HomeMy WebLinkAboutAgenda Report - September 7, 2005 E-20AGENDA ITEM E*W
CITY OF LODI
COUNCIL COMMUNICATION
AGENDA TITLE: Ratification of Settlement Agreement with Former Electric Utility Director, and
Appropriate Funds Therefor
MEETING DATE: September 7, 2005
PREPARED BY: Jere Kersnar, Interim Deputy City Manager
RECOMMENDED ACTION: It is recommended that the City Council ratify the proposed
Settlement Agreement with former Electric Utility Director Alan
Vallow and appropriate funds therefor.
BACKGROUND INFORMATION: Mr. Vallow's employment with the City was terminated by the City
Manager, effective August 29, 2005. As part of the discussions
between the City Manager and Mr. Vallow, a proposed Settlement
Agreement (copy attached) was negotiated and executed by Mr. Vallow, the City Manager, and the City
Attorney, subject to City Council ratification. Among other provisions, the Agreement calls for
severance pay up to six months' salary and health insurance benefits through the period of the
severance payment, and for a full and complete release of all potential claims against the City by
Mr. Vallow.
FISCAL IMPACT: Funding for the unanticipated expense of the severance pay was not
included in the FY 2005106 Budget. The City Council appropriation for this
purpose, requested as part of this action, will be reflected in Mid -Year
Budget revisions.
FUNDING AVAILABLE: The Council Resolution contains an authorization for appropriation to cover
the additional expense included in the Settlement Agreement.
James. Krueger, Finance D rer ctor
Je e . Kers ar,1 to im Deputy City Manager
Attachment: Settlement Agreement
APPROVED:
B ing, City Manager
SEPARATION AGREEMENT AND GENERAL RELEASE
l a Purpose of Agreenhent: The intent of this Separation Agreement and General
Release ("A-reement") is to mutually, amicably and finally resolve and compromise all possible
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issues and Clainhs surrounding the employment of Allan Vallow ("Employee") with the City of
Lodi ("Eahhployer") and the separation there from.
2. Ackno-wledgement of At -Will Status. Eniployee acknowledges that his or her
employment status with Employer has always been at will and that Employee has no preexisting
property right in his or her employment or right to a severance package.
3. Separation from Employment and Receipt of Compensation and Benefits,
Employce's employment with Eahhployer will enol, effective the close of business on Monday,
August 29, 2005 ("Separation Date;"). Employee acknowledges that on the Separation bate,
Employea' paid Employee all unpaid salary and untried vacation time, holiday credit, and personal
leave earned through the Separation gate.. As of the separation Date, except as otherwise stated
herein, Employee will no longer be eligible to receive further payments for wages, salary,
vacation or health insurance:. benefits. (However, Employee will be eligible for continuation of
health insurance benefits at Employee's oven expense pursuant to the provisions of COBRA, the
exact terms of which will be provided to Employee in a separate written document.
4. E'mployer's Consideration for Agreement: In exchange for the release and
a.greeahhents that Employee; is making in this Acn— ement, Employer will provide Employee with a
six month severance payment in the amount of Employee's salary at Employee's final rate of
pay, including all vacation pay, holiday credit, and personal Leave, less all legally required. state
and federal witlhhol.dings, subject to reduction as set [orth in this paragraph. This Severance
Payment will be paid to Employee in installments and in amounts coinciding with Employers'
usual pay periods. In the: event, Employee retains new employment during the six month
severance pea loci any cc rnatiniahg seven payment will be forfeited as of the; date; Employee
begins his or her new employment. EJliployee acknowledges and agrees that but :for
Employee's execution of this Agreement, Employee would not otherwise be entitled to the
henefits described in the paragraph above. Employer shall also provide health insurance benefits
(including medical, dental and vision) to Eanhployce through the aactual period of the severance
paynhcnt.
