Personnel law -- mini Amy Peabody Assistant General Counsel Kentucky Department of Education 1.

Personnel law -- mini

Amy PeabodyAssistant General Counsel

Kentucky Department of Education1

Topics today• One time bonus/fringe benefit to employees• Responsibility to hold a position for an employee on

WC or disability retirement• Break in service and sick leave• Teacher tenure basics• Non-renewals• Reduction of duties• Demotion of certified administrators• Change in assignment• Reduction in force (RIF)• Potpourri of issues we’ve seen lately 2

One time bonus/fringe benefit to employees

• Kentucky Constitution Section 3 prohibits the expenditure of public funds except as payment for public services (can’t give away public funds).

• KRS 160.291 (3) and (4) requires that payments to employees, including bonuses or fringe benefits, be only in exchange for services to be rendered and for the benefit of the common schools.

• This statute requires a local board of education to adopt a plan for employee gross salary payments and for employee fringe benefits at the beginning of the school year.

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One time bonus/fringe benefit to employees

• A board action granting a bonus or fringe benefit to local district employees cannot be retroactive for services already rendered by the district employees.

• The Kentucky Office of the Attorney General in 1996, in OAG 96-23 interpreted the requirements of the Kentucky Constitution and KRS 160.291 to prohibit a local board of education from granting district employees a bonus or fringe benefit or additional compensation of any kind for services already rendered. A local board of education’s decision, evaluated in OAG 96-23, to give additional compensation to a teacher for services already rendered was determined to be unconstitutional.

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One time bonus/fringe benefit to employees

• As you know, local school district funds are additionally limited by the Kentucky Constitution (Sections 180, 183-189) to expenditure for “educational purposes” and provision of a bonus or fringe benefit or any additional compensation to employees for services previously rendered (decision to give additional benefit after the service was rendered) would be a violation of this constitutional restriction on school funds as well.

• KDE understands these sections of the Kentucky Constitution and this statute to allow a local board of education to provide a one time bonus scheduled in the current or next school year for employees as a fringe benefit and must be described as compensation for serviced rendered in the future and for the benefit of the common (public) schools.

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One time bonus/fringe benefit to employees

• First, the decision on the expenditure can only be prospective for services not yet rendered by the employees (and compensation given after services rendered, according to local district payment schedule).

• Second, the local school district finance officer must review the district’s finances and should be asked to provide information regarding the financial feasibility and soundness of a decision to undertake an additional expenditure.

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One time bonus/fringe benefit to employees

• Third, KRS 160.291 states that the decisions as to the compensation, including extra duty pay, fringe benefits or bonuses, are to be made prior to the beginning of the school year, July 1, and for extra duty pay, fringe benefits or bonuses to be achievable during the next school year. While we interpret this last requirement to mean that a local school district should only vote to provide prospective additional compensation before the beginning of the next school year and relevant to services to be rendered during the next school year, there is the possibility that the statute allows this vote to occur during a school year and for the board to grant additional compensation to employees when future services are rendered.

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One time bonus/fringe benefit to employees

• Fourth, a local board of education will need to consider and act on any proposed one time fringe benefit payment in a public meeting. Please note that the school district will want to remain mindful of the deadlines in KRS 161.760 regarding notification to school district employees of any reduction in salary for the next school year (2013-2014), the year after this one time fringe benefit payment is possible and is provided to district employees.

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One time bonus/fringe benefit to employees

• A motion by a board member for this kind of action could be phrased something like “a motion to provide a one time fringe benefit bonus scheduled as part of the compensation for the next school year (13-14) for employees. This fringe benefit bonus will be compensation for future services to be rendered and for the benefit of the common (public) schools.” The board should describe the future services in this same public meeting. 9

One time bonus/fringe benefit to employees

• From a practical standpoint, we do suggest that the phrasing of the bonus mechanism not reference the teachers’ salaries except to state, if the bonus is different for different salary ranges, that teachers making between $a and $b would receive $x as a bonus and replicating that language for all salary ranges. The reason for this suggestion is just wanting to prevent teachers from asserting at the end of this year/beginning of next year that they received a salary increase and therefore have a right to the increase again next year. The district can, without violating any provision of law, choose to ignore this suggestion.

• Districts should consider giving notice of reduction of salary, under KRS 161.760, since the compensation the year after the bonus/fringe benefit will be less.

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Holding a position for an employee receiving workers’ compensation• Kentucky workers' compensation law does not require that a

position be held open for an injured worker. The only WC provision dealing with employment is the prohibition against firing a worker for bringing a workers' compensation claim in KRS 342.197 (1).

