Proposed contract for Acting City Manager

Employment Agreement


This Agreement, made and entered into this __th day of March, 2012, by and between the City of Hamtramck, a municipal corporation, (hereinafter called ”Employer”) and Erik D. Tungate, (hereinafter called “Employee”) (Collectively, Employee and Employer shall be referred to as “Parties”). The Parties agree as follows:

Section 1: Term

This agreement shall remain in full force and effect from March __, 2012 until the earlier occurrence of (1) the conclusion of the Employer’s search to fill the vacancy that currently exists in the position of City Manager (2) the termination with or without cause of this contract by the Employer or Employee on an at-will basis as required in the Hamtramck City Charter.

Section 2: Duties and Authority

Employer agrees to employ Employee as Acting City Manager to perform the functions and duties of City Manager as specified in the City of Hamtramck charter and by all applicable sections of the City of Hamtramck code and to perform other legally-required, permissible and proper duties and functions.

Section 3: Compensation

A. Base Salary: Employer agrees to pay Employee monthly compensation of $7500 (seven thousand and five hundred dollars), payable in equal installments at the same time that the other management employees of the Employer are paid.

B. This agreement shall be automatically amended to reflect any salary adjustments that are provided or required by the Employer’s compensation policies.

C. If the above vacancy shall remain for a period exceeding 90 days and the city’s financial condition permits, Employee may request consideration for an increase compensation to be determined by both parties to this agreement and to be approved by a majority vote of the Hamtramck City Council.

Section 4: Vehicle Expense

The Employer shall reimburse the Employee at 1.5 times the IRS standard mileage rate for any city business use of his personal vehicle..

Section 5: General Business Expenses

Employer recognizes that certain expenses of a non-personal but job related nature are incurred by Employee, and agrees to reimburse or to pay said general expenses. The finance director is authorized to disburse such moneys upon receipt of duly executed expense or petty cash vouchers, receipts, statements or personal affidavits. Employee shall seek pre-approval from City Council of any expense provided for under this paragraph.

The Employer shall also provide Employee with a computer, business software, fax/modem, cell phone required for the Employee to perform the job and to maintain work-related communication. At Employee’s option and in lieu of the purchase of a cell phone, the City shall pay employee an additional $150 per month to defray the cost of his cellular phone service. Employer will also reimburse employee a reasonable amount each month not to exceed $100 for the cost of having home access to the internet. Any equipment purchased hereunder shall remain the property of Employer.

Section 6: Termination

The parties understand and agree that, under the terms of the Hamtramck City Charter, Employee’s position is an “at will” position and that the at will employment relationship set forth herein remains subject to the terms and conditions set forth in the Hamtramck City Charter.

Section 7: Severance

Employer recognizes that Employee has undertaken the commitments set forth herein under circumstances that may preclude his pursuit of other employment opportunities. In recognition of this fact and as an inducement to enter into this contract, Employer agrees that, should it terminate Employee’s employment hereunder at any time before June 30, 2012 that it will pay Employee a severance equal to five weeks pay; provided, however that payment under this paragraph can occur only if Employee’s termination is involuntary (i.e. without the consent of both parties) without cause.

Section 8: Resignation

In the event that the Employee voluntarily resigns his/her position with the Employer, the Employee shall provide a minimum of 30 days notice unless the parties agree otherwise. The council and mayor reserve the right to terminate the Employee immediately, upon receipt of the resignation. If Employee resigns, no severance pay will be due.

Section 9: Hours of Work

It is recognized that, in order to perform his Charter-mandated duties, Employee will have somewhat irregular work hours. Employee is required to maintain a regular work schedule during the city’s regularly-scheduled work day, but also will be required to work additional hours and agrees to do so in order to carry out his duties. Employee is an exempt salaried employee under state and federal law and, therefore, may be required to work in excess of 40 hours per week.

Section 10: Outside Activities

Recognizing that certain outside consulting or teaching opportunities provide indirect benefits to the Employer and the community, the Employee may elect to accept limited teaching, consulting or other business opportunities with the understanding that such arrangements shall not constitute interference with nor a conflict of interest with his or her responsibilities under this Agreement and provided (1) Employee discloses such activities to Hamtramck City Council and (2) a majority of council votes to approve such activities.

Section 11: Indemnification

Beyond that required under Federal, State or Local Law, Employer shall defend, save harmless and indemnify Employee against any tort, professional liability claim or demand or other legal action, whether groundless or otherwise, arising out of an alleged act or omission occurring in the performance of Employee’s duties as City Manager or resulting from the exercise of judgment or discretion in connection with the performance of program duties or responsibilities, unless the act or omission involved willful or wanton conduct. The Employee may request and the Employer shall not unreasonably refuse to provide legal representation at Employer’s expense.. Legal representation, provided by Employer for Employee, shall extend until a final determination of the legal action including any appeals brought by either party. The Employer shall indemnify employee against any and all losses, damages, judgments, interest, settlements, fines, court costs and other reasonable costs and expenses of legal proceedings including attorneys fees, and any other liabilities incurred by, imposed upon, or suffered by such Employee in connection with or resulting from any claim, action, suit, or proceeding, actual or threatened, arising out of or in connection with the performance of his or her duties. Any settlement of any claim must be made with prior approval of the Employer in order for indemnification, as provided in this Section, to be available.

