Seniority for the purposes of layoff and reinstatement from a preferred list set out in "settlement agreement"

Seniority for the purposes of layoff and reinstatement from a preferred list set out in "settlement agreement"

Giardina v New York City Health and Hosp. Corp., 2016 NY Slip Op 01402, Appellate Division, First Department

City Laborer Antonio Giardina was laid off from his position. Giardina’s union subsequently challenged the way the “retention date” of City Laborers, including Giardina’s, for the purposes of layoff had been determined by the employer. The union, on behalf of affected City Laborers, including Giardina, then entered into a stipulation of settlement with the employer that set the “retention date” for the Labors.

Giardina filed an Article 78 petition seeking to annul the determination that resulted in his being laid off after his position had been abolished. Supreme Court dismissing the proceeding brought by Giardina, which ruling the Appellate Division unanimously affirmed.

Noting that Giardina had personally ratified the settlement which advanced his retention date by more than nine years and moved his name from No. 49 to No. 23 on the preferred list, the Appellate Division explained that only two vacancies had occurred since his layoff and  Laborers senior to him had been reinstated to those position. As Giardina was unable to identify any Laborer who should have been displaced by him or any vacancy that occurred to which he should have been appointed from the preferred list, the court held that Supreme Court was correct in dismissing his petition.

Significantly, the positions to which the stipulation of settlement applied apparently were in the Labor Class.* 

As the Appellate Division held in City of Plattsburgh v Local 788, 108 AD2d 1045, this element – an individual’s seniority for the purposes of layoff – may neither be diminished or nor impaired by the terms of collective bargaining agreement with respect to incumbents of positions in the Competitive Class.

In Plattsburgh the issue concerned the application of a contract provision negotiated pursuant to the Taylor Law to determine seniority in a layoff situation.

The collective bargaining agreement between Plattsburgh and the Union provided if there were to be demotions in connection with a layoff, the "date of hire" was to be used to determine an employee's seniority. However, the "date of hire" might not necessarily be the same date required to be used to determine an individual's service for seniority purposes in layoff situation under State law, typically the individual's date of initial permanent appointment in public service.

For example, assume Employee A was provisionally appointed on January 1, and Employee B was provisionally appointed February 1, of the same year. Employee B, however, was permanently appointed on March 1 of the same year, while Employee A was permanently appointed a month later, on April 1. Under the terms of the Local 788 collective bargaining agreement Employee A would have greater seniority for layoff purposes than Employee B. §80 of the Civil Service Law, however, provides that the date of an individual's most recent, uninterrupted "permanent appointment" determines his or her seniority for the purposes of layoff and so, under the Civil Service Law, Employee B would have greater seniority than Employee A.

This was the problem in the Plattsburgh case. The City laid off M rather than another worker, R. Although M had been employed by the City for a longer period than R, R had received his permanent appointment before M was permanently appointed.

Ultimately the Union demanded that the matter be submitted to arbitration, contending that under the seniority provision in the collective bargaining agreement, R should have been laid off. The City, on the other hand, argued that Civil Service Law §80 controlled and thus M, rather than R, had to be laid off first and sought to stay the arbitration of the grievance.

Plattsburgh obtained a court order prohibiting arbitration. The court said that §80 of the Civil Service Law "reflects a legislative imperative" that the City was powerless to bargain away.

As the Court of Appeals held in County of Chautauqua v. Civil Service Employees Ass'n, 8 N.Y.3d 513, “Once such an informed decision as to which positions are to be [abolished] is made, §80(1) obligates the employer to respect the seniority rights of its employees."

* §80 of the Civil Service Law controls with respect to the suspension or demotion of employees in the Competitive Class in the event of a layoff while §80-a of the Civil Service Law controls with respect to the suspension or demotion of employees of State as the employer serving in positions in the Non-competitive Class in the event of a layoff. §81 sets out the procedures to be followed with respect to reinstatement from preferred lists established pursuant to §§80 and 80-a.

