review job classifications and career paths, gather employee feedback, compare the City’s pay structure with similar public employers, and develop recommendations for a competitive and sustainable compensation plan. The presentation was informational, and the final plan is expected to return to the Personnel Board for consideration before being incorporated into the FY2027 budget. Evergreen reviewed approximately 480 employees working across roughly 30 departments or operational areas. The City currently has approximately 280 job classifications, which equals about 1.7 employees per classification. Stasey noted that this is a relatively large number of classifications for the size of the workforce, although it is not necessarily a problem as long as the City avoids creating unnecessary classifications. The current compensation system is an open-range system with minimum, midpoint, and maximum salaries rather than fixed salary steps. The existing general pay plan uses grades 3 through 14 and has an approximately 86% spread between the minimum and maximum of each range. Evergreen noted that organizations of a similar size typically use ranges between approximately 50% and 70%. The review found that approximately 53% of employees are currently paid above the midpoint of their assigned ranges, while about 47% are below the midpoint. Most employees are concentrated around the second and third quartiles of the pay ranges. The average employee tenure is approximately 9.2 years, which Evergreen described as positive compared with current public-sector employment trends. Stasey explained that employees are generally moving between employers more frequently than they did in the past, so an average tenure of more than nine years indicates relatively strong retention. Evergreen identified salary compression as a significant issue. Because many of the City’s minimum salaries are below the labor market, departments have often had to hire new employees above the minimum and sometimes near the midpoint of the range. This creates situations in which new employees are paid close to the salaries of experienced employees who have been with the City for several years. Evergreen concluded that the City has been informally adjusting for an outdated pay plan rather than being able to use the plan as originally designed. As part of the employee-engagement process, Evergreen conducted focus groups and received approximately 250 responses to an anonymous employee survey. The feedback received in the focus groups was consistent with the survey results. Employees said they were attracted to or remained with the City because of the benefits, work schedules, location, convenient commute, opportunities to serve the community, positive relationships with coworkers, and opportunities for career growth. Employees generally reported that they enjoyed their work and had positive relationships with coworkers. However, the most common concern was that pay had not kept pace with nearby public employers or the cost of living. Employees also expressed a desire for clearer career paths that would explain how they could move from entry-level positions into higher classifications and what experience, certifications, or training would be required. For the external market analysis, Evergreen compared the City with 20 peer organizations and received responses from all 20. The study included approximately 1,200 market data points and 129 benchmark classifications. Positions were matched based on actual job duties and responsibilities rather than job titles, and Evergreen required at least five valid comparisons before using a classification as a benchmark. Cost-of-living adjustments were also applied when comparing the City with employers located outside the immediate area. The market analysis found that the City’s current minimum salaries are approximately 15% below the market median. The current midpoints are approximately 9.5% below the market median, while maximum salaries are generally closer to or slightly above the market because of the unusually wide ranges. Areas identified as being particularly behind the market included communications, equipment operators, building inspections, utilities, maintenance, planning, and several public works and skilled operational positions. Stasey emphasized that these findings relate to the City’s salary structure and do not necessarily mean that every individual employee is paid the same percentage below the market. Evergreen recommended replacing the existing general pay plan with a new structure containing 30 salary grades. The proposed plan would narrow the range between the minimum and maximum to approximately 60%. Most salary grades would have about a 5% progression between adjacent midpoints, while certain higher-level grades would have approximately a 7.5% progression to reflect increased leadership responsibilities and market conditions. The proposed midpoints would be aligned with the median of the labor market. The lowest entry rate in the proposed general pay plan would be $13.50 per hour. These lower grades would primarily apply to seasonal employees, attendants, and other task- oriented positions. Several regular entry-level classifications, including certain public works, utilities, and customer-service positions, would be placed at approximately $19 per hour because that rate is more consistent with the local labor market. The proposed plan would allow the City to advertise more realistic salary ranges and hire employees closer to the minimum instead of routinely placing new hires near the midpoint. Evergreen also recommended creating a separate public safety compensation plan because of the unique schedules and pay requirements associated with law-enforcement and public-safety positions. The proposed public safety plan would contain 14 salary grades and would also use a 60% spread between minimum and maximum salaries. It would separately account for employees who work schedules that differ from a standard 40-hour workweek, including employees whose annual salaries are based on approximately 42 hours per week or other applicable public-safety schedules. A proposed employee-placement and compression-adjustment strategy was also discussed. Evergreen recommended using a placement methodology based on factors such as relevant experience, certifications, and tenure. However, the City’s available data does not consistently identify how long each employee has been in the employee’s current classification. Because an employee may have worked for the City for many years but recently moved into a new position, Evergreen recommended capping initial salary adjustments at approximately 7.5%. This would help prevent the placement model from treating an employee’s entire City tenure as time spent in the current position. Evergreen will also provide Human Resources with a salary-placement tool that can be used to estimate an appropriate hiring or placement rate based on experience, education, and certifications. Evergreen recommended that the City maintain the new pay plan by reviewing salary information annually using approximately five to ten local peer organizations and by conducting targeted reviews of representative or difficult-to-fill positions. The City should also consider appropriate economic indicators, including regional Consumer Price Index data, when determining whether the salary scale should be adjusted. A full compensation study should be conducted every three to five years. Evergreen also recommended updating the City’s compensation policies so that they remain consistent with the new pay structure. Annual cost-of-living increases should generally adjust the entire salary scale so that employees near the maximum remain eligible to receive appropriate increases. Department heads will receive the proposed classification and salary schedules and will be given a limited period to review how the recommendations affect their departments. They may submit concerns regarding job classifications, position responsibilities, internal- equity relationships, market comparisons, and proposed new or revised job titles. The group was reminded to evaluate the duties and responsibilities of each position rather than the performance or abilities of the employee currently holding it. Any requested change to one classification must also be evaluated for its effect on related positions throughout the City. The estimated cost of implementing the new compensation plan could range from approximately $300,000 to as much as $2 million, depending on the employee-placement method and the number of classifications that are adjusted. Human Resources will work with department heads, the mayor, Evergreen, and the Finance Department to refine the recommendations while considering the overall payroll budget. Merit increases, certification incentives, and future cost-of-living adjustments may continue separately from the implementation of the salary study. Evergreen concluded that City employees generally enjoy their work, value the City’s benefits, and have a positive view of the workplace culture. However, the existing salary structure is outdated and has contributed to recruitment difficulties and salary compression. The City’s minimums and midpoints are below the local market, and the proposed plan would make the City more competitive while creating a more manageable and sustainable compensation structure. No final action was taken on the proposed pay plan. The matter will return for additional departmental review, possible revisions, and formal consideration by the Personnel Board. End of meeting. Thank you, Jake O’Neil, Secretary