HomeMy WebLinkAboutResolutions - 2021.03.11 - 34226MISCELLANEOUS RESOLUTION #21070 March 11, 2021
BY: Commissioner Kristen Nelson, Chairperson, Legislative Affairs and Government Operations
Committee
IN RE: HUMAN RESOURCES — VOLUNTARY EMPLOYEE SEPARATION INCENTIVE PROGRAM
FOR SCHEDULE C EMPLOYEES (VESIP-C)
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
WHEREAS in 1994, 2003 and 2008, the Board of Commissioners approved voluntary retirement and
separation incentives to eligible employees in an effort to reduce operational costs; and
WHEREAS in December of 2020 the Board of Commissioners approved a Voluntary Early Separation
Incentive Program (VESIP), per Miscellaneous Resolution #20660; and
WHEREAS a number of employees on Retiree Healthcare Schedule C have expressed interest in the
VESIP, but still need additional years of service to qualify for 100% County paid contributions toward their
monthly retiree healthcare premiums upon retirement; and
WHEREAS the County Executive team has reviewed the feasibility of an additional incentive for
employees on Retiree Healthcare Schedule C (Schedule C); and
WHEREAS Schedule C was adopted in 1994 and applies to employees hired between 1995 and 2005;
and
WHEREAS the County Executive is proposing to allow employees on Schedule C with between 20 and
24 years of service to receive 100% County paid healthcare coverage upon retirement if they participate
in VESIP-C; and
WHEREAS it is proposed that this group have an incentive payment that takes into account the added
value of County provided healthcare at 100% upon retirement; and
WHEREAS for those with between 20 and 24 years of service, the incentive payment will be reduced by a
percentage based on years of service as outlined below in this resolution; and
WHEREAS the period of application for this incentive would be from April 1, 2021 to May 28, 2021, in
order to allow at least 45 days for Schedule C employees to consider this program; and
WHEREAS if approved, this new program will have a Separation Agreement and Final Release document
prepared by legal counsel, to be signed by all program participants.
NOW THEREFORE BE IT RESOLVED that the Oakland County Board of Commissioners approves a
VESIP-C incentive for employees on Retiree Healthcare Schedule C as follows:
• Employees on Retiree Healthcare Schedule C with between 20 and 24 years of County service
as of 4/1/21 that participate in this program will be eligible to receive 100% County paid retiree
healthcare coverage when their normal retirement age and service requirements are met, which
will be at age 60 for this group.
• Applications for this incentive will be accepted from April 1, 2021, to May 28, 2021.
• Participants will have until June 30, 2021 to separate.
• Employees will be required to sign a VESIP-C Separation Agreement and Final Release in order
to participate and receive the incentive.
BE IT FURTHER RESOLVED that the Separation Incentive payment for Schedule C employees with
between 20 and 24 years of service will be the following:
• 24 years: 1 week of salary per year worked minus 10%
• 23 years: 1 week of salary per year worked minus 20%
• 22 years: 1 week of salary per year worked minus 30%
• 21 years: 1 week of salary per year worked minus 40%
• 20 years: 1 week of salary per year worked minus 50%
BE IT FURTHER RESOLVED that other components of this program will operate similar to the current
VESIP program authorized under MR #20660, including the ability for departments to request a later
separation date for employees in critical roles up to two years, at the discretion of the Deputy County
Executive with oversight of the Human Resources Department.
BE IT FURTHER RESOLVED that the Deputy County Executive responsible for oversight of the Human
Resources Department is authorized to sign any Letters of Understanding with the unions.
BE IT FURTHER RESOLVED a budget amendment appropriating funds for the costs associated with the
implementation of the VESIP-C one-time incentive payment will be included in a subsequent quarterly
forecast resolution.
BE IT FURTHER RESOLVED that the final amount will be determined based on the rate of acceptance
by eligible employees. Funding for VESIP-C incentive program will be derived from equity in the General
Fund Balance.
