Reform 5.2: Special Pays
Reform “Special Pays” Throughout the City’s Budget. Other Information:
In addition to base compensation (salaries and wages), the City of San Diego includes additional compensation components in
the FY 2011 General Fund budget, many of which are considered “special pays.” Over the years, the labor unions have used “special
pays” to spike take-home earnings of city employees - and increase “pensionable pay”. The result has been a costly system
that lacks true transparency on city employee compensation levels. Worse, the myriad of special pays has resulted in numerous
accounting headaches – particularly in the transition to the new ERP system. In this section, the Roadmap tackles the elimination
of some “special pays” to achieve FY 2012 budget savings and explores changing the methodology under which they are calculated.
As a general principle, our office does not agree with the use of special pays as a salary increase for all affected employees
because it reduces transparency and potentially creates a false notion of a “pay freeze,” when in fact increases in special
pays may be occurring. Furthermore, we also believe that special pays cease to be “special” when they are provided to essentially
all employees covered under a labor contract. Instead, we believe that “special pays” should be reserved for activities that
go well beyond basic job requirements (e.g. “bomb squad” pay). Currently, many special pays are calculated as a percentage
of base pay, as opposed to a flat dollar amount. This has the impact of triggering an increase in the cost of special pays
to the City whenever a general salary increase is enacted. The City can guard itself against these cost increases in the future
by negotiating a change in the current calculation methodology for some special pays to a flat dollar amount. * We must note
that data segregated into bargaining unit and General Fund was not available to our office. As a result, we can only estimate
the financial impact of these reductions based on very limted information. We attempted to obtain the data from the Office
of the Independent Budget Analysis, but the city’s financial system could not correctly provide the necessary information.
While eliminating these pays may in some cases be warranted, there may be other cases where the City finds it prudent to provide
special pay. The table below provides a summary of the various reform options the City can pursue regarding the various specialty
pays currently provided under labor contracts.
Indicator(s):
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