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Employee challenges denial of a retirement incentive provided in collective bargaining agreement

Employee challenges denial of a retirement incentive provided in collective bargaining agreement
Spano v Kings Park Cent. School Dist., 61 AD3d 666

The collective bargaining agreement (CBA) between Kings Park Central School District and CSEA provided that Kings Park would pay a $13,000 retirement bonus to any employee with 10 years of service who notified Kings Park by March 1, 2006, of his or her intent to retire by January 1, 2007. In pertinent part, the CBA provided that:

A retirement bonus shall be granted eligible employees covered by this contract. An eligible employee is one covered by this contract who is eligible to retire . . . and has completed 10 years of service in Kings Park School District. ? Ten years of completed service means continuous service except that persons on an approved leave ? shall neither lose accrued time nor gain time because of said leave.

On February 28, 2006, Roco Spano, believing that he qualified for the retirement bonus, notified Kings Park of his intent to retire effective December 29, 2006. Although Spano had commenced working for Kings Park in January 1995, he was told him that he did not qualify for the bonus because he served as a temporary or substitute employee during his first 18 months on the job and thus he would be credited with only 9 years and 4 months of service. When Spano asked he could rescind his notice of his intent to retire, he told that he could not do so.*

The CSEA unit's president told Spano that CSEA would not oppose Kings Park's determination regarding his eligibility for the bonus. Although the CBA included a contract grievance procedure, Spano did not ask CSEA to file a grievance on his behalf but initiated legal action against Kings Park claiming damages for breach of contract and fraud and rescission of his notice of his intention to retire as well as suing CSEA for its alleged ?breach of the duty of fair representation.?

According to the record referred to in the Appellate Division?s ruling, Spano learned that the superintendent "wanted to get [him] the [bonus] by using the 18 months that [he] put in as a temp, but that the union was against it." When Spano asked the unit president why CSEA was "fighting" the superintendent's effort to get him the bonus, she replied: "I have to fight it because if I give it to you, I have to give it to everybody else."

Although the president acknowledged that there was currently no one else in the Spano?s situation, she explained that she did not want to "set a precedent."

Ultimately the superintendent had determined that Spano was not entitled to the retirement bonus and CSEA?s unit president told Spano that ?CSEA did not intend to challenge the superintendent's determination.?

Supreme Court concluded that the Kings Park and CSEA were entitled to summary judgment dismissing the complaint since, as a matter of law, the Spano had not completed 10 years of service pursuant to the CBA and thus was not eligible for the retirement bonus.

The Appellate Division disagreed. It said that when a contract, "read as a whole to determine its purpose and intent," plainly manifests the intent of the parties, relief may be granted by way of summary judgment. In contrast, where the contractual provision relied upon is ambiguous, "the resolution of the ambiguity is for the trier of fact."

Here, said the court, the CBA provided, in relevant part, that an employee is eligible to receive a retirement bonus when he or she "has completed 10 years of service in Kings Park School District." The CBA defined "10 years of completed service" as "continuous service." The CBA did not define "continuous service," and contained no language indicating that "continuous service" included only service as a permanent employee.

Accordingly, the CBA was ambiguous, since it was silent on the issue of whether "continuous service" included service in a temporary or substitute capacity. Significantly, Kings Park's determination that "continuous service" referred only to permanent service was not based on any language in the CBA, but was made "pursuant to past practice" and CSEA took the position that Spano was not eligible for the retirement bonus was based solely on its decision to honor Kings Park's "longstanding interpretation" of the CBA.

Thus, the issue of whether the plaintiff was an eligible employee under the CBA cannot be determined as a matter of law, and the defendants, therefore, were not entitled to summary judgment on that ground.

As to Spano?s contention that CSEA failed in its duty of fair representation, the Appellate Division said that ?CSEA failed to make a prima facie showing that it did not breach its duty of fair representation,? and thus Supreme Court should not have granted its motion for summary judgment.

Considering that it was CSEA's position that ?Spano was ineligible for the retirement bonus and that the union would not challenge Kings Park's refusal to pay him the bonus,? the Appellate Division concluded that ?Spano?s alleged failure to specifically request that CSEA file a grievance on his behalf ? a request which apparently would have been futile ? does not negate the existence of a triable issue of fact as to whether CSEA breached its duty of fair representation.?

Thus Kings Park was not entitled to summary judgment on the grounds that Spano failed to exhaust his administrative remedies and lacked standing to enforce the terms of the CBA.

* The issue of Spano?s attempt to withdraw his notice of intent to retire was not addressed by the Appellate Division. However, in City School District of City of Emira v Newcomb, 266 A.D.2d 622, the Appellate Division said that: ?? authority exists to support the general proposition that a retirement letter may be withdrawn prior to a legally binding acceptance by a board of education,? citing Matter of Totevski v Board of Educ., 178 Misc 2d 758; Matter of Petnick, 14 Educ Dept Rep 141; Matter of Goodrow, 7 Educ Dept Rep 39; and Matter of Lawrence, 6 Educ Dept Rep 119).

Full post as published by New York Public Personnel Law on February 09, 2010 (boomark / email).