United States: Matters of Interest - Constitutional Amendment By Legislative Referral: How Public Pensions Could Be Affected

Overview

This coming November, New York voters will find a referendum on the ballot on whether there should be a Constitutional Convention to amend the New York State Constitution. Proponents of the Constitutional Convention often cite ethics reform for elected officials as a reason for a Convention. There is a less familiar avenue in New York for constitutional amendment – the Legislative Referral process, under which the Senate and Assembly may propose an amendment to the Constitution without the need for a convention, provided certain conditions are met. This article discusses how the Senate and the Assembly followed the Legislative Referral process during the 2016 Legislative Session, when each passed an amendment relating to public pensions of public officers, and the potential implications of that amendment for public employee unions in New York.

The Legislative Referral Process

Article XIX, Section 1 of the New York State Constitution provides that the Senate and Assembly may propose an amendment to the Constitution without need of a convention, provided certain conditions are met.

  • First, the Attorney General must render an opinion, in writing, to the Legislature as to the effect the proposed amendment may have upon other provisions of the Constitution.
  • If upon receiving this opinion, the majority of the members elected to each of the two houses agree to the amendment, as proposed, the vote shall be entered into their respective journals, the proposed amendment is published for three months and then referred to the next regular legislative session.
  • If, in the following legislative session, the proposed amendment is agreed to by a majority of members of each house, then it "shall be the duty of the legislature to submit [the] proposed amendment...to the people for approval, in such manner and at such times as the legislature shall prescribe."1
  • If the majority of those voting on the amendment ratify the amendment, it "shall become part of the constitution on the first day of January [following] such approval."2

Following that process, during the 2016 Legislative Session, the Senate and the Assembly each passed an amendment relating to public pensions of public officers. The proposed amendment defines "public officer" as

(i) an official filling an elected office within the state; (ii) a holder of office filled by direct appointment by the governor of this state, either upon or without senate confirmation; (iii) a county, city, town or village administrator, manager or equivalent position; (iv) the head or heads of any state or local government department, division, board, commission, bureau, public benefit corporation, or public authority of this state who are vested with authority, direction and control over such department, division, board, commission, bureau, public benefit corporation or public authority; (v) the chief fiscal officer or treasurer of any municipal corporation or political subdivision of the state; (vi) a judge or justice of the unified court system; and (vii) a legislative, executive or judicial employee of this state who directly assists in the formulation of legislation, rules, regulations, policy or judicial decision-making and who is designated as a policymaker as set forth in statute.3

This type of permissible impairment or revocation of public pensions would be an exception to the constitutional protection of public employees from diminution or impairment contained in Article V, Section 7 of the New York State Constitution, generally referred to as the Nonimpairment Clause. Although the iteration of the proposed amendment making the most progress is limited to higher-ranking officials and judicial officers, other bills have been introduced with broader applicability to public employees at every level of government.4

The proposed amendment provides that a public officer who is convicted of a felony that is directly and actually related to the performance of the public officer's duties, may have his or her pension reduced or revoked, following notice and a hearing by an appropriate court.5 In making the determination to reduce or revoke the pension, the amendment would require that the court consider several factors, including the severity of the crime and whether the forfeiture, if any, would result in undue hardship or other inequity upon dependent children, spouse or other dependents.6

In accordance with the New York State Constitution, this same amendment has again been introduced and approved in both the Senate and Assembly during this current legislative session.7 The Attorney General's opinion on the bill has been referred to the Judiciary Committee and could possibly be put to the voters for ratification as early as this coming November.

If the amendment makes its way on to the ballot in November, it will be presented to voters side-by-side with the ballot question on whether a Constitutional Convention should be convened. Although a similar amendment could be achieved through the convention process, once approved, a convention cannot be prospectively limited to topics such as ethics by those voting for it. The scope of any proposed changes would be determined by the delegates to the convention. Thus, the availability of this circumscribed potential constitutional ethics reform may show a way to undermine those who claim that a convention is necessary to address the ethical issues in Albany.

