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8 SLPMA MOU 2023-2028 Section 9.0 Employee Wellness For the period of this Memorandum of Understanding, the concept of employee wellness will continue to be addressed by the City through, but not limited to, executive medical examinations, workshops around health and wellness. The City agrees to continue to provide to employees an Employee Assistance Program as described in the City of San Leandro Personnel Manual, Administrative Procedure 1570. It is agreed that such program shall not be an automatic substitution for appropriate disciplinary action when such action is appropriate. Section 10.0 Retirement– Two-tier System The City shall continue to contract with the California Public Employees’ Retirement System (CalPERS) to provide retirement benefit programs for the term of this Memorandum of Understanding. 10.1 Tier One: For employees hired by the City into the Association prior to January 1, 2013, or for “classic” members of CalPERS hired after January 1, 2013, the City’s contract with CalPERS provides the 3% @ age 50 retirement formula, fourth level 1959 Survivors Benefit and the Military Service credit, with 12 months highest final compensation. Tier one employees shall pay 9% of the employee contribution Effective January 1, 2023, employees will pay an additional one (1%) percent towards the employer’s pension contribution rate for a total employee contribution of 10%. Effective July 1, 2024, employees will pay an additional one-half (0.5%) percent towards the employer’s pension contribution rate for a total employee contribution of 10.5%. Effective July 1, 2025, employees will pay an additional one-half (0.5%) percent towards the employer’s pension contribution rate for a total employee contribution of 11%. Pursuant to IRS Code Section 414 (h) (2), these payments shall be made on a pre-tax basis. The City will contract with CalPERS for Employee Cost Sharing as set forth in Government Code Section 20516(a). These additional employee pension contributions shall be credited to each member’s account as a normal contribution. As soon as administratively feasible, the City will arrange for these additional pension contributions to be incorporated into a contract amendment with CalPERS. The City agrees to refund the employee contributions in the unforeseen event of a member’s death before the contract amendment is complete. 10.2 Tier Two: For employees hired on or after January 1, 2013 and classified as “new” members of CalPERS as defined by Public Employees Pension Reform Act (PEPRA), the City shall maintain a contract with CalPERS for the provision of a 2.7% @ 57 (highest 36 months) retirement benefit formula. Also pursuant to PEPRA, these employees are responsible for paying one-half of the normal cost of this retirement plan. Section 11.0 Compensation Salary for each classification varies from step 1 to step 5 as shown in the salary schedules attached as Appendix A of this agreement. New hires and promotions may be placed at the step closest to a minimum five percent (5%) base salary increase, or any step, subject to the City Manager’s final approval. Employees may be advanced from their current step to the next higher step after each year of satisfactory performance.