August 31, 2016

California Supreme Court opens door for state reimbursing local agencies for unfunded mandates

California Supreme Court opens door for state reimbursing local agencies for unfunded mandates
Department of Finance v Commission on State Mandates, California Supreme Court, S214855

Source: Meyers Nave Legal Alert

A Meyers Nave Internet Newsletter reports that on August 29, 2016 the California Supreme Court handed a victory to local agencies that are seeking to enforce their constitutional right to reimbursement for unfunded mandates imposed by the State. In Department of Finance v Commission on State Mandates,* the Court ruled in favor of public agencies subject to storm water discharge permits, holding that State-mandated storm water permit provisions exceeding federal law requirements may be reimbursable State mandates under Article XIII B, Section 6, of the California Constitution.

While this case arose in the context of storm water regulation, Meyer Nave suggested that the Court's analysis will apply to many unfunded mandate situations going forward and summarized the genesis of the case and the Court's decision as follows: 

“In California, CaliforniaRegional Water Quality Control Boards issue permits under state and federal law for discharges from municipal separate storm sewer systems (MS4s).  Under the federal Clean Water Act, MS4 permits must require controls to "reduce the discharge of pollutants to the maximum extent practicable."  (33 U.S.C. § 1342(p)(3)(B)(iii).)  States may also impose their own requirements so long as they are not less stringent than required under federal law.  (33 U.S.C. § 1370.) 

“In 2001, the Los Angeles Regional Water Quality Control Board (Regional Board) issued an MS4 permit that, among many other things, required local agencies to inspect commercial and industrial facilities, implement programs to inspect and control runoff from construction sites, and place trash receptacles at all transit stops.  The County of Los Angeles and several cities filed test claims with the Commission on State Mandates (Commission) seeking State reimbursement for these permit provisions because they exceeded the federal "maximum extent practicable" standard.  The Commission found all the provisions were unfunded mandates, but the inspection requirements were not reimbursable because local agencies could levy fees or assessments to pay for them.  However, the trial court overturned the Commission's decision, finding that all the permit provisions were mandates imposed by federal law and were not reimbursable state law mandates.  The court of appeal affirmed, and the Supreme Court granted review.

“The Supreme Court held that the California Constitution "establishes a general rule requiring reimbursement of all state-mandated costs," and if the State argues an exception to that rule, such as the federal mandate exception at issue in this case, it "bears the burden of demonstrating that it applies."  The Court found that the State did not carry this burden, and that "[i]t is clear federal law did not compel the Regional Board to impose these particular requirements."  In doing so, the Court also found that in proceedings before the Commission, the Regional Board was not entitled to deference in its conclusion that the permit requirements at issue were federally mandated.  The Supreme Court reversed the Court of Appeal's judgment and remanded the case to the trial court for further proceedings on additional issues raised by the State and on the permittees' cross-appeal that the inspection requirements are reimbursable state mandates.

“In anticipation of the Supreme Court's decision, the Commission has signaled that it intends to clear its backlog of storm water test claims, with hearings beginning in early 2017.  It is also anticipated that another storm water test claim arising out of San Diego County, which is currently fully briefed and pending before the Third Appellate District Court of Appeal, Case No. C070357, may soon be scheduled for supplemental briefing and oral argument.

“In future Commission proceedings, test claimants may argue that once they establish that a statute or executive order (including permits) impose a new program or higher level of service, the State will bear the burden of proving that an exception applies, including exceptions for mandates allegedly imposed by the courts and federal mandates.  Public agencies should now be more vigilant than ever in pursuing their constitutional right to reimbursement of state mandates.”

For additional information e-mail Gregory Newmark, Esq. at or John Bakker, Esq., at who appeared as Amici Curiae on behalf of Real Parties in Interest and Appellants.

* The text of decision is posted on the Internet at

August 30, 2016

Disability not a defense to charges of excessive absence from work

Disability not a defense to charges of excessive absence from work
New York City Office of Administrative Tribunals and Hearings Index No. 1410/16

New York City’s Department of Environmental Protection filed disciplinary charges against one of its employees, A.M., alleging that A.M. had been excessively absent since 2014. A.M., who had an absenteeism rate of over 50%, contended that as an individual “hired under the Civil Service Law §55-a Program” due to her diabetes,* §55-a “protected” her from such disciplinary charges and, in addition, presented numerous doctors’ notes to support her absences.

OATH Administrative Law Judge Kara J. Miller found that participation in a §55-a** program position was not a defense to excessive absenteeism and A.M.’s medical notes illustrated her habit of visiting different urgent care clinics every few days in order obtain doctor’s notes and avoid returning to work.

Judge Miller recommended termination of A.M. employment.

Excessive absenteeism as a basis for termination was an issue in Cicero v Triborough Bridge and Tunnel Authority, 264 AD2d 334.

The Authority terminated a toll collector, after finding him guilty of a number of charges including excessive absences. The Appellate Division rejected the toll collector’s argument that his absences were approved and medically justified and therefore excused for the purposes of maintaining any disciplinary action against him.