• Contact for this information was: John W. Mann Attorney/Chief Specialist Kentucky Labor Cabinet Kentucky Dept. of Workers' ClaimsDivision of Ombudsman & Workers' Comp Specialist Services

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Holding a position for an employee on disability• Classified employees can receive disability

retirement from CERS/KRS under Kentucky statute KRS 61.600 (worked 5+ years) or KRS 61.621 (worked less but disabled on the job). See also KRS 78.510(4) and 78.545(10) (school board classified employees’ disability retirement governed by KRS 61.661). Continuance of disability retirement reviewed every 1-5 years.

• Certified employees can receive disability retirement from KTRS under Kentucky statute KRS 161.661 (worked 5+ years) and 161.663 (worked less but disabled on the job). “Periodic examinations” for continuance. 12

Holding a position for a certified employee on disability

Leave of absence for certified employee, due to disability, is granted by the local board under KRS 161.770(1):-“(1) Upon written request of a teacher or superintendent, a board of education may grant a leave of absence for a period of not more than two (2) consecutive school years for educational or professional purposes, and shall grant such leave where illness, maternity, adoption of a child or children, or other disability is the reason for the request. Upon subsequent request, such leave may be renewed by the board.”-“(2) Without request, a board of education may grant leave of absence and renewals thereof to any teacher or superintendent because of physical or mental disability, but such teacher or superintendent shall have the right to a hearing and appeal on such unrequested leave of absence or its renewal in accordance with the provisions for hearing and appeal in KRS 161.790.”•Certified employee returning from leave, under KRS 161.770, resumes same contract status (tenured/non-tenured) the employee held before the leave.

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Certified employee’s right to return to work and disability retirement application

• Certified employee retains tenure during disability retirement application processing period. KRS 161.661(3): “Retirement because of disability under this section shall not be cause for termination of the contract of a teacher or superintendent under KRS 161.790 during the twenty-four (24) calendar month period described in this section. A teacher or superintendent who applies for disability retirement under the provisions of KRS 161.661 shall retain continuing service status during the period of time the application for disability retirement is being processed. If the application is not approved, the teacher or superintendent may return to the contract, employment, or leave status held prior to submission of the application.”

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Certified employee’s right to return to work and disability retirement

• Certified employee retains tenure during 24 months from date of disability retirement.

KRS 161.661 (1): “Teachers and superintendents with continuing status who retire because of disability shall, notwithstanding provisions of KRS 161.720 to 161.810 to the contrary, retain continuing status in the school district from which they retired for twenty-four (24) calendar months from the date of retirement, if the teacher or superintendent:

(a) Is approved for disability retirement under the provisions of KRS 161.661, or

(b) Is approved for disability retirement but elects to have benefits calculated on the service retirement formula under the provisions of KRS 161.661, or

(c) Is disqualified from receiving disability retirement benefits by KRS 161.661(2) but is otherwise eligible for disability retirement under the remaining provisions of KRS 161.661.

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Certified employee’s priority consideration after disability retirement

• After 24 months (and before 43 months), the certified employee does not have a right to return to work in the district, but does get priority consideration for future hiring. KRS 161.661(4)(b): “If the teacher recovers from the disability and presents written notice of such recovery, supported by the statement of a licensed physician, to the superintendent within twenty-five (25) through forty-two (42) months from the date of retirement, the superintendent shall give priority consideration to reemployment of the teacher for the first available position for which the teacher is qualified and certified.”

• There is a similar provision for superintendent in KRS 161.661(4)(a).

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Holding a position for a certified employee on disability

• Certified employee return to work notice to district requirement: KRS 161.662(2)(b) provides: If the teacher recovers from disability

and presents written notice of such recovery, supported by the statement of a licensed physician, to the superintendent within the twenty-four (24) calendar month period but not later than April 15 prior to the beginning of the school term, the superintendent shall reinstate the teacher to active continuing status at the beginning of the school term. If notice of recovery from disability is not presented to the superintendent within the twenty-four (24) calendar month period, or if the teacher states to the superintendent, in a verified document, prior to expiration of the twenty-four (24) calendar month period that he or she will not return to employment in the school system, the continuing service contract of the teacher shall terminate as by retirement under the provisions of KRS 161.661.

• No certified employee has a right to any particular position or school assignment, per KRS 161.750.

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Holding a position for a classified employee on disability leave

• Granting leave: Board policy, per KRS 161.011, governs leave of absence for classified employees. Continuation of leave and whether the district will hold the classified job will be governed by board policy as well. See KSBA Model Policy No. 03.2234.

