Acting on information provided by the employer later proved to be incorrect does not create a right that was not otherwise available to the individual

Acting on information provided by the employer later proved to be incorrect does not create a right that was not otherwise available to the individual
2014 NY Slip Op 04051, Appellate Division, First Department

A former Court of Claims Judge and acting Supreme Court Justice, relying on the erroneous advice of employees of the Office of Court Administration (OCA) that he was vested in his New York State Health Insurance Program (NYSHIP) resigned from his position. He subsequently learned that he was not eligible to vest his NYSHIP benefits and thus was not eligible for NYSHIP benefits under the law.

Asserting that he would not have resigned from his position when he did if not for this advice, he filed a petition in the Court of Claims seeking a court order reinstating him as a NYSHIP participant or, in the alternative, an order awarding him money damages. The Court of Claims granted OCA’s motion to dismiss the action.

The Appellate Division, affirming the Court of Claim’s ruling, held that notwithstanding the incorrect information provided by the OCA employees, which was ministerial in nature, and which might subject the governmental body to liability, no claim of a “special duty was advanced by the former judge in contrast to his being treated same as any other employee seeking advice or information from OCA.

Accordingly, said the court, OCA may not be estopped from applying the law to the former judge notwithstanding the incorrect information given to him by an OCA employee and upon which he acted to his detriment.

Citing Matter of Grella, 38 AD3d 113, the Appellate Division explained that estoppel may not be invoked to prevent a governmental agency from performing its duty is not applicable here.*In Grella, a case involving eligibility for certain retirement benefits, the court held that even when erroneous advice was given by a Retirement System employee, the Comptroller has the exclusive authority to determine entitlement to retirement benefits and the duty to correct errors and cannot be estopped from exercising such duties in order "to create rights to retirement benefits to which there is no entitlement."

* The decision notes that the “the narrow exception to the rule” barring the application of estoppel to a governmental agency was not applicable in this case. [See, also, 2014 NY Slip Op 03907, Appellate Division, Third Department, summarized at http://publicpersonnellaw.blogspot.com/2014/06/the-consequences-of-withdrawing-from.html]
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Imposing the penalty of dismissal held reasonable under the circumstances

Imposing the penalty of dismissal held reasonable under the circumstances

2014 NY Slip Op 03064, Appellate Division, Fourth Department

A former New York State Trooper [Former], commenced a CPLR Article 78 proceeding seeking to annul the Superintendent's determination finding him guilty of misconduct or, in the alternative, to vacate the penalty of dismissal. Former contended that the determination is not supported by substantial evidence and that the penalty is shocking to one's sense of fairness.

The charges against Former alleged that he knew of certain illegal activities and did not take proper police action to stop them; that he knowingly frequented an establishment where violations of the law existed; that he provided false information during the internal investigation; and that, by his conduct, he brought discredit to the Division of State Police.

The Hearing Board found Former guilty of all of the charges filed against him but one. The Superintendent accepted the findings and recommendations of the Hearing Board and dismissed Former from the Division of State Police.

The standard of review for the Appellate Divisions and the Court of Appeals in such cases is whether there was substantial evidence to support the Hearing Officer's decision" Rejecting Former’s contention to the contrary, the Appellate Division concluded that, we conclude that the Superintendent’s determination was supported by substantial evidence.

Although Former denied having any knowledge of the illegal activities alleged, there was substantial evidence establishing the contrary, i.e., that he was aware of those activities. Further, said the court, Former gave numerous inconsistent statements regarding whether he knew certain facts and evaded answering basic questions. The Appellate Division concluded that the Hearing Board properly determined that such evidence is indicative of a consciousness of guilt.

The Appellate Division explained that although a different finding would not have been unreasonable, "where [, as here,] substantial evidence exists' to support a decision being reviewed by the courts, that determination must be sustained, irrespective of whether a similar quantum of evidence is available to support other varying conclusions' "

Turning to the penalty imposed, dismissal from the Division, the court said that it did not agree with Former that the penalty of dismissal is shocking to one's sense of fairness. "Judicial review of an administrative penalty is limited to whether the measure or mode of penalty or discipline imposed constitutes an abuse of discretion as a matter of law . . . and a penalty must be upheld unless it is so disproportionate to the offense as to be shocking to one's sense of fairness,' thus constituting an abuse of discretion as a matter of law."

