Protecting health insurance benefits after retirement

Protecting health insurance benefits after retirement
Rocco v City of Schenectady, App. Div., 252 AD2d 82, Motion for leave to appeal denied, 93 NY2d 1000
[Decided with Andriano v City of Schenectady, motion for leave to appeal denied, 93 NY2d 999]

In McDonald Police Benevolent Association v City of Geneva, 92 NY2d 326, the Court of Appeals ruled that there was no legal impediment to the City of Geneva’s unilateral alteration of “a past practice ... unrelated to any entitlement expressly conferred upon retirees in a collective bargaining agreement.”

The fact that retirees were involved was critical. The decision noted that “where a past practice between a public employer and its current employees is established, involving a mandatory subject of negotiation, the Taylor Law would bar the employer from discontinuing that practice without prior negotiation.”

But for retirees, benefits may be rescinded, even if established by past practice, if the benefits are not codified in a collective bargaining agreement to which the retirees were party, according to the McDonald decision.

Citing that ruling, a majority of an Appellate Division panel ruled in the Rocco and Andriano cases that a lower court was correct in barring the City of Schenectady from unilaterally changing the existing health insurance benefits of retired police officers and firefighters.

The critical difference was that in the Schenectady case the court found that the benefits were protected by the terms of a collective bargaining agreement negotiated pursuant to the Taylor Law.

Since 1969 labor agreements in Schenectady contained identical language providing that the city was to furnish, at its own expense, health insurance for retirees and their dependents “presently in effect for each member of the Department....” The Appellate Division said this meant that “when a member ... retired the coverage to which that individual was entitled [at the time of his or her retirement] remained fixed in time and could not be changed.”

The Appellate Division pointed out that:

1. The contract at issue had a duration of one to two years.

2. Once employees retire they are no longer represented by their union and have no collective bargaining rights under the Taylor Law.

3. Since retirees are not involved in subsequent negotiations, it is logical to assume that the agreement under which they retired was intended to insulate them from losing important insurance rights during subsequent negotiations.

The Court also distinguished the Rocco and Andriano plaintiffs, whose benefits were set out in a Taylor Law agreement, to those involved in the Geneva case. In Geneva, the retiree’s health insurance benefits were provided pursuant to a resolution adopted by the City Council rather than under a collective bargaining agreement.
NYPPL

Willful dishonesty in responding to superior’s question justifies dismissal of the employee

Willful dishonesty in responding to superior’s question justifies dismissal of the employee
Department of Correction v Katanic, OATH #2117/10

Jason Katanic, a NYC Department of Corrections correction officer, trained other officers in gun safety and marksmanship.

The Department charged Katanic with the possession of “five undocumented handguns and three undocumented rifles, including two rifles that were illegal assault weapons.”

OATH Administrative Law Judge Joan R. Salzman found that Katanic had failed to obtain the required permission from the Department before he purchased the weapons as required by Department Directives.*

Judge Salzman also found that Katanic “was willfully dishonest” on multiple occasions when questioned by his superiors about his possession of those firearms.

Judge Salzman recommended that, despite Katanic’s 13-year record with the Department, his dishonesty and breach of security and trust warranted his being terminated from his position.

* Directive 4511R-A provides that a correction officer was required to file the necessary form to apply for permission from the Commanding Officer to purchase a personal handgun and that “A separate application to/and approval from the member’s Commanding Officer must precede each purchase of an additional firearm.”

The decision is posted on the Internet at:
http://archive.citylaw.org/oath/10_Cases/10-2117.pdf
NYPPL

Police officer terminated after failing to report the loss of evidence

Police officer terminated after failing to report the loss of evidence
Bonifacio v Safir, App. Div., First Dept., 277 AD2d 8, Motion for leave to appeal denied, 96 NY2d 706

The Appellate Division sustained the dismissal of New York City police officer George Bonifacio after he was found guilty of disciplinary charges filed against him.

One charges involved Bonifacio’s actions after he had been reprimanded for having failed to respond to a radio call. According to the findings of the hearing officer, about an hour after he was reprimanded, Bonifacio approached his sergeant to discuss the matter and was discourteous to the point of being threatening. The fact that Bonifacio was upset at the time did not have any mitigating impact on the hearing officer’s consideration of the episode.

Another element in the disciplinary proceeding: Bonifacio also admitted he had failed to safeguard a firearm that he and his partner had recovered at a crime scene. Bonifacio also admitted that he had neglected to note the recovery of the weapon in his log.

Bonifacio attempted to explain his leaving the gun behind at the scene as a mistake that he wanted to cover up out of embarrassment.

The Appellate Division agreed with the hearing officer’s rejection of this excuse, concurring with the hearing officer’s finding that “it was extraordinarily irresponsible of [Bonifacio] not to tell any of his superiors about having left the gun behind, with the result that evidence of a crime was lost and an automatic weapon remains in the public domain.”