The Giardina is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_01402.htm

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The Layoff, Preferred List and Reinstatement Manual - a 645 page e-book reviewing the relevant New York State laws, rules and regulations, and selected court and administrative decisions involving layoff and related matters. For more information click on http://booklocker.com/5216.html

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A party seeking to modify an arbitration award must comply with the relevant provisions of Article 75 of the Civil Practice Law and Rules

A party seeking to modify an arbitration award must comply with the relevant provisions of Article 75 of the Civil Practice Law and Rules

Board of Educ. of the City Sch, Dist. of the City of New York (DOE) v United Fedn. of Teachers, 2016 NY Slip Op 01592, Appellate Division, First Department

Supreme Court vacated a supplemental arbitration award; the Appellate Division unanimously affirmed the lower court’s ruling. The Appellate Division said the Supreme Court had “properly vacated the supplemental arbitration award because the parties failed to comply with the procedure set forth in CPLR 7509.”

§7509 permits a modification of an arbitration award by arbitrator[s] and requires that the party seeking the modification to apply for it within 20 days of the delivery of the award by submitting a written application to the arbitrator.* A copy of the application must be served on the other parties to the arbitration.

In the event there is any objection to the modification requested, the objecting party or parties must served the objection on the  arbitrator[s]  and  other parties to the arbitration within ten days of receiving the request for the modification.

Addressing another issue, the Appellate Division found that the arbitrator had exceeded his powers by "rendering wholly new determinations on matters not addressed in the original award."

* In addition a party involved in the arbitration may ask a court to modify an arbitration award as permitted by §7511(c) of the CPLR.

The decision is posted on the Internet at:

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http://www.nycourts.gov/reporter/3dseries/2016/2016_01592.htm

The essentials elements of processing a complaint alleging retaliation constituting unlawful discrimination

The essentials elements in processing a complaint alleging retaliation constituting unlawful discrimination

Troge v State Div. of Human Rights, 2016 NY Slip Op 01337, Appellate Division, Second Department

In the Troge decision the Appellate Division sets out the basics with respect to litigating a complaint alleging retaliation in violation of the State's Human Rights Law where the individual suffered an adverse personnel action because of the individual's engaging in a protected activity .

First, in order to establish a prima facie case of retaliation, the individual is required to show that:

(1) he or she had engaged in protected activity, 

(2) his or her employer was aware that he or she participated in such activity, 

(3) he or she suffered an adverse employment action based upon his or her activity, and 

(4) there is "a causal connection between the protected activity and the adverse [personnel] action" alleged to have suffered by the individual.

Assuming the individual is able to make this initial showing, the burden would shift to the Employer to present legitimate, independent, and nondiscriminatory reasons to support its action[s] or decision[s].

If the Employer meet that burden, the individual would then have to show that the reasons given by the Employer in its defense were "pretext" to camouflage an act of unlawful discrimination.

Darlene Troge was employed by the Town of Southampton as Director of Workplace Policy and Compliance [DWPC], a position that required her to investigate complaints of job discrimination and harassment. After a Deputy Town Supervisor demanded that Troge produce her notes of an investigation of a workplace dispute between two employees, one of whom was Troge’s supervisor, she filed an internal complaint with the Town alleging that the Deputy Town Supervisor had created an "offensive" work environment.

The Town investigated Troge’s complaint and dismissed it. A month later the DWPC position was abolished by unanimous vote of the Town Board and Troge was terminated.  Contending that she had been terminated in retaliation for her filing her “internal complaint” alleging "an offensive work environment," Troge filed a complaint pursuant to Executive Law Article 15 against the Town and Town Supervisor Anna Throne-Holst [the Town].

At a hearing before the State Division of Human Rights [SDHR] the Town submitted proof of the Town's need to reorganize and consolidate different departments within the Town government for financial reasons, leading to the termination of employees. In addition, the Town offered proof of their discontent with the petitioner's job performance. Troge testified that she filed the internal complaint after “opposing requests that she perceived to be in furtherance of discrimination directed against her supervisor” and that she was fired in retaliation of that action.

A Division of Human Rights Administrative law judge [ALJ], following the hearing, found that

[1] Troge failed to establish a prima facie claim for retaliation, and

[2] Even if Troge had established a prima facie claim of unlawful discrimination, the Town had shown that its actions were motivated by "fiscal, non-discriminatory reasons."

Troge filed objections to the ALJ’s findings and determination. The SDHR’s Commissioner issued a final order adopting the ALJ's findings and recommendations and dismissed Troge’s complaint. Troge then filed a CPLR Article 78 petition challenged the Commissioner’s determination.

