Jurisdiction to consider unilateral changes in terms and conditions of employment

Jurisdiction to consider unilateral changes in terms and conditions of employment
Roma v Susquehanna Valley CSD, 92 N.Y.2d 489 [246 AD2d 714 reversed]

The primary issue on this appeal is whether a complaint of a public employer’s unilateral change in a term and condition of employment that is expressly covered by its collective bargaining agreement (CBA) with an employee organization lies within the exclusive jurisdiction of the State Public Employment Relations Board (PERB), or may be resolved through the grievance procedures of the CBA.

The Civil Service Law § 205 (5) (d) jurisprudence of PERB, which in the view of the Court of Appeals correctly reflects the legislative intent of the enactment, points the parties to a resolution of their dispute in this case through the nonbinding grievance procedures of the CBA (subject to judicial review), rather than through an improper employer practice charge before PERB for failing to negotiate in good faith.

Consequently, the high court said that the Appellate Division erred in dismissing the petition on the ground that PERB had exclusive subject matter jurisdiction over this controversy. Agreeing with Supreme Court that the CBA unambiguously precluded the school district’s unilateral action here, the Court of Appeals said that the judgment of Supreme Court should be reinstated.

The text of the ruling is filed on the Internet at:
http://nypublicpersonnellawarchives.blogspot.com/[Registration required]

Vesting health insurance rights

Vesting health insurance rights
Handy v Schoharie County, Appellate Division 244 A.D.2d 842

In the Handy case, the Appellate Division said a legislative body may adopt of a resolution that alters a retiree’s health insurance benefits and that such a change can be legally applied to people who retired prior to the vote to change benefits.

In December 1995, the Schoharie County Board of Supervisors adopted three motions changing its policy with respect to its providing County retirees health insurance benefits.

Under the new policy, any elected County official who completed 10 or more years of service would be entitled to “health insurance” at the County’s expense upon retirement. Prior to this change Schoharie paid the health insurance premiums for the retiree and his or her spouse if the retired employee had completed five years of County service and was receiving a state retirement allowance.

David E. Handy retired from the Board of Supervisors on December 31, 1995, having served as a member since 1978. The Board, however, at its January 19, 1996 meeting rescinded several December 1995 motions relating to health insurance for retirees.

The Board next reinstated its former policy with respect to providing health insurance to its retired employees. Because he was not receiving a state retirement allowance, the County said it would not pay for Handy’s health insurance in retirement.

Handy sued, contending that under the Board’s December 1995 actions he was “entitled to health insurance paid at [Schoharie County’s] expense as [he had] met the requirement of a vested right.”

The Appellate Division disagreed, holding that the County was under no contractual obligation to provide [Handy] with health insurance and, accordingly, it did not act arbitrarily or capriciously in terminating that benefit.

The Handy decision should be contrasted with two other retiree benefits cases: Della Rocco v City of Schenectady and Andriano v City of Schenectady.

The Schenectady cases differed in that they concerned executive action as opposed to legislative action and Taylor Law agreements were involved and held to control.

On August 28, 1997, State Supreme Court Justice Robert E. Lynch ruled that Schenectady must provide fully paid health insurance comparable to that in effect at the time of each retiree’s retirement because the municipality is bound by the Taylor Law agreement in effect when employees retired.

The fact that the Taylor Law agreements had expired did not alter the municipality’s obligations to retirees under them.

The key element was the existence or absence of a contractual obligation to provide retirees a benefit.

The Appellate Division pointed out that an act of a legislative body will be treated as a contract only when the language and the circumstances manifest a legislative intent to create a private right of a contractual nature.

As an illustration, the Court commented that in Cook v City of Binghamton, 48 NY2d 323, the Court of Appeals said that “certain types of legislative acts, including those fixing salaries and compensation ... are not presumed to create a contract.”

Quoting from the U.S. Supreme Court’s ruling in Dodge v Board of Education, 302 US 74 at page 79, the Court of Appeals said that “the presumption is that such a law is not intended to create a private contractual right or vested right but merely declares a policy to be pursued until the [legislative body] shall ordain otherwise.”

The Appellate Division said that it found nothing in the December 1995 actions by the Board that it “intended to fetter its power in the future” with respect to health insurance. “Rather than evincing an intent to create a private contractual or vested right, the motions are more reasonably read as declarations of [the Board’s] policy.”

