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January 31, 2015

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Henderson buys out more than 100 employees

City Council authorizes up to $11 million to fund the program

Beyond the Sun

Henderson’s offer to buy out veteran employees has had 104 takers with about three weeks to go, and the City Council unanimously authorized up to $11 million Tuesday night to fund the program.

The city has spent a little more than $10 million so far, and 63 of the 104 employees who took the buyouts have already left.

Departure dates for the rest are staggered throughout the upcoming months.

The 104 employees who have accepted the deal represent 6 percent of the city’s workforce, carrying annual salaries and benefits that total almost $11 million, Acting Human Resource Director Fred Horvath said.

Employees who accept a buyout receive two weeks of pay for every year with the city and three months of medical coverage.

When the buyout plan was initially announced, it was projected to save Henderson $15 million over the next four years. But with acceptance rates higher than expected, Horvath said, that number will increase.

His staff is working on a program that will track the savings of vacant positions each pay period for an accurate running count of how much money the buyouts save the city. “I’m pretty comfortable that it’s going to push $20 million,” he said.

Four department heads — Steve Hanson (Finance), Shauna Hughes (City Attorney), Daryl Moore (Human Resources) and Skeet Fitzgerald (Neighborhood Services) have taken the buyouts, as well as Public Information Manager Cindy Herman.

Hanson has agreed to remain with the city until February to help manage the financial crisis, while Hughes and Moore have already left. Herman is scheduled to leave the city next week, and Fitzgerald’s departure date has yet to be determined.

A number of other mid-level managers, including Emergency Medical Services Division Chief Randy Howell, Fire Battalion Chief Randall Jones, Fire Marshal James Madden, Park Operations Manager Lynn Phelps, Assistant Finance Director Thomas Powell and a handful of deputy and assistant city attorneys, have also accepted buyout offers.

Any position that is vacated must be cleared by an interdepartmental review committee before it can be refilled. Of the 63 positions that have been vacated, 39 remain vacant, 20 have been approved for internal recruitment only and four have been approved for external recruitment.

The other 41 employees who have accepted a buyout have not left yet and no decision has been announced as to which of those positions will be refilled.

Henderson has offered the buyouts in three rounds.

The first, which ended in March, required that an employee’s age and years of service with the city, when added together, equal 65 years to be eligible. Of the 350 eligible employees, 65 accepted.

To cut additional costs, the City Council authorized a second round of buyouts in March open to any employee whose age and years of service equaled 60 years, hoping to attract 25 more participants. Employees eligible for the first round were not eligible for the second.

Employees of the Development Services Center, which handles construction and business permits and has seen its workload cut by more than half, were eligible for the second buyout, regardless of age or years of service.

When only 15 employees accepted the second-round offer, the council authorized a third round, open to both groups, but instead of the 10 participants they hoped to get, they got 21.

“There were a whole bunch of people who said no (to the first round) out of fear of that life-changing event,” Horvath said. “Then it went away, and when it came back, they’d had time to really think about it and evaluate their situation.”

The city still has about $800,000 to fund additional buyout requests, Horvath said, and the council’s decision Tuesday night to move all city departments to a four-day work week could make competition for the last few slots tight.

The city estimates that 15 positions may be cut when the work week changes in August or September, and Horvath said eight employees who could be affected are weighing the buyout against trying to transfer to another city department.

“There’s a possibility that I will be turning people away,” he said.

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