The Appellate Division said that the review of an administrative determination made after a hearing by a court is limited to considering whether the administrative determination was supported by substantial evidence. Substantial evidence, said the court is “such relevant proof as a reasonable mind may accept as adequate to support a conclusion or ultimate fact."

Notwithstanding Troge’s contention to the contrary, the Appellate Division ruled that there was substantial evidence to support the Commissioner’s determination that the Troge was not subjected to retaliation, explaining that she failed to establish that she had been subjected to an adverse employment action that was taken because of her having engaged in a protected activity.

Essentially the court found that Troge had not been able to demonstrate that the abolishment of her position by the Town constituted a retaliatory firing and the reasons given by the Town in support of its action was “subterfuge.”

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_01337.htm

Employee has the burden of proving alleged misconduct by the arbitrator prejudiced his or her rights or the integrity of the process

Employee has the burden of proving alleged misconduct by the arbitrator prejudiced his or her rights or the integrity of the process

Collazo v Suffolk County, 2016 NY Slip Op 01321, Appellate Division, Second Department

Maria Callazo initiated an Article 75 CPLR proceeding in Supreme Court seeking to vacate an arbitration award that recommended certain disciplinary action be taken against her with respect to her employment with the County. The Appellate Division affirmed Supreme Court’s dismissal of Callazo’s petition.

Contrary to the Callazo's contention, the Appellate Division said that Supreme Court correctly determined that Callazo “failed to show by clear and convincing evidence that any misconduct on the part of the arbitrator prejudiced her rights or the integrity of the arbitration process.” In addition, the Appellate Division noted that the disciplinary charges filed against her were timely served within 18 months of her alleged misconduct in connection with her employment.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_01321.htm

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The Discipline Book - A 458 page guide focusing on New York State laws, rules, regulations, disciplinary grievances procedures set out in collective bargaining agreements and selected court and administrative decisions concerning disciplinary actions involving state and municipal public officers and employees. For more information click on http://booklocker.com/5215.html 

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Resolving conflicting medical evidence submitted connection with a Workers’ Compensation Law claim is within the exclusive province of the Workers’ Compensation Board

Resolving conflicting medical evidence submitted in connection with a Workers’ Compensation Law claim is within the exclusive province of the Workers’ Compensation Board

Granville v Town of Hamburg; 2016 NY Slip Op 01373, Appellate Division, Third Department

The Town of Hamburg had employed Patrick Granville as a laborer and light equipment operator from 2003 to 2012. In May 2013, Granville filed for workers' compensation benefits claiming that he had sustained an occupational hearing loss due to exposure to loud occupational noise as a result of his operating such equipment such as heavy-duty sit-down lawn mowers, weed whackers, heavy-equipment tractors, backhoes, zambonis and air jacks.

The Town, a self-insured employer for the purposes of Workers’ Compensation, and its third-party administrator [collectively “the Town”] controverted the claim for benefits filed by Granville. The Workers' Compensation Law Judge [WCLJ] who conducted the hearing concluded that Granville had suffered a causally-related binaural loss of hearing. The Workers' Compensation Board affirmed the WCLJ’s findings.

The Town, conceding that Granville had suffered a hearing loss, appealed the Board’s decision, contending that the record as a whole:

[1] did not establish that Granville was exposed to injurious noise during the course of his employment by the Town; and 

[2] did not establish that Granville’s hearing loss was causally related to his employment.

The Appellate Division rejected the Town’s argument, explaining that Granville had satisfied his burden of establishing, by competent medical evidence, that a causal connection existed between his hearing loss and his employment.

At the workers’ compensation hearing Granville had testified that he had operated heavy and light machinery "at least ninety percent of the time" during a typical workweek, that he had no loud hobbies or activities outside of work and that, prior to his work with the employer, he had worked in the banking industry. He also testified that he was required to undergo a hearing test in 2004, shortly after commencing employment with the Town, and that the results of this test revealed that he had "no effects of hearing loss.* In addition, Granville submitted a report and medical opinion of his treating otolaryngologist, Dr. Sayeed Nabi, who found that Granville's hearing loss was causally related to his employment.**

In contrast, the otolaryngologist who examined Granville on behalf of the Town opined that Granville's hearing loss was neither consistent with injurious noise exposure nor causally related to his employment’

Sustaining the Board’s decision in favor of Granville, the Appellate Division said “The Board found the opinion of [Dr.] Nabi to be more credible and, according appropriate deference to that assessment, substantial evidence supports the determination that [Granville] suffered a causally-related binaural loss of hearing,” explaining that the resolution of conflicting medical opinions, particularly with regard to the issue of causation, is within the exclusive province of the Workers’ Compensation Board.

