Policy 1-4 EMPLOYEE SUGGESTION PROGRAM

DISTRIBUTION :    All Departments

SUBJECT :    EMPLOYEE SUGGESTION PROGRAM

PURPOSE :    The purpose of this policy is to provide the procedures and policies used in the Employee Suggestion Program.  This program was created to increase the efficiency of City operations by providing employees an opportunity and an incentive to improve the economy, safety, and quality of municipal work.  City Council authorized the program by adoption of Resolution 87-88 on August 11, 1987.

PROCEDURES :    EMPLOYEE SUGGESTION PROGRAM COMMITTEE

I.    The Employee Suggestion Program Committee shall consist of the following members:

A.    Assistant City Manager or alternate.  (Designated as Chair and Suggestion Program Coordinator).

B.    Finance Director or alternate.

C.    Personnel Director or alternate.

D.    Employee Advisory Committee Chairman or alternate.

Any three (3) members of the Committee shall constitute a quorum.  Each member of the committee shall have one vote, and three-fourths affirmative vote of the Committee shall be necessary to pass any matter requiring Committee action.

The Committee will adopt rules, as necessary, to conduct the Committees business, provided such rules are not in conflict with this policy.  Upon recommendation of City staff, the Committee shall rule on the applicability or implementation of a suggestion and any associated awards.  The decision of the Committee shall be final.

II.    DEFINITIONS

A.    A “Suggestion”  is a written original idea proposed by an employee of the City of Lawton to the Employee Suggestion Program Committee that clearly suggests a specific method to do any job or procedure better, quicker, easier, safer, or at less cost; to handle additional work load with the same staff, to produce a more efficient operation with better control, to increase revenue, or to improve the quality of service.

B.    “Net Increase in Revenue”  means the estimated first year net increase in revenue resulting from the adoption and implementation of a suggestion.  “Net Savings” means the estimated first year net cost avoidance/reduction resulting from the adoption and implementation of a suggestion.

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The cost of capital expenditures shall be amortized over the useful life of the equipment or a period specified by the Finance Department.  Direct labor costs of implementation will be considered first year costs. Indirect or administrative costs of implementation shall be amortized over a three-year period.

C.    “Tangible”  means suggestions for which monetary value can be precisely determined.

D.    “Intangible”  means suggestions involving improvements     in working conditions, changes in procedures, revisions of forms, improvement in employee morale, or employee health or safety, for which the monetary value     cannot be precisely determined.

III.    ELIGIBILITY

It is the responsibility of the Employee Suggestion Program Committee to make the final determination regarding suggestion and suggestor eligibility.  Guidance and recommendations from the information contained in the departmental evaluation(s) will provide the basis for this decision.

A.    Subject Eligibility

1.    All suggestions will be accepted for review.
2.    If a suggestion is not implemented, it is not eligible for an award.
3.    Suggestions which are directly related to the following subjects are not eligible for awards.
a.    Personal grievance
b.    Matters discussed during collective bargaining
c.    Classification and pay of positions
d.    Matters previously or currently under study or review by management
e.    A duplicate of another suggestion already under consideration
f.    Matters which are the result of assigned    or contracted auditing, studies, surveys, reviews, or research
g.    Matters requiring legislative or Court action other than by City ordinance




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h.    Matters requiring the initiation of routine maintenance activities or adherence to prescribed safety practices. Minor safety problems such as loose carpeting, frayed electrical wiring, etc., should be reported through normal channels.
I.    Stricter enforcement of already existing     rules, regulations, and laws within the City
j.    New or newly modified or designed equipment (that part which is exclusively new), systems, procedures or forms shall not be open to suggestions for the first ninety (90) days of actual use, or the warranty period (if applicable) of the equipment, system, procedure or form, etc., in the City operation.
k.    Suggestions recommending the use or purchase of a specific product brand.
l.    An idea awarded cash under a previous suggestion is not eligible for another cash award for a similar application of that idea.

4.    To be eligible for a cash award, suggestions must be implemented within one (1) year after approval.  Implementation will not include pilot programs or test periods.  (Note: Pilot programs or test periods do not include evaluation of cost savings as outlined in Section IV.C.2.

5.    The eligibility of unusual or borderline suggestions will be determined by the Committee.

B.    Employee Eligibility

All City employees are eligible to submit suggestions. The eligibility for an award, however, depends on factors outlined in this section.

Key elements to consider in determining employee eligibility for a cash award are:

1.    Is the employee expected or required to make suggestions of the type under consideration?

2.    Can the suggestion be implemented by the employee without consulting higher authority?

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C.    Special Awards

Regardless of other sections of the policy, the City Manager, upon the recommendation of the Committee, can make a special award for a properly submitted, implemented suggestion.  Special awards will be considered only in the case of an unusual suggestion which results in superior savings or innovative safety or service improvements.