Notwithstanding the fact that Handy would have enjoyed health insurance benefits at the expense of the County had the December motions not been repealed, the Appellate Division decided that the Board’s December 1995 actions did not create a contractual property right enforceable against Schoharie County.

As to any claim that the Board’s action gave Handy a vested retirement benefit, in Lippman v Sewanhaka Central High School District, 66 NY2d 313, the Court of Appeals decided that health insurance for retirees is not a retirement benefit protected against being diminished or impaired by the State’s Constitution.

Demoted whistle blower entitled to reinstatement to the higher-level former position or equivalent and lost salary plus “predetermination interest”

Demoted whistle blower entitled to reinstatement to the higher-level former position or equivalent and lost salary plus “predetermination interest”
Tipaldo v Lynn as Commissioner of the NYC Department of Transportation, 2010 NY Slip Op 06467, decided on August 24, 2010, Appellate Division, First Department

In August 1996, John Tipaldo, a long-time manager with the New York City Department of Transportation (DOT), was promoted to the position of Acting Assistant Commissioner for Planning. Tipaldo was earning an annual salary of $55,000 at the time and was advised that he would be given a $25,000 salary increase if his appointment became permanent.

Less than a year later Tipaldo was demoted from the Acting Assistant Commissioner position. As a result of the demotion, Tipaldo appointment to Assistant Commissioner position did not become permanent and he never received the $25,000 increase in salary.

Tipaldo challenged his demotion citing Civil Service Law §75-b, contending the demotion was in retaliation for his having reported to the Department of Investigation that a superior violated bidding rules (see 48 AD3d 361).*

The instant appeal was from an order following a nonjury trial on the issue of damages following the Appellate Division’s earlier ruling. This appeal challenged Supreme Court's awarding Tipaldo $175,000 in back pay, but without interest and the court’s directive that Tipaldo reinstated to the same, or to an equivalent position to the one that he had held before the retaliatory personnel action that gave rise to his initial lawsuit.

The Appellate Division affirmed the lower court’s ruling with respect to Tipaldo’s reinstatement but said that the award of back salary had to be redetermined because:

1. Tipaldo was entitled to an interest award as provided by Civil Service Law section 75-b; and

2. The record supports Tipaldo's request that he be reinstated "to the same position held before the retaliatory personnel action, or to an equivalent position" as provided by Labor Law §740[5][b]).

The Department, objecting to Tipaldo's reinstatement, argued that he was not entitled to such reinstatement as he had declined promotions 2000, 2001 and 2002. The Appellate Division rejected the Department's theory, commenting that the undisputed testimony of his current supervisor was that at the time of those offers of promotion Tipaldo feared that any promotion would be met with retaliatory action by agency personnel.**

As to the amount of back salary awarded by Supreme Court, the Appellate Division noted that Tipaldo had called an economics expert to establish the amount of back pay to which he was entitled. The expert testified that Tipaldo had lost $388,243 in earnings as a direct result of the retaliatory actions taken by defendants. Tipaldo’s expert also testified that, applying the statutory interest rate of 9% to the lost earnings, Tipaldo was owed a total of $662,721.

In contrast, said the Appellate Division, Supreme Court “without any explanation for how it arrived at the figure, awarded Tipaldo $175,000 in back pay” and denied Tipaldo’s request for pre-determination interest.

Significantly, the Appellate Division noted that the Department “chose not to call their own expert to offer an alternative theory of the earnings which plaintiff would have lost had he not been the victim of retaliation, or to explain why plaintiff's expert's analysis was flawed in any respect.” Thus, said the court, “the only expert opinion before us is [Tipaldo's] and we see no reason to disturb it.”

Further, the Appellate Division held that that predetermination interest is generally available to whistle blowers suing pursuant to Civil Service Law §75-b.

* See Tipaldo v. Lynn, 48 AD3d 361 for the Appellate Division’s ruling in this earlier case.

** The Appellate Division indicated that the fact that Tipaldo declined such promotions did not militate against honoring his request for reinstatement to the higher-level position at this time.

The instant decision is posted on the Internet at:
http://www.courts.state.ny.us/reporter/3dseries/2010/2010_06467.htm

The earlier decision, 48 AD3d 361, is posted on the Internet at:
http://www.nycourts.gov/reporter/3dseries/2008/2008_01801.htm
.