PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA                  Item No.       7c 
Date of Meeting      November 2, 2010 
DATE:      October 15, 2010 
TO:        Tay Yoshitani, Chief Executive Officer 
FROM:     Tammy Woodard, Senior Manager, Total Compensation 
SUBJECT:   Briefing  2011 Salary and Benefit Resolution 

SUMMARY 
The Salary and Benefit Resolution delegates authority from the Commission to the Chief Executive Officer to direct
the administration of compensation and benefits for the Port's non-represented employees. The resolution covers
approximately 830 employees, or 55% of the workforce. The Port's total compensation philosophy has been to
provide a pay and benefits program that is at or slightly above market to support retention and attraction of high-
performing staff committed to achieving the Port's mission. The resolution covers only employees who are not
represented by a collective bargaining agreement (CBA) although provisions of current CBAs are considered and
do inform changes to the resolution.
While changes to the resolution vary from year to year, the 2011 resolution does not contain any substantial
changes from the 2010 resolution.
The Salary and Benefit Resolution authorizes the Port to provide medical and dental insurance benefits for nonrepresented
employees and permits sharing premium costs with employees. In an effort to contain increasing
benefit costs, the Port initiated premium sharing in 2010 for employees on the Port sponsored medical plans. In
2011 the Port will significantly increase the portion of the premium that employees will pay. Some employees 
represented by a labor union are also covered by the Port sponsored medical plan and will also pay increased
premiums in 2011. The Port is also changing the funding mechanism for the Premera medical and Washington
Dental Service plans in 2011 to a self-funded model as a further cost containment step. These changes follow
implementation in 2009 of co-insurance for employees covered by the Port's Premera plans. The changes to
employee out-of-pocket health care costs are programmatic changes that have been factored into the 2011 budget.
The resolution also establishes the Pay for Performance (PfP) program as the manner for granting pay increases to
non-represented employees and stipulates that the program will be administered under Port Policy HR-21, Salary
Administration. The Port's Pay for Performance program is a merit-based program and pay increases are tied to
employee's performance plans and appraisals. There are no automatic Cost of Living Adjustments (COLA) or step
increases. The resolution further specifies that the Pay for Performance amount will be established by the budget
process and implemented by Human Resources and Development (HRD). Funding for the PfP program is included
in the Port budget. The 2011 budget includes approximately $1.9 million to fund an average 2.5% PfP increase.
The average PfP increase takes into account other employers' average anticipated merit-based increases, total
expected increases (COLA plus step increases) at other public employers, and known or anticipated increases for
employees covered by the Port's collective bargaining agreements. 
Unlike the Port's merit-based approach, most public employers utilize a step-in-grade pay program where
employees receive automatic pay increases from one step in their salary range to the next until their pay reaches
the top step, or maximum, of their range. Other public employers also provide CPI-based COLAs that increase
their salary range structure and employees all receive an equivalent pay increase. 
The resolution contains the salary range structure; a listing of each of the Port's salary ranges identified by a grade 
along with the minimum, middle point, and maximum pay for each grade. Increases to the Port's salary ranges,

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
October 15, 2010 
Page 2 of 5 
which do not contain specific steps, are based on how the range structure currently compares to market as well as 
overall anticipated pay changes in the local labor market. Increases to the salary range structure do not result in
any automatic pay increases unless an employee's pay is less than the new minimum of the range following a
range structure increase. Below minimum adjustments resulting from salary range structure increases are
generally minimal, less than $20,000, and absorbed in the budget at the department level where necessary. We
are recommending a 2% increase to the non-represented salary range structure 2011. 