Paid Family Leave: Balancing Cost With Benefit

Consistent with the national trend towards expanding paid family leave for employees, Mayor de Blasio issued a Personnel Order in 2016 that provided six-weeks' paid parental leave for maternity, paternity, adoption or foster care to approximately 20,000 New York City non-unionized management employees.8 In an effort to cover the costs of this new benefit (although some have questioned whether the costing was too high), with a goal of avoiding additional costs to taxpayers, Mayor de Blasio eliminated a 0.47% pay increase that was to become effective in July 2017 (pursuant to Personnel Orders 2015/1 and 2015/2) and capped vacation time at 25 days, effectively reducing by two days the number of vacation days to which senior managers were previously entitled.9

Subsequently, a suit against Mayor de Blasio and other city officials by a group of senior managers alleged that the decision to eliminate the pay raise and two days of annual leave to cover a new paid parental leave program not only amounted to a breach of contract but also unconstitutionally impaired their pension benefits and amounted to discriminatory treatment on the basis of age.10 Wasyl Kinach, et al. v. Bill de Blasio, et al., was dismissed in November 2016. The court held that neither the Personnel Orders nor the Time and Leave Manuals created contractual rights preventing the City from modifying its policies. The court also held that there was no support for the petitioners' claims that the action violated either the equal protection clause or nonimpairment clauses of the state or federal constitutions. Petitioners have filed a notice of appeal.

Similarly, in April 2016, the New York State Legislature enacted the New York Paid Family Leave Act. The Act, which becomes effective on January 1, 2018, provides up to eight weeks of paid leave at 50% of pay (not to exceed 50% of the state's average weekly rate), gradually increasing to 12 weeks of paid leave at 67% of pay (not to exceed 67% of the state's average weekly rate) in 2021. Employers are not required to fund any portion of the family leave benefit. Rather, the benefit is paid through employee contributions via payroll deductions scheduled to begin on July 1, 2017. The maximum employee contribution will be set by the superintendent of financial services on or before June 1, 2017. It is expected to be a modest contribution, estimated at approximately $1.00 per week, a cost seemingly much lower than that charged by the City to its non-unionized management employees.

Although not automatically applicable to unions, the New York State Paid Family Leave Act provides that the State, any political subdivision of the State, a public authority or any other governmental agency or instrumentality may elect to become a covered employer and that a municipal union, as part of the collective bargaining process, may opt into the paid family leave benefit on behalf of those employees it represents. In negotiating inclusion in this benefit, unions are well advised to include a fair costing as part of the bargaining discussions. Whereas unrepresented management employees are subject to the one-sided calculation of their employer, unions negotiating on behalf of members can ensure the cost of the new benefit is appropriate for the benefit received and not unduly burdensome on any segment of their population.

Teaching Assistants Earn Right to Unionize

In Trustees of Columbia University in the City of New York and Graduate Workers of Columbia-GWC, UAW, the National Labor Relations Board ("NLRB") found that students who perform work at the direction of their university, for which they are compensated, are statutory employees and, therefore, protected by the National Labor Relations Act ("NLRA"), including in their right to organize around issues of workplace concern.11 This Decision and Order overturned a 2004 determination, in which the NLRB found that graduate students cannot be statutory employees as they are "primarily students and have a primarily educational, not economic, relationship with their university."12

In reversing its earlier determination, the NLRB looked to the definition of "employee" under the NLRA, which includes "any employee" subject only to certain specified exceptions, none of which applied here.13 Although the NLRA does not provide a more comprehensive definition of the term "employee," it is well established that when a statute does not define the term employee, courts are to look to the established meaning of the word, as in common-law agency.14 Indeed, the Supreme Court has endorsed this approach by the NLRB, accepting an expansive reading of the language in the NLRA.15