In Dickinson v New York State Unified Ct. Sys, 99 AD3d 569, the Appellate Division unanimously confirmed the termination of an employee found guilty of “certain disciplinary charges” that alleged both misconduct and incompetency due to excessive absenteeism and lateness. As to the penalty imposed, termination, the court said that it did not shock its sense of fairness as “[b]eing present at work is an essential job function” and an employee’s "disability ... may not be used to shield him [or her] from the adverse consequences of inadequate job performance."

* The Americans with Disabilities Act provides that the determination of whether impairment is a disability is to be made without regard to the ameliorative effects of mitigating measures; diabetes is deemed a disability even if insulin, medication, or diet controls a person's blood glucose levels. 

** §55-a of the Civil Service Law provides for the employment of persons with disabilities by municipalities in position in the competitive class having duties which can be performed by physically or mentally disabled persons who are found qualified to perform satisfactorily such duties. Upon such a determination, the position is jurisdictionally reclassified to non-competitive class.

The A.M. decision is posted on the Internet at:

August 29, 2016

Public Citizen, Inc. has filed an amicus brief in support of the U.S. Dept. of Labor’s Fiduciary Rule

Public Citizen, Inc. has filed an amicus brief in support of the U.S. Dept. of Labor’s Fiduciary Rule
Chamber of Commerce of the United States of America, et al. v Thomas E. Perez, Secretary of Labor and United States Department of  Labor, USDC, Northern District of Texas, Dallas Division, Civil Action No. 3:16-cv–1476– M; consolidated with 3:16-cv-1530-C and 3:16-cv-1537-N

The U.S. Department of Labor (DOL) issued a new rule – generally referred to as the fiduciary rule*– which seeks to protect workers’ saving and investments for retirement by mandating that their financial advisers act in a fiduciary capacity when providing financial advice for retirement purposes.

The U.S. Chamber of Commerce, the American Council of Life Insurers and a number of other corporate bodies have challenged DOL’s promulgation of its fiduciary rule, and have filed a lawsuit against the DOL in U.S. District Court for the Northern District of Texas. Among their claims is that the DOJ rule constitutes a content-based restriction on the commercial speech of their members and violates the First Amendment.**

On August 26, 2016, Public Citizen*** filed an amicus brief in support of the DOL’s fiduciary rule.

The Public Citizen’s brief argues that Chamber of Commerce’s First Amendment argument should be rejected because the fiduciary rule does not regulate speech; rather, it regulates the terms of a commercial or professional relationship and duties that attach to it.

DOL has indicated that:

1. The rule describes the kinds of communications that would constitute investment advice and then describes the types of relationships in which those communications would give rise to fiduciary investment advice responsibilities.

2. Covered investment advice is defined as a recommendation to a plan, plan fiduciary, plan participant and beneficiary or IRA owner for a fee or other compensation, direct or indirect, as to the advisability of buying, holding, selling or exchanging securities or other investment property, including recommendations as to the investment of securities or other property after the securities or other property are rolled over, transferred or distributed from a plan or IRA.

3. Covered investment advice also includes recommendations as to the management of securities or other investment property, including, among other things, recommendations on investment policies or strategies, portfolio composition, selection of other persons to provide investment advice or investment management services, selection of investment account arrangements (e.g., brokerage versus advisory); or recommendations with respect to rollovers, transfers, or distributions from a plan or IRA, including whether, in what amount, in what form, and to what destination such a rollover, transfer, or distribution should be made.

4. The fundamental threshold element in establishing the existence of fiduciary investment advice is whether a "recommendation" occurred. A "recommendation" is a communication that, based on its content, context, and presentation, would reasonably be viewed as a suggestion that the advice recipient engage in or refrain from taking a particular course of action. The more individually tailored the communication is to a specific advice recipient or recipients, the more likely the communication will be viewed as a recommendation. 

DOL states that it "has taken an approach to defining 'recommendation' that is consistent with and based upon the approach taken by the Financial Industry Regulatory Authority (FINRA), the independent regulatory authority of the broker-dealer industry, [which is] subject to the oversight of the Securities and Exchange Commission (SEC)."

DOL’s “fact sheet” describing its fiduciary rule is posted on the Internet at:

* The Fiduciary Rule requires retirement advisors to act as fiduciaries, putting their clients' retirement needs and interests before their own by acting in the best interest of the party whose assets they are managing. 

** In addition to Chamber of Commerce [its complaint is posted on the Internet at, two lawsuits also challenging the Fiduciary Rule have been filed, one in federal district court, Washington D.C. [The National Association for Fixed Annuities, et al, v. Thomas E. Perez et al. Case No. 16-cv-1035 RDM [the National Association of Fixed Annuities  complaint is posted on the Internet at:] and the other by Market Synergy Group [Market Synergy Group v Perez, et al, USDC District of Kansas, Case 5:16-cv-04083]. The Market Synergly complaint is posted on the Internet at:]. 

