Legislative intent controls in applying personnel rules providing for the liquidation of sick leave accruals upon separation from service

Legislative intent controls in applying personnel rules providing for the liquidation of sick leave accruals upon separation from service
County of Broome v Badger, 2008 NY Slip Op 08230, decided on October 30, 2008, Appellate Division, Third Department

Initially the Broom County Legislature adopted a personnel rule setting out the payment that would be made to administrative employees [i.e., unrepresented personnel within the meaning of the Taylor Law] for unused sick time as follows: “Upon retirement from County employment an employee shall be paid for all credited sick leave which is in excess of that which may be applied to years of service for retirement purposes under New York State Retirement Law §41j."

Subsequently the Legislature amended the first phrase of the rule to state: "Upon separation from County employment" (emphasis in decision). No other change was made to the rule and there is no dispute that the relevant number of days of sick leave that may be applied for retirement purposes is 165 days in accordance with Retirement and Social Security Law §41[j][1][a].

The rule was uniformly interpreted and applied to all separating administrative employees, whether their separation was due to retirement or not, so that only those employees who left service with more than 165 days of sick leave were paid for unused sick time and then only for the days in excess of 165 as was the case with respect to retiring employees prior to the amendment of the original rule.

In 2004, however, the County Executive changed the interpretation of the rule “to make it consistent with the provisions of County’s labor union contracts for non-administrative personnel.” This resulted in administrative employees leaving County service during that year, whether because they retired or simply separated without retiring, receiving payment for all of their unused sick leave.

When a new County Executive took office in 2005, the 2004 "interpretation" was reconsidered and it was determined that “only unused sick time in excess of 165 hours should have been paid.” Consistent with this revised view, the County commenced an action to recover the alleged overpayment from Kenneth E. Badger and a number of other administrative employees that had left County service during 2004 and were paid for any unused sick leave under 165 days.

Supreme Court held that the intent of the Legislature to compensate separated administrative employees for their unused sick time only in excess of 165 days was plainly expressed in the language of the rule, and its amendment, and granted the County’s motion. The Appellate Division subsequently affirmed the lower court’s ruling.

The Appellate Division said that “When interpreting a legislative enactment, a court's primary consideration ‘is to ascertain and give effect to the intention of the Legislature,’" citing Riley v County of Broome, 95 NY2d 455.

Here, said the court, the plain meaning of the language of the original rule, as well as its amendment, clearly expresses the intent of the Legislature only to pay for sick leave accruals in excess of 165 days. Notwithstanding the labor union contracts’ treatment of the liquidation of sick leave accruals for individuals in the relevant collective bargaining unit, it is the way in which the Legislature chose to deal with its unrepresented administrative employees.

The court then rejected Badger’s argument that the County should be estopped from seeking to recover the overpayments in light of the past actions and statements of its officials.

The full text of the decision is posted on the Internet at:
http://www.courts.state.ny.us/reporter/3dseries/2008/2008_08230.htm