California Supreme Court to Review a Trio of Pension Cases

Posted: 4/26/2018 Tags: benefits legislation legislature pension policy retirement Tags Views: 2919 Print:

Protecting your pension and retirement benefits is a core principle for ACSS. Three cases pending before the State Supreme Court raise questions regarding the validity of the long standing “California Rule.” Since 1955, the courts have held under the California Rule that once pension benefits are granted to a public employee, they are vested and cannot be modified for the duration of an employee’s career.

Following the passage of the Public Employees’ Pension Reform Act of 2013 (PEPRA), a number of lawsuits were filed challenging pension changes. The trial and appellate courts have upheld PEPRA changes which limit the compensation that counts toward retirement at the local level. The State Supreme Court has granted review in three cases:

  • Marin Association of Public Employees v. Marin County Employees’ Retirement Assn. - Four local unions challenged the elimination of call-back and standby pay from their pension calculations. The appellate court ruled the modifications were legal and employees only have a right to a “reasonable” and “substantial” pension – a significant deviation from the California Rule.
  • Alameda County Deputy Sheriff's Association v. Alameda County Employees’ Retirement Assn. - Deputy Sheriff's union and others sued challenging the elimination of overtime pay, on-call pay, call-back pay, vacation and sick leave sold back, recruitment bonuses, and other items from pension calculations. The appellate court upheld most of the modifications under the same reasoning of Marin, but held some of the changes were illegal and would send others back to the trial court for further review. Both sides of this case asked the State Supreme Court for review.
  • CalFIRE Local 2881 v. CalPERS – State firefighters union sued challenging the elimination of “airtime.” Under the airtime program, state employees were allowed to purchase up to five years of CalPERS service credit by making the full required employer and employee contributions. PEPRA eliminated this statutory right. The trial and appellate courts ruled against CalFIRE Local 2881. The Supreme Court has also agreed to hear this case.

It is unknown which of cases will be decided first, or whether they will be heard together. The CalFIRE Local 2881 case is fully briefed and awaiting action by the Supreme Court. Briefing in Marin remained on hold while the Alameda case made its way through the lower courts. Briefing in Alameda is just getting underway and should be completed by fall 2018.

ACSS filed a request that the State Supreme Court review the Marin appellate court decision because of the departure from the California Rule precedent concerning vested pension rights. We also continue to work closely with the law firm handling these cases to ensure your vested pension interests and the California Rule are protected.

ACSS continues to fight to protect your pension in all available forums. In the Legislature, anti-pension measures seeking to push new employees into a 401k (instead of a defined benefit pension) and to limit cost of living adjustments for future state workers when they retire, were each defeated in legislative committee on April 23, 2018 and will not be back this year. ACSS also remains active with Californians for Retirement Security. Founded in 2005, CRS continues to educate the public and decision makers to protect public employee pensions. ACSS and CRS have been successful in keeping harmful pension measures off the ballot over the last decade.

ACSS will continue to keep you apprised of important pension issues and inform you of actions taken to protect the interests of excluded state employees.

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