The NLRB also looked to the goals of federal labor policy, namely to "encourag[e] the practice and procedure of collective bargaining" and to protect workers' "full freedom" to express a choice regarding representation.16 Unlike the NLRB in Brown, here the NLRB found that permitting student assistants to bargain over wages, hours and other terms and conditions of employment in no way infringed upon traditional academic freedoms, which only invokes the content of speech in the classroom.17 Again, the Supreme Court has implicitly endorsed this view by upholding the NLRB's authority to exercise jurisdiction over faculty at private universities.18

The NLRB's decision applies only to private colleges and universities. The right of student assistants, or other student "employees," in public colleges and universities to organize is determined by state labor laws. In New York, student employees at public colleges and universities already have this right.19 The NLRB's decision in Columbia University, however, may shed more light on this right and may result in the ability of students at public colleges and universities in other states to exercise the same right.


1 New York State Constitution, Article XIX, Section 1.

2 Id.

3 S-8163, Senate Reg. Sess. (2016); A.-10739, Assembly Reg. Sess. (2016).

4 See, e.g., S-3147, Senate Reg. Sess. (2017)/A-3316, Assembly Reg. Sess. (2017) (providing that any elected official who is convicted of a felony offense against public administration that occurred during their time in office shall forfeit rights to their benefits earned while in such office); A-2885, Concurrent Resolution of Senate and Assembly (2017) (providing any elected official or officer of the state or of a civil division may be subject to impairment of his or her pension if the member is "convicted of any felony offenses as defined by state or federal law and when that offense was directly related to assigned duties..."); S-661, Concurrent Resolution of Senate and Assembly (2017) (providing any pension of any public official (term not defined) "shall be forfeited if he or she is convicted of, or pleads in any manner to, any crime or offense involving the breach of public trust.").

5 Id.

6 Id.

7 S-418, Senate Reg. Sess. (2017); A-1749, Assembly Reg. Sess. (2017).

8 Mayor's Personnel Order, 2016/1 (January 7, 2016), Section I.

9 Mayor's Personnel Order, Sections II and III.

10 Wasyl Kinach, et al. v. Bill de Blasio, et al., Case No. 153833/16 (Sup. Ct. N.Y Cty.), Verified Petition ("Ver. Pet."), ¶¶ 22, 34, 39 and 41-46.

11 NLRB, Case 02-RC-143012 (August 23, 2016).

12 Brown University, 342 NLRB 483, 487 (2004).

13 Columbia University, Case 02-RC-143012, at 4.

14 Id., at 5.

15 See NLRB v. Town & Country Elec., 516 U.S. 85, at 94 (1995) (holding common law principles supported the NLRB's determination that paid union organizers were "employees" under the NLRA); Sure Tam, Inc. v. NLRB, 467 U.S. 883, 892 (1984) (observing that extending coverage of the NLRA to undocumented aliens is consistent with the NLRA's purpose of encouraging and protecting the collective bargaining process).

16 Columbia University, Case 02-RC-143012, at 7.

17 Id., at 7-8.

18 NLRB v. Yeshiva University, 444 US 672, at 690, fn 31 (1980) (observing that not all university faculty members will be managerial employees and that "professors may not be excluded [from statutory coverage] merely because they determine the content of their own courses, evaluate their own students and supervise their own research").

19 See, e.g., Communication Workers of America/Graduate Student Employees Union, AFL-CIO v. State of New York (State University of New York), 24 PERB 3035 (1991) (holding that graduate assistants and teaching assistants hold covered employment as they render services to the University that are the same or similar to those performed by covered employees).  


Co-Editors: Alan M. Klinger, co-managing partner, and Dina Kolker, special counsel in Stroock's Litigation and Government Relations Practice Groups. The Co-Editors wish to thank Beth A. Norton, special counsel, and David J. Kahne and Arthur J. Herskowitz, associates, in Stroock's Litigation and Government Relations Practice Groups.


The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Topics
 
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions