This response to the question of City pay increases was received on Friday, Feb. 27 from the city;'s Director of Human Resources. I would appreciate your comments on its substance. Is there nothing to be alarmed about in the figures?
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Thank you for your e-mail to City Council on the 2009 budget and financial plan. Included in your e-mail was a bar chart showing percentage increases in Nanaimo City Personnel Costs, 2004-2007, for various employee categories. You indicated that the data used to create the chart had been taken from the City's Statements of Financial Information for the years 2004 and 2007. After providing your opinion that there has been a "rapid, even astonishing rise in the total amounts paid to the top echelons of Nanaimo's civil service during this period," and further, that there has been an equally astonishing small increase paid to those employees making less than $75,000 per year, you asked for comments.
It appears from your e-mail that you believe the increase in remuneration for staff paid over $75,000 per year is the result of: (a) increases in the salaries paid to those employees; and (b) new employees at that level. It seems that you have not considered the possibility that increases in salaries to staff making under $75,000 per year has resulted in their being moved into the over $75,000 per year category.
According to my review of the Statements of Financial Information, in 2004 there were 49 staff (excluding the City Manager group) listed as being paid over $75,000 per year. In 2007, this number had increased to 93 staff. While some of the 44 additional staff in this category would have been new employees at that level (we were in a period of economic growth during this time frame), undoubtedly, many of them were existing staff who moved from the under $75,000 category into the over 75,000 category. Therefore, in order to consider the true increase in remuneration paid to City staff between 2004 and 2007, the remuneration for both groups of employees needs to be added together. The result is an increase in remuneration between 2004 and 2007 of about 19%. This percentage change would include both salary increases and staff growth.
With respect to salary increases, it is important to note that the annual compensation adjustments provided to 85% of City staff are contractual in nature, and therefore are not subject to budget cuts at this time. I can further advise that the average annual compensation increases awarded to management staff during the applicable period was 3.4%. The amount of the annual salary increases to exempt personnel was based on independent surveys, conducted yearly, of the median salaries paid to similar positions in the national public sector market.
Mr. Bolin, you have also asked for information about the City's estimated budget surplus for 2008. I can inform you that this information will be made public after a report to Council has been made.
I hope this information is of assistance to you.
Regards,
Terry Hartley
Human Resources Director
City of Nanaimo