Chairperson, on behalf of the Legislative Affairs and Government Operations Committee, I move the
adoption of the foregoing resolution.
V%A;XA
Commissioner Kristen Nelson, District #5
Chairperson, Legislative Affairs and Government
Operations Committee
LEGISLATIVE AFFAIRS AND GOVERNMENT OPERATIONS COMMITTEE VOTE:
Motion carried on a roll call vote with Kochenderfer absent.
fro.AKLANDF
COUNTY MICHIGAN OAKLAND COUNTY EXECUTIVE DAVID COULTER
HUMAN RESOURCES
April Lynch, Deputy County Executive
TO: Kristen Nelson, Chairperson
Legislative Affairs and Government Operations
David Woodward, Chairperson
Board of Commissioners
FROM: April M. Lynch, Deputy County Executive
DATE: March 2, 2021
RE: VESIP-C Separation Incentive
As you are aware, the County is currently offering a Voluntary Separation Incentive Program to all County
employees with one or more years of County service. To date, over 70 employees have elected to participate. We
have a segment of our employee base who may be eligible to retire but are still waiting to qualify for 100% of their
retiree health care. We have been working to address how we can expand the incentive to include these employees
as well,
After legal review and input, we are now able to bring an additional separation incentive to the Board for
consideration involving employees currently on Retiree Healthcare Schedule C. Attached for your reference is a
summary of retiree healthcare schedules A through D. Schedule A and B receive full County coverage. Schedule
D instead has a Retiree Health Savings (RHS) account to use for medical expenses when they separate or retire.
We are focusing on those Schedule C employees who would pay a percent of their monthly premiums depending
on their years of service. For this new program VESIP-C we will only be allowing an incentive for those with 20 to
24 years of service.
There are currently 633 employees on Schedule C with between 20 and 24 years of service, however, only 78 are
eligible to retire. The remaining 555 have not met the age requirements to retire, while they would be eligible for
this incentive, I don't anticipate many would take advantage of this opportunity. The goal is to provide a different
incentive for those particular employees that have met the requirements to retire, but are waiting to achieve 100%
of paid retiree medical coverage.
The Administration is recommending that these employees with 20 to 24 years of service receive 100% County
paid medical coverage upon retirement and an incentive payment similar to the VESIP plan, but with a reduced
amount as shown below:
• 24 years:
1 week of salary per year worked minus 10%
reduction of the incentive
• 23 years:
1 week of salary per year worked minus 20%
reduction of the incentive
• 22 years:
1 week of salary per year worked minus 30%
reduction of the incentive
• 21 years:
1 week of salary per year worked minus 40%
reduction of the incentive
• 20 years
1 week of salary per year worked minus 50%
reduction of the incentive
For example, an employee with 24 years of service and an annual salary of $70,000, would be eligible for 24 weeks
of incentive pay minus 10% (i.e. 24 weeks = $32,307 minus 10% of $32,307 ($3,230) = $29,077 as the incentive
payment).
2100 Pontiac Lake Road I L. Brooks Patterson Building 41 W I Waterford, MI 48328 1 Fax (248) 452-9172 1 OakGov.com
Other program notables:
• The program will run from April 1, 2021 to May 28, 2021
• Employees can apply between April 1, 2021 and May 28, 2021
• Participants can separate or retire between April 1, 2021 and June 30, 2021
• We will work with each union with Letters of Understanding
• The VESIP-C has the same guidelines as the VESIP, the only difference is the incentive amount.
• Employees on Schedule C who have already accepted the VESIP and have between 20 and 24 years of
service, will have the opportunity to elect VESIP-C instead.
We anticipate that the total cost of the program will vary based on how many employees take the incentive and how
many positions are vacated. An actuary study was completed and reviewed by the Director of Management and
Budget and found the impact to the VEBA fund would have little to no effect on our 140% current funding status.
By providing this incentive we will accelerate the savings to the budget as well as future budgets, allowing us to
fund other program priorities while maintaining a balance budget.
