Kokomo Mayor Greg Goodnight announced Friday 140 non-contractual city workers will lose a total of 700 paid days off next year, as part of ongoing city cost-cutting measures.
By moving the eligibility dates for additional paid time off, the new policy will force each of those employees to give up five days off they would have otherwise been entitled to next year.
Goodnight has repeatedly said he will cut $2.2 million in city spending by the end of 2010.
Some of those cost savings have already been achieved by cutting more than two dozen city jobs, and Goodnight is also planning to reduce employee health-care benefits administration officials deem overly generous.
But Goodnight has also expressed numerous concerns about the practice of “banking” unused paid time off (PTO) days, and the number of PTO days given to longtime employees.
The issue first came to light under former Mayor Matt McKillip, when the State Board of Accounts said the city had paid out too much money for banked PTO days.
State auditors asked McKillip to recoup the money, but the directive was ignored. McKillip officials said they interpreted the PTO policy differently than the state auditors.
Even so, the “ding” in the city’s state audit drew Kokomo Common Council attention to the increasing annual payouts for banked PTO days.
And as negotiations with the city’s police, fire and AFSCME unions have continued, Goodnight has expressed concerns about the effect of PTO days on city staffing needs.
City officials estimate more than a third of city employees — all with at least 15 years with the city — have maxed out at 42 annual days off. That number includes vacation, personal and sick days.
City human resources director Kathy Horton said the changes announced Friday — which do not apply to union employees — are more reflective of what private sector workers receive.
“The new policy will allow employees ample time for vacation and sick days, while better reflecting the average benefits of Kokomo taxpayers,” Horton said.
The new policy will not take away any unused PTO days non-contractual employees have already “banked.”
The former city policy allowed employees to bank up to 60 PTO days, rolling those unused PTO days over each year.
Before the policy change, employees could ask for a lump-sum payment of their banked PTO days. Under the old policy, those payments were made on Dec. 1 each year.
But Goodnight’s announcement Friday ended the rollover/lump-sum payment policy for non-contractuals.
Under the new policy, non-contractual employees with banked PTO days rolled over from previous years will only receive payment when they separate from city employment, Horton said.
And employees will only be able to receive a lump sum payment for up to five unused PTO days at year’s end.
In addition, the new schedule for PTO eligibility will take effect Jan. 1.
Instead of maxing out at 42 PTO days after 15 years, employees will max out after 25 years with the city.
It will also take longer to reach each new level of PTO eligibility. For instance, formerly an employee with five years’ seniority was eligible for 32 PTO days. When the new schedule takes effect, an employee would need seven years with the city to get 32 days.
Horton said the policy change will eliminate a large, unbudgeted expense for the city.
“The bad thing is that a lot of people didn’t take vacation because they wanted the payout Dec. 1,” she said. “But this was the only way to fix the problem with the payout.”
City officials said the new policy is the equivalent of hiring three additional employees at no cost to taxpayers.
“By increasing our efficiency now, we’re helping to guard against layoffs down the road,” Horton said.
Local News
City cuts paid time off days
Employees no longer able to roll over unused days off.
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