*** Public Citizen, Inc. is a non-profit, consumer rights advocacy group. Founded by Ralph Nader in 1971, its website is at

Public Citizen’s amicus brief is posted on the Internet at:

August 27, 2016

Selected reports issued by the Office of the State Comptroller during the week ending August 28, 2016

Selected reports issued by the Office of the State Comptroller during the week ending August 28, 2016
Source: Office of the State Comptroller

New York State Comptroller Thomas P. DiNapoli announced the following audits have been issued:

[Internet links highlighted in color]

City University of New York - Administration of Fellowship Leaves

Borough of Manhattan Community College - Controls over bank accounts

New York StateInsurance Fund – Examination of outstanding premiums owed to the New York State Insurance Fund

Office of Information Technology Services - Effectiveness of the Information Technology Transformation

State Education Department - Oversight of School Fire Safety Compliance

State Education and Health Departments – Oversight of Student Immunization in Schools

$2.95 Million Settlement With Hospital Group For Improperly Delaying Repayment of Medicaid Funds

Preet Bharara, the United States Attorney for the Southern District of New York, Scott J. Lampert, Special Agent in Charge of the New York Field Office of the U.S. Department of Health and Human Services, Office of Inspector General, Eric Schneiderman, New York State Attorney General, and Thomas P. DiNapoli, the New York State Comptroller, announced a $2,950,000 settlement of a civil fraud lawsuit against Beth Israel Medical Center d/b/a Mount Sinai Beth Israel, St. Luke’s-Roosevelt Hospital Center d/b/a Mount Sinai St. Luke’s and Mount Sinai Roosevelt, and Continuum Health Partners, Inc. for willfully delaying repayment of over $ 800,000 in Medicaid overpayments. The settlement resolves claims under the federal False Claims Act and the New York State False Claims Act. The report is posted on the Internet at:

State Contract and Payment Actions for July 2016 

State Comptroller Thomas P. DiNapoli announced his office approved 1,462 contracts valued at $1.72 billion and approved more than 1.7 million payments worth nearly $6.3 billion in July. His office also rejected 167 contracts and related transactions valued at $370 million and 1,183 payments valued at more than $5.1 million due to fraud, waste or other improprieties. The report is posted on the Internet at:

Since taking office in 2007, DiNapoli has committed to fighting public corruption and encourages the public to help fight fraud and abuse.  Individuals can report allegations of fraud involving public funds by calling the toll-free Fraud Hotline at 1-888-672-4555, by transmitting an e-mail to, by filing a complaint online at or by mailing a complaint to Office of the State Comptroller, Division of Investigations, 14th Floor, 110 State St., Albany, NY 12236.

August 26, 2016

Selected case summaries concerning public employee retirement benefit posted on the Internet by Justia

Selected case summaries concerning public employee retirement benefit posted on the Internet by Justia

Click on text highlighted in color to access full decision

New retirement options offered eligible retirees benefit actuarially equivalent in value to the previous pension 
Lenander v. Dep't of Retirement Sys.,Washington Supreme Court, Docket 92671-9

In 2000, the Department of Retirement Systems (DRS) created a new option for eligible retirees in which the retiree could opt for a pension that would allow a surviving spouse to continue to receive monthly pension benefits at the same amount after the retiree's death. To make this pension actuarially equivalent in value to the previous pension, the DRS provided for a greater reduction in the retiree's monthly benefits.

In 2010, the DRS adopted rules that modified the degree of the actuarial reduction. Appellant Tim Lenander challenged the changes to the reduction, arguing that the changes violated the statutory scheme and impaired his contract right to a lower reduction in his pension payment.

The Supreme Court found Lenander's arguments unavailing, holding that the DRS acted within its authority in amending the survivor benefit actuarial reduction regulations as set forth under former WACs 415-02-380 (2010) and 415-103-215 (2010).

In amending these regulations, the DRS did not violate the contract clause of article I, section 23 of the Washington Constitution. Consequently, the Court held that the DRS did not infringe on Lenander's right to an "actuarial equivalent" survivor benefit, and that Lenander did not suffer substantial impairment to his pension contract rights.

Excluding specified items from the calculation of retirement income to avoid inflating income to increase the employee’s retirement allowance 
Marin Ass'n of Pub. Employees v. Marin Cnty. Employees Retirement Ass'n., CaliforniaCourt of Appeals, Docket A139610
To combat the practice known as “pension spiking,” by which public employees use various stratagems to inflate their income and retirement benefits, the County Employees Retirement Law, was amended, effective 2013, to exclude specified items from the calculation of retirement income. The trial court concluded application of the new formula to current employees did not amount to an unconstitutional impairment of the employees’ contracts. The court of appeal affirmed, holding that the Legislature did not act impermissibly by amending Government Code section 31461.

While a public employee does have a “vested right” to a pension, that right is only to a “reasonable” pension; it is not an immutable entitlement to the most optimal formula of calculating the pension.

The Legislature may, prior to the employee’s retirement, alter the formula, thereby reducing the anticipated pension, as long as the modifications do not deprive the employee of a “reasonable” pension. The Legislature did not forbid the employer from providing the specified items to an employee as compensation, only the purely prospective inclusion of those items in the computation of the employee’s pension.

The ADA and Internet compliance

The ADA and Internet compliance
Source: United States Department of Justice

Although courts are still in the process of determining if the Americans with Disabilities Act [ADA] applies to material posted on the Internet, the United States Department of Justice (DOJ) has made it clear that it interprets the ADA as applicable to websites.

Many municipalities and school districts have taken the initiative and are making its website “user friendly” for individuals with disabilities and the World Wide Web Consortium, an international developer for open standards for the Web, advocates making websites usable by the disabled even if regulations are still in the drafting stage.

