To: MAYOR AND CITY COUNCIL
From: DIANE STRICKFADEN, DIRECTOR OF HUMAN RESOURCES
TITLE
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APPROVE MANAGEMENT AND CONFIDENTIAL PAY AND BENEFITS PLAN UPDATES AND RETROACTIVE AMENDMENTS TO COMPLY WITH REGULATORY REQUESTS FROM CALPERS AND TO REFLECT RECENTLY ADOPTED POSITION CHANGES
ADOPT BY TITLE ONLY RESOLUTION NO. CC-2610-087, A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDONDO BEACH, CALIFORNIA, UPDATING THE PAY AND BENEFITS PLAN FOR MANAGEMENT AND CONFIDENTIAL EMPLOYEES TO UPDATE ARTICLE II SECTIONS 1 AND 7, MODIFYING THE PAY RANGES FOR THE WATERFRONT AND COMMUNITY SERVICES DIRECTOR POSITIONS AND COMMUNITY DEVELOPMENT DIRECTOR POSITIONS AND UPDATING LONGEVITY PAY LANGUAGE
ADOPT BY TITLE ONLY RESOLUTION NO. CC-2610-088, A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDONDO BEACH, CALIFORNIA, CORRECTING ARTICLE II, SECTION 1, IN THE MANAGEMENT AND CONFIDENTIAL PAY AND BENEFITS PLAN, BY REMOVING THE REFERENCE OF MANAGEMENT INCENTIVE PAY BEING CONVERTED TO BASE PAY, IN ACCORDANCE WITH CALPERS REQUIREMENTS, FOR THE PERIOD FROM DECEMBER 19, 2023 TO DECEMBER 16, 2024
ADOPT BY TITLE ONLY RESOLUTION NO. CC-2610-089, A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDONDO BEACH, CALIFORNIA, CORRECTING ARTICLE II, SECTION 7, “LONGEVITY PAY” IN THE MANAGEMENT AND CONFIDENTIAL PAY AND BENEFITS PLAN, EFFECTIVE RETROACTIVELY FOR THE PERIOD FROM JANUARY 1, 2021 THROUGH OCTOBER 20, 2026, IN ACCORDANCE WITH CURRENT CALPERS REGULATIONS
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EXECUTIVE SUMMARY
The City maintains a Management and Confidential Pay and Benefits Plan (Plan) for unrepresented executive and management positions that establishes compensation and other terms and conditions of employment for designated employees. The City periodically updates the Plan to reflect City Council approved organizational and compensation changes, and to ensure that its provisions accurately document employee compensation practices to comply with applicable California Public Employees' Retirement System (CalPERS) requirements.
In July 2025, CalPERS conducted an audit of the City's Longevity Pay program. Following the audit, CalPERS identified concerns with the historical language used in the Management and Confidential Pay Plan to describe Longevity Pay. CalPERS determined that the language did not clearly demonstrate compliance with its current interpretation of applicable regulations. During the audit, CalPERS also identified a concern regarding language in the Pay Plan adopted in December 2023, during the conclusion of the City's former Management Incentive Pay program. CalPERS has agreed to allow the City to address these issues through retroactive amendments to the applicable Pay Plans.
Accordingly, three related items are presented for City Council consideration:
• An update to the existing Management and Confidential Pay Plan in order to reflect recent City Council approved organizational and compensation changes, as well as to address CalPERS audit findings regarding Longevity Pay Language
• A retroactive update to the previously adopted December 2023 Pay Plan, that removes language that referenced Management Incentive Pay, along with changes to the former Longevity Pay language
• A retroactive update to the Management and Confidential Pay Plan Article II, Section 7 “Longevity Pay” language, dating from January 2021 to present day
For reference, the unrepresented Management and Confidential group has 32 active employees and represents job classifications such as Payroll Manager, Human Resources Analyst, and various Department Directors.
BACKGROUND
FY 2026-27 Organizational Changes and Longevity Pay Language Update
In July 2026, the City Council approved Decision Package #30 as part of the FY 2026-27 budget adoption process which consolidated the previously vacant Waterfront and Economic Development Director position with the existing Community Services Director position and centralized oversight for special events. The Decision Package also shifted economic development activities from the Waterfront Department to the Community Development Department. This action was codified in resolutions approved and adopted at the July 7, 2026 City Council meeting which created a new job specification for the Waterfront and Community Services Director position and also changed the job specification for the Community Development Director. During that action, a new salary range was established for the new Waterfront and Community Services Director position, and the range for the Community Development Director was updated. While both of those actions were codified in their respective Council adopted resolutions, it is necessary to update the Pay Plan so that these changes are accurately reflected in the City’s official Management and Confidential Pay Plan.
The existing Management and Confidential Pay and Benefits Plan also requires revisions to its Longevity Pay language going forward in response to the CalPERS audit. As discussed above, CalPERS identified concerns with the historical language used to describe Longevity Pay and its compliance with applicable CalPERS requirements. The language has been amended in accordance with language provided by CalPERS to comply with their current regulations.
Retroactive Amendment to December 2023 Adopted Management and Confidential Pay Plan
The second item is a retroactive amendment to the Management and Confidential Pay Plan that was adopted in December 2023. That Plan reflected the conclusion of the City's former Management Incentive Pay program and included language concerning Management Incentive Pay and Longevity Pay that CalPERS subsequently identified for correction.
During the audit, CalPERS stated that Management Incentive Pay cannot be “converted” to base pay. The City held the position that the Management Incentive Pay Program ended with the adoption of the December 2023 Pay Plan, and that the pay was not “converted” to base pay. CalPERS has allowed the City to resolve the audit by retroactively amending the December 2023 Pay Plan, as attached. Staff also revised the Longevity Pay language in this Pay Plan as well, in conformance with the CalPERS audit.
Retroactive Amendment to Article II, Section 7, “Longevity Pay” Effective January 2021 to Present
This item retroactively amends Article II Section 7, Longevity Pay, for all Pay Plans that were adopted from January 2021 to present. In their audit findings, CalPERS stated that they look back at special compensation language for up to five years. Because the language appeared in Pay Plans covering multiple periods, a separate retroactive amendment is necessary to address the affected historical provisions.
CalPERS has stated that adoption of these amendments will satisfy the audit findings in regards to the Management and Confidential employee group. Other bargaining units with Longevity Pay language that CalPERS has identified as non-compliant will require the meet and confer process in order to amend the applicable MOU language.
COORDINATION
This report was prepared by the Human Resources Department. The Resolutions were approved as to form by the City Attorney’s Office.
FISCAL IMPACT
The proposed changes are language updates required by CalPERS and have no fiscal impact on the FY 2026-27 Adopted Budget. The audit findings have no impact on the amount or cost of management and confidential employee retirement benefits.
APPROVED BY:
Mike Witzansky, City Manager
ATTACHMENTS
• Reso - No. 2610-087 Updating the Pay and Benefits Plan for Management and Confidential Employees for the Waterfront and Community Services Director and Community Development Director Positions
• Reso - No. 2610-088 Correcting Article II, Section 1, in the Management and Confidential Pay and Benefits Plan
• Reso - No. 2610-089 Correcting Article II, Section 7, “Longevity Pay” in the Management and Confidential Pay and Benefits Plan
• October 20, 2026 Pay & Benefits Plan for Management and Confidential Employees (Redlined)
• December 17, 2024 Pay & Benefits Plan for Management and Confidential Employees (Redlined)
• Retroactive Revision of Longevity Pay Language (Redlined)