March 30, 2004

SUBJECT: SUGGESTION AWARDS PROGRAM

REPORT IN BRIEF

This report reflects Council direction in reviewing and suggesting changes to the Suggestion Awards Program for Council consideration. Staff recommends that Council include this program in the 2004/2005 budget.

BACKGROUND

During fiscal year 2003/04 budget meeting, Council directed staff to redesign the Suggestion Program and include it for Council consideration for the 2004/05 budget reviews. Some of the problems that were identified with the former program included:

• The lengthy process slowed down the pace of innovation
• Suggestions that could not be implemented were given awards
• Required considerable time from managers to evaluate an idea
• Perception that it was applicable to a small group of employees
• Former design discouraged teamwork and idea sharing
• Rewarded employees for making suggestions that were requirements of their own job 

A City employee committee was formed to assist in the review and revision of the Suggestion Program.  A survey was developed to obtain information from other agencies. Sixty-five agencies including several neighboring Bay Area cities were surveyed. It was found that the majority of cities do not have such a program. There were some that had considered the idea, but not implemented it. Other agencies had token low-cost award programs.  Only one other city had a similar program to the City of Sunnyvale.

DISCUSSION

After reviewing all available information, the committee agreed that the former City Program needed to be updated to address the identified problems, but did not need to be totally replaced.  The program had some good features.  There were some other deficiencies that were identified and corrected with the rewriting of the existing policy. The following changes were made:

• Eligibility and submittal procedures were clarified and expanded.
• Roles for suggester and evaluator were clarified at each step of the implementation process.
• The evaluation process is more expedient and has a finite timeline.
• Suggestions that will not be implemented will not be rewarded.
• Creates a “fast track” category for safety awards for quick implementation.
• Consideration of alternative small cash awards or certificates for suggestions offering intangible benefits.
• Appeals to all employees across departments and allows flexibility for program participation
• Group suggestions and team participation is encouraged
• Criteria for unawardable suggestions is clearly delineated in the new policy. 

The revised policy has been presented to Personnel Board members and Executive Leadership Team for their input and has received legal review by the City Attorney.

FISCAL IMPACT

The fiscal impact will depend on the direction and funding that City Council provides for implementation of the Employee Suggestion Awards Program. The average number of submitted suggestions over a period of four years has been 40 per year, assuming an average award of $250 the total needed for the cash award portion of the program is $10,000. The program is to be budgeted in Program 784 Insurances, Retirements, and Incentives in the Benefits Fund, in the Human Resources Department. 

PUBLIC CONTACT

Public contact was made through posting of the Council agenda on the City’s      official notice bulletin board, posting of the agenda and report on the City’s web  page, and the availability of the report in the Library and the City Clerk’s Office.

ALTERNATIVES

1. Approve implementation of the revised Employee Suggestion Awards Program and consider including funding of $10,000 for FY 2004/05 budget.

2. Do not approve implementation of the revised Employee Suggestion Awards Program and do not consider including funding for FY 2004/05 budget.

3. Provide other alternative direction.

RECOMMENDATION

Staff recommends adoption of Alternative No. 1. Approve implementation of the revised Employee Suggestion Awards Program and consider including funding of $10,000 for FY 2004/05 budget.

Prepared by:

Myriam Castaneda
Human Resources Supervisor

Reviewed by:

Mark Gregersen
Director of Human Resources

Approved by:

Amy Chan
City Manager

Attachments

A. Revised Administrative Policy, Chapter III, Article V, Section 8, Subdivision 1, Suggestion Awards Program. (pdf format)