The court said that the penalty of dismissal does not shock its sense of fairness citing the Pell doctrine [Pell v Board of Education, 34 NY2d 222].
NYPPL

Tests applied in cases alleging dismissal from public service because of political affiliation

Tests applied in cases alleging dismissal from public service because of political affiliation
Bavaro and Hogan v Pataki, CA2, 130 F.3d 46

The Bavaro and Hogan v. Pataki case involved attorneys removed from their respective exempt class positions* in the New York State Health Department following the election of a new governor. There was no question that both were terminated because of their political affiliation.

The decision by the Second Circuit U.S. Court of Appeals is important as it sets out the various elements that the Second Circuit [New York State is within the Second Circuit’s jurisdiction] considers when deciding if an individual can claim First Amendment protection if he or she is terminated from the public service because of his or her political affiliation, or the lack of political affiliation.

Ralph Bavaro and Elizabeth Hogan contended that their terminations because of their political affiliation violated their First Amendment rights, which protected them from dismissal based on their political affiliation. The Circuit Court affirmed a district court’s ruling that “the incumbents of the positions of Associate and Assistant Counsel are not entitled to First Amendment protection against patronage dismissals.”

There are limitations on political tests for continuing in the public service however. In Elrod v Burns, 427 US 347, the U.S. Supreme Court concluded that patronage dismissals may infringe upon government employees’ First Amendment rights to political belief and association.

However, the High Court also noted that a newly elected administration may expect political loyalty among at least some of its employees “to the end that representative government not be undercut by tactics obstructing the implementation of policies of the new administration, policies presumably sanctioned by the electorate.”

Subsequently the High Court reaffirmed that patronage dismissals may contravene the First Amendment in Branti v. Finkel [445 U.S. 507]. Branti concerned a deputy public defender employed by a political subdivision of New York. The test to be applied: has the appointing authority demonstrated that party affiliation is an appropriate requirement for the effective performance of the public office involved?

In Branti, the Supreme Court noted that political affiliation is not always relevant even to the job of a policymaker. As an example, the Branti decision notes that the coach of a state university’s football team [typically a position in the unclassified service] formulates policy, “but no one could seriously claim that Republicans make better coaches than Democrats, or vice versa....”

The Second Circuit said that it understood Branti as standing for the proposition that “political affiliation is an appropriate [job] requirement when there is a rational connection between shared ideology and job performance” and thus the courts must look to the “inherent duties of the position” rather than the actual duties performed by the employee in a particular case. Accordingly, it is the official job description that controls, not the nature of the actual assignment or responsibilities of the individual.

In determining whether a “rational connection” exists between political affiliation and performance of the inherent duties of a position, the court said that it considers a number of factors, including the following:

1. Is the position exempt from civil service protection [subject to certain exceptions, i.e., veterans who served in time of war and exempt volunteer firefighters who may be subject to the provisions of Section 75 of the Civil Service Law]?

2. Is some technical competence or expertise required to satisfactorily perform the duties of the position?

3. Does the individual supervise the work of others? and

4. Is the incumbent “empowered to act and speak on behalf of a policymaker, especially an elected official”?

The court found that the positions held by Bavaro and Hogan (1) were in the exempt class; (2) required Bavaro, a supervisor, and Hogan, who was not a supervisor, to have “technical competence and expertise;” and (3) that they were not empowered to speak directly on behalf of an elected official. These findings, however, did not end the court’s inquiry.

The Circuit Court then found that Bavaro and Hogan represented the State in the performance of their duties, thereby reflecting the views of policymakers. This, the Circuit Court concluded, meant that Bavaro and Hogan were inherently involved in matters of policy extending “well beyond mere ministerial or technical duties.”

The court distinguished the role of Bavaro and Hogan from that of Branti. Branti, a deputy public defender, said the court, represented individuals accused of crimes -- not his employer. Accordingly, in a Branti situation the employee’s duty of loyalty is to the individual accused of a crime rather than to his or her employer - the Office of the Public Defender and there is no employer “policy issue” involved.

According to the ruling, Bavaro’s and Hogan’s “inherent duties” indicated a “rational connection between shared ideology and job performance,” so that “political affiliation is an appropriate [job] requirement” of these positions. Such was not the case in Branti, where political affiliation was not deemed a consideration to an individual’s continuation in public service although the position satisfied the four threshold elements set out by the Circuit Court.

* In September 1982 the Health Department justified its seeking jurisdictional re-classification of these titles to exempt status on the grounds that the incumbents “must be able to reflect the views of the Counsel and the [Health] Commissioner in oral appearances . . . and demonstrate the utmost discretion in handling these cases. To insure that the Commissioner’s views are appropriately reflected, the Agency needs maximum flexibility in selection, retention and remuneration.”

