Withdrawing from membership in a New York State public retirement system

Withdrawing from membership in a New York State public retirement system
Richardson v NYC Employees’ Retirement System, NYS Supreme Court, Justice Gammerman, [Not selected for publication in the Official Reports]

A member of a public retirement system may lose his or her eligibility for significant benefits if he or she decides to withdraw his or her contributions upon leaving public employment. The Richardson decision illustrates this.

Richardson, a New York City corrections officer, joined the New York City Employees’ Retirement System [NYCERS] in 1987. When he resigned from his position on September 29, 1997, Richardson submitted a form to NYCERS asking for a refund of all of the money he contributed to the System. In late November 1997, the System sent him a check for the full amount of his employee contributions -- approximately $19,000.

However, Richardson had also submitted an application for a disability pension to the Medical Division of NYCERS on October 14, 1997. He was found disabled by both the NYCERS Medical Board and an outside health provider after medical examinations. The Medical Division staff was unaware that Richardson had applied for, and received, his membership contributions.

On February 9, 1998, the Medical Division wrote to Richardson indicating that the Medical Board had approved his application and the NYCERS Board of Trustees would consider it. A few days later NYCERS again wrote to Richardson advising him that its February 9, 1998 letter was sent by mistake as he was in fact no longer eligible for disability retirement benefits because in September 1997 he elected to withdraw his employee contributions. Accordingly, said the System, he ceased to be a member of NYCERS and thus was ineligible for disability retirement benefits.

Richardson sued, contending that he was entitled to a disability pension since the Medical Board approved his initial application. He claimed that NYCERS’ determination rejecting his application for disability retirement was arbitrary, capricious and unlawful under both the United States and New York constitutions. He also claimed that had he been notified that the withdrawal of his contributions would disqualify him for disability retirement, he would have returned the money and remained a member of NYCERS.

As to Richardson’s argument concerning the rejection of his application for disability retirement, Justice Gammerman said that Section 517 of the Retirement and Social Security Law specifically provides that: “[u]pon withdrawal of contributions by a member ... membership in the public retirement system involved shall cease.” Justice Gammerman concluded that Richardson’s withdrawal of his contributions terminated his membership with NYCERS and his eligibility for disability benefits.

Justice Gammerman also rejected Richardson’s contention that the System should have warned him of the fact that he would become ineligible for benefits if he withdrew his contributions. He said that:

“there is no affirmative duty for NYCERS administrative staff to inform about the specifics of pension provisions beyond providing written material ... [members are] thus charged with constructive knowledge [of the pension materials]” and that “not inquiring about the status of one’s pension rights is unreasonable.”

The court held that NYCERS’ decision was reasonable and that its refusal to consider Richardson’s application for disability retirement benefits was neither arbitrary nor capricious. It then dismissed Richardson’s petition.

If a member of the New York State Employees’ Retirement [ERS] system leaves government service and does not withdraw his or her employee contributions, he or she continues to be a member of ERS. His or her ERS membership, however, will cease after five years have elapsed since he or she last left government service, or he or she dies or retires, whichever event first occurs [Section 40.f, Retirement and Social Security Law].

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John J. Murphy, the NYCERS' Executive Director from 1990 to 2005, e-mailed NYPPL stating that “I assume this member did not have 10 years of credited service. If he did, the refund was given contrary to law. The fact that he was granted a tentative disability, however, leads to the possibility that he may have had 10 years of service. Unless he was disabled due to an accident on the job, he would have had to have been credited with ten years of service to have been granted a disability. The crucial fact is how much service was he credited with when he resigned on Sept 27, 1997. Mr. Murphy further asked: “Did this plaintiff have 10 years of service in Sept, 1997? This supersedes the court decision. NYCERS must correct any error if they find them. If the refund was given after 10 years of credited service, it was invalid and therefore, the disability benefit is in force retroactively to 1997. [Mr. Murphy posts a blog focusing on the New York City Employees’ Retirement System at http://nycers-info-murphy.blogspot.com/ ]

NYPPL comments: Assuming, but not conceding, that Richardson did not have 10 years of member service at the time he withdrew his employee contributions, the Richardson decision demonstrates that in the event a member of a public retirement system withdraws his or her "employee contributions" upon resignation or termination, which he or she may elect to do if otherwise permitted, his or her membership in a New York public retirement system* ceases for the purposes of subsequently claiming eligibility for any benefit otherwise available to a member.

In contrast, were such an individual not to withdraw such employee contributions and he or she is later appointed to a position whereby he or she is required [or may elect] to become a member of a public retirement system of this State within the permitted period of time for "rejoining the System," his or her membership, and member service credit, could determined based on his or her membership as of the date of his or her separation. This suggests that absent compelling circumstances, the individual might be better served if he or she were to consider leaving the “employee contributions” with the System.

* The Optional Retirement Plans, available to certain employees of SUNY, CUNY, the statutory colleges at Cornell and Alfred Universities, the community colleges and the New York State Department of Education, are not public retirement systems of this State within the meaning of Article V, §7 of the State Constitution.
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Disability benefits - volunteer firefighters

Disability benefits - volunteer firefighters
Griffo v Onondaga Hill VFD, 256 AD2d 858

Although the Workers’ Compensation Board found that Greg Griffo had sustained a “permanent partial disability” as a result of two back injuries he suffered while serving as a volunteer firefighter, it also determined that Griffo had not “suffered a loss of [his] earning capacity” within the meaning of Section 3.8 of the Volunteer Firefighters’ Benefit Law.