Websites should be accessible to disabled users through features permitting easier navigation and that interface with available assistive technologies such as not limiting access time for activities, oral communication to trigger program functions and appropriate controls for all operations.

It is expected that public entities will soon be required to make certain that its electronic publications are ADA compliant. Advocates for the disable believe that the sooner municipality and school district websites are accessible to the disabled the better.

The Department of Justice has posted information addressing such compliance with the ADA on the Internet at

August 25, 2016

Hearing officer considers failed efforts at “progressive discipline” in setting disciplinary penalty

Hearing officer considers failed efforts at “progressive discipline” in setting disciplinary penalty
OATH Index No. 1721/16

The New York City Human Resources Administration (HRA) served disciplinary charges against Carey Bryant, a clerical associate, alleging Bryant was guilty of being late to work excessively, several instances of discourtesy, threatening and disruptive conduct, and making a false statement in a supervisory conference.

OATH Administrative Law Judge ALJ Noel A. Garcia held that HRA proved that Bryant was late on 53 occasions, had engaged in discourteous conduct on three occasions, was disruptive during a training class, and made a false statement during a supervisory conference.

Judge Garcia, however, found that HRA failed to prove its allegations that Bryant had engaged in other instances of discourteous conduct. The ALJ explained that HRA did not provide any corroboration to support the statements it alleged Bryant had made nor did not specify Bryant’s words or actions it alleged were discourtesy or threatening.

The ALJ requested and received Bryant’s personnel history.* The record indicated Bryant had been served with disciplinary charges on a number of occasions resulting, respectively in [1] a 5-day suspension without pay for using obscene and abusive language directed towards a supervisor; [2] a 10-day suspension  without pay for using “obscene and abusive language, oral threats and discourteous conduct; [3] a 45-day suspension without pay for using abusive language, discourteous conduct, making oral threats, insubordination, and failing to comply with time and leave regulations; and, ultimately, [4] a 60-day suspension without pay for using obscene or abusive language, making oral threats, and discourteous conduct.

Judge Garcia found that Bryant had repeatedly engaged in discourteous, threatening and unprofessional conduct. Despite accepting longer and longer suspensions for such behavior, Bryant conduct did not improve. Further, said the ALJ, “Even when [Bryant] admitted at trial to making statements that undermined his superiors, or to making inappropriate comments regarding potential workplace violence, [Bryant] never took any responsibility for any of his actions, or expressed any regret.

According, due to Bryant’s poor disciplinary history and his continued unwillingness to follow agency rules or behave in a professional manner, Judge Garcia recommended Bryant’s termination from his position as the appropriate penalty for his misconduct.

* In Bigelow v Village of Gouverneur, 63 NY2d 470, the Court of Appeals said that such records could be used to determine the penalty to be imposed if [1] the individual is advised that his or her prior disciplinary record would be considered in setting the penalty to be imposed, and [2] the employee is given an opportunity to submit a written response to any material he or she deemed “adverse” contained in the record or an opportunity to offer “mitigating circumstances.”

The decision is posted on the Internet at:

The Discipline Book - A 458 page guide to disciplinary actions involving public officers and employees. For more information click on

August 24, 2016

Determining “continuous residency” for the purpose of qualifying for public office or employment

Determining “continuous residency” for the purpose of qualifying for public office or employment
Glickman v Laffin, 2016 NY Slip Op 05842, Court of Appeals

Candidates seeking election to the New York State Senate must meet the five-year New York State residency requirement and the one-year Senate District residency requirement as set out in Article III, §7 of the New York State Constitution. In addition, such candidates must meet the provisions of Election Law §1-104 in which the term "residence" is defined as "that place where a person maintains a fixed, permanent and principal home and to which he [or she], wherever temporarily located, always intends to return.”*

The Court of Appeals said the primary issue presented by this appeal as whether Steven Glickman, a candidate for the office of State Senator, satisfies the State Constitution's five-year residency requirement that candidates for legislative office are required to satisfy.

In view of Glickman's 2014 registration to vote in Washington, D.C., the court said that his Washington, D.C. registration to vote in that jurisdiction “precludes him, as a matter of law, from establishing continuous residency in New York within the meaning of the Constitution” at this time.

The court explained that residency is typically a factual question and depends on the intent of the individual. As was held in Matter of Ferguson v McNab, 60 NY2d 598, the crucial element for electoral residency purposes “is that the individual must manifest an intent, coupled with physical presence ….” Further, said the court, “according to the record of the 1938 Constitutional Convention, the intent behind the residency requirement was to “ensur[e] that legislative representatives have contemporaneous familiarity and involvement with the issues facing the state and the community they represent.’”

The Court of Appeals the observed that although a person is permitted to have more than one residence, he or she is not permitted to have more than one electoral residence. As Washington, D.C. law provides, in part, that an individual “who attests that he or she ‘[h]as maintained a residence in the District for at least 30 days preceding the next election and does not claim voting residence or right to vote in any state or territory’” is a “qualified elector.’”

Accordingly, when Glickman registered to vote in Washington, D.C., he was required to attest that Washington, D.C. was his sole electoral residence and that he did not maintain voting residence in any other state. In the words of the Court of Appeals, “[t]hese factors clearly demonstrate that Glickman broke the chain of New York electoral residency which did not recommence until he registered to vote in New York in 2015.