* The Appellate Division noted that the Town “failed to produce the records of this hearing test.”

** The court said that "[W]here medical proof is relied upon to demonstrate the existence of a causal relationship, it must signify a probability of the underlying cause that is supported by a rational basis and not be based upon a general expression of possibility"

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_01373.htm

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The Disability Benefits E-book: - This e-book focuses on disability benefits available to officers and employees in public service pursuant to Civil Service Law §§71, 72 and 73, General Municipal Law §207-a and §207-c, the Retirement and Social Security Law, the Workers’ Compensation Law, and similar provisions of law. For more information click on: http://booklocker.com/3916.html

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Determining when the statute of limitations to file a civil rights action commencesn

Determining when the statute of limitations to file a civil rights action commences

Azor v City of New York, 2016 NY Slip Op 01440, Appellate Division, First Department

Jean Azor alleged that his civil rights were violated in the course of a disciplinary hearing. Azor the filed an action claim a violation of 42 USC 1983.

The Appellate Division ruled that his action was barred by the three-year statute of limitations as his time to commence the §1983 action began to accrue on the date of the disciplinary hearing determination was delivered.

The decision is posted on the Internet at:

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http://www.nycourts.gov/reporter/3dseries/2016/2016_01440.htm

Negligence in complying with the Open Meetings Law may not be sufficient to vacated decisions made at a meeting subject to its provisions

Negligence in complying with the Open Meetings Law may not be sufficient to vacated decisions made at a meeting subject to its provisions

Cutler v Town of Mamakating, 2016 NY Slip Op 01543, Appellate Division, Third Department

The Town of Mamakatingabolished its position of Parks Maintenance Supervisor.

The then incumbent of the position, Oliver Cutler, challenged the Town’s action. Cutler contended that the Town had “had illegally and in bad faith abolished his position.” Cutler also alleged that the Town violated the Open Meetings Law, Public Officers Law Article 7, when it voted to abolish the Parks Maintenance Supervisor position at a closed executive session and was unrecorded.

Supreme Court dismissed Cutler’s “combined proceeding pursuant to CPLR Article 78 and action for declaratory judgment” to vacate the Town’s action abolishing his position which resulted in his being terminated from employment.

Cutler appealed the Supreme Court’s action but the Appellate Division affirmed the lower court’s rulings. Citing §80 of the Civil Service Law, the court ruled that a public employer may, in the absence of bad faith, collusion or fraud, abolish positions for purposes of economy or efficiency.

Here the record included affidavits of the Town Supervisor and a member of the Town Board indicating that because its “parks maintenance department consisted of only [Cutler] and one part-time laborer, it could achieve greater economy and efficiency by abolishing the supervisory position in favor of hiring additional laborers.” The Town also said that Cutler’s managerial duties were “shifted” to the Town Supervisor and that this reorganization and the employment of two full-time and one part-time laborer provided an overall “cost savings.”

Thus, said the court, the burden was then shifted to Cutler to demonstrate that his position was eliminated in bad faith or as a subterfuge to circumvent his rights under the Civil Service Law. The Appellate Division said Cutler failed to meet his burden, submitting only “conclusory and unsupported assertions” which failed to refute the Town Board's showing that its actions were part of “a good faith effort to reorganize a municipal department for the purposes of reducing costs and increasing efficiency.”

The court explained that the mere reassignment of duties, in and of itself, does not constitute proof of bad faith nor was there any indication in the record of any personal or political animosities that would suggest some deceitful purpose of ousting and replacing Cutler.

Addressing Cutler’s argument in the alternative, that the closed executive session in which the unrecorded vote to abolish his position was taken constituted a violation of the Open Meetings Law, the Appellate Division held that “Supreme Court had good cause to void the Town Board's action.” Although a discussion of the abolishment of Cutler's specific position for reasons of economy and efficiency was a proper subject of an executive session, the court said it agreed with Cutler that the Town Board violated the Open Meetings Law by inadequately describing the purpose for entering into the executive session as, simply, "personnel issues."

