NorCo Council Solicitor Rules Payraise to Top Officials is Illegal

Northampton County Council Solicitor has ruled that payraises awarded by Executive John Brown to three top officials last year, including a 19% payhike to Deputy Director of Administrration Cathy Allen, are illegal.

MEMORANDUM

TO: County Council

CC: Linda Zembo

FROM: Philip D. Lauer, Esq., County Council Solicitor

DATE: May 4, 2015

Issue:

Whether, and to what extent, the County Executive can unilaterally increase a County employee’s salary in a manner otherwise inconsistent with the Career Service Regulations and Employee Policies Manual, because of the provision in the Employee Policies Manual labeled "Exceptions".

Background:

Several members of County Council have inquired regarding the propriety of a pay increase for a County employee recently approved by the County Executive, which was substantially inconsistent with the specific provisions of the Employee Policies Manual and Career Service Regulations.

1 When inquiry was made of the Executive regarding the matter, the County Solicitor directed the attention of Council members to that portion of the provisions of the Employee Policies Manual dealing with Job Evaluation, Job Descriptions, and Compensation, which reads as follows:

1
The employee received a raise in salary from $57,459.58 to $68,554.93, a 19.3% increase. Approximately $3,500 is a non-permanent raise for working out-of-class since there has been no director of Human Resources for approximately one year. The Employee Policies Manual provides for out-of-class pay increases not exceeding 4.5%. If that employee is deemed to be in an "acting" status, pay increases are handled pursuant to normal promotional increases.

"Exceptions to this policy may be considered on a case-by-case basis. Such written exceptions must be submitted to the Director of Human Resources and approved by the County Executive and shall be considered a one-time, non-precedential, exception and not the establishment of a past practice. Exceptions made without written approval as described above shall be invalid."

Opinion

For the reasons which follow, the County Executive does not have the authority, on a case-by-case basis, to change the salaries of individual employees in a manner inconsistent with the Career Service Regulations and provisions of the Home Rule Charter.

Reasons for Opinion

Home Rule Charter Provisions


The Home Rule Charter, in defining the powers of County Council, provides, in Section 202(11), that Council has the power "to establish in accordance with this Charter the salaries and wages of all elected officials, officers, and employees. . ."

Article VIII of the Charter provides that a merit personnel system shall apply to all members of the career service [see Section 803(a)]; states that all officers and employees except those enumerated shall be members of the career service [see Section 802(9)]
2; and provides for career service regulations including "a pay plan for all positions" [see Section 805(a)(2)].

2 The employee in question is not an exempt employee, and holds the position of Assistant Director of Administration.


Section 805 provides that the County Executive (or the head of the agency responsible for administering the merit personnel system) "from time to time shall prepare and submit to the Personnel Commission proposed career service regulations…" [See Section 805(a)]. The personnel commission has 30 days to consider the proposed career service regulations and report recommendations to the official who submitted them, and to the County Council [Section 805(b)]. Thereafter, the proposed career service regulations must be submitted to the County Council for approval.

Council has the power by resolution to approve, reject or amend the proposed career service regulations [Section 805(c)].

Career Service Regulations Provisions


By Resolution No. 28-2011, adopted by the Northampton County Council on February 17, 2011, Council approved revised Career Service Regulations [herein, CSR’s], copies of which were attached to the resolution.

CSR Section 4.01 provides that the Department of Human Resources, on behalf of the Executive, shall develop a pay plan "which is comparable to rates of pay in the area and which is equitable in terms of the contributions of the job makes to the work of County government." More specifically, Section 4.02 provides for a "comprehensive pay plan for all Career Service County employees". It further provides that there will be a periodic pay survey of the Northampton County labor market, with a report by the Department of Human Resources to the County Executive. It further provides that there shall be a system of "job evaluation" established, that adjustments may be made based on changes in job criteria, and that "there shall be a pay schedule with designated pay grades. Within said grades, County Council may establish intervening steps at levels it deems appropriate between the minimum and maximum rates of pay, or simply minimums and maximums, or individual salary placement".

