OCEAN CITY — Most Ocean City municipal employees will be getting a modest pay hike starting next year, many for the first time since 2008.
The Mayor and Council on Tuesday approved the implementation of a modification in the town’s pay structure for municipal employees, many of whom will see a 2-percent increase on their paychecks starting Jan. 1, but not before some contentious debate about who should get paid more and why. During budget sessions last spring, the Mayor and Council approved an across-the-board, 2-percent pay hike for municipal employees for 2016 and instructed Human Resources Director Wayne Evans to explore ways to implement the raises across the stepped pay structure.
On Tuesday, Evans came before the council to present an implementation plan for the pay increases. Evans showed the elected officials how the increases could be worked into the resort’s existing pay ranges for employees with varying experience, job description and tenure.
Complicating the issue somewhat was the introduction earlier this summer of a pay and classification study, conducted to determine how the resort’s municipal employee pay rates compare to other jurisdictions of similar size, for example.
Evans said he used information in the study, combined with the intent of the council when it approved the pay increases, to adjust the ranges for employees at different step levels.
“Our ranges are pretty broad and I’m suggesting tightening them up,” he said. “Some of the high ranges would come down under this proposal and some of the lower ranges would go up.”
The fiscal year budget includes the 2-percent pay increase for all employees effective Jan. 1. Some employees are at or close to the maximum of the proposed pay ranges and many last received a raise in 2008. While the council approved the pay hikes, some elected officials questioned the move.
“I’m trying to find out what was the council’s intent,” said Councilman Wayne Hartman. “Are employees under the impression they are all getting a 2-percent increase?”
Councilman Tony DeLuca said his intent was never a flat 2-percent for all employees, but rather a performance-driven hike for those who deserve it most from the pool of money budgeted for the pay increases.
“My intent was never a flat rate,” he said. “I’ve always said you reward your best employees. Otherwise, what is the motivation to do a good job? We have an evaluation process and the department heads know who their best are. To reward poor performers is not really the way to go. Maybe reward the best with a 4-percent increase and the non-performers get zero percent.”
Mayor and Acting City Manager Rick Meehan said he had a different understanding of the council’s intent when it approved the pay hike in the 2016 budget.
“I view it a little differently,” he said. “I remember it being presented as a COLA (Cost of Living Allowance) and it wasn’t a merit or step increase. I’m sure our intent was for a 2-percent COLA across the board. If it was a merit increase, performance would certainly be part of the equation.”
Councilman Dennis Dare said his recollection of the decision at budget time was similar.
“I remember when we did this during the budget, we didn’t have the pay study yet,” he said. “Historically, it’s easier to run your business as you want to in the private sector, but it’s a little more challenging in the municipal sector. I think the recommendations are spot on. A lot of them haven’t had any adjustment in seven or eight years. Their lifestyle has eroded because of inflation and for some this might be the last adjustment of their careers.”
Councilmember Mary Knight pointed out the only other current way for employees to get raises is through occasional step increases.
“We haven’t given anybody anything since 2008,” she said. “Two percent isn’t much, but it can help pay for a few things.”
Evans pointed out there have been no raises since the 2013 freeze, but some employees have seen incremental pay increases in the last two years.
“Those on the lower end get a higher percent increase and those on the higher end got a lower percent increase,” he said. “People at the max of their range didn’t get any increase.”
Knight pointed out there is often a different perception in terms of those employees at pay range maximum.
“When we think max, we automatically think of those making $90,000,” she said. “Somebody in their job description could be at their max and only be making $30,000. It’s not just the top tier people and the department heads.”
Back to the discussion of pay for performance, Dare said there was already a system in place.
“Evaluations are done throughout the city,” he said. “Some managers do it better than others. As far as performance goes, we have expectations. If you don’t meet the expectations, you are given opportunities to improve. If you don’t improve, it’s grounds for termination.”
After considerable debate, the council approved the flat 2-percent pay increase across the board effective Jan. 1 with a 4-3 vote with Hartman, DeLuca and Matthew James, each elected one year ago next week, opposed.