D.    Suggestion Modification

    If a department modifies an employees suggestion and adopts the suggtion in a different form, the employee shall be eligible for an award if the employees suggestion was directly responsible for managements taking action.  If the final adopted suggestion does not allow for the quantifiable identification of the employees contribution, then the award will be based on the intangible category.

E.    Employee Class

Any City employee whose submitted suggestion is approved by the Committee is eligible to receive a monetary award, with the following exceptions:

1.    Members of the City Council, appointed advisory boards or commissions.
2.    City Manager.
3.    Members and staff of the Employee Suggestion Program Committee.
4.    Department Heads or Division Supervisors, unless the provisions listed at Section (III) (B) of this policy are not specifically applicable to the suggestion submitted, (i.e.) a Department Head can make a suggestion not pertaining directly to his department which would result in a tangible savings in another area of the City, which, under Section (III) (B), he has no authority or responsibility to implement.







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5.    Any employee assigned to a position of conducting research and development, or assigned to a job requiring the solution of specific problems where the suggestion submitted is found by the Committee to be within the scope of such research, development, or problem.
6.    Any employee assigned to a board or committee which has a primary function of recommending ideas or suggestions directly to the City Manager (i.e., Employee Advisory Committee, Safety Committees, Health Committee, etc.) if the suggestion is a subject within the scope of the committee of which the employee is a member.
7.    Any eligible employee submitting a suggestion which is placed into effect shall not lose his eligibility for a monetary award by reason of termination of employment or by becoming ineligible subsequent to submission of the suggestion, if the suggestion is implemented within one year of submittal.

F.    Time Period Eligibility

A suggestor retains the right to any award during the period in which the idea is being evaluated, plus an additional period of 12 months from the date of notification that the suggestion was rejected.  To extend the eligibility period beyond twelve months, the suggestor must complete and submit an additional completed suggestion form.  The new suggestion must identify the former suggestion by number and request the extension of eligibility.  Failure of the suggestor to resubmit the suggestion by the above procedure will result in an automatic lapse of award eligibility at the end of twelve months.

G.    Suggestion Evaluation

The Coordinator, under the policy guidelines set by the Committee, will decide what evaluation process is needed to determine all matters of cost effectiveness or intangible benefits of a suggestion.  The Coordinator is responsible for notifying employees of the disposition of suggestions.




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When requested by the Employee Suggestion Program Committee, departments will conduct a test of a suggestion.  During the test period, the department will maintain appropriate cost and/or savings information to allow the Committee to evaluate the merits of the suggestion.

If duplicate suggestions are received by the Committee, the one bearing the earliest date of receipt shall be deemed the one considered eligible for award.

Awards will be split equally among eligible co-signees of     a suggestion if more than one individual submits the suggestion.  However, the award share of an ineligible co-signer shall not be split with eligible co-signees.

H.    Patentable or Nonpatentable Inventions

Suggestions which involve patentable or nonpatentable inventions shall be eligible for awards.

Awards for inventions shall be determined on the same basis as awards for other types of suggestions.

If a suggestion results in patent rights, the employee shall have the rights as long as the City is granted a right or license to use the invention without compensation.

I.    Appeal Process

After an Employee Suggestion Program Committee decision rejects a suggestion, additional information may be submitted to appeal the Committees decision. An employee who wishes to appeal this decision should submit evidence to support his claim.  The Committee will review new information and will render a final decision concerning the appeal.

IV.    AWARDS AND SAVINGS

If a suggestion is determined to have merit, the Committee will vote on the applicability of an award. Award presentations will be made quarterly.

A.    There are four types of awards:

1.    Cash Awards

2.    Certificates of Award (Signed by the Mayor and the City Manager)

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3.    Certificates of Commendation (Signed by the Mayor and the City Manager)

4.    Plaques (Innovator Award)

Certificates of Award will accompany all cash awards. Certificates of Commendation will be issued to employees whose suggestions contain genuine merit, but are not recommended for a cash award.  The Innovator Award is a special award given to Management or Supervisory personnel not eligible for a cash award or to other employees to recognize specific achievements, when not eligible under the provisions of Sec. (III) (B).

The intangible cash awards are made available from budged funds in the Finance Office.  The costs of tangible cash awards are offset by the net savings or revenue increase in the affected operating departments.

B.    Determination of Savings

Generally accepted accounting principles will be     the guiding influence in determining the savings resulting from the implementation of an employee suggestion.