5. Employee's Consideration for Aureement: In exchange for the payments and
undertaaicin-s described in this Agreement, Employee releases and waives may and all claims,
that lie or she might possibly have against Employer, wIzcfticer° Employee is aware c?fPhcrraz or
meat. In legal terans, this means that, individually and on behalf of his or her representatives,
successors, and assigm> Employee: does hereby completely release and forever discharge;
Employer, its elected and appointed officers, anhanagers, agents, and past and present employees
("thee Releasees") From al claims, rights, demands, actions, obligations, and causes of action of
any and every kind, nature; and character, known or unknown, which Employee may now have, or
has ever had, (against Releasees arising from or in any way connected with Employee's
enhlaloy�hheut witlh Enhploycr aihcllor the separation tier°eol'. 'phis release covers all statutory,
common law, constiwtional and other clainhs, includier; but not limited to:
7738.37.1 -i -
(a) Any and all claims for ivronJful discharge, constructive discharge, or
wrongful demotion;
(f)) Any and all clanns relating to ally contracts of ernployarent, express or
implied, or breach of the covenant of good faith and fair dealing, express or implied;
(c) Any and all tort claims of any nature, including but not limited to claims
For negli-once, defamation; misrepresentation, fraud; age, racial, religious or sexual
discrimination, racial, religious or sexual harassment (whether quid pro duo or hostile
work environment), or negligent or intentional infliction of emotional distress;
(d) Any and all claims under federal, state or municipal statutes or ordinances;
ally claims tinder tire California Fair Imployment and 1 -lousing Act, Title VII of the Civil
Rights Act of 1964, the Civil lights Act of 1991, 42 U.S.C;. Section 1981, the Age
Discrimination in Employment Act, the Older Workers' Benefit Protection Act, the
Americans With Disabilities Act, the Employment Retirenient Income Security Act., the
Califor-nia Labor Code, and any other laws and regulations relating to employment; and
(e) Any and all claims for attorneys' fees or costs.
Employee further agrees that if any such claim is prosecuted in Employee's narne before
any court or administrative agency. Employee waives and agees not to take any award of money
or other dan-ages front such suit.
Cie Return of Eniplover ..Prope:r°ty: Employee shall return to Employer all property
belonging to Employer within 15 days of the execution of this Agreement.
7. Waiver of tlzAznown Future Claims: Employee has read Section 1542 of the
Civil Code of the State of California, which provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR
SUSPFC" f" "TCS EXIST IN f=fl>S FAVOR ATTHE TIME OF
EXECUTING "T>i-IL+ RELEASE, WHICH IF KNOWN BY HIM
MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THEDEBTOR.
Ernployee understands that Section 1542 gives Employee the right not to release existing claijus
ofwhich Employee is not now awa-re, unless Employee voluntarily chooses to waive this right.
Even though Ernployee is aware of this right, Eiripl.oyee nevertheless hereby voluntarily waives
the rights described in Section 1542, and elects to assume all risks for claims that now exist in
Employee's favor, krrr iva or tcrrl,noivu, arising from the subject platter of this Agreement.
8. Interpretation and Construction of Agreement: This Agreement shall be
construed and interpreted in accordance with the laws of the State of Catifornia. Regardless of
which party initially dr�l tcd this Ageenlent, it shall not be construed against any one party, and
shall be construed and enforced as a mutually prepared Age:ernent,
9. No Admission of Lidability:.By entering into this Agreement, E,rnployer is not
admitting to any liability, wror7gdoing or legal violation whatsoever with regard the employment
relationship between the parties or with respect to any claims released herein. Employer -
expressly denies any asid rill such liability and wrongdoill-
77.3r3 A -2-
1.0. Complete and Voluntary A reement: Employee acknowledges that Employee
has read and understands this Agreement; that Eniploye;e lavas had the opportunity to, and has been
advised by Employer to seek legal counsel of Employee's own choosing and to have the teri-n.s of
the Agreement fully explained to ]iiia or her; that Employee is not executing this Agreement in
reliance; on any promises, representations or inducements other than those contained herein; and
that Employee is executing this Agreement voluntarily, free of any duress or coercion, Employee
specifically understands that by entering: into this Agreement L:mployee is Ibrever foreclosed
from pursuing any of the claims Employee has waived in paragraph 5 above.
