The Hermosa Beach City Council voted unanimously to adopt a three-year memorandum of understanding (MOU) with the city’s management employee unit covering July 1, 2025 through June 30, 2028.

Key changes in the successor MOU include annual 3% across-the-board wage increases for each year of the agreement, adjustments to bring classifications to market medians based on a compensation study, an increase in the city’s deferred compensation match from $8,000 to $10,000 per year, the addition of half-day holidays on Christmas Eve and New Year’s Eve, changes to vacation accruals for longer-tenured employees and modest increases to police chief premium pay and uniform allowances.

City staff estimated the negotiated changes will cost about $570,000 over the 2026–2028 fiscal years. The management membership ratified the agreement in September 2025 and the council approved the MOU by unanimous vote.

Council members said they appreciated the negotiators’ work and asked staff to consider linking future compensation increases more explicitly to measurable performance outcomes.

The resolution adopting the MOU directs staff to implement the pay and benefit changes in payroll and to reflect the fiscal impacts in upcoming budget reports.