Establing a special eligible list

Establing a special eligible list
NYC v NYS Division of Human Rights, 250 AD2d 273

This case started 25 years ago when Eddie Ricks took and passed Civil Service Examination No. 3090 for the title of sanitation worker in the New York City Department of Sanitation (DOS). Ricks was disqualified because of spina bifida, a condition that, under the medical standards then in place, automatically disqualified an applicant for the position.*

In August 1990, the then-Commissioner of Human Rights signed an order upholding a finding of unlawful discrimination. However, the original eligible list had expired, preventing Ricks from being placed on a special eligible list on the basis of Deas v. Levitt (73 NY2d 525). Nevertheless, the then-Commissioner directed the city to pay Ricks compensatory damages consisting of back pay computed from the date he was disqualified to the date the eligible list expired (offset by his actual earnings during that time) as well as the compensatory damages recommended by an Administrative Law Judge.

The State Division Human Rights subsequently realized that the Commissioner who signed the order had appeared as counsel for SDHR in the matter and that “such dual participation in the proceedings” required de novo review and a new order. The newly appointed successor Commissioner vacated the 1990 order, conducted a de novo review of the hearing record and issued a new order that found that Ricks had been discriminated against on the basis of a disability that did not prevent him from performing the duties of the position sought. The city appealed the new ruling.

The Appellate Division said that there was a significance change in the Civil Service Law since Rick’s initial filing of his complaint with SDHR in 1983 with respect to the Division’s 1990 order. In 1990, under the Deas decision, once an eligible list expired, an applicant could be placed on a special eligible list only if he or she had commenced the proceeding challenging the validity of the list prior to its expiration. In 1994, specifically in response to Deas, the Legislature amended Civil Service Law Section 56 to provided that “[a]n applicant or eligible whose disqualification has been reversed or whose rank order has been adjusted subsequent to the expiration of an eligible list shall be placed on a special eligible list for a length of time ... not to exceed a maximum of one year” (CSL Section 56[3]).

The court said that the amendment recognized that because there were often long delays in adjudicating such claims, whether by administrative or judicial proceeding, “[t]oo often applicants find that, like those in Deas and DiNatale, they have won the battle to be found eligible to compete for a permanent civil service appointment, but have lost the war -- because the eligible list is approaching expiration or has expired.”

The Appellate Division resolved the matter by approving the Commissioner’s order in part, directing the city to:

(1) create a special eligible list for the position of sanitation worker for Ricks;

(2) award Ricks retroactive seniority if he is appointed from the special eligible list; and

(3) pay him $10,000 for mental anguish.

It rejected the Commissioner’s awarding Ricks back pay because Ricks only had “an expectancy” of employment rather than a guarantee of an appointment from an eligible list.

* The medical standards were subsequently revised, and the automatic disqualification for spina bifida was dropped.
NYPPL

Local law permitting suspension of an employee without pay beyond the 30 days permitted by Civil Service Law Section 75 held controlling

Local law permitting suspension of an employee without pay beyond the 30 days permitted by Civil Service Law Section 75 held controlling
Meringolo v Jacobson, 256 AD2d 20

Section 75(3) of the Civil Service Law authorizes the suspension of an individual upon whom disciplinary charges have been filed for up to 30 days without pay.* If the hearing has not been completed by the 30th day, the individual must be restored to the payroll. But what if a local law provides more flexibility? Which law takes precedence? The Meringolo shows that the answer depends on the details of the legislative history, including which law was enacted first.

Meringolo, a corrections captain, was suspended from his job with New York City for more than 30 days. Administrators cited City Administrative Code Section 9-112, which provides that a member of the city’s uniformed forces may be suspended without pay “while criminal charges are pending.”

When Meringolo challenged the legality of his suspension, the city cited Section 76(4) of the Civil Service Law, which provides that nothing in Section 75 shall be construed to “repeal or modify” any local law. The city claimed it could therefore legally suspend the captain without pay for than the 30-day period, as authorized by Section 75 pursuant to Section 9-112. The Appellate Division, upholding a lower court’s ruling, disagreed.

The court said the problem in the city’s reasoning was that Section 9-112 was not enacted until after Section 76(4) was legislated. Section 76(4) can be thought of as a “grandfather clause” that applies only to local laws enacted before its effective date. This implies that had Section 9-112 been in place prior to the adoption of Section 76(4), it would have been “grandfathered” and probably survived judicial review.

The Appellate Division affirmed the Supreme Court’s order directing the city to restore the captain to its payroll and pay him the back salary due him for the period of his suspension without pay in excess of 30 days.

* Disciplinary grievance procedures set out in a collective bargaining agreement may permit the suspension of an employee without pay pending the resolution of disciplinary charges. Also, Education Law Section 3020-a.2(b) authorizes an educator against whom charges have been filed to be suspended without pay if the individual has entered a guilty plea to or has been convicted of a felony crime involving “the criminal sale or possession of a controlled substance, a precursor of a controlled substance, or drug paraphernalia as defined in article two hundred twenty or two hundred twenty-one of the penal law; or a felony crime involving the physical or sexual abuse of a minor or student.”
NYPPL

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].

====================

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.
NYPPL

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.
NYPPL

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.
NYPPL

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/

NYPPL