1 l . Review and Revocation Periods: Employee shall have; twenty-one (21) days to
accept and sign this Agreerne rit. Employee waives said twenty -orae (2 1) day period to accept and
sign this Agreement. Employee shall have seven (7) days following the date on which be or she
signs this Agreement to revoke it. Revocation roust be made by delivering written notice to the
City Manager at 221 W. Titre St. Lodi, California, 95240. For the revocation to be effective,
written notice must be received no later than 5:00 p.m. on the: seventh calendar day after
Employee signs this Agreement. If Employee revokes in a timely manlier, this Agreement shall
not be, cfrcctivc or e rilor'ceable, and Employee will not be entitled to arry payment or benefits as
described in paragraph 4 above.
I 2. savizrgs Clause: should ally of the provisions ol'this Agreement be determined to
be invalid or uncral'orcerable; by a court or gov rn.naent agency of competent jurisdiction, it is
agreed by the patties that such determination shall not affect the enforceability of the other
provisions herein.
13, Scope of Agreement, "I'lais Agreement constitutes the. entire understanding of the
parties on the subjects covered. Except as expressly provided here, this Agreement supersedes
and readers null and void any and all prior agreements, whether oral or written, between
Employed and I:
15. Ratification-, This Agreement will be binding upon the City only upon its
ratification by the Lodi City COUDC11
PLEASE READ CARE, FULLY. THIS AGREEMENT CONTAINS A F[)LL RE1,EASE
OF LEGAL CLAIMS, BOTH KNOWN CLAIMS AND UNKNOWN CLAIMS,
Dated -
CI
TY OF LORI, a municipal corporation
B
BLAIR KING
City Manager
ATTEST:
SIJSAN J. BLACKSTON
City Clerk
APPROVED AS TO FORM:
D. �-�PFIENI SC1-VWX7A
City Attorney
773837.1 -4-
EMPLOYEE
ALAN VALLOW
RESOLUTION NO. 2005-
A RESOLUTION OF THE LODI CITY COUNCIL
RATIFYING THE SETTLEMENT AGREEMENT
WITH FORMER ELECTRIC UTILITY DIRECTOR
ALAN VALLOW AND APPROPRIATING FUNDS
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NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council hereby
ratifies the Separation Agreement and General Release ("Settlement Agreement')
entered into between City Manager Blair King and former Electric Utility Director Alan
Vallow, as shown on Exhibit A attached hereto; and
BE IT FURTHER RESOLVED that the Finance Director is hereby authorized to
appropriate funds as necessary to cover the terms of the Settlement Agreement.
Dated: September 7, 2005
I hereby certify that Resolution No. 2005- was passed and adopted by the
City Council of the City of Lodi in a regular meeting held September 7, 2005, by the
following vote:
AYES: COUNCIL MEMBERS —
NOES: COUNCIL MEMBERS —
ABSENT: COUNCIL MEMBERS ---
ABSTAIN: COUNCIL MEMBERS —
SUSAN J. BLACKSTON
City Clerk
2005-
EXHIBIT Al
SEPARATION AGREEMENT AND GENERAL RELEASE
I . Purpose o1' Agreement: The intent of this Separation Agreement and General
Release ("Agreement") is to mutually, amicably and finally resolveand compromiw all possible
issues and claims surrounding the employmerit of Allan Val.low ("Employee") with the City of
Lodi ("Employer") and the separation there from.
2, Acknowled enrent of At -Will Status: Employee acknowledges that his or her
19.
employment status with Employer has always been at will and that Employee has no preexisting
property right in his or her employtnew or right to a severance package.
