Dismissing an employee before he or she has completed his or her probationary period

Dismissing an employee before he or she has completed his or her probationary period 

153 AD3d 1201, Appellate Division, First Department

In York v McGuire, 63 NY2d 760, the Court of Appeals indicated that "it is well settled that a probationary employee may be discharged without a hearing and without a statement of reasons" where the decision is made in good faith and not for a constitutionally impermissible purpose or reason.   

With respect to employees in the classified service of a public employer, this general statement has been clarified and while a probationer in the classified service can be discharge at any time after the completion of his or her minimum period of probation and before the end of the maximum period of probation, the courts have further held that in the event the appointing authority decides to terminate a probationary appointee during his or her minimum probationary period, the individual is entitled to “notice and hearing” in the nature of a disciplinary proceeding as a condition precedent to such termination.*

The rule is somewhat different with respect public employees in the unclassified service.**

Here an educator [Petitioner] serving her probationary period, challenged the New York City Department of Education's decision discontinue her employment as a probationary teacher, a position in the unclassified service.  Petitioner challenged the Department's action, contending that it erred in concluding that her actions constituted prohibited corporal punishment. 

Supreme Court agreed and annulled the Department's action. The Department then appealed the Supreme Court's ruling. The Appellate Division, however, unanimously reversed the lower court's decision "on the law" and reinstated the Department's decision to dismiss Petitioner from her from her position.

Citing Mendez v New York City Dept. of Education, 28 NY3d 993, the Appellate Division explained that Petitioner failed to show that the Department's decision to discontinue her employment as a probationary teacher was done in bad faith, for a constitutionally impermissible purpose, or in violation of the law.

Further, said the court, Petitioner's claim that the Department had erred in concluding that Petitioner had subjected the student  to "prohibited corporal punishment" was insufficient to establish that the employer reached its conclusion in bad faith or for an impermissible reason. 

* See McKee v Jackson, 152 AD2d 54, holding that a probationer is entitled to a minimum period of time to demonstrate his or her ability to successfully perform the duties of the position, and Gray v Bronx Developmental Center, 65 NY2d 904, holding that a probationer may be dismissed without notice and hearing after completing his or her minimum period of probation and prior to the expiration of his or her maximum period of probation. 

**§3012(a) of the Education Law provides that the services of a probationary teacher may be discontinued at any time during the teacher's probationary period, which is typically set by law. Absent a provision in a collective bargaining agreement to the contrary, such a dismissal will not be overturned unless the teacher can demonstrate that the appointing authority's action was for a constitutionally impermissible reason or purpose.

The decision is posted on the Internet at: 
http://www.nycourts.gov/reporter/3dseries/2017/2017_06713.htm

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School board seeks to remove a sitting member from the board for alleged "official misconduct"

School board seeks to remove a sitting member from the board for alleged "official misconduct"

Decisions of the Commissioner of Education, Decision No. 17,204

The School Board [Board] held a special meeting at which it voted to pursue removal charges against a sitting member of the board [Member]* for alleged "official misconduct." Member did not attend the special meeting at which the Board approved three motions, all by a 4-2 vote, ** which, respectively:

1. Charged Member with official misconduct pursuant to Education Law §1709(18);

2. Appointed a board attorney to prosecute the charges; and

3. Designated an attorney to serve as a hearing officer for the removal hearing.

Member was subsequently served with disciplinary charges that set out "twelve specifications of misconduct [that] alleged numerous incidents in which [Member], among other things, berated or verbally attacked district personnel, invaded the personal space of others, refused to comply with orders, improperly photographed personnel records and improperly destroyed a document."

In response, Member filed an appeal with the Commissioner of Education challenging the Board's action, contending:

[1] The Board "lacked sufficient votes to approve charges against [Member] because [the Board's President] ... was biased and, therefore, should have been disqualified from voting"; 

[2] "The charges do not allege official misconduct;" and

[3] [The charges] "[d]o not sufficiently identify specific factual details which would afford [Member] an opportunity to prepare a defense."