Further, Employer agrees to pay all reasonable litigation expenses of Employee throughout the pendency of any litigation to which the Employee is a party, witness or advisor to the Employer. Such expense payments shall continue beyond Employee’s service to the Employer as long as litigation is pending. Further, Employer agrees to pay Employee reasonable consulting fees and travel expenses when Employee serves as a witness, advisor or consultant to Employer regarding pending litigation.

Section 12: Bonding

Employer shall bear the full cost of any fidelity or other bonds required of the Employee under any law or ordinance.

Section 13: Notices

Notice pursuant to this Agreement shall be given by depositing in the custody of the United States Postal Service, postage prepaid, addressed as follows:

(1) EMPLOYER: City Attorney
James P. Allen, Sr.
400 Monroe, Ste. 220
Detroit, MI 48226

(2) EMPLOYEE: Erik D. Tungate
66 Winder, Unit #452
Detroit, MI 48201

Alternatively, notice required pursuant to this Agreement may be personally served in the same manner as is applicable to civil judicial practice. Notice shall be deemed given as of the date of personal service or as the date of deposit of such written notice in the course of transmission in the United States Postal Service.

Section 14: General Provisions

A. Integration. This Agreement sets forth and establishes the entire understanding between the Employer and the Employee relating to the employment of the Employee by the Employer. Any prior discussions or representations by or between the parties are merged into and rendered null and void by this Agreement. The parties by mutual written agreement may amend any provision of this agreement during the life of the agreement. Such amendments shall be incorporated and made a part of this agreement.

B. Binding Effect. This Agreement shall be binding on the Employer and the Employee as well as their heirs, assigns, executors, personal representatives and successors in interest.

C. Effective Date. Anything to the contrary notwithstanding this Agreement shall not be effective until it is approved by the City Council. Once it has been fully executed and approved by City Council, this Agreement shall be effective as of March __, 2012.

D. Severability. The invalidity or partial invalidity of any portion of this Agreement will not affect the validity of any other provision. In the event that any provision of this Agreement is held to be invalid, the remaining provisions shall be deemed to be in full force and effect as if they have been executed by both parties subsequent to the expungement or judicial modification of the invalid provision.

E. Nondiscrimination. The Parties agree that this Agreement will not be interpreted or enforced in a manner which discriminates on the basis of race, color, creed, religion, sex, age, national origin or disability.

F. Binding Arbitration. Any controversy or claim arising out of or relating in any way to this Agreement shall be settled exclusively by arbitration administered by the American Arbitration Association (“AAA”) under its then-current National Rules for the Resolution of Employment Disputes, and judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. This Agreement to submit to binding arbitration specifically includes, but is not limited to, all claims that this Agreement has been interpreted or enforced in a discriminatory manner. Arbitration shall take place at the AAA office located in Southfield, Michigan. The Parties will share equally all administrative charges and arbitrator fees relating to such arbitration.

a Michigan municipal corporation an individual

By: ____________________________ By: ________________________
Karen Majewski Erik D. Tungate

By: ____________________________
T. Edwin Norris
City Clerk

Executed: ______________, 2012 Executed: _______________, 2012

3 thoughts on “Proposed contract for Acting City Manager

  1. This is the actual resolution, wherein the contract is made effective retroactively:


    WHEREAS, Erik D. Tungate was appointed as Acting City Manager for the City of Hamtramck (Resolution 2012-42) effective 3-13-12 until such time as the current vacancy in that office shall be filled in accordance with the provisions of the Hamtramck City Charter; and

    WHEREAS, the City Attorney was directed to negotiate a contract with the Acting City Manager at a rate of compensation not to exceed $7,500 per month together with standard terms and conditions consistent with the Hamtramck City Charter; and

    WHEREAS, The City Attorney was directed to take the necessary steps consistent with the Hamtramck City Charter to cause said contract to be placed upon an agenda of the Hamtramck City Council for consideration and approval.

    NOW THEREFORE BE IT RESOLVED by the City Council of the City of Hamtramck, Wayne County, Michigan that:

    FIRST: The City Council approves the attached employment contract for Mr. Erik D.Tungate as Acting City Manager.

  2. The resolution also requires the acting City Manager comply with the conditions consistent with the Hamtramck City Charter, which he be qualified per Charter. He is not. Without an appointment of a qualified individual, than a department head with the City of Hamtramck is required to be appointed until a qualified city manager is hired.

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