The Appellate Division also agreed with Cutler “that it was improper for the Town Board to vote on its decision without recording the vote in the executive session minutes, even though it did not "appropriate public moneys."

Notwithstanding its agreement with Cutler concerning these two “procedural defects,” the court decided that Cutler failed to show the requisite "good cause" for declaring the Town Board's action to be void stating that the record does not suggest that the [Town Board's] failure to comply with the precise requirements of the Open Meetings Law was anything more than mere negligence." Citing Roberts v Town Board of Carmel, 207 AD2d 404; Leave to appeal denied, 84 NY2d 811, the Appellate Division concluded that “mere negligence” does not constitute good cause for invalidating the Town Board's otherwise permissible action.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_01543.htm

_____________________

The Layoff, Preferred List and Reinstatement Manual - a 645 page e-book reviewing the relevant New York State laws, rules and regulations, and selected court and administrative decisions involving layoff and related matters. For more information click on http://booklocker.com/5216.html

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A law enforcement agency may refuse to appoint an applicant for employment in a civilian position based on the applicant's prior criminal conviction

A law enforcement agency may refuse to appoint an applicant for employment in a civilian position based on the applicant's prior criminal conviction

2016 NY Slip Op 01548, Appellate Division, First Department

Article 23-A of the Corrections addresses the “licensure and employment of persons previously convicted of one or more criminal offenses.” It is referred to as a remedial statute “enacted to eliminate the effect of bias against ex-offenders that prevented them from obtaining employment,” by prohibiting employers, public and private, from unfairly discriminating against persons previously convicted of one or more criminal offenses. In making its employment decision, Article 23-A bars discrimination based on a criminal record “unless after consideration of certain enumerated statutory factors, the employer determines that there is direct relationship between the offense(s) and the duties or responsibilities inherent in the … employment … or such employment … poses an unreasonable risk to the public….”

Characterized as case turning on the interpretion of Article 23-A and involving “an issue of first impression,” the Appellate Division unanimously sustained the decision of the New York City Police Department [NYPD] not to appoint DB to the position of Police Communications Technician (PCT). Individuals employed by NYPD as PCTs serve as "civilian employees"* in contrast to serving in the Department as "sworn officers" as defined in §1.20 (34) of the Criminal Procedures Law. 

Notwithstanding the criteria set out in Article 23-A, the court ruled that a law enforcement agency may refuse to hire an applicant seeking employment with that agency as a civilian solely on the basis of the applicant's prior criminal conviction. The Appellate Division explained that, in its view, the protections of Article 23-A do not apply to an individual seeking to be hired by a law enforcement agency in a "civilian" capacity because "membership in any law enforcement agency" is expressly exempted from the statutory definition of "employment" set out in §750(5) of the Correction Law.**

DB had alleged that the sole basis for the NYPD rejecting her for employment as a PCT was that she has a prior criminal conviction.*** 

The issue as formulated by the Appellate Division: Is an individual applying for civilian employment as a PCT with NYPD, a law enforcement agency, seeking something different from "membership" in a law enforcement agency? DB contended that "membership" in a law enforcement agency applies only to sworn officers such as police officers in contrast to those seeking employment in a civilian capacity and that any other interpretation renders the policy of rehabilitation through employment meaningless because good jobs with the NYPD are foreclosed to her, despite having received a certificate from disabilities.

The court concluded that where a term does not have a controlling statutory definition, "courts should construe the term using its usual and commonly understood meaning." Turning to the Merriam-Webster dictionary, the Appellate Division said "membership" is therein defined as "the state of belonging to or being a part of a group or an organization — the state of being a member — all the people or things that belong to or are part of an organization or a group." 

Thus, said the court, applying this broad definition, the exemption does not apply to a narrower group of people such as those seeking employment as sworn officers with a law enforcement agency but applies to anyone, including those such as DB, applying for employment in a law enforcement agency in civilian capacity rather than in a sworn officer capacity. In the words of the Appellate Division: “Had the legislature intended that the exemption from Article 23-A only apply to persons seeking to enforce laws [i.e. uniformed police officers or peace officers], but not the civilians employed by the same agencies or departments, it could have specifically so provided.”