Addressing Member's argument that the Board "lacked sufficient votes to approve charges" because the Board President "was biased*** and, therefore, should have been disqualified from voting," the Commissioner first noted that "a distinction must be drawn between a board member’s vote to authorize removal proceedings (the “initiation level”) and his or her vote to sustain charges of official misconduct following a full and fair opportunity for the subject of such charges to refute them (the “final determination level”)"

Although "a board member harboring an 'adverse animus' should not be allowed to participate in the 'decision-rending' aspect of a removal proceeding," the Commissioner noted that Member cited "no authority indicating that this standard is applicable to a board member’s vote to initiate removal proceedings." In other words, a board member may participate in activities leading to, and making, the decision to file disciplinary charges against an individual but then he or she should recuse himself or herself from any and activities involving or related to going forward with the disciplinary action.

Accordingly, the Commissioner said that she found that Member had tried, and failed, to meet Member's burden of demonstrating that the Board President should have been disqualified at the initiation of disciplinary action level.

Turning to Member's allegation that the Charge and Specifications were defective, the Commissioner said she found no merit in Member's claim that the statement of charges is deficient. "On the record before me," said the Commissioner, Member was  "afforded sufficient due process to satisfy this requirement and found that "the statement of charges was sufficiently detailed so as to apprise [Member] of the alleged official misconduct which would be at issue at the hearing." In the words of the Commissioner, "[e]ach charge identified the date when the alleged conduct occurred and a specific description of the objectionable conduct.

Finding that Member's claims were "without merit," the Commissioner dismissed Member's appeal.

* Education Law §1709(18) authorizes the members of a Board "To remove any member of their board for official misconduct. But a written copy of all charges made of such misconduct shall be served upon him [or her] at least ten days before the time appointed for a hearing of the same; and he [or she] shall be allowed a full and fair opportunity to refute such charges before removal.

**  The decision notes that "[a]s relevant to this appeal," the Board President was one of the four board members who voted in favor of the motions.

*** In support of this contention, Member refereed to and submitted numerous newspaper articles and public statements detailing the acrimonious relationship between various board members and the superintendent.  In particular, Member complained of an incident in which the superintendent alleged that his vehicle had been vandalized, and the Board President allegedly told a fellow board member that he believed Member was responsible for the vandalism.  Member  further complained that the Board President told a reporter that Member had been a “headache” since Member took office and that Board President is referenced within some of the charges against Member.  The Board denies in its answer that the Board President speculated that Member damaged the superintendent’s vehicle and, in an affidavit, Board President generally averred  that he is not biased against Member.

The decision is posted on the Internet at:

http://www.counsel.nysed.gov/Decisions/volume57/d17204

Trends in arbitration

Trends in arbitration

On October 24, 2017, the United States Senate, by a 51-50 vote, approved H.J.Res. 111 providing for congressional disapproval under Chapter 8 of Title 5, United States Code, of the rule submitted by Bureau of Consumer Financial Protection relating to "Arbitration Agreements." 

The Joint Resolution, in effect, nullified a rule adopted by the Consumer Financial Protection Bureau prohibiting banks from mandating that consumers resolve disputes with the bank through arbitration.

The Bureau's rule regulated the use of arbitration agreements in contracts for specific consumer financial products and services and prohibited "the use of a predispute arbitration agreement to prevent a consumer from filing or participating in certain class action suits." The rule also requires consumer financial product and service providers to furnish the CFPB with particular information regarding arbitrations."

In contrast, on October 26, 2017, a California appellate court handed down its decision in Baxter v. Genworth North America Corp., [California Courts of Appeals, First Appellate District, Docket Number A144244, ], sustaining a lower court's ruling that held that a employment agreement constituted  “procedural unconscionability.”

Genworth had acquired another company, AssetMark, and Maya Baxter, as a condition of continue employment by Genworth, was required to agree to resolving any dispute with Genworth through its "Resolve Employee Issue Resolution  Program," a four-step procedure culminating in arbitration of the matter[s].

Significantly, the court ruled that severing the offending provisions it found in Genworth's "Resolve Employee Issue Resolution  Program" was not an option because "the arbitration agreement is permeated by unconscionability."

Educator's unsatisfactory performance rating for the academic year supported by the "detailed descriptions" of educator's difficulties in the classroom in the record

Educator's unsatisfactory performance rating for the academic year supported by the "detailed descriptions" of educator's difficulties in the classroom in the record

2017 NY Slip Op 03891, Appellate Division, First Department

Supreme Court denied the CPLR Article 78 petition filed by a teacher [Petitioner]seeking a court order annulling the determination of New York City Department of Education [DOE], thereby sustaining DOE's unsatisfactory performance rating of Petitioner for the 2013-2014 school year.

