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Burbank City Manager proposes dumping merit pay for some employees

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Major development involving Burbank’s controversial practice of merit pay for some employees. In the last fiscal year of 2009-2010, the city reportedly paid out an estimated $1 million in bonuses, during these hard economic times of cutbacks and reduced city services. The Burbank City Attorney’s Office is fighting a lawsuit to get details on those bonuses filed last January by The Burbank Leader/The Los Angeles Times.

Last fall, the Leader filed a public records request for that information.  I also requested the same information from the City Attorney’s Office. City officials, including the majority on the city council and City Manager, Mike Flad, defended these bonuses and efforts to block the full disclosure of them to the media and the public.

Photo: FLLewis/Media City G -- City Manager Mike Flad at a city council meeting Burbank City Hall March 15, 2011

Photo: FLLewis/Media City G -- City Manager Mike Flad at a city council meeting Burbank City Hall March 15, 2011

In a memo, dated January 7, 2011, sent out to Burbank employees about the Leader/Los Angeles Times request, Flad defended the city’s position: “The City has taken the position … that City employees have, and at all times since the merit pay program was created, had an expectation that the amount of merit pay awarded would be as private and confidential as their performance evaluations.”

Well, Flad is backing away from a blanket support of these bonuses. Late yesterday, this news release was sent out by Burbank City Hall.

City Manager Proposes Suspension of Merit Pay and New Pension Contributions for City Executives/Unrepresented Managers  Staff taking steps to reduce City’s budget deficit

BURBANK, Calif. (May 13, 2011) – As the City of Burbank prepares its upcoming budget for fiscal year 2011-2012, the proposal calls for the City’s executive team, which includes all department directors, and its unrepresented managers to relinquish merit pay and begin contributions to their pension costs.  The savings from these steps alone is estimated at more than $500,000/year.

“With over 80% of our costs in the general fund going to labor and 85% of the budget deficit attributable to pension costs, we simply can’t balance the budget in the short or long term without impacting our labor groups,” says City Manager Mike Flad.  “I believe anything to the contrary will be fiscally irresponsible.”

City employees outside of the executive and unrepresented management groups have union representation which requires any proposed changes to be negotiated in new contracts.

The proposed budget also calls for salary ranges (for all City positions) to be frozen.  In addition, the interim command staff of the Burbank Police Department has already offered to take a 5% pay reduction and Flad has voluntarily declined a 5% pay raise for which he is contractually eligible.  He says all of these measures may be required for the next several years as the City’s budget deficit is gradually closed.

“It’s important for us to remain competitive with other cities by offering fair compensation and benefits, but these are unprecedented times which require unprecedented action,” Flad said. “I am grateful to our executives and managers for their contributions and to all of our labor groups who continue negotiations with City management as we work toward developing solutions together.”

The City Manager’s proposal is scheduled for discussion at the City Council meeting of May 24th.


By the way, a lot of chatter all over town this week about a certain employee in the Park, Recreation, and Community Services Department, who has a merit bonus of  $1,000 a month written into his personal employment contract. Interesting.

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