Although each suggestion requires a different approach to determine its financial impact, the following list may be useful in identifying relevant cost elements:

1.    Personal Services

a.    Direct labor cost (use mid-point of range if specific data is unknown)
b.    Fringe benefits (if applicable)
c.    Overtime or stand-by costs
d.    Management and administrative costs

2.    Equipment or Capital Costs

These costs will be amortized over the life of the equipment and the first years depreciation is considered as implementation costs, i.e., $10,000.00 equipment cost with a five year expected life will equal a $2,000 implementation cost.
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3.    Energy or Fuel Costs

4.    Materials and Supplies

a.    Materials - the new material or purchased parts comprising a major component of the activity under investigation.
b.    Supplies and tools - items used in order to perform the service, i.e., forms, secretarial supplies, nuts or bolts, tools, etc.

5.    Financial Elements

a.    Interest savings or expense
                            b.    Inflation considerations

                        6.    Miscellaneous Costs

Some additional elements which might be considered are: Additional or reduced space requirements, Training efforts, Communications (telephone, mail, etc.), Safety and security,                         Contractual arrangements (rentals, leases, etc.), Transportation costs, maintenance and repairs, Inventory levels and down time for equipment.

C.    Payment of Awards

1.    Complete payment - If an award is $200 or less, and the action required to effectthe savings has been completed, or a period of one years experience with the implemented suggestion has been completed, the entire payment will be awarded to the suggestor.

2.    Partial payment - A percentage of an award will be presented to the suggestor at the beginning of implementation when the award is estimated to exceed $200 and a complete year of savings has not been verified.





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Of savings cannot be determined upon implementation, the Committee will determine the length of time necessary to evaluate it, up to a maximum of one year.  Upon evaluation of the results, the applicable award will be determined by the Committee.

If the first years estimated savings were incorrect, and the error resulted in overpayment to the employee, the employee shall not be required to return any portion of the funds.

In all instances where cost/savings data are submitted for review by the evaluator, the Coordinator, on a sample basis will verify the authenticity and reliability of the information.  After implementation   of   the   suggestion, the Coordinator will periodically verify the validity of the implementation and its related costs and savings.

D.    Taxes

Cash awards made to City employees for their suggestions are considered wages subject to FICA, FIT/EIC, City Retirement, and income tax withholding.  It is the policy of the City to recognize these deductions and grant awards where the net amount will be meaningful to the recipient.    

E.    Amount of Award

1.    Tangible suggestion award is 10 percent of the estimated first years net savings or net increase in revenue with a minimum of $10.00 and a maximum net award of $1,000.00.

2.    Intangible suggestion awards are based on a scale of applicability:

                            






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    Maximum Award  

a.    One to ten employees    $25.00 net
b.    More than ten to a full division                $75.00 net
c.    More than a division to a full department $100.00 net
d.    More than one department up to the City, $300.00 net in general

F.    Group Awards

The amount of an award for a suggestion made by a group of employees shall be determined on the same basis as if the suggestion had been submitted by one employee, and the amount awarded shall be prorated among those employees making the suggestion.

V.    SUGGESTION PROCEDURE
    
Suggestions must be submitted on the currently approved Employee Suggestion Program form, which may be obtained from supervisory personnel or at any of the designated locations within each department.  This form should be submitted to the Employee Suggestion Program Coordinator.  All suggestions will be acknowledged.

Except in special cases and for the sake of clarifying eligibility, the identity of a suggestor is not revealed outside of the Committee or staff other than for award purposes.

The Coordinator will forward the suggestion to the appropriate department head for evaluation.  It will be the responsibility of the department to assign one or more technically qualified employees to evaluate each suggestion submitted.  These evaluations should be completed within 21 days after receipt.  If  the evaluation of the idea requires additional review time, the department shall notify the Committee Chairman.






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All recommendations for adoption or rejection must be signed by the Department Head or Assistant Department Head prior to forwarding to the Committee for disposition.  After receipt of the signed evaluation, the Coordinator will review the form for completeness and correctness.  The Coordinator will verify at least on a sample basis, the detailed cost savings of suggestions recommended for adoption.  A summary of the recommendation will then be completed by the Coordinator and presented to the Committee for evaluation.  If the Committee feels that further study is required before a final decision can be made, such study will be conducted by the Coordinator who will report to the Committee.

The decision of the Committee will be communicated directly to the suggestor.  A letter of recognition for all suggestions reviewed will be forwarded to the department for insertion in the suggestors personnel file.
 
REFERENCES :    City Council Resolution No. 87-88, dated August 11, 1987.

RESCISSION :    This policy becomes effective August 28, 1996 and rescinds Administrative Policy 15-1 dated June 4, 1990.

RESPONSIBLE
DEPARTMENT :    City Manager




________________________________
Gilbert H. Schumpert, Jr.
City Manager
August 28, 1996