The Appellate Division unanimously affirmed Supreme Court's ruling.

The court explained the DOE's determination that Petitioner's performance as a teacher of during the 2013-2014 school year was unsatisfactory was not arbitrary and capricious.

The Appellate Division pointed out that the determination was supported by Petitioner's  principal's detailed descriptions of Petitioner's difficulties in [1] developing learning objectives, [2] using lesson plans, [3] maintaining academic rigor, [4] meeting students' varying needs, [5] facilitating "accountable talk" through "higher order thinking questions," and [6] actively engaging students.

The Appellate Division also noted Petitioner's deficiencies including Petitioner's "persistent failure to improve despite the ongoing individualized professional development support she received."

The court also rejected Petitioner's contention that she was not provided with sufficient time or feedback to remedy perceived deficiencies as also "belied by the record."

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2017/2017_03891.htm

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The Discipline Book - A concise guide to disciplinary actions involving public officers and employees in New York State set out as an e-book. For more information click on http://booklocker.com/books/5215.html

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The findings of fact made by a §75 hearing officer are given collateral estoppel effect in considering a terminated individual's application for unemployment insurance benefits

The findings of fact made by a §75 hearing officer are  given collateral estoppel effect in considering a terminated individual's application for unemployment insurance benefits

Matter of Schaefer (Commissioner of Labor), 2017 NY Slip Op 04335, Appellate Division, Third Department

The Claimant for unemployment insurance benefits had been terminated from her position as a school bus driver after having been served with disciplinary charges alleging  misconduct arising from her alleged [1] mismanagement of students on her bus during an incident, [2] being uncooperative with school district personnel during a field trip and [3] calling a parent of a student and requesting that the student wait for the bus at an unapproved bus stop without permission from the school district.

Following a disciplinary hearing held pursuant to Civil Service Law §75, the Hearing Officer sustained the charges [1] and [3] but dismissed the charge related to being uncooperative during the field trip. The Hearing Officer, considering that Claimant had received prior parental complaints, counseling memos from the school district and performance evaluations that were all critical of her student management skills, recommended that the appointing authority terminate Claimant.

The appointing authority accepted the Hearing Officer's findings and recommendation as to the penalty to be imposed and dismissed Claimant from her position.

Subsequently Claimants application for unemployment insurance benefits was denied by the Unemployment Insurance Appeal Board based its finding that Claimant had been terminated from her position with the school district due to "disqualifying misconduct.*

Claimant appealed the Board's determination. The Appellate Division sustained the Board's ruling, explaining that "[A]s claimant had a full and fair opportunity to litigate the issue of misconduct at the disciplinary hearing, the Board properly accorded collateral estoppel effect to the Hearing Officer's factual findings."

In addition, the court noted that the Board made its own its own determination as to whether Claimant's behavior, which included creating a hostile environment for a student on her bus and failing to follow a known policy of the employer, constituted disqualifying misconduct for unemployment insurance purposes.

Under the circumstances, the Appellate Division said it found that the Board's decision was supported by substantial evidence and "will not be disturbed." 

* N.B. As the Appellate Division noted in Matter of Wrzesinski [Roberts], 133 AD2d 884, not every discharge for cause in a disciplinary action is misconduct within the meaning of the Unemployment Insurance Law, which defines such disqualifying misconduct  conduct as “a willful and wanton disregard of the employer's interest.” 

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2017/2017_04335.htm

An appointing authority's request for "any and all medical records relating to an employee's current state of health" may be too broad and not reasonably tailored to the scope of the relevant medical records

An appointing authority's request for "any and all medical records relating to an employee's current state of health" may be too broad and not reasonably tailored to the scope of the relevant medical records

2017 NY Slip Op 07129, Appellate Division, Second Department

This CPLR Article 78 was filed by an individual [Petitioner] seeking judicial review a determination by the appointing authority, a school district, that Petitioner was guilty of charges of insubordination and incompetence following a Civil Service Law §75 disciplinary hearing and that the appropriate penalty was termination.

The Appellate Division annulled the appointing authority's finding Petitioner guilty of insubordination and vacated the penalty imposed by the appointing authority. The matter was matter was remitted to the appointing authority for new consideration of the matter and the imposition of appropriate penalty, if any, under the circumstances.

