Public officers and employees may engage in outside employment, aka “moonlighting,” subject to certain restrictions and limitations

Public officers and employees may engage in outside employment, aka “moonlighting,” subject to certain restrictions and limitations
Kastoff v NYS Dept. of Social Services, 195 A.D.2d 808

"Moonlighting" has been a common practice in both the public and private sectors. The Kastoff ruling by the Appellate Division explores some of the guidelines that may control a public employee's eligibility to accept "outside employment" after his or her normal working hours.

Kastoff, a hearing officer with the NYS Department of Social Services [DSS], requested the department's approval to serve as an acting village justice one evening a week in the event the elected village justice was unavailable or recused himself from the proceeding. DSS denied Kastoff's request, indicating that "it would be inappropriate" for him to accept such an appointment. When the DSS did not respond to Kastoff's request for a written explanation of its decision, he sued to annul its determination. The Supreme Court granted Kastoff's petition and DSS appealed.

The Appellate Division said that Kastoff's outside employment was controlled by the provisions of §74 of the Public Officers Law and the "relevant" DSS guidelines. Such laws, rules, regulations and policies required that Kastoff avoid activities that were "in substantial conflict with the proper discharge of his duties in the public interest" and not accept any employment "which (would) impair his independence of judgment in the exercise of his official duties” or which would "require him to disclose confidential information which he has gained by reason of his official position or authority."

Additionally it noted that DSS guidelines prohibited outside employment that would "create or appear to create a conflict of interest with [the] policies and programs of [DSS] or diminish [Kastoff's] effectiveness in the performance of his assigned duties."

The Appellate Ddivision affirmed a lower court ruling granting Kastoff's petition to be allowed to accept outside employment as an acting village justice. The court said that nothing in the record established that Kastoff's service as an acting village justice would be in substantial conflict with his DSS duties and responsibilities and that it did not find any rational basis for DSS to deny his request.

It appears that unless the appointing authority can clearly demonstrate an actual or potential conflict of interest or some substantial incompatibility between an individual’s public employment and the individual's proposed outside employment, a request for approval to engage in "moonlighting" should be approved. In some instances a public employer has negotiated a "no outside employment" provision in the course of collective bargaining under the Taylor Law that provides that approval of outside employment is at the sole discretion of the appointing authority.

However, other provisions of law may bar moonlighting involving certain employers.

For example, an article in the August 25, 2010 issue of the Buffalo News reported: “Police officers cannot work in a licensed bar, restaurant or nightclub in New York State,’ quoting William S. Crowley, public affairs director for the State Liquor Authority who cited [§128 of] the ABC Law as prohibiting such employments. However, during a telephone interview Thomas J. Donohue, Esq., Special Counsel to the State Liquor Authority, pointed out that there is one exception to the Authority’s interpretation of §128 with respect to police officers being prohibited from being employed by its licensees. He commented that §128-a of the Alcoholic Beverage Control Law permits police officers to work at a licensed premise in certain cases.*

Some public employers have adopted policies or negotiated provisions in collective bargaining agreements that limit the ability of its workers to "moonlight" or accept outside employment.

Violating such policies can have serious consequences, as four Saratoga County Sheriff Department employees learned.

The four, including William Marshall, the president of the union representing the Department's civilian employees [the Saratoga County Deputy Sheriffs Benevolent Association], were moonlighting as security personnel for M J Designs, a private sector employer. Marshall was a "road patrol deputy" sheriff, while the other three served as "desk officers."

The Department said that moonlighting was specifically prohibited by its collective bargaining agreement with another union, Saratoga County Deputy Sheriffs Police Benevolent Association, which represents only road patrol personnel.

The Department also noted that it had an administrative policy barring moonlighting and this policy applied to both the Department's road patrol and non-road patrol personnel.

The case also had a criminal aspect. The County's District Attorney had presented charges that the four had committed "official misconduct" to a grand jury. Official misconduct is a misdemeanor.