Further, said the court, "[i]n matters concerning police discipline, great leeway' must be accorded to the [Superintendent's] determinations concerning the appropriate punishment, for it is the [Superintendent], not the courts, who is accountable to the public for the integrity of the [Division of State Police]," citing Kelly, 96 NY2d 32 among other decisions.

Given the nature of the offenses, the "higher standard of fitness and character [that] pertains to police officers," Former's evasive conduct and his refusal to accept any responsibility for his conduct, the Appellate Division concluded that the penalty of dismissal does not shock one's sense of fairness.

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Disciplinary decision vacated as employer failed to cite any law or rule that classified the employee’s alleged actions as misconduct

Disciplinary decision vacated as employer failed to cite any law or rule that classified the employee’s alleged actions as misconduct
2014 NY Slip Op 03958, Appellate Division, First Department

In a §3020-a disciplinary action the arbitrator found a teacher guilty of misconduct and terminating his employment with the New York City Department of Education. Supreme Court confirmed the arbitration award and the teacher appealed.

The Appellate Division unanimously vacated the lower court’s ruling and vacated the arbitration award, explaining that the Department of Education “has not identified any rule or statute that classifies [the] statements and action [alleged] as teacher misconduct." Thus, the court found that, in consideration of the circumstances, the finding that the teacher's actions constituted teacher misconduct was not supported by adequate evidence, and is arbitrary and capricious.

The Appellate Division also noted that the teacher did have “a disciplinary history including findings of non-sexual touching of students, and that two prior disciplinary awards expressly warned him not to touch his students again,” However, said the court, it is undisputed that the teacher did not touch any of his students “in the case at bar” and thus, contrary to the arbitrator's finding, the evidence did not indicate that teacher had failed to heed prior warnings.

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Selected reports and information published by New York State's Comptroller Thomas P. DiNapoli during the week ending June 7, 2014

Selected reports and information published by New York State's Comptroller Thomas P. DiNapoli during the week ending  June 7, 2014

Click on text highlighted in color  to access the full report

New York State Comptroller Thomas P. DiNapoli announced the following audits have been issued during the week ending June 7, 2014.:

Department of Corrections and Community Supervision, Corcraft's Textile Procurement Practices (2012-S-22) 

 
Corcraft is a major component within the Department of Corrections and Community Supervision. Corcraft's mission is to employ offenders in real work situations to produce quality goods and services at competitive prices. Current procurement practices allow one person, the purchasing supervisor, to control almost all of the process for the procurement of textiles. The inadequate separation of incompatible duties and lack of compensating controls increases the risk of favoritism in the award process. Auditors found Corcraft officials awarded contracts without testing all of the required specifications and instead used their own discretion in deciding whether and which specifications were tested. As a result, they did not adequately ensure open competition, and there was limited assurance that contracts totaling $32.3 million went to the lowest responsive and responsible vendors. 

Department of Health, Medicaid Program: Medicaid Payments Made Pursuant to Medicare Part C  (2012-S-133)

 
During the audit period, auditors found Medicaid could have saved up to $69 million if it limited payments of Medicare Part C cost-sharing liabilities such that the total Medicare and Medicaid payment for a service did not exceed Medicaid's normal service fee. Other states already use this approach and New York uses this approach to limit payments for certain other Medicare cost-sharing liabilities. In addition, auditors determined Medicaid made $1.6 million in overpayments for Medicare Part C cost-sharing because recipients were not enrolled in Part C. 

Department of Health, Medicaid Program: Medicaid Claims Processing Activity October 1, 2012 Through March 31, 2013 (2012-S-131)

Auditors identified about $13 million in inappropriate or questionable Medicaid payments, including:

$6,329,458 in questionable payments for claims that were not subjected to the appropriate edits and pricing logic due to eMedNY's incorrect designation of the claim type being processed; $2,965,300 in overpayments for claims billed with incorrect information pertaining to recipients' other health insurance coverage; $2,689,352 in inappropriate payments for lab services claims submitted well beyond the required time frame for submission; $488,837 in overpayments for claims for duplicate billings; $222,806 in overpayments for claims for a dialysis drug billed at 10 times the number of units actually provided; and claims with improper payments for physician-administered drugs, hospital services, medical equipment and dental services. 