The appointing authority had been advised that Petitioner had been admitted to a psychiatric facility after making threats of violence against his former spouse to his psychiatrist. Pursuant to Education Law §913, the appointing authority referred Petitioner to a psychiatrist for a medical examination to determine his mental capacity to continue working as a custodian and directed  Petitioner to provide the psychiatrist with "any and all medical records relating to [his] current state of health."

Petitioner attended the medical examination but did not bring any medical records, contending that production of such records was an invasion of his privacy. This failure resulted in Petitioner by charged with insubordination and incompetence.

The Appellate Division addressed a number of issues, finding:

1. A hearing pursuant to Civil Service Law §75 was the proper means to adjudicate the charge of incompetence in consideration of the fact that the appointing authority's  examining psychiatrist opined that Petitioner presented a potential danger to the students and fellow staff members and was thereby unfit to continue working at the elementary school.

2.  The appointing authority's determination to sustain the charge of insubordination based on Petitioner's failure to provide the requested medical records was not supported by substantial evidence.

The Appellate Division said that there was no evidence the Petitioner failed to attend the medical examination to which he was directed and submit to the medical examination. Neither, said the court, was that any evidence that Petitioner was requested to submit to any additional medical examination by the same or another psychiatrist.

As Education Law §913 does not mandate that medical records be produced as a requirement of submitting to a medical examination, the Appellate Division held that "under the circumstances of this case, the [appointing authority's] determination that Petitioner's failure to provide requested medical records constituted a failure to submit to the medical examination is not supported by substantial evidence."

Further, the court opined that "the appointing authority's request for 'any and all medical records relating to [Petitioner's] current state of health' was overly broad and not reasonably tailored in scope in that it sought medical records beyond those that were relevant to [Petitioner's] mental capacity to perform his duties."

Noting that the request for medical records "lacked any time or subject matter limitation," the Appellate Division concluded that the appointing authority "was in error "to the extent that it found that Petitioner was insubordinate "for his failure to comply with this unreasonable directive."

Finding that the penalty of termination of Petitioner's employment was based on the Board's adoption of the hearing officer's recommendation to sustain both the charge of insubordination as well as the charge of incompetence, the court said that the matter must be remitted to the appointing authority to give it the opportunity to consider the appropriate penalty to be imposed upon [Petitioner] in connection with the charge of incompetence, and the imposition of that penalty thereafter."

Editor's Note:

In situations such as the one confronting Petitioner, a number of disciplinary hearing officers have suggested that the employer consider that the is employee is incompetent within the meaning of §72 of the Civil Service Law, Leave for Ordinary Disability, rather than be deemed incompetent within the meaning of §75 of the Civil Service Law for the purpose of initiating disciplinary action.

Indeed, in Gooshaw v Village of Massena, 216 AD2d 819, the Appellate Division said that it is inappropriate to file disciplinary charges against an individual who is unable to report for work because of his or her conceded disability while in Penebre v Dzaluk, 51 AD2d 574, the Appellate Division ruled that §75 charges for misconduct should not have been served on the employee but that the employer should have proceeded under §72, Ordinary Disability Leave, instead.

The decision is posted on the Internet at:.

http://www.nycourts.gov/reporter/3dseries/2017/2017_07129.htm

A decision issued pursuant to a compulsory arbitration proceeding must have evidentiary support, cannot be arbitrary and capricious and meet the requirements of administrative due process

A decision issued pursuant to a compulsory arbitration proceeding must have evidentiary support, cannot be arbitrary and capricious and meet the requirements of administrative due process

Mazzella v Bedford Cent. Sch. Dist., 2017 NY Slip Op 07127, Appellate Division, Second Department

An Education Law §3020-a hearing officer sustained sustained five of the seven specifications supporting the charge of incompetence that Bedford Central School District [Employer] had alleged in disciplinary the charge it had filed against Ava Mazzella [Petitioner]. The penalty imposed by the hearing officer: termination of Petitioner from her position.*

Petitioner challenged the hearing officer's findings and the penalty imposed and initiated a CPLR Article 75 proceeding in Supreme Court seeking to have the arbitration award vacated. Supreme Court denied Petitioner's motion to vacate the award and Petitioner appealed the Supreme Court's ruling to the Appellate Division.