BACKGROUND 
Developing Recommendations 
Recommendations for the Salary and Benefit Resolution are based on many factors. These can include: 
changes to laws governing employee benefits, 
updates to Port policies that guide employee pay or benefits, 
estimates made in the late spring for Port budget planning purposes, 
market pay levels, 
pay increase plans of local public employers, 
anticipated performance increases of general industry employers 
input, as well as questions, from managers and employees throughout the year, and 
known as well as estimated cost-of-living adjustments (COLA) and stipulated increases contained in the
Port's collective bargaining agreements. 
While the resolution addresses pay and benefits for non-represented employees, policies and other documents
also provide comprehensive guidance to HRD staff in administering these programs. Policies including Employee
Performance Planning and Appraisal, Leave, Employment Practices, and Salary Administration for Salaried
Employees expand on the provisions of the resolution and address various aspects of pay and benefits. The Pay
Program also contains details beyond those included in the Salary and Benefit Resolution to guide pay
administration. B enefit plan documents provide additional information on the Port's benefit programs. 
Unique Aspects of the Port 
The port is a public employer operating and overseeing major transportation hubs and industrial facilities (the
airport and seaport) and is thus different from other public employers that deliver services to the citizens who
support it. The Port also manages a large construction program as part of its activities and is a major economic
engine for King County and the region because of its role in preserving and creating economic opportunities and
family-wage jobs. In addition to being a government the Port is a business, and its most valuable asset is its skilled
and motivated work force. 
Given the nature of the aviation and seaport businesses, a significant number of the Port's employees perform
highly technical and often specialized work. The Port's business requires a variety of engineers, including
specialists in runway pavements and pier design, and environmental specialists with the knowledge and ability to
work collaboratively with other agencies and stakeholders on major remediation projects. The Port requires
employees skilled in operating a major international airport and a seaport with both container and cruise
businesses, as well as writing and overseeing the many grants the Port receives. These skill sets are not typical of
other local governments in the area. Port employees also perform work that is more general in areas like
marketing, real estate management, construction management, legal, accounting, and public affairs. These
employees are also somewhat specialized because of their knowledge of global aviation and/or maritime sectors,
or of industrial real estate. More than 100 employees manage the Port's information and communication
technology systems, including various billing systems and the flight display systems at the airport. Even in today's
economy, assembling, training, and retaining this broad array of talent can be a challenge. The national
unemployment rate is 9.6%. Many Port jobs require college degrees, and the national unemployment rate for
college graduates is 4.4%, less than half the overall average.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
October 15, 2010 
Page 3 of 5 
As stated in the summary, the Port's pay program for non-represented jobs is unique when compared to most
public employers. Public employers often have pay structures that include established 'steps' within each pay
range and employees pay automatically progresses from one step to another at established time intervals. Steps
within a pay range are typically set at determined intervals (e.g. 2.5% or 4%) and employees often receive step
increases at the beginning of the year until their pay reaches the top step in the range. When the ranges in these
structures are adjusted, generally as a result of COLA increases, all employees receive a pay increase equivalent
to the increase in the ranges. COLA increases are in addition to step increases employees receive. Public
employers often utilize one pay structure for all their jobs, both represented and non-represented. 
The Port's non-union workforce, however, does not receive COLAs or step increases. Employees are typically
hired at a starting pay rate between the minimum and middle point of the range. T heir pay progresses through the
range based on Pay for Performance increases tied to their performance evaluations. The earned average PfP
increase of the Port's non-represented employees is often less than the automatically granted combined COLA and
step increases that employees at other public employers receive. The Port's 2010 PfP increase is currently
averaging 3.8%. In 2010 King County employees received 2% COLA increases plus step increases of 2.4% to
7.2%. City of Seattle employees received 2% COLA increases plus 4% step increases. 
Considerations for 2011 
The varied and distinct nature of the Port's airport, seaport and real estate business, together with the work these
businesses require, inform recommended changes to the resolution each year. There are also factors unique to
specific years that warrant consideration when developing recommended changes to the resolution. For 2011 
notable considerations are a substantial increase to the employee medical premiums and the expected increases to
both Port and employee contributions to State retirement plans. 
In 2010, the Port implemented premium sharing for all employees covered by Port sponsored medical plans 
following plan design changes in 2008 and 2009 that increased employee costs for medical care. In 2011 the Port
will convert the Premera medical and Washington Dental Service plans to self-funded plans. These changes are
expected to reduce the 2011 health plan cost increases by about 9%. Next year employees covered by the Port
sponsored medical plans will also pay a larger portion of the monthly premiums. Employees pay, on average, 5%
of the medical premiums this year. The actual amount each employee pays is dependent on the medical plan they
select, whether they cover dependents, and if they met the 2009 Wellness Rewards Program goal. In 2011 the
employee premium share will increase by more than 80% and range from $16.22 to $348.34 per month, depending
on the plan they select, the dependents they cover, and whether or not they achieved the 1000 point 2010
Wellness Reward Program target. 

