Hoover council president calls for 'serious discipline' of employees for change in police retirement pay

Hoover Council President Gene Smith tonight called for “serious discipline” and possible termination of city employees who were responsible for a recent change that could significantly affect retirement pay for police officers and dispatchers.

Earlier this year, in response to an Alabama Supreme Court decision, the city changed the way it reports overtime pay for police officers and dispatchers to the Retirement Systems of Alabama.

The Fair Labor Standards Act requires that police officers be paid overtime only after 43 hours of work, Hoover City Administrator Allan Rice said. The Retirement Systems of Alabama has a rule that employees can only earn pension benefits on 120 or 125 percent of their base pay, depending on their RSA tier.

Historically, the city of Hoover has included all 43 hours of work in a given week in “base pay” calculations, but the city this year changed that to only include 40 hours of work in “base pay” calculations, Rice said.

This was done because of a recent Alabama Supreme Court decision that said state law enforcement officers had to have their “base pay” reported in this way, Rice said.

However, Smith said the affected employees were not notified of the change in advance, and it only came to their attention after an officer noticed the discrepancy in the retirement deductions on his paycheck.

Smith said the change was a misinterpretation of the Supreme Court decision because the decision explicitly states that its ruling applies to law enforcement officers employed by the state and does not affect local law enforcement officers.

“It may be likely that the perpetrators of this policy change were trying to save money for the city, but at a terrible cost to our employees and recent retirees,” Smith said. “We were saving quarters yet collectively costing them tens if not hundreds of thousands of dollars over their lifetimes.”

The change “reflects a serious lack of judgment that exposes the city to litigation,” Smith said. “I see this as an unconscionable action taken by a few people, that was directly targeted towards our police officers and certain 911 communicators.”

Smith said he also was concerned because this was a “policy change” and policy decisions are made by the City Council. “Only the mayor, in step with the council, can set both pay schedules and benefits,” he said. “Retirement income is such a benefit.”

“Mr. mayor, I request that you bring in a third-party investigator to determine who was involved in this appalling and cruel targeting of these public safety employees,” Smith said. “They come to work every day praying they will, but not knowing if they will, go home at the end of their shift or assignment. They don’t need bureaucrats making their financial futures an additional stress in life.”

Smith said the city should immediately reverse the policy and replace whatever funding was reduced. He also asked that “each and every person involved in this activity is seriously disciplined, up to and including demotion and termination.”

Mayor Frank Brocato said city staff met with police officers after the complaint was brought to their attention.

“We are studying this to see if what we did was the right decision or wrong decision, and if it’s not the right decision, we’ll correct it,” the mayor said.

Rice said city officials made the change earlier this year only because they thought they had to do so. The city attorney is reviewing the matter and the mayor has committed to reverse the change made earlier this year if the attorney finds the city did not, he said.

Brocato said he had never seen so much grandstanding his entire life. “We address any kind of problem that comes up, and we don’t have to have this type of grandstanding to address it,” he said. “We’ve got it. We’re working on it. We’ll talk about it, and we’ll take care of it.”

Rice said the decision to make the change was made by several people, but he declined to identify them.

Normally, the only police officers present at City Council meetings are the chief, executive officer and the officer assigned to provide security, but tonight there were about three dozen officers in the audience, and there were seven or eight uniformed officers at the Aug. 6 council meeting.

Police Chief Nick Derzis said the large police presence was due to a salary study that originally was to be presented on Aug. 6 but ended up being presented tonight.

Salary study

That study, which compared salaries of Hoover employees to those of other cities in Alabama and cities similar to Hoover in Georgia and Tennessee, determined that, on average, salaries for Hoover employees are highly competitive with other cities. However, on average, Hoover does not “lead the market” in salaries, said Gail Meriweather, the consultant who led the study for Gallagher Benefit Services.

Her company found that salaries for city of Hoover employees on average were 3.7 percent below salaries in the other cities or similar private sector jobs. Public safety jobs, which represent a large chunk of Hoover employees, had salaries that were 4.26 percent less than salaries in other cities, Meriweather said.

Her company recommended a new salary schedule that would cost the city $1.1 million to implement to help Hoover in employee recruitment and retention.

Brocato said he will be including the salary recommendations in his fiscal 2019 budget proposal because he wants to make sure Hoover continues to be the employer of choice in the area.

The study by Gallagher Benefit Services also evaluated staffing levels and found that Hoover should have about four more police officers and four more firefighters than it does, Meriweather said.

This story was updated at 10:45 p.m. with information about the salary study presented to the Hoover City Council.