The Appellate Division said that in a CPLR Article 75 proceeding the grounds for vacating a hearing officer's decision rendered pursuant to Education Law §3020-a "include misconduct, abuse of power, and procedural irregularities." Where, as here, the parties are subject to compulsory arbitration, the decision "is subject to closer judicial scrutiny under CPLR 7511(b) than it would receive had the arbitration been conducted voluntarily."

To be sustained, said the Appellate Division, a decision in a compulsory arbitration proceeding must have evidentiary support and cannot be arbitrary and capricious and must be in accord with administrative due process. In an appeal of a compulsory §3020-a arbitration decision, the Appellate Division said that "the court should accept the arbitrators' credibility determinations, even where there is conflicting evidence and room for choice exists."

Finding that the hearing officer's decision was rational, supported by adequate evidence, and not arbitrary and capricious, the court noted that under the controlling provisions of the Education Law "two consecutive annual ineffective ratings" constituted "a pattern of ineffective teaching or performance" and "a pattern of ineffective teaching or performance" constituted "very significant evidence of incompetence for purposes of this section."

Accordingly, the Appellate Division concluded that "It was rational for the hearing officer to rely on the 'ineffective' APPR ratings that Petitioner received during the relevant rating periods", as well as all the other evidence presented at the hearing, in sustaining the charge of incompetence.

Citing the so-called Pell Doctrine,** the Appellate Division said that "[u]nless an irrationality appears or the punishment shocks one's conscience, sanctions imposed by an administrative agency should be upheld" and then opined "[h]ere, the penalty of termination of [Petitioner's] employment was not irrational or shocking to one's sense of fairness." 

* Education Law §3020-a, as amended, provides for the compulsory arbitration of disciplinary charges filed against an educator by the appointing authority. The appointing authority or the employee may seek to confirm or vacate the arbitration award, as the case may be, in accordance with Subdivision 4 of §3020-a of the Education Law , which, in pertinent part, provides that "Not later than ten days after receipt of the hearing officer's decision, the employee or the employing board may make an application to the New York state supreme court to vacate or modify the decision of the hearing officer pursuant to section seventy-five hundred eleven of the civil practice law and rules. The court's review shall be limited to the grounds set forth in such section ...." 

** Pell v Board of Education. of Union Free School District. No. 1 of Towns of Scarsdale & Mamaroneck, Westchester County, 34 NY2d 222

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2017/2017_07127.htm

Termination of employment following extened absence without approval

Termination of employment following extended absence without approval  

Dep’t of Homeless Services v. Anonymous,OATH Index No. 1653/17

An agency employee [Anonymous*] who had worked in the New York City Borough of Manhattan was charged with being Absent Without Leave [AWOL] when she did not report to an assigned new workplace in another borough of New York City for over 13 months and failed to respond to notices regarding this absence.

Anonymous claimed that she was afraid to report to the new workplace because she had personally handled disciplinary action involving employees at that location. A psychologist who testified on Anonymous’ behalf opined that Anonymous suffered from depression and anxiety related to her reassignment to the new location.

The employer’s psychiatrist, on the other hand, testified that Anonymous  did not exhibit signs of severe anxiety or depression.

Office of Administrative Trials and Hearing Administrative Law Judge Astrid B. Gloade found this conflicting medical evaluations were of limited value as they were completed after the AWOL period.

Further, ALJ Gloade was not persuaded that Anonymous’ mental health prevented her from responding to department notices or reporting to work for over 13 months. Nor did the ALJ credit Anonymous’ contention that the relocation threatened her safety, as Anonymous' supervisors confirmed that security measures, including security guards, department police officers and "panic buttons" were in place.

Judge Gloade recommended that Anonymous be terminated from her position as a result of Anonymous' long, unexplained absence from her assigned duty station.

An appointing authority's may attempt to remove a tenured employee from his or her position for "absence" it deemed to be an abandonment of the position. In Ciccarelli v West Seneca Central School District, 107 AD2d 105, a teacher successfully challenged a Board of Education’s resolution [1]  holding that the educator had abandoned her position and [2] terminating her from her tenured employment. 

The Appellate Division held that the burden of proving that an educator had abandoned his or her tenured teaching position was upon the District. This, said the court, must be established "by clear and convincing evidence" that a teacher, by a "voluntary and deliberate act," intended to relinquish [the] teaching position and forfeit [his or her] tenure rights. Otherwise, ruled the Appellate Division, a tenured teacher may be terminated only in accordance with the provisions set out §3020-a of the Education Law.