RECOMMENDATIONS FOR 2011 
Summary of Recommendations 
Recommendations for 2011 will include 
a few wording changes to clarify definitions and other provisions, 
an updated 2011 holiday schedule, 
a reduction to the Paid Time Off (PTO) accumulation limits, and 
a 2.0% adjustment to non-represented salary ranges. 
BACKGROUND ON RECOMMENDATIONS 
Wording Changes 
Each year Human Resources and Development (HRD) staff track questions and comments from managers and
employees about information contained in the resolution. HRD staff also continually monitors policies and practices
to ensure the Salary and Benefit Resolution remains consistent with them. Wording changes will be recommended

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
October 15, 2010 
Page 4 of 5 
to help align policies and practices with the resolution and add clarity to several areas of the resolution. The
resolution will also include the 2011 holiday schedule and a reduced PTO accumulation limit that is consistent with
plans implemented along with the PTO program in 1999. 

Salary Ranges 
HRD staff reviews and analyzes updated pay data from published salary survey sources each year to assess how
well Port non-represented salary ranges compare to market. We compare average actual pay for a job to the
middle point of the job's salary range to determine how well a job compares to market. We combine data on all
jobs to determine how well our structure of salary ranges compares to market. We use general industry data in
most cases, which includes both public and private sector data, since we recruit employees from, and lose them to,
employers in a variety of industries. We do use available data specifically from public employers when the work is
unique in the public sector. For 2011 we are utilizing data from 20 published salary surveys to update market data
on 272 (49%) non-represented jobs. Our market analysis indicates that all non-represented salary ranges together
are currently 1% below market.
Actual pay data is combined with published data about anticipated pay changes from other employers to help
inform recommended salary range changes. This year we are utilizing four salary planning surveys in addition to
pay increase projections contained in salary surveys. These surveys indicate an anticipated 2.9% average pay
increase for 2011. 
Data we gather from local public employers regarding their anticipated pay changes also helps inform
recommended salary range adjustments. We have requested data from eight local public employers. T o date we
have received the following data indicating that pay increases at local public employers may vary considerably.
Actual increases at these organizations may not be finalized until late November. 

COLA        Step        Total 
King County     Not yet known     2.4% to 7.2%     2.4% to 7.2% 
City of Seattle     Not yet known         4%             4% 
City of Kent          0             5%             5% 
City of Everett          0          2.9% to 8.9%      2.9% to 8.9% 
Data not yet     Data not yet     Data not yet
City of Renton 
received        received        received 
Pierce County    2.5% proposed      5% to 7%      7.5% to 9.5% 
City of Bellevue         0         5% maximum     5% maximum 
City of Redmond       1%         0% to 5%       1% to 6% 
City of Tacoma        0             0             0 
City of Federal        0         4.5% to 6.2%     4.5% to 6.2% 
Way 
Port of Tacoma    Not yet known    Not yet known    Not yet known 

We also consider how pay for employees in the Port's represented jobs is expected to increase when formulating a
range adjustment recommendation. We expect represented Port employee's pay to increase between 2% and 6%
based on provisions of current collective bargaining agreements (CBA). Many CBAs include rates not yet
determined for 2011.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
October 15, 2010 
Page 5 of 5 
We will be recommending an increase of 2.0% to the Port's non-represented salary ranges for 2011. Implementing
a range adjustment in 2011 that is less than the average market pay increase projections may result in retention
and hiring challenges if hiring activities in the local labor market increase substantially before the end of 2011. T he
increase in employee medical premiums will also contribute to our total compensation package (pay and benefits)
being less attractive than it currently is. The current economic outlook is still uncertain, and we need to be aware
that some skill sets (e.g. experienced engineers and some accounting specialties) remain in high demand. 

CONCLUSION 
Changes to Salary and Benefit Resolution for 2011 will be minimal and will not significantly impact employees. 
Related programmatic changes, particularly the increases in medical premium sharing, will have a much greater
impact on employees. The 2% increase to the salary range structure will help our salary ranges remain close to
market. P ay for non-represented employees is expected to remain close to the overall (public and private) labor
market as a result of the 2.5% average Pay for Performance increase included in the 2011 budget. All changes,
those to the resolution as well as the programmatic changes, continue to reflect a conservative approach to pay
and benefits for non-represented employees.