Thus, concluded the Court of Appeals, Glickman cannot claim continuous New York residency for the past five years as required by the State Constitution.

* This definition demonstrates that the distinction between an individual’s “residence or residences” and that individual’s “domicile.” Frequently the term residence is used when domicile would be the accurate descriptive term. Although an individual may have, and maintain, a number of different residences simultaneously, he or she can have but one domicile at a given time, regardless of he or she actually is living at such domicile, until the individual designates another place as his or her domicile [see Matter of Newcomb, 192 NY 238 at 250 (1908)]. "It is the fixed and permanent home of the elector from which the Constitution, as well as the Election Law, contemplates that the elector shall register and vote." As the court indicated in Weiss v Teachout, 120 AD3d 701, as used in the Election Law, and presumably in the State Constitution, the term ‘residence' is being used to denote an individual's legal status that is more accurately described as his or her “domicile."

The decision is posted on the Internet at:

August 23, 2016

Challenging the employer’s decision to terminate a probationary teacher

Challenging the employer’s decision to terminate a probationary teacher
Muller v New York City Dept. of Educ., 2016 NY Slip Op 05813, Appellate Division, Second Department

Andrea Muller was appointed by the New York City Department of Education [DOE] as an elementary school teacher subject to her satisfactory completion of a three-year probationary period commencing in August 2008.

During the 2010-2011 school year Muller received unsatisfactory ratings on several observation reports. At the end of the school year, she agreed to waive her rights to tenure and to continue as a probationary teacher for another year. At the end of the 2011-2012 school year Muller again agreed to waive her rights to tenure and to continue as a probationary teacher for another school year.

During the 2012-2013 school year, two of the Muller's three formal observations were rated unsatisfactory while one of her informal observations was rated unsatisfactory. Ultimately her performance was declared unsatisfactory for the school year. As a result, DOE did not give Muller [1] a certification of satisfactory completion of probation and [2] discontinued her probationary employment. DOE also recommended that Muller’s teaching license be terminated.

Muller then sought judicial review of DOE’s actions, contending that its determinations were illegal, arbitrary and capricious, were made in bad faith and were in violation of her constitutional, statutory, and contractual rights. In addition Muller alleged that she was “entitled to a hearing under Education Law §3020-a pursuant to the provisions of her union's collective bargaining agreement.”

DOE, on the other hand, asserted that the Muller had failed to file a grievance under the terms of the CBA to address her claim that she was entitled to a hearing under Education Law §3020-a, thereby failing to exhaust her administrative remedies under the CBA. DOE argued that this omission barred her from raising this contention in the Article 78 proceeding. Muller, in rebuttal, contended that DOE should be equitably estopped from raising the exhaustion of administrative remedies defense because it had misled her into believing that the only administrative process available to her for the review of DOE's action was an internal review procedure.

The Supreme Court denied Muller’s petition and dismissed the proceeding without a hearing. Muller appealed the Supreme Court’s decision.

The Appellate Division, in sustaining the Supreme Court’s ruling, said that “[i]t is a basic policy” that the responsibility for selecting probationary teachers and evaluating them for appointment on tenure [sic] should lie with the Board of Education upon appropriate recommendation of its professional administrators.”

Further, said the court, an educator "may be terminated during his or her probationary period for any reason, or no reason at all, and without a hearing, unless the teacher establishes that his or her employment was terminated for a constitutionally impermissible purpose, in violation of a statutory proscription, or in bad faith” and in such situations “[t]he petitioner bears the burden of establishing bad faith or illegal reasons by competent evidence."

Addressing Muller’s assertion that she was not given a chance to conduct discovery to acquire evidence to support her allegations with respect DOE’s alleged acts of unlawful discrimination, the Appellate Division said this claim was without merit as Muller did not move for leave to conduct discovery.

As to Muller’s theory that DOE should be equitably estopped from asserting that she did not exhaust her administrative remedies, the Appellate Division explained that estoppel is generally not available against a municipal defendant with respect to the exercise of its governmental functions or its correction of an administrative error.

Although the court noted that exceptions to this general rule were triggered where "wrongful or negligent conduct" of a governmental entity, or its "misleading nonfeasance … induces a party relying thereon to change his [or her] position to his [or her] detriment" resulting in "manifest injustice" was involved, the Appellate Division said that Muller failed to establish that DOE engaged in wrongful or negligent conduct or misleading nonfeasance that resulted in manifest injustice to her such that the doctrine of equitable estoppel should be invoked against it.

The Appellate Division concluded that the evidence in the record that Muller received unsatisfactory ratings on several observation reports supported both DOE’s decision to terminated Muller’s probationary employment and its recommendation that her license to teach be terminated and that such decisions were made in good faith, were rationally based and were not arbitrary and capricious.

Finally, the Appellate Division ruled that Supreme Court properly determined that Muller was not entitled to a hearing under Education Law §3020-a pursuant to the terms of the CBA because she failed to avail herself of the grievance procedure set forth in the CBA. The court observed that the CBA provides that “[A]n aggrieved union member whose employment is subject to the terms of a collective bargaining agreement entered into by his [or her] union and employer must first avail himself [or herself] of the grievance procedure set forth in the agreement before he [or she] can commence an action in court."

