ATTACHMENT 1

BUDGET WORKING PAPER

TO:                   W. Calvin Horton, Town Manager

FROM:             Pam Eastwood, Director of Human Resources

SUBJECT:       Summary of Methods and Terms Used in Town Pay Survey

DATE:             April 24, 2006

PURPOSE

The purpose of this attachment is to explain the method and terminology used in the Town Pay Survey and to present findings and recommendations.

INTRODUCTION

The Human Resources Department conducted surveys in December 2005 to compare the Town’s pay and benefits programs with those area organizations with whom the Town competes for employees.  The Council determines which organizations are included by Resolution.

Part I: Pay Survey

The organizations included in the pay survey were:

• City of Burlington
• Town of Carrboro
• City of Cary
• City of Durham
• Town of Hillsborough
• City of Raleigh
• Durham County
• Orange County
• Wake County
• Chapel Hill-Carrboro City Schools
• UNC Chapel Hill<
• UNC Health Care System
• OWASA

Survey

The survey requested information on a selected group of Town jobs (called benchmark positions) which represent substantial numbers of positions (such as Fire and Police jobs) or which represent a variety of jobs with skill sets which the Town seeks in filling positions. Respondents were asked to provide information on:

• job titles
• minimum, midpoint and maximum of the pay range for each job
• the number of employees in each class title
• the average actual salary paid to each class of employees

Detailed study and analysis was conducted by Town Human Resources staff and follow-up calls were made to respondents to assure accuracy and completion of data. The information was organized to show comparable data for all survey respondents for each job title surveyed. In the comparison chart, the job title used by the organizations responding is shown, with the minimum, midpoint and maximum amounts of the pay range used by the survey respondent. Also shown are the number of employees in the organization which hold similar positions and the average pay amount for this group of employees.

Below this information is shown the raw average of these figures, the weighted average of these figures and the relevant data for this job title at the Town. Below this in the shaded line are ratios which compare the Town’s range minimum, midpoint and maximum amounts to the weighted average of the data from the survey respondents. The term used to describe this ratio in compensation work is a comparison-ratio.

This ratio serves as a simple indicator of whether the Town data is lower or higher than the weighted average for each amount. Use of the weighted average rather than the raw average is a best practice in compensation work. These comparisons form the basis for the Human Resources department staff’s observations and any recommendations for changes in pay ranges and average employee pay.