Section 4.03 provides for revisions of the pay scale to be "submitted to the County Council for its consideration", and further states that "a revised pay scale accompanied by an estimate of cost for the year shall be submitted to the County Council for its consideration".

Section 4.04 provides that "each employee shall be paid at one of the established steps in the pay grade for his/her class.…" Increases in pay are governed by section 4.09, which provides that "annual increases, in the event the pay plan enacted by County Council so provides, will be granted unless the current performance evaluation is unsatisfactory.

The CFR’s provide detailed regulations governing performance appraisals, recruitment, examinations and other provisions. However, nowhere is there a provision granting to the

executive the authority to make case-by-case departures from the otherwise applicable provisions of the CFR’s.

Employee Policies Manual Provisions


CSR 1.16 defines the Employee Policy Manual as follows:

"Policies, or procedures issued by the County Executive, interpreting and providing procedural instructions to supplement the Career Service Regulations.
The Employee Policy Manual shall be consistent with the Career Service Regulations."

Regulation 2 of the CFR’s provides for the creation of the Employee Policy Manual as follows:

"The County Executive shall establish, amend and abolish employee policies or procedures as communicated to employees and supervisors through the Employee Policy Manual. The purpose of the Employee Policy Manual is to provide standard interpretation of a detailed procedure to be followed in carrying out the Charter provisions related to a merit personnel system". [Section 2.03]

The Employee Policies Manual to which reference has been made was apparently initially effective January 1, 2008, and amended January 16, 2008.

It is this Manual which contains the provision permitting the Executive to make case-by-case exceptions to the otherwise applicable provisions of the Career Service Regulations.

Application of Regulations and Policies

Historically, there has been considerable confusion regarding the differences between, and application of, regulations and policies. In a Council Solicitor’s opinion dated May 8, 2008, this confusion was recognized, and thereafter, on October 2, 2008, County Council adopted an ordinance which would have established the procedure for approval by County Council of the CSR’s, and the procedure to validate the Employee Policies Manual and the CSR’s. That ordinance was vetoed, Council overrode the veto, and the then Executive filed a lawsuit challenging the legality of the ordinance.

That litigation was resolved by an agreement that the Executive would review all existing career service regulations, and present any changes to the Personnel Commission, which would then make recommendations to Council for its consideration and action. It also provided that the Executive would review any Personnel Policies and Procedures, to ensure conformity to the Career Service Regulations, and notify the Personnel Commission and County Council of any action taken. Finally, it provided that, in the event the Executive would thereafter issue any policy or procedure which Council considered to be a career service regulation, the executive would then submit the policy or procedure in question to the Personnel Commission for its review and recommendation as to whether or not the policy constituted a career service regulation requiring the formal approval of County Council.

Thereafter, as noted above, the current Career Service Regulations were adopted on February 17, 2011.

Conclusion

While these issues have a somewhat complicated history, the resolution of the current question is fairly basic. The home rule charter provides that:

 County Council has the authority to establish wages of all elected officials, officers and employees of the County;

 The Executive is to prepare Career Service Regulations which are subject to approval or rejection by County Counsel; and

 The Career Service Regulations will include a pay plan for all positions.

The Career Service Regulations provide that:

 There will be a comprehensive pay plan for all Career Service County employees;

 There shall be a pay schedule with designated pay grades. Within said grades, County Council may establish intervening steps at levels it deems appropriate between the minimum and maximum rates of pay, or simply minimums and maximums, or individual salary placement;

 Revisions of the pay scale are to be "submitted to the County Council for its consideration", and any revised pay scale accompanied by an estimate of cost for the year shall be submitted to the County Council for its consideration;

 Each employee shall be paid at one of the established steps in the pay grade for his/her class; and

 The Employee Policy Manual shall be consistent with the Career Service Regulations.

Neither the Home Rule Charter, nor the Career Service Regulations contain a provision granting to the executive the authority to make case-by-case departures from the otherwise applicable provisions of the CFR’s. Further, there has been no proposed revision of the pay plan, providing for such authority, submitted to County Council for its consideration and approval or rejection. Accordingly, that provision in the Employee Policy Manual is not consistent with the Career Service Regulations, and the Executive does not have that authority.