By the end of the audit fieldwork, auditors recovered about $3.8 million of the overpayments identified. 

Department of Health, Selected Employee Travel Expenses (2012-S-94)

 
Travel expenses totaling $466,301 for 14 of the 17 DOH employees selected for review were appropriate and adhered to state travel rules and regulations. However, for three employees, auditors identified numerous problems with travel practices and related expenses attributed to inadequate oversight. Of the $121,727 in travel expenses examined for the three employees, auditors found problems with costs totaling $14,870. 

NYC Human Resources Administration (HRA) NYS Office of Temporary and Disability Assistance, Benefit Eligibility Assessment Process (2012-S-51)

 
Auditors found that HRA employees apply a comprehensive assessment process when determining a client's eligibility, and that process is in compliance with governing regulations and procedures. However, procedural revisions are necessary to reduce the number of hearings held, and to reduce the number of HRA determinations that are reversed at hearings. 

 
Office of Information Technology Services, Procurement and Contracting Practices (Follow-Up) (2013-F-24)

 
In an initial audit report issued in February 2012, auditors found a culture at the Office of Information Technology Services (ITS), emanating from the highest levels of the agency, that disregarded the New York State Finance Law, the state's procurement guidelines and the agency's own procurement policies. This did not result in the best value for the taxpayers, but instead led to a waste of substantial public resources. Moreover, in several notable instances, transgressions appeared to have been motivated by personal gain and may have violated the ethics standards contained in the New York State Public Officers Law. In a follow up, auditors found ITS officials have made some progress and continue to make progress in addressing the problems identified in the initial audit. Of the eight prior audit recommendations, one was implemented and seven were partially implemented. 

Office of Mental Health, Sky Light Center Inc.: Supported Housing Program (2012-S-37)

 
Auditors identified $125,302 in unsupported or inappropriate personal service expenses charged to the housing program. These charges included unsupported salary allocations and inappropriate overtime payments to management. Auditors also identified $295,321 in unsupported or inappropriate non-personal service expense items, including expenses associated with the unrelated program facilities, payments to a contractor to enhance his personal property and rental payments for unoccupied apartments. Sky Light officials cannot account for over $75,000 in contingency funds that were to be used specifically for client housing emergencies. Additionally, Sky Light officials did not make all required visits to client apartments. Auditors identified several potential safety issues, including the lack of smoke and carbon monoxide detectors. 

Port Authority of New York and New Jersey, Inspecting Highway Bridges and Repairing Defects (2012-S-34)

 
Auditors found the authority conducted the required biennial inspection of its highway bridges, but does not follow New York state requirements for classifying, reporting and repairing bridge defects. Instead it follows its own method, but does not always satisfy state requirements. As a result, it did not perform 47 interim inspections for priority conditions open more than one year. The authority also did not inspect a highway bridge with an immediate safety concern for 332 days while it awaited repairs. Ten of the 17 safety concerns sampled were not repaired for more than two years, including three which were open for five years. 

State University of New York SUNY at Albany, Selected Employee Travel Expenses (2012-S-74)

 
Expenses for nine of the 10 University employees selected for review were appropriate. For a track coach, however, officials did not enforce Office of State Comptroller and university guidelines limiting travel advance amounts and requiring unspent balances to be returned on a timely basis. The track coach routinely overestimated the amount of advance funds needed for athletic events. As a result, at one point he had over $87,000 in outstanding advances. Also, the coach consistently returned unused advance funds more than two months later than required by the university. University officials allowed this coach to pay back his travel advances in installments – similar to the payback of a loan. The track coach may have violated the Public Officers Law by employing his daughter as a volunteer coach and using state funds to pay for her travel with him and the team to local and national track events. 

Tuition Assistance Program, Medgar Evers College (2011-T-4)

 
Medgar Evers was overpaid $3,398,205 over three academic years because school officials incorrectly certified students as eligible for Tuition Assistance Program (TAP) awards. Incorrect certifications include 29 students who received awards but did not meet the requirements for full-time status, 14 students who did not maintain good academic standing, four students whose accounts were not credited with the TAP payment, three students who were not properly matriculated, two students who enrolled in programs not approved by the State Education Department, one student who did not meet the citizenship requirement, and one student for whom auditors found insufficient proof that she satisfied the New York state residency requirement. 

