The State Worker

Chronicling civil-service life for California state workers

October 4, 2013
Jerry Brown sues U.S. Labor Department over pension law

As he announced last month, Gov. Jerry Brown today sued the U.S. Department of Labor over its ruling that California's new pension-reform law violates mass-transit workers' collective bargaining rights.

The Sacramento Regional Transit District joined Brown's Department of Transportation as a party to the complaint which seeks to overturn federal decisions that have withheld $54 million from the Sacramento district, including $14 million for light rail construction to Elk Grove that cannot be recovered.

A 1964 law requires that the Labor Department certify agencies are preserving their employees' collective representation as a condition of receiving federal mass-transit grants.

September 23, 2013
Hearing date set for Jerry Brown's furlough ruling appeal

Jerry_Brown_HJA3698.JPGWith an estimated $12 million at stake, Gov. Jerry Brown and unions representing California's state scientists and engineers will again debate whether the government owes back wages for wrongly furloughing a combined 13,000 employees.

Professional Engineers in California Government and California Association of Professional Scientists successfully argued last year that Brown in 2011 reduced their members' hours and wages two days longer than authorized by the Legislature.

The unions also persuaded Alameda Superior Court Judge Steven Brick that about 250 of their members shouldn't have been furloughed at all because state law protects their positions.

September 12, 2013
Column Extra: More info about Knox v. SEIU Local 1000

130912-US-Supreme-Court.jpgThis week's State Worker column looks at how much and to whom SEIU Local 1000 is making repayment for special assessments it wrongly took from nonmembers, according to the U.S. Supreme Court, to fund political activities in 2005 and 2006.

While Local 1000 wouldn't talk about it, the attorney on the other side did. The column lays out what James Young said about how many people will get some money back and how much.

Here are a few links and documents that informed the column:

SEIU Local 1000's Information and FAQs: Knox Judgment Refunds

Bloomberg Law's SCOTUS Blog's page for Knox v. SEIU International Union, Local 1000

The petition to the U.S. Supreme Court by Diane Knox and other SEIU nonmembers

The response by SEIU Local 1000

The U.S. Supreme Court's Knox majority ruling and dissent

With just 400 to 450 words for our weekly State Worker column, much of what we learn each week never sees print. Column Extras give you some of the notes, the quotes, the documents and the observations that inform what's published.

PHOTO: U.S. Supreme Court building. The Associated Press/Pat Benic

September 11, 2013
Judge: Federal prison receiver can get California state pension

130911-Kelso-2008.jpgA Sacramento judge has ruled that California's Prisons Receiver J. Clark Kelso qualifies for a state pension, even though his position as the penal system's medical overseer was established by federal appointment.

The decision by Judge Michael Kenny sides with CalPERS, which said it had vetted an unusual deal between the federal judge who appointed Kelso and the state Administrative Office of the Courts that allowed him to stay in the state pension system. In essence, Kelso is working as a state-courts employee on loan to the federally established California Prison Healthcare Receivership Corp. charged with overseeing the medical care of inmates.

Before Kelso took the receiver job, he held several leadership positions in state government, with years of contributions built up in his CalPERS pension account.

Daniel Francis, a retired state employee, sued CalPERS, arguing that Kelso was really a federal employee and that payments to his state pension account amounted to a gift of public funds.

Kenny said that Francis failed to prove that CalPERS' determination of Kelso's employment status was wrong.

RELATED:
Lawsuit claims prison receiver spiking CalPERS pension
Judge: Lawsuit against CalPERS over California prison receiver pension may proceed

PHOTO: Federal Prisons Receiver J. Clark Kelso takes questions during a 2008 news conference. The Sacramento Bee/Brian Baer

September 9, 2013
California state worker-AWOL bill sent to Jerry Brown's desk

110822 Assembly chamber.JPGA bill that gives state employees a better chance at reinstatement if they're fired for being AWOL is on the way to Gov. Jerry Brown's desk.

Republicans in the Democratically-controlled Assembly framed debate over Assembly Bill 855 as an argument over existing law that allows state workers five days away without explanation before they can be terminated. They can be reinstated if they explain to an administrative law judge why they were absent and why they failed to get leave for the absence. They must also show proof they are "ready, able and willing" to return to the job.

But the judge can't consider the other side of the equation: whether the employer properly invoked the AWOL statute to terminate an employee. The measure by Assemblywoman Cheryl Brown, D-San Bernardino, allows for that.

The Democrat-controlled Assembly had already approved the bill once and sent it to the Senate. Friday's vote was to approve minor tweaks made by the upper chamber.

Such "concurrence" votes usually aren't dramatic. But the first round of votes fell a few shy of the 41 required to produce a majority for the union-backed bill, despite Democrat's two-thirds control of the 80-seat Assembly. The measure was put on hold, more votes rounded up and it eventually went to Gov. Jerry Brown's desk. Final tally: 46-30.

PHOTO: The California Assembly during a 2011 session. The Sacramento Bee/Hector Amezcua

September 6, 2013
Read bill exempting mass-transit workers from pension reform

DICKINSON-lg.jpgAs we've reported, Gov. Jerry Brown is backing legislation to exempt California mass-transit employees from his pension-rollback law while the courts decide whether it violates federal collective-bargaining conditions for mass-transit grants.

Here's the legislation, Assembly Bill 1222, authored by Assemblymen Roger Dickinson, D-Sacramento, and Richard Bloom, D-Santa Monica. The bill is an "urgency" measure that needs two-thirds support in the Assembly and Senate to take effect immediately with Brown's signature.

September 5, 2013
When should government ask job seekers about criminal past?

job-seekers.jpgOur State Worker column in today's fiber/cyber Bee looks at government hiring policies in California and laws in other states that de-emphasize asking whether job applicants have criminal histories.

Assemblyman Roger Dickinson's Assembly Bill 218 would make California's policy a law with a few more restrictions on employers and apply it to all state and local governments. (Dickinson's bill makes some exceptions for law enforcement officers and the like, although some opponents say those exceptions need to be braodend and better defined.)

The National Employment Law Project -- which describes itself as partnering with "grassroots groups and national organizations, worker centers and unions, policymakers and think tanks" to promote middle-class jobs -- tracks state and local governments that aren't giving as much prominence as they once did to criminal history questions. Click here to view the group's thoroughly linked list of entities that "ban the box," a phrase referring to the check-box lines that many job applications use to ask about criminal history.

The column also refers to two lawsuits that the Obama administration filed against private-sector employers that allegedly screened applicants and fired employees using criminal background checks. Here's the Equal Employment Opportunity Commission's June press release about those two cases and why the commission says their practice discriminated against minorities.

PHOTO: Job seekers crowd around a table to get information on available jobs during the California Job Journal HIREvent on Feb. 10, 2009, in San Francisco. Getty Images/Justin Sullivan

September 5, 2013
From the notebook: Letter explains how California, federal laws conflict

thomas_perez.jpegAs we reported in a breaking news story on Wednesday and followed with a more detailed report today, the Brown administration has announced a plan that it says will allow federal grants to continue flowing to regional transit districts while the courts decide whether California's new pension law degrades mass transit employees' collective bargaining rights.