In a similar situation involving an employee in the classified service [educators are in the unclassified service] a former rule of the New York State Civil Service Commission [4 NYCRR 5.3(d)] providing that a State employee absent for a period of ten or more days without an explanation would be deemed to have resigned from his or her position was held to violate the employee's right to administrative due process [Bernstein v Industrial Commissioner, 59 AD2d 678]. This type of provision, however, has survived in a number of  collective bargaining agreement [see New York State Off. of Mental Health v New York State Div. of Human Rights, 53 A.D.3d 887].

* Pursuant to OATH Rule of Practice section 1-49(d), respondent had requested that "Anonymous" be used in reporting this decision.

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Administrative due process must be provided the accused employee in a disciplinary arbitration proceeding

Administrative due process must be provided the accused employee in a disciplinary arbitration proceeding

2017 NY Slip Op 03853, Appellate Division, First Department

Petitioner, a tenured educator, initiated a CPLR Article 75 action seeking a court order vacating an arbitration award in which Petitioner was found guilty of multiple disciplinary charges and was terminated.

The Appellate Division sustained the arbitration award, noting that the following administrative due process requirements were satisfied:

1. Petitioner's right to administrative due process was not violated as Petitioner [a] was provided with appropriate notice, [b] was represented by counsel at a 13-day hearing and [c] had the opportunity to present evidence and cross-examine witnesses;

2. The hearing officer issued a detailed decision in which she [a] thoroughly analyzed the facts, [b] evaluated the credibility of witnesses and evidence presented and [c] arrived at a reasoned conclusion; and

3. Petitioner's claim that the arbitrator was bias was speculative and unsupported by the evidence.

As to the penalty imposed by the arbitrator, dismissal from the position, the Appellate Division opined that considering "Petitioner's teaching deficiencies over the course of three years, the absence of any improvement despite assistance offered by the appointing authority," and Petitioner's "refusal to acknowledge her shortcomings," imposing the penalty of termination "does not shock the court's sense of fairness," citing the so-called Pell standard [Pell v Board of Education,  34 NY2d 222.

Click here to Read a FREE excerpt from The Discipline Book concerning the due process rights of public employees in New York State.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2017/2017_03853.htm

Failure to comply with contractual grievance procedures may not always serve as a basis a for a court's issuing a stay of arbitration where such issues are to be resolved by the arbitrator

Failure to comply with contractual grievance procedures may not always serve as a basis a for a court's issuing a stay of arbitration where such issues are to be resolved by the arbitrator

Matter of Arbitration Between Town of Greece and Civil Service Employees Association, Inc., Local 828, AFSCME, AFL-CIO, 2017 NY Slip Op 06785, Appellate Division, Fourth Department

The Town of Greece [Greece] initiated a CPLR Article 75 action seeking a permanent stay of the arbitration of a grievance arising from its termination of one of the Civil Service Employees Association, Inc., Local 828 [Local 828] members. Supreme Court denied Greece's application for a permanent stay of arbitration and directed it to hold a hearing pursuant to step two of the three-step grievance procedure set out in the collective bargaining agreement [CBA] between the parties "within 30 days."

Greece appealed and although the Appellate Division affirmed the Supreme Court's denial of the permanent stay of arbitration sought by Greece, it vacated that part of the Supreme Court's order that directed Greece "to hold a step two hearing."

The Appellate Division explained that Supreme Court erred in directing Greece to hold a step two hearing. Contrary to the court's determination, the Appellate Division said that "a step two hearing is not a condition precedent to arbitration under the terms of the CBA."

As the CBA contained "a broad arbitration clause and does not expressly identify any conditions precedent to arbitration," the Appellate Division said that any alleged failure of a party to comply strictly with the contractual grievance procedures or time limits is not a proper ground for a stay of arbitration because such issues are to be resolved by the arbitrator.

With respect to CBA between Greece and Local 828,  Appellate Division held that  "... as a step two hearing is a permissive and not a mandatory part of the CBA's grievance and arbitration procedure, strict compliance with each step in the procedure is not a condition precedent to arbitration."

