Toronto city manager Joe Pennachetti is recommending a raise for non-unionized employees and senior managers.
The raises would begin this year and continue through 2015 at a total cost to the city around $30 million.
The report says Toronto's non-union and management staff are paid significantly less than similar municipal employees across the GTA.
The pay increase still needs to be approved by council.
The city's unionized workers received slightly larger raises as part of labour deals signed earlier this year.