The County and the four employees agreed to settle the all of the charges alleged. Under the terms of the settlement agreement, the four agreed to a six-month leave without pay. In addition, Marshall agreed to resign from his union position and to "never again serve as a union officer."

One of the concerns noted by the Department was its risk of being sued if one of its employees made an arrest or injured an individual while working a second job.

The Rivera case involves a similar situation (Rivera v Farrell, NYS Supreme Court, Justice Stallman, April 5, 2001, [Not selected for publication in the Official Reports]).

Rivera, a New York City Department of Sanitation [DOS] supervisor, was "moonlighting" as an income tax advisor. According to the decision, Rivera "promoted a tax-evasion scheme, informed other DOS workers about how to evade taxes, and filled out their payroll forms so that taxes would not be withheld, in return for a fee."

Served with disciplinary charges, Rivera was terminated after being found guilty of violations of the DOS Code of Conduct by his filing a W-4 tax withholding allowance certificate falsely claiming exemptions to which he was not entitled, falsely claiming "tax-exempt status" and failing to a file a tax return for the tax year 1994.

The decision indicates that Rivera had earlier pled guilty to failing to file a tax return for the tax year 1994, a misdemeanor.**

DOS alleged that Rivera violated Code of Conduct 3.2, by engaging in conduct prejudicial to good order and which tends to discredit the City or Department, and Code of Conduct 4.4, filing false records or statements.

Rivera appealed, contending that dismissal "was disproportionate compared to sanctions imposed in similar cases." He claimed that (1) others similarly situated, with worse disciplinary records, received suspensions, not termination and (2) three sanitation workers who failed to pay taxes and filed false W-4 forms received 30-day suspensions.

Judge Stallman, after distinguishing the misdeeds of the other DOS workers cited by Rivera with respect to the disciplinary penalties imposed, upheld Rivera's termination. The court said that Rivera had failed to meet his burden of proving that DOS acted arbitrarily, capriciously or contrary to law. Under the circumstances, said the court, the penalty of termination "does not shock the judicial conscience; it was thus not an abuse of discretion."

As an alternative argument for overturning his termination, Rivera submitted a Certificate of Relief from Civil Disabilities he had obtained pursuant to Section 701 of the Corrections Law.

Judge Stallman, after commenting that Rivera failed to demonstrate the relevance of the Certificate insofar as this case was concerned, indicated that even if it were relevant, such a certificate does not exempt a civil servant from administrative discipline.

In another “moonlighting” case, Timothy Kelly was terminated after being found guilty of unauthorized "off-duty employment" and falsifying records. Ultimately the Court of Appeals considered the matter in terms of a court's authority to overturn or modify an administrative disciplinary decision or a disciplinary penalty imposed on a worker [Kelly v Safir, 96 N.Y.2d 32].

The Court of Appeals, ruled:

1. The courts may not modify such a determination if substantial evidence supports it; and

2. A court must uphold an administrative penalty unless it finds that it is so disproportionate to the offense as to be shocking to one's sense of fairness -- the Pell standard [Pell v Board of Education, 34 NY2d 222].

* §128-a of the Alcoholic Beverage Control Law provides that “Notwithstanding any inconsistent provision of law to the contrary, the authority shall promulgate such rules and regulations as may be necessary to provide that it shall not be unlawful for a police officer employed in this state, having written permission and consent from his commanding officer, to work in a premises licensed to sell beer at retail for off-premises consumption under section fifty-four of this chapter or to work solely as a security guard or director of traffic on the premises of a volunteer firefighters' organization licensed to sell beer and wine at retail pursuant to a temporary permit for on-premises consumption under section ninety-seven of this chapter.

** On a related note, some years ago the Internal Revenue Service checked the returns of some 200 police officers and deputy sheriffs in the Indianapolis, Indiana, area that had requested or received "off-duty work permits." It reported that almost 50% of the returns under-reported the total income earned by these taxpayers. IRS said that those found to have underreported their income faced substantial interest charges and penalty payments.
NYPPL