1. Employee Development Through a Skill Based Pay Approach NC AWWA WEA Meeting November 16, 2015

2. 2 Drivers for an ESD program ESD Program Philosophy Typical Application of an ESD Program The “Two Way Street” Project Scope, Schedule Employee Communications Examples NC AWWA WEA November 16, 2015 Employee Skills Development (ESD) Program

3. Drivers for an ESD Program ESD Program Philosophy

4. Employee retention A more motivated workforce Knowledge capture Better flexibility/agility A learning culture “Promotional ready” employees Utility Wants: Better defined career paths Upward mobility (without waiting for a vacancy) Pay for performance Self directed advancement Work/Life Balance NC AWWA WEA November 16, 2015 4 Employee Wants:

5. Advancement based upon appropriate knowledge, skills and abilities acquired Advancement is, in part, self directed Operational flexibility is efficient and is worth additional compensation Multi-skilled employees can provide greater value Leadership skills can be developed as part of career advancement Self directed advancement increases the likelihood of employee retention ESD Program Philosophy NC AWWA WEA November 16, 2015 5

6. Typical application of an ESD The “two way street”

7. Learning skills, responsibilities and duties Learning advanced or companion skills, responsibilities and duties Learns to train new employees, develop and plan work Gains leadership and supervisory skills Typical Application of ESD  Each level has additional knowledge, skills and abilities expectations  Time in level to gain proficiency  Employee and Utility each benefit NC AWWA WEA November 16, 2015 7 Price of retention Limited Participants Career Progression

8. Typical Application of ESD NC AWWA WEA November 16, 2015 8 Lateral move to leverage skills and achieve additional growth. Career Progression 1 Career Progression 2

9. Utility benefits with increased operational flexibility and efficiency Employee Benefits with increased compensation via self directed learning and growth ESD Emphasizes Win-Win Thinking NC AWWA WEA November 16, 2015 9

10. Careful attention to what adds value A performance management focus – good performance is the price of admission Salary analysis to get the comp right Straight talk with employees Avoid unjustified grandfathering Skills assessment to prove knowledge Transparent slotting process Proper attention to HR rules and procedures Key Considerations NC AWWA WEA November 16, 2015 10

11. Employee Communications Examples

12. ESD programs create questions Senior leadership must champion the effort Employee Surveying can assist in understanding potential acceptance Rumors Abound Staff reductions Everyone gets a raise Assurances upfront may help allay fears and set the tone Employee Communications NC AWWA WEA November 16, 2015 12

13. Probationary period, no licensing, safety training, Sampling Initial licensing, process training, SCADA /CMMS use & procedures Higher licensing, process control testing, proficiency in process operations, training duties Highest license, leadership skills, EMS, permit compliance Plant Operations  Self directed  Typically has time in grade requirements  Minimum “meets requirements” performance NC AWWA WEA November 16, 2015 13 Price of retention Career Progression Limited Participants

14. Probationary period, 1 st year trade school, safety training 2 nd year trade school, CMMS procedures Graduation from trade school or utility program Additional skills menu Cert. Welding Lic. Operator HVAC Electrical training for combined trade Mechanical Maintenance  Utility Driven or Trade school based program  Minimum Grades Required  Minimum “meets requirements” performance NC AWWA WEA November 16, 2015 14 Price of retention Career Progression Limited Participants

15. 1 st year training 2 nd year training Collection Systems NC AWWA WEA November 16, 2015 15 System Maintenance System Construction 1 st year training 2 nd year training 3rd year training combined skills from other training area 4 th year training advanced tech and leadership Price of retention Limited Participants  3 rd year for opposite skill attainment  Minimum “meets requirements” performance  4 th year includes crew leadership

16. Engineering Design Project Mgmt Construction Mgmt Plant Engineering Inspection/CM Inspector Sr. Inspector Contracts Mgr Construction Mgr. Other progressions Field Operations Sewer Collections Water Distribution Stormwater systems Customer Care Field service call center Billing call center Dispatching NC AWWA WEA November 16, 2015 16

17. Planning and scheduling Mechanical or electrical maintenance progressions Inspection Field operations progressions Process Control Technology Operator progressions I&C progressions Supervision Leadership skills learned at top steps Crew leader responsibilities Planner Scheduler Feeder Pools – another benefit NC AWWA WEA November 16, 2015 17

18. 18 NC AWWA WEA November 16, 2015 Questions? Jeff Theerman P.E. jtheerman@brwncald.com 314.323.4344