Very Urgent Assignment - 4-5 Hours
jhayes
FSE375HumanResourceCosts.pptxFSE 375
Human Resource Costs
Personnel are required to provide service
May be volunteer, career, or both
Personnel are the most valuable of all resource categories
Personnel resources are expensive to acquire and maintain
People
Career personnel must be paid salaries
Labor market may cause competition
Recruiting, selection, and retention issues
Collective bargaining
Why are personnel costs so expensive?
Recruiting
Hiring and selection process
Entry training and upfit costs
Wages (including overtime)
Benefits
Employee maintenance – fitness, medical evaluation, and training
Retirement – pension costs
Personnel Expense Categories
Let’s look at specific costs in each category.
Career vs. Volunteer (or paid on call)
How do costs differ?
Position announcements or advertising
Full time recruiter?
Job fairs – travel costs
Brochures or flyers
Social media
Recruiting
Written exams
CPAT
Oral Interview Boards (travel, per diem, and overtime costs)
Background checks and polygraphs
Psychological
Medical clearance
Hiring and Selection Costs
Career FD – Cadets (Recruits) @ Fire Academy
Volunteers – are they paid for training sessions?
Instructor personnel
Training materials – books, instructional aids, etc.
Expendable items
Training PPE & SCBA
Cert fees – IFSAC, EMT, CPR, etc.
Others?
Basic Training & Initial Costs
Hourly employees are fire fighters and company commanders
Salary employees (exempt from OT) are Chief Officers
Hourly employees earn OT above 40 hrs per week (OT rate is 1.5 times hourly wage)
24/48 56 hr workweek FF’s earn average of 16 OT per week
Scheduled and Unscheduled OT
Wages – Career
Employed for one or more shifts per week, but less than full time
May not have a set schedule
May be used to fill in staffing gaps
What about costs?
Part Time Personnel
Typically no overtime earned
Less benefit costs such as health insurance, pension, etc.
Less costs for vacation/sick leave and pay
Others?
How are part time FF costs different?
Per response/incident stipends
Similar amount for training/meeting sessions?
Tax law issues
Volunteers may be completely unpaid
Some volunteers are paid an hourly rate for time in service
Flat minimum rates may apply
Paid on Call Volunteers
FICA – Federal Insurance Contributions Act
Employer and employee each pay 6.2% of wages for SS (Only on first $118,500)
Both pay 1.45% for Medicare
Total cost = 15.3% of payroll
Employee contributions are budgeted as salary/wages
Social Security/Medicare
Wages/Salaries are only part of the issue!
Health insurance
Dental insurance
Life, disability, etc.
Eye care coverage
Unemployment compensation
Benefits
Often shared between employee and employer
Health insurance alone can cost $1000 per month for family coverage. Even higher in some states.
Health and Wellness programs are gaining in popularity – why?
Unemployment insurance premiums are usually paid by employer
Costs of Insurance Benefits
Employees are given a ‘pool’ of $ to spend as they choose on insurance options
Tax laws change over time
Employees were allowed by previous tax law to invent unused benefit $ in 401K/457 retirement accounts. No longer an option!
Employee Benefit Pools
Workers Comp - approx 1.5% of payroll
Fed/State Unemploy insurance – approx .5%
Varies state by state
Workers Comp & Unemployment Insurance
Annual employee physicals
TB, Hep B vaccines (FD’s with EMS or first responder programs)
Gym memberships for fitness
Training and certifications costs usually in other areas of budget, but are related to personnel costs.
What training and certifications are required?
Other Annual Personnel Costs ‘Personnel Maintenance’
Incentive pay
Salary supplement for training (Ky Fire Comm)
Salary supplement for college hours or degrees
Usually increase with higher levels of achievement
Education expense reimbursement
Reimbursement for tuition
Reimbursement for books and supplies
Education Benefits Two Approaches
Hot topic across the US – why?
Pension Costs
Employer and employees share costs
Not always! The Wisconsin experience
Kentucky – CERS Hazardous Duty
Employees pay 8%
Employer pays 17.91%
Employer costs typically go up due to unfunded liability concerns
Pension Costs Details
Other states have different contribution rules and benefits
What is the difference between a ‘Defined Benefit’ pension and a ‘Defined Contribution’ program such as: 401K, 457, etc.
Not all Pensions are the Same
Employees pay 12% of salary as of July 1, 2013
Employer pays a flat – approx. 13 million per year
Lexington-Fayette
People are expensive
All costs discussed must be considered when setting staffing levels
Decision to go from volunteer to career FD staff is a big one!
Summary