The decision is posted on the Internet at:

August 22, 2016

Employee terminated for failure to posses a valid license required to perform the duties of the position

Employee terminated for failure to posses a valid license required to perform the duties of the position
Matter of Rivera v New York City Dept. of Sanitation, 2016 NY Slip Op 05837, Appellate Division, First Department

Supreme Court granted the Article 78 petition filed by probationary sanitation worker Carlos Rivera  seeking a court order annulling Department of Sanitation’s terminating his employment with the Department.

According to the Appellate Division’s decision, Rivera, during his probationary period, had been arrested and charged with Driving While Intoxicated [DWI]. His commercial driver's license, a requirement for employment as a sanitation worker, was suspended and then revoked as a result. The Department filed several disciplinary complaints against Rivera as a result of this incident and he was subsequently terminated.*

Rivera filed an Article 78 petition in Supreme Court seeking to annul Department terminating his employment, which the court granted in form of a “default judgment” as the result of the City’s failure to file a timely answer to Rivera’s petition. The City then filed a motion to vacate the default judgment on the grounds of “law office failure,” which motion was denied by Supreme Court. The City appealed the Supreme Court's decision.

The Appellate Division explained that a movant seeking to vacate a default judgment must [1] move to do so within one year of entry of the default; [2] show a reasonable excuse for the default; and [3] a meritorious defense. The court found that the City had met all three of these requirements and, further, the Appellate Division noted that Rivera did not oppose the City’s application to vacate the default judgment.

Considering the City’s claim of "law office failure" as a reason for its default, the court said that under certain circumstances, law office failure may provide a reasonable excuse for a default. The City’s excuse: Rivera’s was an “e-filed case” and its law office “failed to regularly check its email and, as a result, was unaware of the motion court's order that gave rise to the default.” The Appellate Division found that the City’s excuse was “sufficiently particularized and there is no evidence of willful or contumacious conduct” on its part.

As to the City’s advancing “a meritorious defense,” the court noted that Rivera [1] was a probationary employee at the time he was arrested and charged with DWI and [2] his commercial driver's license, a requirement for employment as a sanitation worker, was suspended and then revoked as a result of this event.

As a probationary employee, said the Appellate Division, Rivera “may be discharged without a hearing or a statement of reasons, in the absence of a demonstration that [his] termination was made in bad faith, for a constitutionally impermissible purpose, or in violation of statutory or decisional law."**

Finding that the record before it “clearly establishes that there were legitimate reasons for terminating [Rivera’s] employment, specifically, his arrest and the revocation of his license.” Further, said Appellate Division, “[t]his is a valid reason for termination even if the charges for which he was arrested were later withdrawn or dismissed.”

As the City’s failure to timely file an answer was neither willful, nor part of a pattern of dilatory behavior, and Rivera points to no evidence that the three-month period of default caused him to change his position, and he has demonstrated no other prejudice, and “in view of the strong public policy of disposing of cases on their merits, [the Appellate Division ruled that Supreme Court had] improvidently exercised its discretion in denying [the City’s] motion to vacate the default.” The Appellate Division then unanimously reversed the lower court’s rulings “on the law,” vacating the default judgment, denying Rivera’s petition and dismissing the proceeding.

* Termination of an employee for failure to posses a valid license required to perform the duties of the position is not disciplinary in nature and thus was subject to neither the pre-termination disciplinary procedures set out in a  collective bargaining agreement nor the provisions of Civil Service Law §75 [Cravatta v New York State Dept. of Transp., 77 AD3d 1399]. Further, in Meliti v Nyquist, 41 NY2d 183, the Court of Appeals held that the suspension of a teacher without pay was appropriate where the teacher lacked the necessary license or certification to teach. With respect to the existence of a “valid license requirement,” see Martin ex rel Lekkas, 86 AD2d 712.

** There is another limitation on such “summary” termination, however. In the event an appointing authority wishes to dismiss a probationary employee before he or she has completed his or her minimum probationary period formal disciplinary action must be initiated and notice and hearing provided [Challandes v Shew, 275 A.D.2d 369].

The decision is posted on the Internet at:


The Discipline Book - A 458 page guide to disciplinary actions involving public officers and employees. For more information click on

August 20, 2016

Recent postings on Employment Law Notes

Recent postings on Employment Law Notes
Source: WK WorkDay

Click on text highlighted in colorto access full text of the posting

By Brandi O. Brown, J.D.
A female employee who described a work environment replete with sexist comments, pornography, minimization of female workers, and at least one daytime visit by strippers—as well as her own belittlement and eventual termination—may proceed in part with her suit against two corporate defendants, a federal district court in New York ruled. Although the employee’s state-law claims and claims against individual defendants were dismissed, the court found more than enough reason to deny the defendants’ motion to dismiss her Title VII claims of sex discrimination, sexual harassment, and retaliation (Conforti v. Sunbelt Rentals, Inc.).

In the current political climate, in which many assert that dog-whistle politics have paved the way for divisiveness and racial discrimination more common in times that many Americans hoped were safely relegated to the past, the Supreme Court has been presented an opportunity to rule on just how powerful one particular symbol of racism—a hangman’s noose—remains today. The Ninth Circuit affirmed summary judgment for the employer because the employee had failed to make a prima facie case—the noose, as it turns out, was not clearly enough targeted to the employee to be one of those single acts of harassment that are threatening enough to create a hostile work environment—at least in the eyes of the district court and the Ninth Circuit.