3. Separation from Employment and Receipt of Compensation and Benefits:
Employee's employment with Employer will end, effective the close of business on Monday,
August 29, 2005 ("Separation Date"). Employee acknowledges that on the Separation Date,
Employer paid Employee all unpaid salary and unused vacation time, holiday credit, and personal
leave earned through the Separation Date. As of the Separation Date, except as otherwise stated
herein, Employee will no longer be eligible to receive further payments for wages, salary,
vacation or health insurance benefits_ However, Employee will be eligible for continuation of
health insurance benefits at Employee's own expense pursuant to the provisions of COBRA, the
exact terms of which will be provided to Employee in a separate written document.
4. Employer's Consideration for Agreement: In exchange for the release and
agreements that Employee is making in this Agreement, Employer will provide Employee with a
six rnontli severance payment in the amount of Employee's salary at Employee's final rate of
pay, including all vacation pay, holiday credit, and personal leave, less all legally required state
and federal withholdings, subject to reduction as set forth in this paragraph. This Severance
Payment will be paid to Employee in itistallinents and in amounts coinciding with Employers'
usual pay periods. fn the event, Employee retains new employment during the six month
severance; period, any rernaining severance payment will be forfeited as of the date Employee
begins his or tier new employment. Employee acknowledges and agrees that but for
Employee's execution of this Agreement, Employee would not otherwise be entitled to the
benefits described in the paragraph above. .Employer shrill also provide health insurance benefits
(including medical, dental and vision) to EMPioyce through the actual periodof the severance
payment.
5. Employee's Consideration for Agreement: In exchange for the payments and
undertakings described in this Agreement, Employee releases and waives any and all clailr'rs,
that he or she might possibly have against Employer, whelher Employee is aware of then or
11ot. In legal terms, this means that, individually and on behalf of his or her representatives,
successors, and assigns, Employee does hereby completely release and forever discharge
Employer, its elected and appointed officers, managers, agents, and past and present employees
("the Releasees'') from all claims, rights, demands, actions, obligations, and causes of action of
any and. every kind, nattrre and Character, Known or unknown, which Employee may now have, or
has ever had, against Releasees arising from or in any way connected with Employee's
employment with Employer and/or the separation thereof. This Release covers all statutory,
common law, constitutional and other claims, includinbut not limited to -
7 73,U ?
o:
773x3?1 - r -
(a) Any and all claims for wrongful discharge, constructive discharge, or
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wrongful demotion;
(b) Aiiv and all claims relating to any contracts ofemployment, express or
implied, or breach of the covenant of good faith and fair dealing, express or implied;
(c) Any and all tort claims ofany stature, including but not .limited to claims
for negligence; defanlaxioll; 111 isrepresentation; 1raud; age, racial, religious or sexual
discrimination, racial, religious or sexual harassment (whether quid pro quo or hostile
work envirounient); or negligent or intentional infliction of emotional distress;
(d) Any and all clainis under federal, state or municipal statutes or ordinances,
any claims under the California Fair Finployment and 1 -lousing Act, Title V1I of the Civil
Rights Act of 1964, the Civil Rights Act of 1991, 42 U.S.C. Section 1981, the Age
Discrimination in Employment .Act, the Older Workers' Benefit Protection Act, the
Americans With Disabilities Act, the I?nlployi-sent Retirement income Security Act, the
California Labor Code, and any other laws and regulations relating to employment; and
(e) Any and all claims for attorneys' fees or costs.
Employee further agrees that if any such claim is prosecuted in Employee's naive before
ally court or administrative agency, Employee waives and agrees not to take any award of money
or other damages from such suit.
G. Return of Employer Property: Employee shall return to Employer all property
belonging to Employer within 15 days of the execution of this Agreement.
7. Waiver of Unknown Future Claims: Employee has react Section 1542 of the
Civil Code of the State of California, which provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN FUS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY .HIM
MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE llEBTOR.
Employee understands that Section 1542 gives Employee the right not to release oxisting claims
ol'which Employee is not stow aware, unless Employee voluntarily chooses to waive this right.