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2017/2017_06785.htm

New York State Comptroller Thomas P. DiNapoli announced the following audits and reports were issued during the week ending October 21, 2017

New York State Comptroller Thomas P. DiNapoli announced the following audits and reports were issued during the week ending October 21, 2017

Source: Office of the State Comptroller

Click on text highlighted in color  to access the full report

New York StateComptroller Thomas P. DiNapoli issued the following audits and examinations:

Department of Health (DOH): Improper Medicaid Payments to Eye Care Providers (2015-S-6)

Auditors identified vulnerabilities in DOH’s provider enrollment and revalidating procedures that undermine its ability to ensure that only qualified providers participate in the Medicaid program and prevent improper payments for services. As a result of these weaknesses, six eye care professionals who did not fully comply with the DOH’s Medicaid policies for provider enrollment and revalidation were able to obtain Medicaid eligibility under questionable circumstances.  


Department of Health: Medicaid Program, Managed Long Term Care Premium Rate Setting (2015-S-30)

Two managed care organizations reported medical costs for services procured through a corporate affiliate that would have been more accurately classified as administrative costs. These costs, which should have been subject to an administrative cap, were included in the medical costs component of the premium rate, which is not capped. Based on an analysis of the corresponding impact on the 2013-14 Managed Long Term Care premium rates, auditors estimated the misclassification of costs led to questionable payments of at least $82.3 million.

Department of Health: Ambulatory Patient Groups Payments for Duplicate Claims and Services in Excess of Medicaid Service Limits (Follow-Up) (2017-F-3)

An initial audit released in June 2015 determined DOH did not implement adequate controls to enforce Ambulatory Patient Groups (APG) policy and payment rules. As a result, Medicaid made $32.1 million in actual and potential overpayments. Additionally, DOH did not have controls in place to prevent duplicate claims, resulting in $7.5 million in overpayments. In a follow-up, auditors found DOH officials made some progress in addressing the problems identified in the initial audit report. About $800,000 of the identified overpayments were recovered and DOH updated policy manuals to give clearer billing guidance to providers.


Metropolitan Transportation Authority: New York City Transit Subway Wait Assessment (Follow-up) (2017-F-7)

A prior audit determined that wait assessment performance did not improve during the audit period and that New York City Transit had not developed a full and comprehensive plan to deal with the long-term causes of service disruptions, including matters related to major structural and technology improvements. In a follow-up, auditors found the MTA made some progress in addressing the problems identified in the prior report. However, additional actions are warranted.  


State Education Department (SED): Brookville Center for Children’s Services Inc., Compliance with the Reimbursable Cost Manual (2016-S-75)

Brookville is a Nassau County-based not-for-profit organization providing preschool special education services to children with disabilities between the ages of three and five years. For the three fiscal years ended June 30, 2014, auditors identified $1,089,215 in reported costs that did not comply with requirements for reimbursement and recommended these costs be disallowed. The costs included: $305,207 in duplicative administrative costs; $240,673 in ineligible lease expenses; $273,100 in ineligible management fees; $234,291 in ineligible and/or insufficiently documented fringe benefit expenses; and $35,944 in over-allocated compensation, ineligible tuition reimbursements, and other insufficiently documented expenses.

State Education Department: Building Blocks Developmental Preschool Inc., Compliance With the Reimbursable Cost Manual (2017-S-1)
 
Building Blocks is a not-for-profit special education provider located in Commack. Building Blocks provides preschool special education services to children with disabilities who are between three and five years of age. For the three fiscal years ended June 30, 2015, auditors identified $56,966 in ineligible costs that Building Blocks reported for reimbursement. These ineligible costs included: $53,073 in non-reimbursable lease costs, $3,497 in non-reimbursable consultant costs, and $396 in non-reimbursable food costs.


State Education Department: Hawthorne Foundation Inc., Compliance With the Reimbursable Cost Manual (2017-S-3)

Hawthorne is a not-for-profit special education provider located in Westchester County. Hawthorne provides preschool special education services to children with disabilities who are between three and five years of age. For the fiscal year ended June 30, 2015, auditors identified $75,189 in ineligible costs that Hawthorne reported for reimbursement for the rate-based preschool special education program that it operated. The ineligible costs included: $56,619 in personal service costs for insufficiently documented staff time; and $18,570 in other than personal service costs. Auditors also determined Hawthorne did not disclose related-party transactions with three entities.