By Marjorie Johnson, J.D.
A jury will decide whether a university’s decision to require a professor to undergo a mental fitness-for-duty examination was job-related and consistent with business necessity, and thus lawful under the Rehabilitation Act and the California Fair Employment and Housing Act. Denying both parties’ motions for partial summary judgment, a federal district court in California determined that triable issues existed as to whether the HR director based his decision on unsubstantiated allegations or specific emails from students and staff demonstrating her outbursts and inability to perform her job. And since the exam never occurred due to her refusal to attend, it was also questionable whether it would have been sufficiently job related (Ellis v. San Francisco State University, August 11, 2016, Henderson, T.).

By Matt Pavich, J.D.
A North Carolina district court has granted certification of a Rule 23 class action to a group of former hospital employees in their WARN Act lawsuit. The court found that questions of fact common to the class predominated over individual inquiries (Hutson v. CAH Acquisition Company 10, LLC dba Yadkin Valley Community Hospital, August 15, 2016, Osteen, W., Jr.).

August 19, 2016

Forfeiture of employee retirement contributions made to a New York State public retirement system

Forfeiture of employee's retirement contributions made to a New York State public retirement system
United States v. Stevenson, USCA, 2ndCircuit, Docket 14-1862

Article V, §7 of the New York State Constitution, sometimes referred to as the “Nonimpairment Clause,” provides, in relevant part, that: “membership in any pension or retirement system of the state or of a civil division thereof shall be a contractual relationship, the benefits of which shall not be diminished or impaired.” Such systems are "defined benefit" retirement plans.

One of the issues in the Stevenson case was whether Article V, §7 barred a federal district court from directing the forfeiture of an employee's contributions to a New York State public retirement system* as a "substitute asset."

Eric Stevenson, a former Member of the New York State Assembly, was convicted of accepted three bribes in 2012 and 2013 in the total amount of $22,000 in return for various actions to promote certain adult daycare centers including proposing legislation to the New York State Legislature that would have imposed a moratorium on new adult daycare centers, thus favoring certain interested parties.

The jury found Stevenson guilty on all counts and the Federal District Court judge hearing the case, among other things, entered a preliminary order of forfeiture of Stevenson's assets in the amount of $22,000, representing the amount of the bribes. A final judgment, entered on May 23, 2014, including an order of forfeiture that provided, as a substitute asset for forfeiture purposes, “[a]ny and all contributions, funds, benefits, rights to disbursements, or other property held on behalf of, or distributed to, Eric Stevenson, by the New York State and Local Retirement System, … and all property traceable thereto”** up to $22,000.

Stevenson appealed and with respect to the court's “order of forfeiture,” he contended that identifying his pension plan employee contributions as a substitute asset and permitting seizure up to the amount of $22,000 by the Government was error as those contributions were protected by Article V, Section 7 of the New York State Constitution, which, in pertinent part, provides that such a plan’s benefits “shall not be diminished or impaired.”

The Circuit Court of Appeals disagreed and affirmed the lower court’s ruling with respect to the forfeiture of assets and its designating Stevenson's contributions to the Retirement System a substitute asset for purposes of paying the $22,000 penalty imposed by the court.

The court explained that to the extent that there is "a conflict between New York law providing that the employee's pension  is not to be 'diminished or impaired,' and federal law, which authorizes forfeiture 'irrespective of any provision of State law,' of any property derived from the crime of conviction, [see 21 U.S.C. §853(a)], and, where such property cannot be located or has been transferred, of ‘any other property of the defendant’ in the same amount,” Article V, §7 of the New York State Constitution “is preempted to the extent that it would prevent forfeiture of Stevenson’s contributions to or benefits from a state pension or retirement system up to $22,000, the amount ordered forfeited.”

The Circuit Court then affirmed the lower court’s decision, including the sentence imposed, the forfeiture order, and the order identifying substitute assets by the district court.”

In Matter of D'Agostino v DiNapoli, 24 Misc 3d 1090, one of the relatively few State court decisions that consider the extent of the protections provided by Article V, §7 of New York State Constitution's, the court said that Article V, §7 “merely provides that retirement system benefits are contractual in nature and may not be impaired or diminished by state action. Further, said the court, “Such guarantee does not render an individual retirement system member's benefits inviolate.” Rather, the court, citing Matter of Village of Fairport v Newman, 90 AD2d 293, leave to appeal denied 58 NY2d 1112, said "[t]he purpose of the constitutional provision is 'to insure that pension and retirement benefits [are not] subject to the whim of the Legislature or the caprice of the employer.”

Further, explained the D’Agostino court, “[t]here is no constitutional violation unless the contractual benefits are unilaterally diminished,” presumably as a result of an action by the State Legislature, the State or a political subdivision of the State to truncate a retirement allowance otherwise payable, citing Rosen v New York City Teachers' Retirement Bd., 282 App Div 216,  affd 306 NY 625, and Delaney v Regan, 183 AD2d 981.

