Council Reduces City Pay Scales For New Hires

OCEAN CITY – The mayor introduced the idea to reduce current town employees’ maximum pay scale this week in order to reduce the resort’s payroll expenses, but the majority of the City Council held off on his proposal.

A couple of weeks ago, the Mayor and City Council narrowed down the percentage of decrease in newly hired town employees’ pay scale.

At that time, the council reviewed a few options of pay scale decreases and one option stood out from the rest.

City Manager Dennis Dare explained the option. “It uniformly decreases the starting pay and the maximum pay from grade one up to 22. The lower grades…have a small effect and then the higher salaries have more of a full effect of the 8-percent decrease.”

Dare explained that this scenario mirrors what the council has learned over the last year and half. That the town’s starting salary is close to what it is on the Eastern Shore for the lower paying jobs.

“Nobody gets hurt. You’re adjusting yourself to what the market is here in the Eastern Shore,” he said.

A downfall to the option was that it would affect a current employee’s pay scale, which is what the council does not want to do.

Human Resources Director Wayne Evans this week returned to the council with the same option but provided two different maximum pay columns, one for new hires and one for current employees. The option now does not affect current employees and their cap of maximum pay will remain the same.

“The chart reduces the minimum by a graduated percentage from zero percent to 8 percent,” Evans said. “The new hire maximum of the range is reduced by the same percentage as the minimum.”

The council had also directed Evans to return seasonal or temporary employees to the current rate they had left with, but the starting rate for new seasonal employees to be reduced.

Evans explained that the pay grade reduction for newly hired seasonal or temporary employee and full-time workers is the same percentage just converted into an hourly wage.

Evans also pointed out that the new pay scale will affect non bargaining unit employees, such as communications, police command staff and the fire department command staff. Those who are covered by contract, such as the fire fighters and the police officers, are not part of the pay plan reduction.

As the council approached the vote, Mayor Rick Meehan said that he had a question that “may surprise some of you.”

“I have heard all kinds of statements about what the reduction should be and how to do it,” Meehan said. “Now, when it comes time to actually enact it, we’re looking at a graduated reduction, which I agree with and support because I think it follows the findings and studies we’ve done, and I think it follows the information in comparable of the Eastern Shore.”

Meehan said the studies showed Ocean City’s pay scale being on target in the lower grade pay ranges but upper pay grades “weighed heavy.”

“The graduated scale works but my question really would be why would this only apply to new hires?” Meehan said. “That is going to have a minimum affect over a long period of time.”

Meehan said that a number of years ago the council made changes to town employee pay scales and those changes were made based on “comps at the time, the market at the time, and the economic situation at the time.”

Meehan said during the meeting that just as the town changed one way before he thinks it can change in another direction today.

“If you really look at it and after all this discussion and you want to do what the studies show and what our analysis show, I would just like to know why we wouldn’t do it for all employees so we have everybody on the same page,” he said. “Not move anybody backwards but adopt new maximums because they really reflect what the analysis and studies show where the ranges should be.”

Councilwoman Margaret Pillas responded, “I would like to do one thing at a time…I was always concentrating on new hires. I haven’t given thought to what this means in terms to the current employee.”

Pillas did agree with the mayor in what the studies did show and that budget time would be appropriate to analyze current employee’s pay scale.

“If the budget is not in favor of doing anything I think that we should hold off and be responsible to our current employees and stay loyal to them,” Pillas said. “But if the budget dictates to it we should go ahead and do it.”

On the other hand, Pillas said that the council should not fall back on studies.

“I think we ought to talk about performance-based salaries,” she said. “The performance rather than anniversary based or on longevity.”

Meehan said studies are important and play a key role on the where the council bases their decisions.

The council voted to accept the new pay scale in a vote of 4-2, with Councilmen Doug Cymek and Lloyd Martin in opposition and Councilwoman Mary Knight absent.

“If we really want to address this properly and make an impact that addresses the pay scale just as we did a number of years ago…now would be the time to do that,” Meehan said.