• Return to work: Local board policies include the return to work notification requirements for classified employees returning from disability leave and notice regarding whether employee has the right to return to a particular position or school assignment. See KSBA Model Policy No. 03.2234 and 03.223 (classified employee leave and return to work notice). 18

Break in service and sick leave• The sick leave statute for all school district employees, KRS 161.155 requires

continuity of employment from one district to another for accumulated sick leave to transfer. Sick leave transfers with the employee when an employee moves without a break in service from one public school district to another or to KDE and back to the district. The statute requires that the transfer be without a break in service. One cannot resign, have a break in service, move somewhere new and pick up the formerly accumulated sick leave. There is Kentucky case law that says the phrase in KRS 161.155 “transfers…from one school district to another” means that there must be continuity in employment from one district to another in order for the sick leave to transfer. Young v. Board of Education, 661 S.W. 2d 787 (Ky. App. 1983).

• Note: School district employment typically runs through June 30 so the person is still employed through that date and a “break in service” doesn’t usually begin before then.

• Cross reference: KRS 156.026 (transfer from/to KDE and school district).• No current ceiling on number of sick leave days the employee can transfer. • Reduction in Force (RIF) break in service: Classified, in KRS 161.011(8)(c), get sick

leave restored with recalled. Certified, in KRS 161.800, also most likely get sick leave back when restored to tenure status. 19

Initial acquisition or regaining of tenure in a district:

• Teacher has to be certified by EPSB with a certificate that meets the definition of KRS 161.720(6) for service time to apply toward tenure.

• Teacher has to work at least 140 days, at least 6 hours in length, in certified duties in a single school year in a single school district for a year to count toward tenure in that district (substitute teaching time can count toward tenure per OAG 76-282).

• Teacher has to work 4 consecutive years or 4 of the last 6 years in a single school district.

• Teacher has to be offered a certified position contract for the 5th year while currently employed.

• Teacher has to accept the contract for the 5th year and work at least 1 day of the 5th year to attain tenure.

• Tenure cannot be granted or denied by a district; tenure is a creation of statute and attaches to the teacher’s status when the requirements of the statute are met.

• Retired teacher cannot acquire tenure due to KRS 156.106 and KRS 161.605’s very narrow circumstances and restrictions on the hiring of retired-reemployed teachers.

• Regaining tenure involves the same process and requirements. 20

Transfer of tenure from a first district to a second district:

• Teacher has to have tenure in the first district (working the 4 years and then transferring without receiving 5th year contract and without working at least 1 day in 5th year in first district does not count).

• Teacher has to "transfer" employment to the second school district within 7 months of terminating employment in first school district.

• Teacher has to work one probationary year in second school district.• Teacher has to be offered second year teaching contract and work one day

of second year in second school district for transfer of tenure to occur.• Transfer of tenure is only possible when transferring from a district where

the teacher earned tenure (worked 4 years and 1 day of 5th year) and transferring to a second school district and meeting the transfer requirements in the second district.

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Termination of tenure:

• Once a teacher has attained tenure in a school district, the teacher has a continuing right to a contract of employment with that school district until the teacher retires or resigns, or until:

• The tenured teacher is terminated for cause under the circumstances and provisions of KRS 161.790. A district notifies the teacher that dismissal for cause is intended and the teacher can request a teacher tribunal hearing to make the final decision.

• The tenured teacher is laid off in a reduction in force in the school district, based on the circumstances and procedures outlined in KRS 161.800. Local board policies usually have information on rights and benefits of tenured and non-tenured staff upon return to the district after a reduction in force.

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Non-renewal/termination:

• Districts have to provide notice of non-renewal by May 15 to limited contract (non-tenured) classified (KRS 161.011) or certified staff (KRS 161.750 http://www.lrc.ky.gov/Statutes/statute.aspx?id=3995). Notice to quasi-tenured classified employees of non-renewal has to be given by May 15th too and then the employee can request a hearing on the grounds (for cause) for non-renewal. If the district failed to provide notice of non-renewal to limited contract (not tenured) employees by the May 15 deadline, then the district has given the employee another year of employment. If a district missed the May 15 deadline then the district has to find spots for them for next year, even if the positions in which they worked last year have been eliminated at this time.

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Reduction of duties and salaries (still stay employed, just less money and less duties):• A reduction of duties and salary can be accomplished by complying

with the notice and deadline requirements of KRS 161.760(3) http://www.lrc.ky.gov/Statutes/statute.aspx?id=3996 ("ninety (90) days before the first student attendance day of the school year or May 15, whoever occurs earlier"). If a district meets the deadline in KRS 161.760(3) for notice of that reduction of duties and salary, then the district can reduce the employee's salary the next school year. An administrator with 3 years of more administrative experience will get due process rights regarding the demotion as stated in KRS 161.765(2) http://www.lrc.ky.gov/Statutes/statute.aspx?id=3997.

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Demotion of certified administrators:• KRS 161.765

http://www.lrc.ky.gov/Statutes/statute.aspx?id=3997 provides the procedural requirements and due process rights of demoted certified administrators. If the demoted certified administrator has less than 3 years of certified administrator experience, then the notice provisions in KRS 161.760 for notice of reduction of responsibilities and duties is sufficient for providing notice of administrator demotion.