* The State University’s Optional Retirement Plan, established pursuant to Article 8-B of the Education Law [and similar defined contribution retirement plans established by law] is not a public retirement systems of the State and, as indicated in §396 of the Education Law, the “Employer [is] not liable for [the] payment of benefits.”

** Stevenson did not have sufficient “years of member service” in the Retirement System to have become a “vested” member of the System but the Federal District Court said that he was entitled to a refund of the “member contributions” that he had made as a member of the System.

The Stevenson decision is posted on the Internet at:

August 18, 2016

August 17, 2016

Determining if an employee is a joint employee of two or more employers for the purposes of State and City human rights laws

Determining if an employee is a joint employee of two or more employers for the purposes of State and City human rights laws
Brankov v Hazzard, 2016 NY Slip Op 05778, Appellate Division, First Department

The decision of the Appellate Division in Brankov, which involved an employment in the private sector, concerned whether “an ostensible non-employer is actually a "joint employer" for purposes of employment discrimination claims under the State and City Human Rights Laws (HRL).” Thus the ruling may be instructive in determining the employer-employee relationship for the purposes of HRLs in situations where a public officer or employee, alleging unlawful discrimination, initiates an administrative or judicial complaint under state, local and, or federal laws claimng two or more public sector employers are liable for the alleged acts of unlawful discrimination.

Although the majority of employments in the public service involve the appointment of an individual to a position under the jurisdiction of a single appointing authority, there are a number of other types of employments that may be made depending of the circumstances, the most common being a “dual employment” and a “joint employment.”*

Dual employments typically involves a single individual serving in two different positions, each under the jurisdiction of different appointing authorities and generally require the knowledge and approval of the appointing authorities involved.**

In contrast, a joint employment is effected when two [or more] appointing authorities jointly authorize the employment of an individual in a single position and the two [or more] appointing authorities typically share the personnel service costs involved.

Other types of employments in the public service include, but are not limited to:  

1. A “special employee” in the service of two or more employers pursuant to a shared services agreement,

2. A “shared employment” in which two or more individuals are employed part-time by a single appointing authority and “share” a single position and

3. An “extra service employee” where an individual, typically working full time for one appointing authority, is simultaneously employed by the same or another appointing authority in a different position with the approval of the appointing authority or both appointing authorities, as the case may be.

The Appellate Division described Dragica Branko’s employee status as follows:

“In this action "Company A" hired Brankov, paid her salary and bonuses, controlled where she was assigned to work, and placed her at "Company B" and later transferred her to other locations. A "Company A" employee supervised Branko on a day-to-day basis. "Company B" had no say in the end of Branko's employment with "Company A" years after she had been transferred to another location. The record plainly indicates that "Company A", and not "Company B," ultimately controlled Branko's employment.”

Explaining that Federal District Courts have typically applied the "immediate control" test in determining the appropriate “defendant-employer” in such situations, the Appellate Division said that under the "immediate control" formulation, a "joint employer relationship may be found to exist where there is sufficient evidence that the defendant had immediate control over the other company's employees," and particularly the defendant's control "over the employee in setting the terms and conditions of the employee's work."

"Relevant factors" in this analysis "include commonality of hiring, firing, discipline, pay, insurance, records, and supervision." Of these factors, "the extent of the employer's right to control the means and manner of the worker's performance is the most important factor."

In Brankov, the Appellate Division held that “[v]iewed in the light most favorable to [Brankov], the record fails to demonstrate that ["Company B"] had the requisite "immediate control" over the terms and conditions of her employment to be subject to liability under the New York State and New York City Human Rights Law as a "joint employer."

Accordingly, said the court, Supreme Court correctly held that "Company B" was not Brankov’s joint employer, and correctly dismissed her claims against "Company B" and Hazzard as those claims rested on her theory of joint employment.

* These designations involve the "nature of the individual's performance of duties obligations" rather than the “nature of a public officer’s or employee’s status" in the position such as a permanent, temporary, contingent permanent, full-time, part-time, seasonal, trainee, per diem or substitute appointee or as an individual elected to a position in the public service. An independent contractor serving with a State, a political subdivision of the State, a public authority or other governmental entity is not a “public employee."  

** Another consideration with respect to dual employments concerns the appearance of, if not an actual, a conflict of interest involved in a particular “dual employment” situation? As the Attorney General advised in an informal opinion: In the absence of a constitutional or statutory prohibition against dual-office holding, one person may hold two offices simultaneously unless they are incompatible [Informal Opinions of the Attorney General 98-17].

The decision is posted on the Internet at:


Subsequent court and administrative rulings, or changes to laws, rules and regulations may have modified or clarified or vacated or reversed the decisions summarized here. Accordingly, these summaries should be Shepardized® or otherwise checked to make certain that the most recent information is being considered by the reader.
New York Public Personnel Law Blog Editor Harvey Randall served as Principal Attorney, New York State Department of Civil Service; Director of Personnel, SUNY Central Administration; Director of Research, Governor’s Office of Employee Relations; and Staff Judge Advocate General, New York Guard. Consistent with the Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations, the material posted to this blog is presented with the understanding that neither the publisher nor NYPPL and, or, its staff and contributors are providing legal advice to the reader and in the event legal or other expert assistance is needed, the reader is urged to seek such advice from a knowledgeable professional.
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