Tuition Assistance Program, Pratt Institute (2013-T-3)

 
Auditors determined that Pratt's certification procedures substantially complied with the governing Law and Regulations during the audit period for the transactions tested. There is low risk that a significant number of students certified for TAP were not eligible for awards. Nonetheless, tests did disclose 26 awards totaling $38,236 that school officials certified in error. After reviewing the errors, Pratt officials decertified one award for $2,450 and sent another student a $50 refund check.

Labor Department needs to improve wage theft investigations

The state Department of Labor (DOL) doesn’t complete many of its wage theft investigations in a timely manner, allowing thousands of cases to remain unresolved for a year or more, according to an audit released June 6, 2014 by State Comptroller Thomas P. DiNapoli.

Wage theft is the illegal holding of wages or denial of benefits to a worker by an employer. Examples include failing to pay overtime, not giving workers their last paycheck after they leave a job or not paying for all the hours the employee worked.

DiNapoli’s auditors found that, as of August 26, 2013, DOL had more than 17,000 open cases, an increase of about 150 percent from the 7,000 cases on hand at the start of 2008. The current caseload consists of about 9,300 active investigations and more than 7,800 cases pending payment. Of these, almost 13,000, or 75 percent, were at least one year old from initial claim date.

The increasing backlog stems largely from system and process deficiencies that hinder timely investigations, coupled with a limited number of staff to perform the growing amount of work. As of August 2013, auditors estimate that DOL’s 98 investigators were responsible for an average of 95 active investigations each.  According to the audit, resolving the inefficiencies in DOL’s procedures and its use of resources could significantly improve productivity.

DiNapoli’s auditors also found:
 

1. DOL’s Workforce Protection Management System does not provide management with accurate or useful case management reports;
 

2. Employers may be allowed a payment plan for restitution, but DOL has not established criteria to guide eligibility or payment terms; and
 

3. DOL does not maintain a centralized record of all payment plans in effect, and neither the Division of Labor Standards nor its districts have adequate controls in place to track and monitor employer compliance.

During the audit period the division instituted procedural changes to streamline its work and reduce the backlog.

DiNapoli recommended DOL:

1. Continue efforts to close the oldest wage investigation cases and strive to investigate and resolve newer cases faster;

2. Monitor the newly implemented strategies discussed in this report and continue to pursue additional initiatives to reduce the wage investigation case backlog and complete new wage investigation cases sooner;

3. Correct system flaws and develop capability to create meaningful reports to better manage the current cases and backlog;

4. Establish specific payment plan procedures;

5. Develop criteria for investigators to use to determine if a payment plan should be granted;

6. Ensure that each district office follows the payment plan procedures and keeps similar records; and

7. Develop a centralized payment collection system to effectively separate incompatible duties and to manage all payment plan information and transactions.

“It is imperative that DOL do a better job resolving wage theft cases as workers across New York are often waiting too long for the compensation they rightly deserve,” DiNapoli said. “While wage theft investigations are generally complex and time-intensive, any lags pose a risk that complications, such as lost records, could arise and interfere with an investigation and possible settlement.”

DOL officials responded to the audit’s recommendations and indicated the actions they are taking to address them. For a copy of the report, including DOL’s response, click on http://www.osc.state.ny.us/audits/allaudits/093014/13s38.pdf

Court of Appeals deferred to PERB’s expertise with respect to its holding the employer had engaged in an improper employer practice but ruled its remedy was unreasonable

Court of Appeals deferred to PERB’s expertise with respect to its holding the employer had engaged in an improper employer practice but ruled its remedy was unreasonable

Town of Islip v New York State Pub. Empl. Relations Bd., 2014 NY Slip Op 04043, Court of Appeals

The Town of Islip filed a CPLR Article 78 petition challenging the New York State Public Employment Relations Board's [PERB] ruling that Islip violated Civil Service Law §209-a when it when it unilaterally discontinued the practice of permanently assigning Town-owned vehicles to certain employees. 