2100 Pontiac Lake Road I County Executive Building 41W I Waterford, MI 48328 1 Fax (248) 452-9172 1 OakGov.com
RETIREE HEALTH CARE ELIGIBILITY
Once you have attained the required years of service and age, you are eligible for
health coverage as a retiree from Oakland County. The eligibility is dependent upon
your date of hire as an eligible for benefits employee. The schedule on the following
pages applies to non -represented employees. If you are represented by a bargaining
unit, the dates may vary and you are encouraged to contact the Retirement Unit to
determine which schedule applies to you. In all cases, except as specified
differently by some Sheriff bargaining agreements, you must have met the
requirements specified on the following pages and be at least age 60 with 8
years of service or age SS with 2S years of service for coverage to
commence.
At age 65, Medicare becomes the primary coverage and the coverage available through
the County becomes secondary. Standard dental coverage and standard vision coverage
is also available to retirees.
A - 8 YEAR SCHEDULE OF ELIGIBILITY
Employees hired prior to September 21, 1985 are eligible for full family health
coverage at retirement. Age 60 with 8 years of service or Age 55 with 25 years
of service.
B - REVISED SCHEDULE OF ELIGIBILITY
Employees hired on or after September 21, 1985 and before January 1, 1995.
Dates may vary by bargaining unit.
Total Actual Service Paid Health Coverage
With Oakland Countv Direct Retirement Deferred Retirement
Less than 8 years None None
8 — 14 years One Person* None
15 — 19 years Family One Person*
20 years or more Family Family
*Retiree has the option to pay the difference for a family policy.
Revised 4-1-2014 1
C — 15 YEAR SCHEDULE OF ELIGIBILITY
Employees hired on or after January 1, 1995 and before January 1, 2006.
Dates may vary by bargaining unit.
At Completion of:
Percentage of Retiree
Paid Health Care**
Up to 15 Years
0% (No Coverage)
15 Years
60%
16 Years
64%
17 Years
68%
18 Years
72%
19 Years
76%
20 years
80%
21 Years
84%
22 Years
88%
23 Years
92%
24 Years
96%
25 Years or more
100%
**This is the percentage the County would pay
oward a Single person or Family plan,
depending on the plan the employee was enrolled in at the time of retirement. The employee
would be responsible for the difference between
this amount and the current full cost of their
health plan, plus anv deductibles or co -nays.
u
D — RETIREE HEALTH SAVINGS ACCOUNT (RHS)
Employees hired on or after January 1, 2006. Dates may vary by Bargaining Unit.
At Completion of:
Up to 6 Years
6 Years
7 Years
8 Years
9 Years
10 Years or more
Vesting Schedule for Employers
Contribution
0% (Not Vested)
60%
70%
80%
90%
100%
Revised 4-I 2014 2
Resolution #21070 March 11, 2021
Moved by Gingell seconded by Gershenson the resolutions on the Consent Agenda be adopted.
Discussion followed.
Vote on Consent Agenda:
AYES: Charles, Gershenson, Gingell, Hoffman, Jackson, Joliet, Kowall, Kuhn, Long, Luebs,
Markham, McGillivray, Miller, Moss, Nelson, Powell, Spisz, Weipert, Woodward, Cavell. (20)
NAYS: None. (0)
A sufficient majority having voted in favor, the resolutions on the Consent Agenda were adopted.
Moved by Spisz seconded by Weipert to amend MR #21064, MR #21065, MR #21066 and MR #21067 as
follows:
Add all Commissioners as co-sponsors of these resolutions.
A sufficient majority having voted in favor the amendment carried.
I HEREBY APPROVE THE FOREGOING RESOLUTION
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, Lisa Brown, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and
accurate copy of a resolution adopted by the Oakland County Board of Commissioners on March 11,
2021, with the original record thereof now remaining in my office.
In Testimony Whereof, I have hereunto set my hand and affixed the seal of the Circuit Court at Pontiac.
Michigan this 111h day of March, 2021.
Lisa Brown, Oakland County