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Change in assignment:

• KRS 161.760(4) http://www.lrc.ky.gov/Statutes/statute.aspx?id=3996 does not provide any teacher the right to any placement/position in the district. To move or reassign a school employee, like a teacher, to another position within the same school, the principal has the authority to do so under KRS 160.345 if the move is to another position in the same school; but, if the teacher needs to be transferred to another position in the district (or in another school in the district), then this requires the coordination and acquiescence of the superintendent (for the district position) or other school's principal (for the other school position) too.

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Reduction in force (classified)A reduction in force (RIF) of classified staff is conducted per KRS 161.011(8) http://www.lrc.ky.gov/Statutes/statute.aspx?id=3824 and includes no deadline for notice to classified employees or restriction as to when the RIF can be conducted (anytime during the school year):(8) The superintendent shall have full authority to make a reduction in force due to reductions in funding, enrollment, or changes in the district or school boundaries, or other compelling reasons as determined by the superintendent.(a) When a reduction of force is necessary, the superintendent shall, within each job classification affected, reduce classified employees on the basis of seniority and qualifications with those employees who have less than four (4) years of continuous active service being reduced first.(b) If it becomes necessary to reduce employees who have more than four (4) years of continuous active service, the superintendent shall make reductions based upon seniority and qualifications within each job classification affected.(c) Employees with more than four (4) years of continuous active service shall have the right of recall positions if positions become available for which they are qualified. Recall shall be done according to seniority with restoration of primary benefits, including all accumulated sick leave and appropriate rank and step on the current salary schedule based on the total number of years of service in the district. 27

Reduction in force (certified)• A RIF of certified staff is conducted per KRS 161.800 and includes no deadline for

notice to certified employees. A reduction in force (RIF) of certified staff is conducted per only the triggers and in the order specified in KRS 161.800 http://www.lrc.ky.gov/Statutes/statute.aspx?id=4002:

When by reason of decreased enrollment of pupils, or by reason of suspension of schools or territorial changes affecting the district, a local superintendent decides that it shall be necessary to reduce the number of teachers, he shall have full authority to make reasonable reduction. But, in making such reduction, the local superintendent shall, within each teaching field affected, give preference to teachers on continuing contracts and to teachers who have greater seniority. Teachers whose continuing contracts are suspended shall have the right of restoration in continuing service status in the order of seniority of service in the district if teaching positions become vacant or are created for which any of the teachers are or become qualified.

• The district can at any time implement a reduction in force to layoff certified staff but this has to be for one of the triggers listed in KRS 161.800 and has to be conducted in the manner described in that statute (can't just pick particular certified employees for layoff). 28

Potpourri

• Issues we’ve seen lately at KDE legal:- Procurement law compliance issues- Calendar questions regarding MLK day- Use of school funds and “educational

purpose” evaluation- Affordable Care Act questions- Surplus property sale and appraisal

requirement

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District procurement• Has to meet requirements of procurement law (bid law or MPC,

whichever you are under)• District has the responsibility to review and ensure, if they use

another entity’s bid contract, that the bid met the requirements of procurement law.

• District needs to secure a copy of that bid if they plan to buy off it.• District procurement guidance, training, and resources on KDE’s

website at: http://education.ky.gov/districts/Proasst/Pages/default.aspx

• Questions on district procurement in practice: Jeff Coulter• Questions on all procurement in practice: Tom Stratton• Questions on procurement law and nutrition procurement: Lisa Lang

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Calendar and MLK day

The language of KRS 158.070 does not allow districts to use MLK day as a make-up day.

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School funds and “educational purpose”

• Power Point presentation on this topic on KDE’s website at: http://education.ky.gov/districts/legal/Pages/2013-KASBO-Conference-Presentation-Materials.aspx

• Examples of issues: coaches cards, retirement incentive (OAG 96-23)

• Some funds have additional restrictions (e.g., nutrition funds) requiring expenditure for only their exclusive purpose (rebates too)

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Affordable Care Act

• KDE resources (including an implementation guide and podcast guidance) at: http://education.ky.gov/districts/FinRept/Pages/Health-and-Life-Insurance-Benefits-and-Flexible-Spending-Accounts.aspx

• Contact Susan Barkley or Melissa Sullivan for guidance.

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Sale of surplus real property

• After board action, can sell by public bid, public auction, or private sale.

• Have to sell for fair market value (FMV).• FMV is the certified appraised value,

regardless of method of sale. • Have to get an appraisal before selling and

sale price has to be at least the appraisal amount.

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Questions?

Amy PeabodyAssistant General Counsel

Kentucky Department of [email protected]

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