U.S. Labor Secretary Thomas Perez had warned Gov. Jerry Brown that at least $1.6 billion was at risk, because federal mass transit law requires agencies that receive certain federal grants protect their workers' collective bargaining rights. The Labor Department certifies whether employers are complying.

The warning became an official decision on Wednesday. Here's the letter from Michael Hayes, the director of the U.S. Department of Labor's Office of Labor-Management Standards, that explains why the Obama administration decertified the Sacramento Regional Transit District because it has implemented California's Public Employees' Pension Reform Act.

August 27, 2013
State worker vehicle accident settlements threaten to overwhelm fund

20 dollar bill.jpgLawmakers are on the verge of sending a measure to Gov. Jerry Brown that will tap the state's general fund to pay nearly $21 million for legal settlements of two automobile accidents involving state workers.

Normally, the money would come from an obscure state self-insurance fund maintained with contributions from departments. But the two lawsuit settlements, and a third multi-million dollar payout earlier this year, would strain the Motor Vehicle Insurance Account. The fund averages about $38 million in payouts each year against $45 million it takes in from premiums.

Assembly Bill 234 has cleared the lower chamber and is now poised for a Senate floor vote. It would pay $15 million to the two daughters of a man killed on a San Bernardino freeway last year after he was rear-ended by a CalFire employee driving 70 mph in a state vehicle. Most of the money will be placed in trusts for the man's two daughters, who were ages 4 and 7 when he died.

The balance of the money in AB 234 covers a personal injury settlement with a motorcyclist who collided with a state car driven by a Department of Public Health employee on a San Leandro street. The motorcyclist was left paralyzed from the chest down as a result of the 2011 accident.

A mediator found that both parties were equally at fault: The state employee failed to yield to an oncoming driver. The motorcyclist was speeding. State attorneys negotiated a $5.75 million settlement, with 40 percent of the money earmarked to buy an annuity that will pay for the injured man's medical care.

Taken with a $15.6 million payout a few months ago, the state has settled three cases totaling more than $36 million. Paying the money from the state insurance account would threaten its viability, according to the bill analysis, so lawmakers are dipping into the general fund to pay the bills.

It's not an unusual move for big-ticket settlements, but the number and size of them this year is unusual, according to the bill's analyses.

PHOTO: freephoto.com

August 16, 2013
Feds delay ruling to withhold California's mass-transit funding

130816_light-rail-bridge-rnady-pench.jpgWith billions of mass-transit dollars at stake, the U.S. Department of Labor said today that it will delay ruling on whether California's new pension law violates a 49-year-old federal statute that ties the funds to collective bargaining rights.

A spokesman for the Labor Department confirmed this morning that federal officials are holding off on making any decisions for now while they continue talks with strong Gov. Jerry Brown's office to resolve the thorny issue.

Brown spokesman Jim Evans said in an email that the administration is "gratified" federal authorities are giving the state more time and that state officials "will continue to work closely with the federal government in an effort to resolve this issue."

California has more than 100 regional mass-transit agencies in the pipeline, $1.6 billion for this year alone. Earlier this month, however, U.S. Labor Secretary Thomas Perez warned Brown that the department would begin withholding the funds because the state's new public pension law likely violates the collective bargaining rights of some 20,000 mass transit employees.

Federal law requires that the Labor Department certify that mass-transit grant recipients preserve their employees' collective representation. Mass-transit unions contend the pension law that took effect Jan. 1 has imposed terms on their members that should be bargained.

In a letter to Brown earlier this month, Perez signaled that he agrees with the unions and that a series of decisions could have come down as early as today to decertify one transit agency after another, which would block their federal funds.

Gov. Jerry Brown's administration has said the pension law merely sets a new framework for public pension bargaining but that it doesn't weaken collective bargaining itself.

A message left this morning with mass-transit union spokesman Barry Broad wasn't immediately returned.

PHOTO: In this January 2013 view looking east, the Blue Line bridge - under construction - loops over Cosumnes River Blvd. near Bruceville Road. A conflict between California's public pension law and federal mass-transit grant law has put funding for the project in jeopardy. The Saramento Bee/Randy Pench

August 8, 2013
Column Extra: Rationales for and against prison legal contract

With just 400 to 450 words for our weekly State Worker column, much of what we learn each week never sees print. Column Extras give you some of the notes, the quotes, the documents and the observations that inform what's published.

Today's State Worker column filters the debate over state outsourcing through a contract dispute scheduled for a hearing this morning before the State Personnel Board. The Department of Corrections and Rehabilitation is asking the board to reverse its earlier ruling that a $6 million outsourcing agreement for legal services should be voided.

You can watch the 10 a.m. hearing via SPB's website. We expect the contract debate between CDCR and the state attorney's union to start around 11 a.m. or so. Here are the arguments filed with the board in advance of the hearing:

August 6, 2013
Read the lawsuit against CalPERS on long-term care insurance

Here's the class-action lawsuit filed today in Los Angeles on behalf of CalPERS long-term care insurance policyholders. The complaint alleges that CalPERS sold policies by persuading buyers that rates on its lifetime, inflation-protected plans would be fixed and "reasonably priced."

Click here to read Bee colleague Dale Kasler's breaking news story about the lawsuit.

CalPERS LTC lawsuit by jon_ortiz

August 6, 2013
Lawsuit filed against CalPERS for long-term care premium hikes

A Southern California law firm has filed a class-action lawsuit against CalPERS, alleging that the fund lied to members who have held its privately-funded long-term care insurance policies.

The Bee's Dale Kasler has the breaking news here. Check back to The State Worker blog for a copy of the court filing when it becomes available. And watch Wednesday's print and online editions for a story with more details about the lawsuit.

July 12, 2013
Caltrans ad contractor gets nine years in prison for fraud

130712-yoda.jpgAn Elk Grove man who defrauded the state of nearly $2 million has been sentenced to nine years in prison and must forfeit personal property -- houses and a collection of Star Wars memorabilia -- under terms of a plea deal announced this afternoon.

Eric Hodgson, the 43-year-old owner of Phenix Print & Image, was arrested in April on 22 counts of grand theft after allegedly taking more than $1.8 million to advertise new construction contracts to bidders as required by state law. Caltrans paid the 2008 and 2009 contracts but cancelled a third in 2011 for more than $800,000 before any invoices were paid.

Caltrans staff found evidence of the alleged fraud during a routine request for proof of the advertisements' publication in local newspapers. California Department of Justice investigators subsequently found Hodgson defrauded the state with bogus documentation and used the money to pay off a mortgage, buy toys and comics and purchase "exotic trips" for himself and company employees, according to a news release from Attorney General Kamala Harris' office.

Hodgson pleaded guilty to seven of the 22 counts. In addition to his prison sentence, he will forfeit two residences, two cars, several retirement accounts and a collection of Stars Wars items worth more than $10,000 (including the 3-foot-tall Yoda pictured above) that will be auctioned off.

PHOTO: This "life-size" rubber Yoda will be auctioned off as part of Eric Hodgson's plea deal with the state of California. Courtesy of California attorney general's office.

June 13, 2013
Read Delaware court ruling ordering CalPERS to pay $52 million

CalPERS has lost a lawsuit over fees it owes a former real estate investment partner. A Delware court, The Bee's Dale Kasler reports, has ordered the fund pay $52 million.

Here's the court ruling for State Worker blog users who want to delve into the technical details. (We know who you are, Bargaining Unit 2 people!)

Senior Housing Capital, LLC v. SHP Senior Housing Fund, LLC 5 13 13

May 16, 2013
Column Extra: California's decades-long civil service civil war

Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for 100609 gavel.jpgToday's State Worker column looks ahead to Friday's much-anticipated reports on additional appointments and how they will test Gov. Jerry Brown's 2-year-old reorganization of the State Personnel Board and the Department of Human Resources.

The piece also references the long, combative history between CalHR (formerly the Department of Personnel Administration) and the personnel board as they jostled for power over various aspects of the state's hiring and workplace policies. At one point, SPB sued the then-DPA over contracts it negotiated that allowed some state employees to take disciplinary appeals to a different panel than the personnel board.

Here's the 2005 California Supreme Court ruling in State Personnel Board, et al. v. the Department of Personnel Administration. The court sided with SPB.

State Personnal Board, et al. v. Department of Personnel Administration

With just 400 to 450 words for our weekly State Worker column, most of what we learn each week never sees print. Column Extras give you some of the notes, the quotes, the documents and the observations that inform what's published.

May 8, 2013
Former lawmaker: State could control CalPERS' long-term care plan

Thumbnail image for Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgA former assemblyman suggested Tuesday afternoon that the Legislature should consider reining in CalPERS' control of its struggling long-term care insurance program if the system follows through with plans to hike premiums for some policies by 85 percent.

March 1, 2013
CCPOA says it will pay multimillion-dollar defamation award

MONEY_FACTORY.jpgAfter years of court fighting and a failed appeal, the California Correctional Peace Officers Association is negotiating details to pay nearly $5 million to a former business associate defamed, a federal jury said, by union officials.

"The association is going to pay the award," union spokesman JeVaughn Baker said in a telephone interview this afternoon.

A federal jury said in 2010 that that CCPOA officials had ruined Brian Dawe's name and his livelihood over a business dispute and awarded him a total $12 million in damages. Presiding Judge Lawrence Karlton found the sum excessive and reduced it to $4.96 million.

February 22, 2013
Unions argue their furloughed members deserve back pay

130222 Blanning.JPGUnions representing state scientists and engineers this week filed court papers arguing that Gov. Jerry Brown wrongly furloughed thousands of state workers and owes them millions of dollars in back pay.

At stake: an estimated $12 million in back pay a Sacramento judge ordered the state pay the combined 13,000 employees covered by the unions last year. Brown has appealed the decision.

"The well-reasoned and considered judgment of the trial court should be affirmed in its entirety," says the unions' response brief filed this week in San Francisco's 3rd District Court of Appeal.

February 13, 2013
State to defend pension reform law from county union lawsuits

Thumbnail image for Thumbnail image for 110628 Kamala Harris Paul Kitagaki Jr 2010.JPGAfter staying out of the fray for several months, Gov. Jerry Brown has asked attorney general Kamala Harris to defend California's new public pension law from lawsuits filed by employee unions in at least four counties.

The litigation targets the quasi-independent pension boards in Alameda, Contra Costa, Marin and Merced counties for applying part of the law to all members, including those in the systems before the statute took effect on Jan. 1.

February 4, 2013
Correctional officers lose bid to flip $5 million defamation case

100609 gavel.jpgA federal appellate court has ruled that a $5 million judgement against California's prison officers' union will stand, brushing aside the group's arguments that the sum is excessive and that a federal jury's verdict in the case was wrong.

"We're disappointed that our appeal was unsuccessful, but we'll comply with the court and move forward," California Correctional Peace Officers Association spokesman JeVaughn Baker said this morning.

Does that mean the union will continue the court fight?

"We'll confer with our attorneys to determine the viability of our remaining options," Baker said.

Still, the decision issued Friday could have been worse for CCPOA. Plaintiff Brian Dawe had contended that he should receive more than twice as much money, but the appellate court disagreed.

January 18, 2013
California board apologizes for WWII discrimination against Japanese Americans

130118 SPB logo.jpegThe State Personnel Board has issued a formal apology for a 71-year-old resolution that essentially kicked 265 Japanese Americans out of state service and prevented countless others from taking state government work during World War II.

The apology, laid out in a resolution adopted last week, has no legal consequences. Many years ago the state rescinded its discriminatory resolutions and awarded back pay to 88 Japanese Americans who challenged their terminations. A 1983 state law awarded up to $5,000 to Japanese American employees who lost their state jobs.

But until last week the board had never said it was sorry for its part in the institutionalized discrimination.

"I applaud the State Personnel Board for its resolution," said David Unruhe, spokesman for the Japanese American Citizens League. "This apology was a long time coming, but it is a sincere apology nevertheless."

January 17, 2013
Lawmakers to investigate CalPERS' hourly jobs for managers

MC_PEREZ_03.JPGAssembly Speaker John A. Pérez and Assemblyman Rob Bonta called news of CalPERS paying salaried employees additional hourly wages "disturbing" in a joint press statement released this afternoon and promised to look further into the practice.

January 17, 2013
Column Extra: Jerry Brown versus unions over holiday pay

Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgWith just 400 to 450 words for our weekly State Worker column, much of what we learn each week never sees print. Column Extras give you some of the notes, the quotes and the observations that inform what's published.

Our column in today's Bee updates the lengthy court battle over disciplinary threats made against state workers who might stay home on Lincoln's Birthday and Columbus Day, even though the state dropped those occasions from its paid holiday list in 2009.

As our column explains, the tussle between Gov. Jerry Brown and three unions isn't in appellate court because of a dispute between labor and management over whether the holidays were legally removed. It's a question of whether this provision of the Dills Act was violated.

The unions won the first round in Sacramento Superior Court. Gov. Arnold Schwarzenegger , the state's employer-in-chief at the time, appealed. Brown has kept the appeal going.

Click here to see the 3rd District Court of Appeal calendar of the case.

Here's the original verdict by Sacramento Judge Timothy Frawley that the administration is challenging:

January 9, 2013
Top 10 posts of 2012: Jerry Brown's pension reform legislation

Thumbnail image for countdown 3.JPGThis is the latest in a series counting down this year's most-viewed State Worker blog posts, with a little hindsight analysis.

It's not often that a governor issues draft legislation and invites lawmakers and special interests to kick it around, but that's exactly what Gov. Jerry Brown did nearly a year ago by releasing state and local public pension reform language.

Pension reform crusaders said the plan was weak. Minority Republicans, who had little political leverage, eventually co-opted Brown's pension legislation as their own and then dared the Democratic governor and majority-party lawmakers to reject it. The political judo move didn't trip up the Democrats, who simply ignored the Republican's/Brown's bill.

The public pension measure that Brown signed in September included many of his original proposals, from putting an end to service credit purchases and "pension holidays" for employers and employees to pushing back the normal retirement age and requiring workers and their employers to split normal pension costs 50-50.

Brown's hybrid pension idea didn't gain traction, nor did any of the changes to the CalPERS board's composition that would have required changing the state constitution.

How will history regard Brown's push for pension reform? It probably depends on whether the new law sticks for at least a generation. That's how long it will take for state and local governments to fully realize its impact on their finances and their recruiting and retention.

For now it's safe to say this: Republican Gov. Arnold Schwarzenegger, for all of his public-pension rhetoric, didn't accomplish the changes that Brown signed into law last year.

Here's the State Worker's No. 3 post of 2012: Jerry Brown delivers pension reform language to legislators

January 2, 2013
Top 10 posts of 2012: U.S. Supreme Court rules against SEIU

Thumbnail image for Thumbnail image for countdown 8.JPGThis is the latest in a series counting down this year's most-viewed State Worker blog posts, with a little hindsight analysis.

In a year that saw government unions sustain losses in Wisconsin, Michigan and elsewhere, perhaps the biggest hit that a California public labor organization took in 2012 came out of Washington, D.C.

In June, the U.S. Supreme Court ruled that SEIU Local 1000 didn't appropriately notify members and fair-share payers when it temporarily raised fees in 2005 and 2006. The 7-2 decision in Knox v. SEIU Local 1000 further defined the law requiring unions give nonmembers in closed-shop workplaces a chance to opt out of unexpected fee increases or special assessments.

The news of the court's decision was quickly drowned out a few days later by Local 1000's deal with Gov. Jerry Brown to accept furloughs for the last year of the union's contract.

Here is 2012's No. 8 State Worker blog post: U.S. Supreme Court rules against SEIU Local 1000 in fee case

December 11, 2012
Read the latest CalPERS - San Bernardino pension court filing

Thumbnail image for Thumbnail image for Thumbnail image for 100609 gavel.jpgFrom biz reporter Dale Kasler's story in today's Bee:

CalPERS must now confront a powerful group of foes in its multimillion-dollar fight with bankrupt San Bernardino: the city's bondholders.

A group of major bondholders filed a 114-page legal protest against CalPERS on Monday, saying the pension fund is trying to win preferential treatment in San Bernardino's case. CalPERS has been demanding the right to sue the city, which has fallen behind on $6.9 million in payments to the giant pension fund after filing for Chapter 9 bankruptcy protection in August.

The San Bernardino case and another municipal bankruptcy involving the City of Stockton are testing whether public pension protections or bankruptcy laws reign supreme.

If you haven't read it already, check out Dale's story then peruse the court filing he sent to The State Worker:

December 3, 2012
State worker's sentencing for fraud delayed until January

100602 yolo county gavel.jpgSentencing for a former California state employee convicted of fraudulently applying for worker compensation benefits has been delayed until next month.

Lisa Trevino-Angelo was arrested in 2009 after claiming that chronic pain, anxiety and fatigue left her virtually homebound without the strength to hold her baby, drink from a coffee cup and unable to perform her duties as a personnel specialist for the DMV.

A CalPERS investigation gave a Sacramento Superior Court jury in October enough evidence to convict the 41-year-old Trevino-Angelo of submitting a false benefit claim and making false statements to support it. Each crime is punishable by up to one year in prison. Sentencing was scheduled for last week but is now rescheduled for Jan. 4.

RELATED POSTS
Former California DMV worker convicted of disability claim fraud
View Trevino-Angelo disability fraud documents

IMAGE: www.yolocourts.ca.gov

November 19, 2012
Jerry Brown administration files furlough appeal

100602 yolo county gavel.jpgA $12-million furlough lawsuit has entered its next phase with a formal appeal filed by Gov. Jerry Brown that seeks to overturn a lower court ruling against the administration.

November 2, 2012
Former California DMV worker convicted of disability claim fraud

Thumbnail image for Thumbnail image for Thumbnail image for 100609 gavel.jpgA former state employee faces up to two years in prison after a Sacramento jury convicted her of fraud and lying to investigators to obtain a state disability pension.

Lisa Trevino-Angelo, now 41, was a personnel specialist working part time for the Department of Motor Vehicles in 2008 when she applied for the tax-free benefit. She claimed that chronic pain, anxiety and fatigue left her virtually homebound and unable to raise a coffee cup to her lips.

Officials arrested her on suspicion of fraud in 2009 after CalPERS investigators collected four hours of videotape that showed Trevino-Angelo bowling in Elk Grove, lifting a toddler, jumping at a soccer game and shopping at several stores with bags in tow.

On Wednesday a jury concluded that she had filed a false benefit claim to CalPERS and made false statements to support it. Each misdemeanor conviction carries a maximum of one year in jail. Sentencing is scheduled for Nov. 28.

"CalPERS is pleased by the verdict," said CalPERS spokeswoman Amy Norris. "We don't tolerate fraud and abuse of the system."

Trevino-Angelo's attorney, Michael Wise, could not be reached for comment.

November 1, 2012
Arizona donor appeals, forestalling FPPC audit

Thumbnail image for Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgAs expected, Phoenix-based nonprofit Americans for Responsible Leadership has appealed a court order that it submit to a state audit of the funding sources behind $11 million it contributed to a California committee fighting Proposition 30 and backing Proposition 32.

Click here for the story from The Bee's Kevin Yamamura.

October 25, 2012
Read CalPERS' objection to San Bernardino's bankruptcy

Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for 100607 CALPERS HQ.JPGAs reported this morning by The Bee's ace business reporter, Dale Kasler, CalPERS has filed its opening rebuttal to the City of San Bernardino's municipal bankruptcy. CalPERS is the city's largest creditor with about $5.2 million in unpaid pension contributions on its books so far.

The case is significant to all government employees because it pits federal bankruptcy law's power to break contractual obligations against laws that establish the sanctity of public pension obligations.

Read Dale's report and then check out the CalPERS filing:

October 9, 2012
Unions say Prop. 32 campaign is hiding its expenses

The union-backed No on Proposition 32 campaign has filed a formal complaint with a state political watchdog commission over $8 million the measure's supporters spent on media ads last month.

The opposition group on Monday asked the Fair Political Practices Commission to investigate two Yes on Proposition 32 campaign committees, California Future Fund for Free Markets and the Small Business Action Committee PAC, No on 30/Yes on 32. The complaint alleges the independent pro-32 committees failed to disclose enough payment detail for TV and radio spots that started running in mid-September.

August 24, 2012
Column Extra: Judge says Stockton bankruptcy can break retiree health guarantees

With just 400 to 450 words for our weekly State Worker column, much of what we learn each week never sees print. Column Extras give you some of the notes, the quotes and the observations that inform what's published.

Writing is often as much about deciding what to leave out as it is what to put in. One of the items we decided to cut from Thursday's State Worker column was a reference to Association of Retired Employees of the City of Stockton v. City of Stockton. The case is significant because it signals the court's view of contract and pension law vs. bankruptcy law.

Association of Retired Employees of the City of Stockton v. City of Stockton

July 26, 2012
Judge: Lawsuit against CalPERS over California prison receiver pension may proceed

Thumbnail image for kelso.jpegA judge has cleared the way for a lawsuit to proceed against CalPERS over an unusual work arrangement that allows California Prison Receiver J. Clark Kelso to continue accruing state pension benefits even though his position was established by a federal court and he answers to a federal judge.

As we have previously reported, Daniel E. Francis v. CalPERS contends that Kelso's employment agreement illegally washes his pay through the state Administrative Office of the Courts so that the money can be factored into his CalPERS pension. Kelso has said the arrangement, while unusual, was vetted, is above board and legal.

Francis, the plaintiff, is a retired state worker and therefore a CalPERS member. CalPERS had argued he had no standing to sue. Sacramento Superior Court Judge Michael P. Kenny ruled that Francis had the right to pursue the lawsuit as a taxpayer.

That decision means that the litigation can now focus on whether Kelso is a state worker on loan from the AOC to the federal court or a federal employee with an illegal pension-spiking arrangement. The receivership corporation reimburses the AOC for Kelso's pay and benefits. Ultimately, the state pays the receivership's costs.

Here's Kenny's ruling from last week:

July 20, 2012
California Department of General Services employee slapped with fine -- works as a retiree

120720 FPPC seal.jpgA former state executive who funneled money to a client of his wife's consulting firm has agreed to pay a $3,500 fine -- while he works as a retired annuitant for the state.

As first reported by The Bay Citizen, Theodore Park, former Acting Deputy Director of the Real Estate Services Division of the Department of General Services, agreed to pay the fine.

The State Worker has since learned that although Park retired in December with an annual $99,085 state pension, he has returned to the department as a retired annuitant.

"He is temporarily working for us as a staff services manager III," General Services spokeswoman Monica Hassan said this week.

Full-time staff services manager III positions pay from $6,779 to $7,474 per month, according to the state's jobs.ca.gov website. Retired annuitants can work up to 960 hours in a given fiscal year.

July 13, 2012
A look back at Jerry Brown's furlough history
July 13, 2012
Column Extra Part 2: How Gov. Jerry Brown would counter a furlough lawsuit

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgWith just 400 to 450 words for our weekly State Worker column, much of what we learn each week never sees print. Column Extras give you some of the notes, the quotes and the observations that inform what's published each Thursday.

On Thursday, we looked at one way Professional Engineers in California Government might sue the state for imposing furloughs on its members and violating state and federal contract laws. The union hasn't committed to suing and has said it still hopes to work out an agreement with Gov. Jerry Brown for wage reductions.

But how would the state, specifically the Brown administration, defend the imposed furloughs?

July 12, 2012
Column Extra Part 1: Inside the legal argument against California state worker furloughs

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgWith just 400 to 450 words for our weekly State Worker column, much of what we learn each week never sees print. Column Extras give you some of the notes, the quotes and the observations that inform what's published each Thursday.

Our column in today's fiber/cyber Bee notes that for the first time since furloughs became a regular feature in state budgets three years ago, the government has imposed them on employees who are under contract.

Although Gov. Jerry Brown negotiated furloughs with 19 of the 21 bargaining units representing state workers, two haven't gone along: Professional Engineers in California Government (Unit 9) and International Union of Operating Engineers (Unit 13).

The governor has used authority bestowed on him by the Legislature to impose a one-day-per-month furlough on the holdouts. Now the questions are whether the either union will sue and what the basis of a lawsuit might be.

July 10, 2012
Ashton Kutcher company sues California DMV over reality show

Ashton Kutcher's production company Katalyst Media, Inc. has sued California's Department of Motor Vehicles for breach of contract over a proposed reality show.

The show, "California DMV: Field Offices," would have chronicled life working at the DMV.

Katalyst and the production company Soda and Pop, Inc. are now suing the DMV for not allowing the show to go forward, after initially agreeing to it in writing, according to the production companies.

DMV spokesperson Mike Marando declined to comment on pending litigation.

The lawsuit laid out this chronology: In early 2010, the DMV and Katalyst entered into negotiations for the show. In June of that same year, the DMV committed to the collaboration in writing. Pre-production work was started shortly after. In May 2011 a formal written agreement was reached in which the DMV agreed to provide access to the facilities and employees for the reality show, according to documents filed with the Los Angeles Superior Court.

Katalyst then reached an agreement with TV network truTV to air the show. It would have been produced by Kutcher and TV executive Jason Goldberg.

Six weeks after signing the agreement, the DMV "changed course," documents filed by Katalyst argue. Katalyst cites a letter from Marando saying that the DMV "would not be moving forward on such a project" because it was not in its "best interests."

Katalyst argues that the company spent hundreds of thousands of dollars in pre-production activities, such as casting, preparing budgets and negotiating contracts.

The company is asking the DMV to compensate it for money used on the project, at least $1,440,000, interest and legal costs.

This is not the first time the lives of state employees would have been documented for TV. National Geographic's show "Wild Justice," which followed game wardens, reached around 2 million viewers. The show first aired in 2010 and continues today.

Katalyst Media Inc. v. DMV

July 5, 2012
Budget ends furlough protections for State Compensation Insurance Fund employees

California's state attorney's union launched its furlough agreement ratification today. While it's 3,700 or so members ponder their vote, several hundred who work at the State Compensation Insurance Fund face a new reality: They're no longer protected from furloughs.

Lawyers representing the state attorneys' union and SEIU Local 1000 employees won several court cases that turned back furloughs and restored lost pay for employees at the self-sustaining fund by relying on a state law that protects them from "staff cutbacks." Nearly 8,000 State Fund workers were wrongly furloughed, the courts said.

This time around, however, things are different.

June 7, 2012
California state workers ask: Will minimum wage issue return?

Thumbnail image for 100830 checkbook2.gifSeveral jittery state workers have called and emailed in the last week asking whether their pay might be withheld if lawmakers don't reach a budget deal by the June 30 fiscal year-end.

The short answer: No.

But you can understand why some folks might be nervous. Former GOP Gov. Arnold Schwarzenegger twice tried to apply a 2003 Supreme Court decision that says without a budget appropriation for salaries by July 1, the state shouldn't pay employees more than the federal minimum wage. Once a budget is in place, the state would issue back pay.

Schwarzenegger tried to use the minimum wage threat to pressure majority Democrats into budget concessions. Then the state's chief paycheck writer, Democratic State Controller John Chiang, refused to comply. Litigation ensued. The state never withheld the money.

Three factors are in play now that didn't exist when Schwarzenegger was in office.

First, the Legislature is highly motivated to pass a budget by the June 15 constitutional deadline, even if the numbers are a sham. If they don't, 2-year-old Proposition 25 kicks in, docking their pay until a budget (which would include a state worker salary appropriation) is approved.

Second, Democratic Gov. Jerry Brown wouldn't hold state workers' pay hostage. The proof? One month after taking office, Brown dropped the Schwarzenegger lawsuit to force Chiang's compliance.

Additional note: Many employee contracts, including SEIU 1000's guarantee no minimum wage for their duration.

June 4, 2012
From the notebook: More about the union challenge to Corrections' legal services contract

notebook-thumb-216x184-9328.jpgWe can never get everything we learn into a news story. "From the notebook" posts give you some of the extra details behind the news.

Our story in today's fiber/cyber editions of The Bee includes a reference to a request for the State Personnel Board to review a $5 million legal services contract between a private law firm and the California Department of Corrections and Rehabilitation.

California Attorneys, Administrative Law Judges and Hearing Officers in State Employment filed the request and the board overturned the contract, albeit so late that the law firm will continue its work until the agreement expires on June 30.

Here's the paper trail:

CASE's Feb. 14 request that the State Personnel Board review the contract
CDCR's Mar. 23 response to the request for contract review
CASE's Mar. 30 reply to CDCR's response
The State Personnel Board's decision to disapprove the contract

May 31, 2012
Final briefs filed in CCPOA lawsuit appeal; court hearing next

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgThe final briefs have been filed in the Dawe v. Corrections USA case, signaling that the California Correctional Peace Officers Association appeal of a multimillion-dollar court decision against it is moving toward a hearing.