Even though Employee is aware of this right., Employee nevertheless hereby voluntarily waives
the rights described in flection 1542, and elects to assume all risks for claims that now exist in
Employee's favor, knaivu or unknusvit, arising from the subject matter of this Agreement.
8. Interpretation and Construction of Agreement: This Agreement shall be
construed and interpreted in accordance with the: Jaws of the State of California. Regardless of
which party initially drtilted this A-rccinent, It shall not lie construed against any one party, and
shall be construed and enforced as a inulually prepared Agreement.
9. No Admission of Liability: 13y entering into this Agreement, Employer is not
admitting to any liability, wrongdoing or legal violation whatsoever with regard the employment
relationship between the parties or with respect to any claims released herein. Employer
expressly denies any ,'md till stich liability anti wrongdoing.
711917. 1 -2-
10. Complete and Voluntary Agreement: Employee acknowledges that Employee
has recd and understwids this Agreement; that Employee has had the opportunity to, attd has been
advised by Employer to seek legal counsel of Employee's own choosing and to have the terms of
the Agreement fully explained to hien or her; that Employee is not executing this Agreement in
reliance on any promises, representations or inducements other than those contained herein; and
that Fniployee is exectcting this Agreement voluntarily, free, of any duress or coercion. Employee
specifically understands that by entering into this Agreement Employee is forever foreclosed
from pursuing any of the claims Employee has waived in paragraph 5 above.
11. Review and Revocation Periods: Employee shall have twenty-one (21) days to
accept and sign this Agreement. Employee waives said twenty-one (21) day period to accept and
simn this Agreement. Employee shall have seven (7) days following the date on which he or she
signs this Agreement to revoke it. Revocation must be made by delivering written notice to the
Citv Maitag,er at 221 W. fine St. Lodi, California, 95240. For the revocation to be effective,
written notice must be received no later than 5:00 p.nt_ on the seventh calendar day after
Employee signs this Agreement. If Employee revokes in a timely manner, this Agreement shall
not be effective or enforceable, and Employee will not be entitled to any payment or benefits as
described in paragraph 4 above;,
12. Savings Clause: Should any of the provisions of this Agreement be determined to
be invalid. or unenforceable by a court or government agency of competent.jurisdiction, it is
agreed by the parties that such determination shall not affect the enforceability of the other
provisions herein.
13. Scope of Agreement: This Agreement constitutes the, entire: understanding of the
parties on the subjects covered. Except as expressly provided here, this Agreement supersedes
and renders null and. void any and all prior agreements, whether oral or written, between
Employee and Employer,
14. :Arbitration: The parties agree that any controversy involving the construction or
application of any tercets, covenants or conditions of this Agreement, or any clatnts arising out of
or relating to this Agreement or the breach thereof will be submitted to and settled by final and
binding arbitration, pursua.ltt to the California Arbitration Act, in. San Joaquin County, California.
Each. side will bear its own attorneys' fees in any such arbitration, and the arbitrator shall not
have authority to award attorneys' fees unless a statutory section at issue in the dispute authorizes
the award of attorneys' fees to tate prevailing party, in which case the arbitrator has the authotlty
to make such award as permitted by the statute in question.
773837,4 -I-
15. Ratification: This Agreement will be binding; upon the City only upon its
ratification by Lho Lodi City Council
PLEASE READ CAREFULLY. THIS AGREEMENT CONTAINS A FULL RELEASE
OF LEGAL CLAIMS, BOTH KNOWN CLAIMS AND UNKNOWN CLAIMS,
Dated -
CITY OF LODI, a municipal corporation.
By r ._
BLAIR KING
City Manager
A"IPEST:
SUSAN J. BLACKSTON
City Clerk
APPROVED AS TO FORM:
-."�
WOR AV
773837-1 -4-
Dated: 8-2-9-05
EMPLOYEE
ALAN VALLOW