Proposal:

Approve the Updated Boilerplate Language for Executive Management Agreements and Resolve an Ambiguity in Agreement Language to Clarify Intent of the Parties

Synopsis:

In 1987 the Board established the Designated Deputy program whereby senior management employees serve under an Executive Management Agreement. These Agreements contain language to ensure that Designated Deputies receive the same benefit and cost-of-living adjustments as are provided to non-contract management employees. The boilerplate for the Executive Management Agreement was modified in January to bring it current and Agreements executed since January have used the updated boilerplate language. However, an ambiguity has been identified in the case of five Deputies with contracts containing the old boilerplate language: Oscar Abarca, Joe Contaoi, Carol Coy, Chung Liu, and Patrick Pearce. Their Agreements need to be clarified to ensure that they will receive the same across-the-board increase in compensation as all other Designated Deputies.

Committee:

Administrative, May 23, 1997, Recommended for Approval

Recommended Action:

Approve the updated boilerplate language for Executive Management Agreements and authorize the Executive Officer to ensure that Oscar Abarca, Joe Contaoi, Carol Coy, Chung Liu, and Patrick Pearce receive the same across-the-board increase applied to all other Designated Deputies.

James M. Lents, Ph.D.
Executive Officer

Background

The original 1987 boilerplate language of the Executive Management Agreements provided that a Designated Deputy receives the same percentage increase in the second and third years of a three-year contract as that granted to the management class of employees, as well as the same increases in benefits. Over the years, various Board actions to amend terms and conditions of employment for non-contract management employees have, by the terms of the Executive Management Agreements, been applied to the Designated Deputies. This has resulted in outdated boilerplate language and, therefore, the old boilerplate was updated several months ago. The reference to "second year" and "third year" was substituted with language clarifying that the Designated Deputy "receives a percentage increase equivalent to the percentage increase for management class employees as approved by the Board." The purpose of this provision, both as written in the old boilerplate and as updated, was and is to ensure that all Designated Deputies receive the same across-the-board enhancements as are granted to non-contract management personnel.

Staff has identified an ambiguity which could produce an inequitable result and which would be contrary to the intent of the parties. The original boilerplate references across-the-board salary enhancements in the second and third years of the contract term. A question has arisen as to whether Deputies who are in the first year of an extended contract are eligible for the across-the-board increase granted to all other Designated Deputies by reason of the Board’s action on May 9, 1997 providing a cost-of-living increase to non-contract management employees. Five Designated Deputies are in the first year of an extension -- Oscar Abarca, Intergovernmental Affairs Officer; Joe Contaoi, Director of Administrative & Human Resources; Carol Coy, Assistant Deputy Executive Officer/Stationary Source Compliance; Dr. Chung Liu, Assistant Deputy Executive Officer/Technology Advancement; and Patrick Pearce, Director of Finance. It is necessary to clarify the intent of the parties and authorize the Executive Officer to ensure that these five Deputies receive the same benefit as other Designated Deputies.

Proposal

This action is to approve the updated boilerplate for Executive Management Agreements and authorize the Executive Officer to ensure that Oscar Abarca, Joe Contaoi, Carol Coy, Dr. Chung Liu, and Patrick Pearce receive the same across-the-board increase applied to all other Designated Deputies.

Fiscal Impacts

Sufficient funds are available in the FY 1996-97 budget.

Attachment

Updated Executive Management Agreement Boilerplate