6.5. ERMUSR 03-10-2009 - Laserfiche WebLink

Home Browse Search

~j Elk River -~= Municipal Utilities 13069 Orono Parkway • P.O. Box 430 Elk River, MN 55330-0430 March 4, 2009 To: Elk River Municipal Utilities Commission John Dietz Jerry Gumphrey Daryl Thompson From: Vance Zehringer Subject: Proposed Work Hour Reduction Study Phone: 763.441.2020 Fax: 763.441.8099 At the February 24th Utilities Commission meeting under Other Business, the Commission directed staff to prepare a work hour reduction study. The request was to research the impact of implementing a 36 hour work week for all employees. This reduction is a 10% reduction in work hours resulting in an approximate 10% reduction in employee wages. The question is would this be in the best interest of the Utilities. From a financial perspective, this proposed reduction in hours is not warranted. The number of customers is up, revenue is up, and the 2009 budget was based on 0% growth. In the previous six months, the Utilities have reduced the number of employees by two. The utilities promoted from within in lieu of hiring from the outside. The promotions from within have resulted in depleting the line crews by two. Even with the promotions and pending changes in salaries, this reduction in staff has resulted in savings of approximately $100,000. There are approximately 1800 summer help hours budgeted for 2009. Prior to reducing full time employee hours, these summer help hours should be cut. Many outsourced jobs have, recently been brought back in- house including: tree trimming, system preventive maintenance, bill processing, system mapping, anda portion of underground electrical distribution installation. There are some big ticket items still being outsourced. A study of bringing this workload back in-house should be considered before reducing full time employee hours. As publicly noted by Commissioner Dietz, this past year has been tumultuous for Llk River Municipal Utilities. Employee morale is at an all-time low and center around a lack of trust in the fellow employees, management, and the commission. Great effort has been made to unite the staff and move forward. The Utilities are headed in the right direction, but it will be a slow process. To reduce the employee's wages by approximately 10% would be detrimental to the efforts made in healing moral. The timing couldn't be worse. The Utilities may even lose employees as jobs become available elsewhere. To hire new always costs more than to retain. The retention of talent is a key factor in a company's success.