In 2010, CCPOA lost a federal defamation case brought by businessman Brian Dawe. Judge Lawrence Karlton, who heard the case in Sacramento and lowered a jury's $12 million award to $5 million, then ordered CCPOA to post property and cash as collateral during the appeal.

Attorney Dan Baxter, who represents Dawe, has cross-appealed Karlton's decision to reduce the award.

We expect that in the next few weeks the court will set a date for oral arguments to commence, probably in the last quarter of this year.

CCPOA is asking the 9th U.S. Circuit Court of Appeals to overturn the decision because the trial court, the union says, shouldn't have allowed consideration of "assertedly libelous statements that form the core of Plaintiffs' case and the basis for their multi-million dollar judgment."

The union also argues says that Karlton erred by changing a ruling that Dawe was a public figure. Public figures have to prove that a defamatory statement about them is made with "actual malice." In other words, to win a defamation lawsuit, public figures have to prove that whoever made the statement knew it was false or made it with reckless disregard for whether it was true.

And, CCPOA says, that even the reduced award is excessive, since it is more than the union's net worth.

The plaintiffs counter that Dawe was indeed libeled and that the union's net worth isn't a standard for setting awards. Besides, Dawe's filing says, CCPOA's net worth is more than it has claimed, since the association takes in nearly $30 million per year in dues from members and has a history of spending money on entertainment, property and executive travel, among other things.

We've embedded the final briefs filed by both sides, and you can read them by clicking the link below. Or you can download the files by clicking here for CCPOA's brief and here for Dawe's brief.

Note: The filings contain profane language.

May 16, 2012
Poll: Should unionized California state workers get a vote on Jerry Brown's furlough plan?

As our story in today's Bee notes, it's not clear whether rank-and-file state workers will be able to vote on any scheduling changes or other concessions that their representatives bargain to reach the payroll savings target in Gov. Jerry Brown's budget proposal.

Brown wants unions to take a 5-percent pay reduction with a commensurate cut in work hours each month to trim $401 million from the general fund's employee costs and $839 million from all funds in fiscal 2012-13. The governor's plan includes putting most employees on a 4-day, 9.5 hours-per-day workweek.

State law doesn't require a membership vote if a union reaches a side agreement with Brown. The associations' various bylaws, practices and processes determine whether they would issue ballots. Some union leaders also could seek guidance by surveying their members without a formal vote.

April 23, 2012
UPDATED: California's prison plan changes who makes staffing decisions

Editor's note, April 24, 10:35 a.m.: This post, orginally published on Monday, now includes a comment from the California Correctional Peace Officers' Association.

A plan rolled out today to overhaul the state's penal system includes a big change to how prisons are staffed.

"The Future of California Corrections: A Blueprint to Save Billions of Dollars, End Federal Court Oversight and Improve the Prison System" lays out a plan to centralize and standardize staffing instead of leaving such decisions to each prison as they are now.

The shift is part of the California Department of Corrections and Rehabilitation's effort to slash its costs by $1 billion and eliminate 5,500 positions in 2012-13.

JeVaughn Baker, spokesman for the 29,000-member California Correctional Peace Officers Association, which represents roughly 29,000 prison officers, said the union is evaluating the proposal.

"The total implications of CDCR's staffing plan is yet to be determined but we will continue to thoroughly evaluate the proposal," Baker said in an e-mail. "If the plan is successful at ensuring safe operations inside the institution and our potential concerns are addressed, there may be an opportunity for collaboration with the state in the endeavor."

Until now, a prison's management decided how to allocate staff based on how many inmates a facility housed. California's budget crises forced difficult and disparate decisions.

Some prisons cut correctional officers and other custody staff, which "led to situations at some institutions where general population inmates are no longer let out of their cells due to insufficient custody personnel being available to maintain safe and secure prisons," the CDCR report says.

Others preserved custody jobs and cut support staff. But many of those jobs are vital to keeping facilities up and running and aren't tied to how many inmates a prison is holding: "Further population-driven reductions from plant operations," CDCR says, "would leave the prisons with insufficient staff to maintain the physical plant of the facility."

Now, with the prison population shrinking, the state has a chance to standardize staffing and gain efficiencies from it. A "team of correctional experts" developed the standards for most of the prisons that will be running in 2013-14 when the new staffing plan is supposed to take hold, the report says. Some older institutions still need to be evaluated.

California State Prison, Sacramento, for example, will shed about 66 custody positions and add about 26 health care jobs. In sum, the facility will lose about 29 positions in 2012-13.

RELATED LINKS
Californians to Watch: Matthew Cate directs prison downsizing
The Future of California Corrections (executive summary)
The Future of California Corrections (full report)
Institution Profiles (details the staffing changes at each facility)
Court-ordered targets for California inmate population reduction (includes weekly census)

March 28, 2012
Citrus Heights pension reformer sued for not contributing to retirement accounts

Marcia Fritz, the high-profile advocate for public employee reform, is being sued by two of her former employees for allegedly withholding money for their 401(k) accounts but failing to promptly make the contributions.

"There's absolutely nothing to it," Fritz said in a telephone conversation this afternoon. She said the action is "frivolous" and that she's planning to file her own counter lawsuit against plaintiffs Colleen and Tannith Mitchell.

The mother and daughter say that Fritz, a CPA and former head of Citrus Heights-based Marcia Fritz & Co., didn't make timely retirement savings contributions withheld from their pay checks, didn't pay them overtime and failed to provide meal and rest breaks.

Fritz said today that she has since sold her interest in the firm, although she's still available for consulting work.

Dave Low, chairman of union coalition Californians for Retirement Security, brought up the lawsuit during a pension policy face-off with Fritz at the Sacramento Press Club luncheon today. Low and Fritz have publicly sparred over the pension issue for the last few years.

Click the link below to read the court complaint.

February 22, 2012
Court sides with CCPOA, rejects Don Novey bankruptcy plan

Thumbnail image for 110623 Novey file photo 2002.JPGA Sacramento bankruptcy court last week rejected Don Novey's second amended bankruptcy plan, saying that the proposal lacks sufficient documentation to allow less-than-full payment to his debtors.

The former president of the California Correctional Peace Officers Association last summer offered a bankruptcy plan to pay back a portion of the $600,000 Novey owed against $355,000 in assets. The plan would have let Novey skip most of the $20,000 he owes to CCPOA, money intended to settle a messy dispute over allegations he breached his consulting contract with the union.

Union attorney Barry Spitzer has vigorously challenged Novey's bankruptcy plan, implying that he and his wife, Carol, have hidden some of their assets and understated the value of others to shield them from creditors.

For an example, you can read Spitzer's Sept. 21 cross examination of Novey in the "Exhibits in Support of Motion to Confirm Debtor's Second Amended Plan" that we've embedded below and linked here. Scroll down to PDF page 70.

(You'll find an interesting bit of the testimony that addresses Novey's split from the California Statewide Law Enforcement Association. When Spitzer asked why Novey received severance pay from the union's foundation in June of 2011, Novey said, "Their president thought it would be best that we part ways.")

