Agenda - Council - 01/09/2001 - Laserfiche WebLink

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PC CASE REQUEST AUTHORIZATION TO MAKE CORRECTIONS NECESSARY FOR PAY EQUITY IMPLEMENTATION REPORT By: Rhouda Heryla, Human Resources Manager & Linda Mayer, Senior Accountant Background: The Department of Employee Relations notified the City of Ramsey of the need to complete a Pay Equity Implementation Report reflecting salary and benefit information as of December 31, 2000. Staff forwarded the necessary information to a consultant who ran the statistical software necessary to calculate the underpayment ratio. While an underpayment ratio of 80% or greater would find the City of Ramsey in compliance, the calculation indicated an underpayment ratio of 67.4% which is out of compliance. Observations: The underpayment ratio of 67.4% requires an increase in maximum wage for two female classes as of December 31, 2000. In reviewing the infmTnation and looking for a least cost alternative, the consultant recommended increasing the Finance Officer's wage by $54.00 and the Assistant City Administrator's wage by $229.00 retroactive to December 3 I, 2000. Therefore the change in salary necessary to bring the City of Ramsey into compliance would be $283.00. Due to the tax liability implications, staff would like to make these corrections sooner than later. The City of Ramsey, per IRS regulations, is required to make electronic employment tax deposits on a semi-weekly deposit schedule. This schedule means that when wages are paid on a Wednesday, Thursday, or Friday, the deposit is due by the following Wednesday. If wages are paid on a Saturday, Sunday, Monday, or Tuesday, the deposit is due by the following Friday. To ensure a timely payment, the transaction must be completed by 4:00 PM at least one business day prior to the due date for both state and federal taxes. Because the checks would need to be backdated to December 31, 2000, the City may be subject to deposit penalties. There is a provision for deposit shortfalls requiring a deposit the first Wednesday or Friday that falls on or after the 15th of the month following the month in which the shortfall occurrs. If the [RS determines that the City of Ramsey can use the shortfall provision, the deposit would need to take place no later than January 16, 2001. However, if the IRS does not nde in favor of the City of Ramsey and meeting the requirements for the deposit shortfall, the City rnay be penalized for amounts not properly or timely deposited at the rate of either 5% for deposits made 6-15 days late or 10% for deposits made 16 or more days late. Staff Recommendation: Staff is recommending that City Council accept the recommendations of the consultant with regards to the Pay Equity Implementation Report and give authorization to make the necessary corrections to bring the City of Ramsey into compliance with an underpayment ratio of 80% or greater.