Council to consider new pay structure after study

By Anna Jauhola
The Hallock City Council met in a workshop Wednesday, Oct. 30 to hear results of a pay equity study completed by DDA Human Resources.
Dr. Tessia Melvin, who heads DDA’s classification and compensation service area, met virtually with the council. At the regular council meeting on Monday, Oct. 7, the council approved hiring DDA to complete this study to work on pulling the city into compliance for pay equity.
“I started with the market analysis, so that’s what I’m going to present tonight,” Melvin said. “For the market analysis, we took job descriptions we had so we could look at the benchmarks and compare your jobs, where you pay and where the benchmarks pay.”
Melvin said the city of Hallock is paying its employees 66% of the market average on minimum and 75% of the market average on the maximum. The benchmarks used were data from similar-sized towns, as well as Kittson, Marshall and Roseau counties. Comparable cities included Karlstad, Stephen, Baudette, Greenbush and Red Lake Falls. There were others involved, but those had the closest comparable statistics and pay to Hallock. The study also compared county governments because they have similar positions.
“In 2023 and 2024, retail in the private sector is pushing the entry-level pay where some are paying $18 to $20 to $24 per hour. That’s pushing the public sector to have to be competitive in that,” Melvin said.
She added that moving into 2025 and 2026, leadership positions in the public sector will increase as the Legislature removed the salary cap. Until 2024, legislation dictated no one in the public sector could make more than the governor, unless there was an exemption.
“If you have a low minimum, people aren’t coming in the door. And you’re low on the maximum, they’re not staying,” Melvin said of the pay scale. “So I look at those as indicators to help the council decide where they want to be and then building from there.”
She said the council’s next step is to look at its pay philosophy – where the council feels the payscale should be for minimum and maximum pays, and how fast they should get there. For example, the city may want its minimum and maximum pay rates to be within 10% of market average, but it may take a few years to get there because the tax base can’t handle a huge change all at once.
“It’s important to determine where you want to be and how fast we can get there based on what you have to spend and what you think is reasonable,” Melvin told the council. “Some entities will take several years to implement. Some will do one big jump. The benefit for you guys is you don’t have a lot of employees in those positions. Some have been there a while, so it’s going to be within the range and it won’t be a huge cost, but they’ll have growth potential.”
Councilor Kevin Waller, who appeared virtually as well, asked if the market analysis includes benefits as well as pay. Melvin said this analysis only includes pay because benefits vary between locations. Waller also asked whether they could include similar private sector positions in the market analysis.
“We could pull that in, but it’s not pay equity,” Melvin said. “Pay equity is only for public sector groups and it only matters to you. It’s harder to compare because the positions are not comparing apples to apples.”
Once the council decides on its pay philosophy – how close to the market average they want to be – then they can recalibrate and implement a new pay scale. Melvin said DDA can help with the recalibration and implementation for additional fees, but said other entities have completed these steps on their own as well. Because this meeting was a workshop, the council did not make any decisions. They each will look closer at the data, further discuss pay philosophy and make a final decision at the regular November meeting, which was Monday, Nov. 4.