The State Worker reached Novey by cellphone this morning and asked if he had a comment about the case.

"I didn't open the floodgates," Novey said. When asked if he thought CCPOA had a vendetta against him or was focused on forcing him to give up a Scottsdale, Ariz,, condo to settle his debts, Novey answered, "I don't know" to both questions.

Novey tried and failed to get his declaration sealed. Had the court agreed, much of the information in his bankruptcy would have been out of public view.

Bankruptcy Judge Thomas Holman last week said that Novey failed to appropriately estimate his future earnings, since he may receive money "contingent on the approval of various state agencies" from unspecified sources that would boost his income more than the $16,000 per month estimated in the bankruptcy plan. And even if the court accepted that figure, Holman wrote, Novey's expenses aren't enough to warrant stiffing unsecured creditors.

Holman also rejected Novey's claim of higher-than-normal utility bills and ruled that a Scottsdale condo that Novey and his wife, Carol, own is a luxury property and not an income-producing rental that should be shielded from creditors.

The judge's decision means that Novey will have to submit another bankruptcy plan to the court.

February 15, 2012
Two more agencies say they'll pay furlough back wages

Solidarity isn't just a union concept.

Nearly all current and former employees of the California Housing Finance Agency and the California State Lottery will receive back pay for wages lost to furloughs, officials now say.

Two other so-called "off-budget" agencies said the same thing earlier today. None of the payments will come from the state's general fund and -- this is key -- the Legislature doesn't appropriate money for their budgets.

Russ Lopez, the Lottery's deputy director of communications. The agency is still figuring out how many of its 644 current employees are in line for furlough back pay. Lottery retirees and other former staff furloughed during their time with the agency will have money coming to them.

The payments "aren't going to happen overnight,"
Lopez said.

Cal HFA has the same accounting challenge. The agency employs about 260 staff who support its mission to provide home financing and housing programs for low- and moderate-income Californians. Spokeswoman Melissa Flores said that her agency last year set aside "just under $4 million" to cover back payment costs, but hasn't yet determined how many current and former employees were affected by furloughs.

Nine Cal HFA employees represented by Professional Engineers in California Government won't received the back pay, Flores said, because their union is continuing to fight furloughs in court.

The decision by the Lottery and Cal HFA to pay furlough back wages means that four of five off-budget agencies that settled furlough litigation with SEIU Local 100 and the state attorney's union have now said publicly that they are extending the back-pay provisions of the settlements to all their affected employees and retirees.

Click here to read about similar decisions made by leaders at the state's Prison Industry Authority and the First 5 California Commission. The post includes more background on the union settlements that set the precedent for the payments now extended to all employees.

The fifth off-budget agency, the California Earthquake Authority, hasn't yet responded to our inquiry whether it will follow the other four off-budget agencies, but we expect it will.

The agency's attitude about furloughs is well known: During one heated courtroom debate, CEA's lawyer said of Gov. Arnold Schwarzenegger's administration and furloughs that "These guys are making it up as they go along,"

February 14, 2012
Two California agencies extend furlough back pay to all staff

Thumbnail image for 120214 Cal PIA logo.JPGThe California Prison Industry Authority and the First 5 California Commission will pay furlough back wages to all their employees.

The decision extends the terms of recent court settlements with two unions to excluded workers and other employees -- except the PIA's top executive and state engineers and scientists whose labor groups are pressing furlough litigation.

It's not yet clear when the State Controller's Office will issue the checks or exactly how many current and former employees will receive money. The payments won't affect the state's general fund budget since both agencies are fiscally independent of it.

The PIA employs about 570 workers who run inmate training programs. Officials figure the back pay will cost about $7.9 million of the $8.6 million the PIA set aside last year in anticipation of a settlement. (The payments won't include the interest that authority officials anticipated when they allocated the money.)

The agency doesn't yet have a specific count for how many people will receive back pay, spokesman Eric Reslock said, since some furloughed staff have since retired or left for other jobs and some current employees started work at the agency after furloughs ended last spring.

First 5 employs 35 staff. Spokeswoman Susan Hyman said that 50 current and former employees will receive payments. The agency, which administers services for children up to age 5, hasn't yet estimated what the furlough back pay will cost.

A few PIA workers are excluded from the deal. The authority's board will need to approve back pay for General Manager Charles Pattillo, Reslock said. A handful of staff represented by California Professional Engineers in California Government or California Association of Professional Scientists won't get the back pay, either, because their unions are pressing furlough litigation.

First 5 and the PIA are two of five so-called "off-budget" state agencies that recently settled furlough litigation with SEIU Local 1000 and California Attorneys, Administrative Law Judges and Hearing Officers in State Employment.

The settlements obligate the PIA, First 5, the California Earthquake Authority, the California Housing Finance Agency and the California State Lottery to pay back wages only to staff covered by the two unions. In exchange, Local 1000 and CASE have dropped their furlough lawsuits against the state.

Gov. Jerry Brown's administration has left it up to the five off-budget agencies whether to extend back wage payments to non-union workers. The State Worker has left messages with officials at the other three to find out whether they intend to pay back wages to all their employees.

PHOTO CREDIT: Image courtesy of California Prison Industry Authority.

February 13, 2012
California lawmaker writes 'Public Employees Bill of Rights'

Thumbnail image for 110304 Dickinson Randal Benton 2010.JPGAssemblyman Roger Dickinson, D-Sacramento,(right) has introduced legislation that would give unionized state workers more workplace discipline protections and first dibs on state government work.

SEIU Local 1000 and the Union of American Physicians and Dentists support AB 1655, the "Public Employees Bill of Rights Act." Here's what it would do:

February 13, 2012
Special agents group loses request to stop CA Justice Department layoffs

A Sacramento judge has refused to temporarily halt layoffs planned for the Department of Justice, leaving the path clear for about 80 employees to be shown the exits.

The Association of Special Agents, a subset of the California Statewide Law Enforcement Association, had sought the temporary restraining order from Judge Timothy Frawley. He turned the association down on Friday after hearing brief arguments from both sides.

Many DOJ employees heeded the layoff warnings last year and moved on to other jobs or retired. As of this morning, about 73 sworn officers and 8 non-sworn staff were in department jobs that will be eliminated, DOJ spokeswoman Lynda Gledhill said in an email to The State Worker.

DOJ will terminate those workers on Friday, said ASA President Mike Loyd.

"They'll be handed their final check, shown the door and told, 'Thanks for your service,'" Loyd said.

When asked whether the ASA would keep up the fight, Loyd said, "Heck yeah."

The association alleges that Gov. Jerry Brown engineered the elimination of about 300 jobs -- most of them held by special agents in the department's anti-drug unit -- in retaliation for CSLEA's support of Republican Meg Whitman during the 2010 California gubernatorial race.


The Brown administration blamed the job cuts on Republicans' tax inflexibility during budget talks.

February 10, 2012
Poll: Is the SEIU Local 1000 furlough settlement an unfair deal?

The State Worker continues to hear from state employees who are complaining that a recent furlough lawsuit settlement between SEIU Local 1000 and the Brown administration isunfair.

The complaints run along two tracks. One comes from managers and supervisors in the five "off-budget" agencies named in the settlement. They're not represented by SEIU or any other unions and aren't part of the furlough agreement.