The employees in question had been permitted to use these so-called "take home" vehicles to travel from home to work and back — i.e., to commute to work. Section 209-a (1) (d) makes it an improper practice for a public employer to refuse to negotiate in good faith with the bargaining agent for its public employees. Likewise, the Court of Appeals concluded that PERB reasonably applied precedent when making its determination, which determination was supported by substantial evidence.*

PERB’s Administrative Law Judge had held that Islip had violated Civil Service Law §209-a (1) (d) by canceling "take home" vehicle assignments without negotiation -- a clear and unequivocal 20-plus year practice -- and had ordered the Town to:

1. Restore the vehicle assignments for commutation between home and work to those unit members who enjoyed the benefit prior to April 4, 2008.

2. "Make whole unit employees for the extra expenses incurred as a result of the unilateral withdrawal of the vehicle assignment(s), if any, together with interest at the maximum legal rate"; and

3. To sign and post a notice in the workplace to inform employees of the remedies ordered.

PERB ultimately affirmed ALJ's ruling and the remedy ordered.

The Appellate Division held that "substantial evidence supported PERB's determination that the permanent assignment of Town-owned vehicles to the affected employees constituted a past practice as to a term or condition of employment, a mandatory subject of negotiation, which the Public Employees' Fair Employment Act (Civil Service Law Article 14), known as the Taylor Law, barred the Town from unilaterally discontinuing" [see 104 AD3d 778, (2013)].

As to the remedies imposed by PERB the Court of Appeals said that with, deference to its expertise, "a remedy fashioned by PERB for an improper practice should be upheld if reasonable," although "[i]t is for the courts to examine the reasonable application of PERB's remedies." However the Court of Appeals ruled that PERB's remedial order was unreasonable insofar as it requires the Town to restore vehicle assignments to the affected employees.

In this instance the court concluded that PERB's remedial order requires the Town to "[f]orthwith restore the vehicle assignments for commutation between home and work to those unit member who enjoyed the benefit prior to April 4, 2008." However, notes the decision, a PERB injunction was not sought by the employees’ representative to preserve the status quo ante and Islip had sold some or all of the vehicles formerly permanently assigned to blue- and white-collar unit employees, thus forcing Islip to invest “significant taxpayer dollars to replace these vehicles is unduly burdensome under the circumstances, and does not further the goal of reaching a fair negotiated result.” 

Consistent with this view, the Court of Appeals remanded the matter to PERB so that it “may fashion a remedy that grants commensurate, practical relief to the employees subject to the improper practice without requiring the Town to purchase a whole new fleet of vehicles with an uncertain future.”

Judge Pigott dissented, indicating that, in his view, the issue in this appeal was whether a public employer must collectively bargain its way out of a previous policy that is plainly in violation of a duly-enacted local law.

Judge Pigott noted that the relevant Chapter Islip’s Town Code was adopted in December of 1968 and, “apparently, as amended from time to time by the elected Town Board, has functioned without incident ever since.” Section 14-12 of the Town Code provides in its entirety as follows: "No officer or employee shall request or permit the use of Town-owned vehicles, equipment, material or property for personal convenience or profit, except when such services are available to the public generally or are provided as municipal policy for the use of such officer or employee in the conduct of official business" (emphasis supplied in the opinion).

Judge Pigott, concluding that PERB’s determination should be annulled and vacated, said:

1. Essentially, PERB's decision trumps a local law and requires the Town to bargain its way out of an illegal activity;

2. This is contrary to law [as] "Illegal past conduct does not, and should not, evolve into binding terms and conditions of employment”;

3. Were it so, sloppy bookkeeping, lax supervision and perhaps, in some cases, rife favoritism could form the basis of a policy by which PERB could overrule a duly-enacted local law; and

4. The conduct engaged in by the Town and its employees was against the law and PERB's determination could not make it legal.

* The Court of Appeals said that the scope of its review in this case was “limited to whether PERB's determination that Islip had engaged in an improper practice was ‘affected by an error of law’ or was ‘arbitrary and capricious or an abuse of discretion’ (see CPLR 7803 [3]) and PERB is accorded deference in matters falling within its area of expertise" such as in "cases involving the issue of mandatory or prohibited bargaining subjects."

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2014/2014_04043.htm

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