LOS ANGELES (CNS) - Some Los Angeles city employees will have the chance to take an early retirement, as the City Council voted today to approve an option that could reduce or eliminate proposed worker furloughs.
The city's initial plan was to furlough 15,000 employees for a select number of days due to the financial effects of the COVID-19 pandemic. The proposed furloughs equated to about a 10% reduction in annual pay to save about $139 million. Most public safety positions are exempt from the proposal.
Of those employees, about 2,850 are eligible for a proposed separation incentive -- or early retirement buyout -- plan, according to the City Administrator's Office.
“We, by our action ... will be likely eliminating and at least reducing the impact of furloughs,'' said Councilman Paul Krekorian, who chairs the Budget and Finance Committee.
On Monday evening, the committee moved to continue with cuts to the Los Angeles Police Department and set aside about $40 million to reduce the need for furloughs. Adjustments the council proposed to the city budget for 2020-21 will be voted on during Wednesday's meeting.
The City Council also voted to delay potential furloughs as Los Angeles tries to find ways to avoid additional cuts to services and city staff.
For eligible employees, the incentive plan would provide a payment equivalent to 2% of their final pensioned salary for each year of service, supplemented by $7,500. The total payment is not to exceed $80,000.
“I think what's before you is a good work product in a terrible situation,'' Krekorian said. “Most of these choices are not choices that any of us would have made in a normal circumstance, but we're not living in a normal circumstance.''
At least 1,300 furloughed employees will have to accept the terms of the separation agreement, otherwise the city and the labor unions that represent employees will have to draw up a new agreement.
The furloughed employees will have from July 6 until 3 p.m. on Aug. 3 to agree to a separation incentive program.
Richard Llewellyn, the City Administrative Officer, said about 350 employees retire from the city each year, so the program would increase that number by about 1,000, if enough employees agree to the plan.
“Our labor partners believe that this will essentially cover the cost of furloughs,'' Llewellyn said Monday.
Llewellyn said his office estimates the furloughs will save the city $5.79 million each biweekly pay period. Based on the targeted timeline of about two months for implementation of the separation incentive plan, furloughs would be deferred for approximately four pay periods, costing the city $23.1 million.
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