Section 3.8 defines the term “loss of earning capacity” as the volunteer’s inability to perform his or her usual work, or some reasonably alternative employment, as a result of a service-related injury. This definition, the Appellate Division concluded, was the key to resolving Griffo’s appeal from the board’s determination.

According to the ruling, Griffo’s chiropractor authorized his return to work after both accidents. Some time later, the chiropractor imposed lifting and bending restrictions on Griffo because his back condition became exacerbated. According to Griffo, these limitations precluded him from applying for “higher paying and more physically demanding positions.”

However, the Appellate Division said that “the loss of opportunities for advancement is not relevant to whether [Griffo] suffered a loss of earning capacity within the meaning of Section 3.8.

The court noted that the statute simply does not make any provision for any award of benefits based on expected future income due to advancements or promotions. Since the record supported the board’s finding that Griffo “was capable of performing his usual work duties following both accidents,” his claim for benefits was properly rejected by the board.
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Lunchtime injuries

Lunchtime injuries
Smith v City of Rochester, 255 AD2d 863

Donna Smith, a City of Rochester parking monitor, slipped on a wet floor and fell while leaving a restaurant during an unpaid lunch break. The Workers’ Compensation Board denied Smith’s workers’ compensation claim, finding that she had not sustained an accidental injury in the course of her employment.

The Appellate Division affirmed the board’s determination, holding that “lunchtime injuries are generally deemed to occur outside the scope of employment except under limited circumstances where the employer continues to exercise authority over the employee during the lunch break.” The court said that the record showed that Smith had discretion as to the time and location of her lunch breaks and the city neither suggested that she eat at that particular restaurant nor derived any benefit from her patronizing that establishment.
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Civil Service Law controls in the event positions in the classified service are transferred between a school district and a BOCES

Civil Service Law controls in the event positions in the classified service are transferred between a school district and a BOCES
Matter of Hellner v Board of Educ. of Wilson Cent. School Dist., 2010 NY Slip Op 08472, Decided on November 19, 2010, Appellate Division, Fourth Department

Janet Hellner was employed by the Wilson Central District as an occupational therapist when, as a result of budget considerations, the District abolished her position* and entered into an agreement with BOCES to provide occupational therapy services.

Contending that this action constituted a "transfer of a function," the union said that Civil Service Law §70(2) required that the District certify Hellner’s name to BOCES as the employee to be transferred and that BOCES offer her the position of occupational therapist.

The District and BOCES, on the other hand, contend that Education Law §3014-a and 1950 controlled with respect to Hellner's transfer rights inasmuch as BOCES was to take over the occupational therapy program from the District.

Ultimately the Appellate Division ruled that:

1. The Agreement between the District and BOCES providing for occupational therapy services constituted the "transfer of a function" within the meaning of Civil Service Law §70(2).

2. The theory advanced by both the District and BOCES that Education Law §§3014-a and 1950 “exclusively govern the issue of employee transfer rights” was incorrect in this instance as neither §3014-a nor §1950 provided any transfer rights with respect incumbents of non-teaching positions in the classified service, citing Matter of Vestal Employees Association v Public Employment Relations Board, 94 NY2d 409.

In Vestal the Court of Appeals ruled that a school district employee providing printing services and thus had a non-educational position [in the classified service] was "afforded certain protections upon the transfer of his functions pursuant to Civil Service Law §70(2)."

The Appellate Division ruled that the transfer of occupational therapy services from the District to BOCES “constitutes the transfer of a function within the meaning of Civil Service Law §70(2) and thus Hellner, as the employee whose function was transferred, is afforded certain affirmative rights upon the transfer” of the position.

As to the District’s argument that this action “would violate various administrative provisions applicable to BOCES and the District,” the Appellate Division said that to the extent that such administrative provisions are inconsistent with §70(2), the statute control.

The Appellate Division said that "[A]dministrative regulations are invalid if they conflict with a statute's provisions or are inconsistent with its design and purpose," citing Matter of City of New York v Stone, 11 AD3d 236.

However, court said that the record was insufficient to enable it to determine whether BOCES had sufficient occupational therapy staff at the time of the Agreement and remitted the matter to Supreme Court for further proceedings on the union's petition to determine that issue.

* In the event an appropriate preferred list is certified to an appointing authority to fill a vacancy, the appointing authority must either [1] use the preferred list to fill the vacancy or [2] may elect to keep the position vacant.

The decision is posted on the Internet at:
http://www.courts.state.ny.us/reporter/3dseries/2010/2010_08472.htm

For information about PELP's e-book Layoff, Preferred Lists and Reinstatement of public employees in New York, go to: http://nylayoff.blogspot.com/

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Employer must prove that the employee knew, but failed to follow, procedures

Employer must prove that the employee knew, but failed to follow, procedures
NYC Department of Environmental Protection v Segarra, OATH Index No. 2730/10

The New York City Department of Environmental Protection charged Anthony Segarra, a senior sewage treatment worker at a water pollution control plant, with two instances of neglect of duty involving the taking of water samples.

OATH Administrative Law Judge Alessandra F. Zorgniotti found that the Department failed to prove that Segarra knew about the procedures at issue.

Accordingly, Judge Zorgniotti recommended that the charges that the Department had filed against Segarra be dismissed.

The decision is posted on the Internet at:
http://archive.citylaw.org/oath/10_Cases/10-2730.pdf
NYPPL