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All three labor agreements included the following language: "*In the event that the 2014 health insurance renewal comes in at a rate increase of greater than 10%; as may be the case due the Health Care Reform Act, at the request of the bargaining unit, there will be a re -opener to negotiate the City's contributions. In any case, the City will contribute no less than the 2014 amounts listed above." The renewal came in at 13.3% due to additional healthcare reform taxes. Therefore, it is entirely possible that the unions will request a re -opener to discuss the 2014 contributions. Observations/Alternatives: Although this case is for discussion only. The Personnel Committee may want to come to a consensus based on the following options: Option # 1: Retain the previously budgeted 2.5% increase in order to have flexibility based on the results of further analysis and receipt of additional pending data and to offer the same health insurance benefit to the non -union group as the unionized groups. Option #2: Option # 1, plus direct staff to perform a League of Minnesota Cities wage study for each non -union position in order to gather position specific market data and then use the remaining 1/2% to increase the position(s) that are too low. Option#3: Based on discussion. Comment: In 2012, all staff members, except Department Heads, received a 2% increase -- Department Heads received a 1% increase. This caused an even greater disparity within the compensation structure and the market. Funding Source: The preliminary 2014 budget has accounted for a 2.5% non -union COLA and the health insurance increases. Note: The difference between a 2% increase and a 2.5% increase is about $6000 per year. . Recommendation: Staffs' recommendation for the 2014 non -union wages is to retain the previously budgeted 2.5% increase in order to have flexibility based on the results of further analyses and receipt of additional pending data. Staffs' recommendation for the 2014 non -union health insurance is to provide the same benefit as the unionized groups. Action: Not applicable at this time - discussion only. 07-23-13 Work -Session Minutes Overview of Wages and Health Insurance Attachments Form Review Inbox Reviewed By Date Kurt Ulrich Kurt Ulrich 10/10/2013 04:10 PM Form Started By: Colleen Lasher Started On: 10/10/2013 12:21 PIM Final Approval Date: 10/10/2013