Noting that New York State’s Attorney General has similarly interpreted the exemption in Article 23-A [see 1981 Ops Atty Gen No. 81-7], the court said that while an opinion of the Attorney General is not binding, it "is an element to be considered." In addition, the Appellate Division cited Little v County of Westchester, 36 AD3 616, a case involving the rejection of an applicant for appointment as a correction officer.****

The court opined that its interpretation was not inconsistent with the broad purpose of Article 23-A, that applicants with prior criminal convictions be treated fairly as PCTs take calls, obtain critical information and are the first point of contact between the public and law enforcement and such personnel have access to confidential information, including non-public activities. In the words of the Appellate Division, “The civilian nature of the job does not determine its importance in NYPD operations.”

* Incumbents of such positions are frequently referred to as 911 operators or dispatchers.

** §750.5 provides that "employment" shall not, for the purposes of [Article 23-A], include membership in any law enforcement agency” while §751, pertinent part, provides that the provisions of Article 23-A shall apply with respect to employment “except where a mandatory forfeiture, disability or bar to employment is imposed by law, and has not been removed by an executive pardon, certificate of relief from disabilities or certificate of good conduct.” According to the decision, DB possessed a certificate of relief from disabilities.

*** The court noted that DB contended that she was a victim of domestic violence and that she inflicted certain injuries on her abuser in self-defense. She pleaded guilty to second-degree assault, a Class D felony and was sentenced to five years probation, which she had completed.

**** In Little the court held that “An appointing authority has wide discretion in determining the fitness of candidates, which discretion is particularly broad in the hiring of law enforcement officers, to whom high standards may be applied.”

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_01548.htm

Selected Reports issued by the Office of the State Comptroller during the week ending March 5, 2016

Selected Reports issued by the Office of the State Comptroller during the week ending March 5, 2016

Click on text highlighted in color to access the full report

State audits released.
 
City University of New York – Administration of Fellowship Leaves; Follow-up
An initial audit issued in October 2013, examined whether the fellowship leaves granted instructional staff were awarded for authorized purposes and in compliance with all applicable requirements. Although most of the fellowship recipients reviewed complied with CUNY policy, improvements were needed to protect taxpayer dollars and the integrity of CUNY’s fellowship leave program. In a follow-up report, auditors determined CUNY has made progress in addressing the issues identified in the initial report.

http://osc.state.ny.us/audits/allaudits/093016/15f5.pdf

Office of General Services – Passenger Vehicle Fleet Management

In the almost three years since the state’s Spending and Government Efficiency (SAGE) Commission’s recommendations, OGS has not made any formal recommendations regarding the state’s vehicle fleet, as directed in the commission report. As a result, there has been relatively little progress in achieving the overall goal of consolidating and centralizing management of the fleet, which largely remains the responsibility of managers at the individual agencies. For additional progress to occur, OGS needs to perform a comprehensive analysis of agency needs and take steps to ensure the fleet available to each agency is the proper size and makeup to most efficiently meet agency missions.

http://osc.state.ny.us/audits/allaudits/093016/14s30.pdf

Department of Health – Fraudulent and Improper Claims – Follow-up

An initial audit issued in August 2013, determined that Medicaid made improper payments totaling $94,460 to Davis Ethical Pharmacy. Auditors determined that Davis Ethical likely fabricated nearly all of the improper claims. After an investigation, the owner, William Davis, pleaded guilty to Grand Larceny in the Second Degree in Nassau County District Court. In a follow-up, auditors determined DOH made progress addressing the problems identified in the initial report. At the time of the follow-up review, Davismade full restitution to the state.

http://osc.state.ny.us/audits/allaudits/093016/15f25.pdf

United HealthCare – Fraudulent and Improper Claims
An initial audit report issued in August 2013, determined the New York State Health Insurance Plan (NYSHIP) made improper payments totaling $137,459 to Davis Ethical Pharmacy. After an investigation, the owner, William Davis pleaded guilty to Grand Larceny in the Second Degree in Nassau County District Court. In a follow-up, auditors determined United made progress addressing the problems identified in the initial report. At the time of the follow-up review, William Davis made full restitution to the state.

http://osc.state.ny.us/audits/allaudits/093016/15f26.pdf

 