State Education Department: The Child Study Center of New York (CSC), Compliance With the Reimbursable Cost Manual (2017-S-13)

CSC, a not-for-profit organization located in Jericho, is authorized by SED to provide preschool special education services to children with disabilities who are between three and five years of age. For the fiscal year ended June 30, 2014, auditors identified $127,101 in ineligible costs CSC reported for reimbursement. The ineligible costs included $121,255 in employee fringe benefit costs that were incorrectly allocated and $5,846 in ineligible costs for food, personal travel, gifts, and other non-reimbursable expenses.

Department of Taxation and Finance: Controls Over the Collection of the Public Safety Communications Surcharge (2016-S-84)

The department has not established policies and systems to sufficiently ensure that wireless telecommunication service providers comply with the tax law and that the state receives all monies to which it is entitled. In particular, the department does not have adequate controls to ensure that all eligible providers supplying services in the state collect, report, and remit the surcharges for all eligible devices to the department.

Comptroller's audits reveals local water systems losing millions in revenue

Audits of municipal water systems estimate local governments are losing millions of dollars in revenue due to water loss, inaccurate meters or improper billing, according to a report issued today by State Comptroller Thomas P. DiNapoli. The report analyzed the results of audits conducted by DiNapoli’s office of 161 local government and seven public authority water systems from January 2012 through May 2017.

“Water leaks, broken pipes and aging infrastructure are costing local governments millions of dollars annually,” said DiNapoli. “Across New York, my audits have revealed infrastructure problems, poor budget practices and a lack of long-term planning are straining municipal finances and increasing costs for taxpayers. If these problems aren’t addressed, the issues plaguing water systems will only get worse.”

Of the audits, 22 pointed to water loss as an issue and estimated that fixes could yield as much as $2.2 million in savings.

More often than not, water loss is caused by leaks from broken or aging underground pipes.  In some cases, however, auditors found inaccurate meters or improper billing to be the problem. As a result, some customers are paying too much and others too little. Efficient operations would require that officials upgrade meters or improve the accuracy of the billing process.

Auditors also found that several local governments had insufficient revenues to operate their water systems, which was aggravated by incorrect billing. As with water loss, these practices negatively affected water system operating budgets and overall municipal finances. During the five-year period, a review of 16 municipalities with revenue or billing deficiencies revealed that corrective action could increase revenues by more than $400,000.

DiNapoli’s report also noted:

1. Several municipalities were routinely transferring money into the water fund from other funds, which continued to mask revenue shortfalls;

2. Water fund surpluses were being improperly used to subsidize general operating costs for municipalities;

3. The lack of adequate monitoring of system finances left local officials unaware of ongoing deficits and the dangers of depleting fund balances; and

4. Some local officials had no strategies to eliminate long-term deficits, improve infrastructure or replace aging equipment, or spend down significant surpluses.

The Comptroller’s office has expanded its audit focus to include issues regarding local water supplies. Recently, DiNapoli’s staff conducted an audit of a county’s oversight of water testing, identifying opportunities for improvement. In addition, upcoming audits are planned that will examine the cybersecurity of computer-based systems used to monitor, modify, regulate or manage municipal water facilities. In the wake of recent cyberattacks that have disrupted a number of local governments, including a municipal-owned dam in the Hudson Valley, these systems have come to the forefront as a critical risk area.

The U.S. House of Representatives’ Energy and Commerce Committee recently advanced a bill that would reauthorize the Drinking Water State Revolving Fund, which provides grants for water systems. This financial assistance helps local governments address critical drinking water issues, including protecting water quality, repairing infrastructure, and modernizing water meters.

This report is the second in a series examining various aspects of municipal water systems, including infrastructure, finances and organization.

The first report, Drinking Water Systems in New York: The Challenges of Aging Infrastructure, was issued in February 2017. To view the report, visit:

http://www.osc.state.ny.us/localgov/pubs/research/municipal-water-systems.pdf

Pension Plan limitations for "Tax year 2018

Pension Plan limitations for "Tax year  2018

Source: The Internal Revenue Service

The Internal Revenue Service has issued information concerning cost of living adjustments affecting dollar limits for pension plans and other retirement-related items for tax year 2018. 

Go to 2018 cost of living adjustments for information concerning Pension Plan Limitations and 401(k) Contribution Limits.