Higher Education Services Corporation – Tuition Assistance Program
Auditors determined that Metropolitan Learning Institute was overpaid $581,315 because school officials incorrectly certified students as eligible for state financial aid awards.

http://osc.state.ny.us/audits/allaudits/093016/14t1.pdf

NYC Department of Health and Mental Hygiene – Administration of Contracts
NYC Department of Health and Mental Hygiene [DOHMH] did not effectively administer certain financial aspects of the contract with the Center for Urban Community Services. As a result, CUCS overbilled DOHMH by about $1.06 million during the year ended June 30, 2013. The overbillings include $1.05 million of improperly claimed personal service expenses and $11,889 of unsupported or inappropriate non-personal service costs.

http://osc.state.ny.us/audits/allaudits/093016/14n5.pdf

SUNY Downstate Medical Center – Review of Grove Technologies, Inc.
In April 2014, Downstate entered into a state-funded, non-competitive, single-source contract with Growe for electronic medical health record services.  Auditors found Downstate paid up to $1.3 million more than necessary by using a non-competitive procurement rather than bidding the services or using existing competitive contracts available to Downstate.  The decision to use the non-competitive contract was based on unsupported claims from Downstate officials.

http://osc.state.ny.us/audits/allaudits/bseaudits/bse20160219.pdf

IRS Alerts Payroll and HR Professionals to Phishing Schemes

IRS Alerts Payroll and HR Professionals to Phishing Schemes

Source: IRS Newsletter #IR-2016-34 [Links to additional information are in color below.]

On March 3, 2016, the Internal Revenue Service [IRS] issued an alert to payroll and human resources professionals warning of an emerging phishing e-mail scheme that purports to be from executive officers or supervisors and requests employee personal information.

The Merriam‑Webster dictionary defines phishing as "a scam by which an e-mail user is duped into revealing personal or confidential information which the scammer can use illicitly."

The IRS reports that it has learned this scheme – part of the surge in phishing e-mails seen this year – already has claimed several victims as payroll and human resources offices mistakenly e-mailed payroll data including W-2 Forms that contain Social Security numbers and other personally identifiable information, to cyber-criminals posing as executive officers or supervisors.

IRS Commissioner John Koskinen said “If your CEO appears to be e-mailing you for a list of company employees, check it out before you respond. Everyone has a responsibility to remain diligent about confirming the identity of people requesting personal information about employees.”

IRS Criminal Investigation is reviewing several cases in which individuals have been tricked into sharing Social Security numbers with what turned out to be cyber-criminals. Criminals using personal information stolen elsewhere then seek to “monetize” this data, including filing fraudulent tax returns for refunds due a taxpayer. 

There is also a phishing variation is known as a “spoofing” e-mail. The e-mail will contain, for example, the actual name of an executive officer or supervisor. In this variation, the “CEO” sends an e-mail to a payroll or personnel office employee requesting a list of employees and information including employee Social Security numbers.

The following are actual examples of the information requested in these “spoof mails”:

“Kindly send me the individual 2015 W-2 (PDF) and earnings summary of all W-2 of our employees for a quick review

“Can you send me the updated list of employees with full details (Name, Social Security Number, Date of Birth, Home Address, Salary) as at 2/2/2016.

“I want you to send me the list of W-2 copy of employees wage and tax statement for 2015,

“I need them in PDF file type, you can send it as an attachment. Kindly prepare the lists and e-mail them to me ASAP.”

The IRS recently renewed and issued a consumer alert [IR-2016-28, Feb. 18, 2016] for e-mail schemes after seeing an approximate 400 percent surge in phishing and malware incidents so far this tax season and receiving other reports of scams targeting others in a wider tax community.

The e-mails are designed to trick individuals into thinking these are official communications from the IRS or others in the tax industry, including tax software companies. The phishing schemes can ask individuals to provide a wide range of personal and financial information. E-mails can seek information related to refunds, filing status, confirming personal information, ordering transcripts and verifying PIN information.

The IRS, state tax agencies and tax industry are engaged in a public awareness campaign – Taxes. Security. Together. – to encourage everyone to do more to protect personal, financial and tax data. See IRS.gov/taxessecuritytogetheror Publication 4524 for additional information addressing steps that can take to protect employees and individuals from spoofs, scams and phishing.