Callers have pointed out that when a union reaches a contract agreement at the bargaining table that the managers and supervisors attached to those covered workers usually receive similar terms.

The exempt employees calling and emailing us about the furlough settlement think the same should apply here to the furlough back pay agreement. Of course, that decision is up to the Brown administration and/or the agencies.

The other complaint comes from state worker blog users who think that settlement provisions that awarded back pay to rank-and-file workers in five "off budget" agencies unfairly and arbitrarily single out a select few employees for a special benefit.

It's a twist on the complaints we heard when employees working for constitutional officers avoided furlough. Ditto when the courts decided State Compensation Fund Employees were illegally furloughed awarded them back pay.

SEIU has said that it got the most it could from a losing legal hand.

What do you think?

February 9, 2012
State worker criticizes SEIU's decision to settle furlough cases

We've heard from several state workers who aren't happy that SEIU Local 1000 settled its furlough litigation in exchange for back wages for 700 or so of its members working in "off-budget" agencies.

Local 1000 President Yvonne Walker has said that the union's legal team advised that broader litigation wasn't likely to win, so the union cut its losses and took what it could get from a settlement.

Paul Warrick, an associate governmental program analyst, sent an email to The State Worker that hits the tone of the complaints we've heard. We're publishing his email here, unedited and with his permission. He's speaking for himself, not his employer, colleagues or Local 1000:

Big whoop! Someone (or SEIU) should have pursued the larger Federal issue of equal pay for equal work. Everyone who receives a state payroll check should have been furloughed or no one should have been furloughed. Furloughs were happenstance. If you just happened to be an Office Technician, Staff Services Analyst, etc. in the wrong agency (based on funding source or other criteria), you got furloughed while your neighbor who was also an OT or SSA, but worked for another agency didn't get furloughed. It's just ridiculous.

Paul Warrick DSS

February 6, 2012
Former Caltrans employee indicted for trying to export high-tech parts to China

A former Department of Transportation employee who attempted to illegally export military satellite technology has been indicted on federal charges, according to court documents unsealed today.

Civil engineer Philip Chaohui He, who was also known as Philip Hope, was arrested in Long Beach on Dec. 11 and fired from his Caltrans job 10 days later for failing to show up to work.

Department spokeswoman Tamie McGowen said that He, an Oakland resident, reviewed technical drawings and that his work was closely supervised, including work he did on the Bay Bridge.

"He had no access to sensitive information that's not available to the public," McGowen said, asserting that there are no safety or security concerns about He's work.

Investigators from U.S. Immigration and Customs Enforcement and the Department of Homeland Security told Caltrans last July that they were watching He. At the fed's request, Caltrans cooperated with the investigation.

"We're proud of the fact that we were closely working with them," McGowen said.

The Colorado federal grand jury indictment alleges that He drove to the port of Long Beach on Dec. 11 with 200 radiation-hardened integrated circuits worth nearly $550,000 in the trunk of his car. The circuits, which are considered sensitive defense articles banned from export without federal authorization, were concealed in plastic infant formula containers inside five sealed boxes marked "milk powder" in Chinese.

At the port, the indictment alleges, He met two men "in front of a docked ship bearing a (Chinese) flag. The (Chinese) flagged ship was registered to Zhenhua Port Machinery Company LTD, a subsidiary of the ... state-owned corporation China Communications Construction." One of the men had a Chinese passport and the ship was scheduled to return to China in a few days.

He allegedly obtained the circuits illegally from Colorado-based Aeroflex Colorado Springs. After his arrest, he was extradited to Colorado and now faces up to 35 years and $1.5 million in fines on charges of conspiracy, attempted unlawful export and attempted smuggling of defense articles.

He appeared in U.S. District Court in Denver on Friday where he was advised of his rights and the charges against him
.
Click here to read the Colorado federal grand jury indictment.

February 6, 2012
SEIU Local 1000 asks courts to dismiss furlough lawsuits

100602 yolo county gavel.jpgAs part of its agreement with Gov. Jerry Brown's administration, SEIU Local 1000 has filed requests for dismissal of five furlough lawsuits in Alameda, Sacramento and San Francisco superior courts.

Click here for background on the furlough litigation between the union and Brown.

The following links open Local 1000's applications to have the cases dismissed. If you want more information about each, click on the county in the list below to open the court's document viewer, plug in the case number, and download the complaints.

Alameda Case No. RG10494800
Alameda Case No. RG10507922
Alameda Case No. RG094567750
Sacramento Case No. 34-2009-80000150-CU-WM-GDS
San Francisco CPF09509782

IMAGE: www.yolocourts.ca.gov

February 3, 2012
California state attorneys, Jerry Brown settle furlough litigation

The union representing the state's legal professionals and Gov. Jerry Brown's administration have agreed to settle their furlough fight.

The deal returns wages lost to furlough to about 24 members of California Attorneys, Administrative Law Judges and Hearing Officers in State Employment. In exchange, the union is dropping its last two furlough lawsuits.

The agreement affects only CASE members in five departments that don't receive legislative budget appropriation: First 5 California, the Prison Industry Authority, the California Earthquake Authority, the California Housing Finance Agency and the California State Lottery.

SEIU Local 1000 recently agreed to a similar settlement.

The CASE rationale, which you can read below or by clicking here, can be summed up in five words: "Take what you can get."
CASE memo to members

February 1, 2012
SEIU Local 1000 President Yvonne Walker talks about furlough lawsuit settlement with Jerry Brown

120130 Yvonne Walker 2008.JPGOur report in today's Bee quotes SEIU Local 1000 President Yvonne Walker talking about the union's decision to settle its furlough litigation against the state. Here are highlights from her interview with The State Worker:

On working with Democratic Gov. Jerry Brown compared with his predecessor, Republican Arnold Schwarzenegger:

"What a difference a governor makes. ... He actually respects workers and the services we provide Californians."

On the state's furlough policy and Brown's position on it:

"We've said all along the furlough plan was a bad plan. It not only jeopardized working people, but came at a great cost to the state. This governor did the right thing. He looked at it and understood that we had the opportunity to say, 'How do we close out this ugly chapter in the state's history?' "

On how the deal came together:

"The governor's attorneys called and said, 'Can we settle this?' and we said, 'Yes.' "

On arguments that the agreement benefits a relatively small group of SEIU members at the expense of pursuing lawsuits that could benefit the vast majority of union-covered state workers:

"Realistically, those four lawsuits didn't have the potential to do something for everyone. We lost the majority of our cases. Even when your cause is righteous, going to court is a crap shoot."

PHOTO CREDIT: Yvonne Walker speaks at a news conference responding to Gov. Schwarznegger's furlough plan for state workers, Friday Dec. 19, 2008. Sacramento Bee / Brian Baer

January 31, 2012
Furlough lawsuit deal affects only SEIU workers, drops further litigation

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpg

Correction, 2:57 p.m.: An earlier version of this post incorrectly stated that the Office of Administrative Hearings is one of the five departments included in the SEIU settlement.

Roughly 700 state workers covered by SEIU Local 1000 will receive back wages from an furlough lawsuit agreement between the union and Gov. Jerry Brown's administration.

The deal, which we first reported this afternoon, also dumps four much larger furlough lawsuits the union was pressing in Northern California trial courts.

Only Local 1000 employees at First 5 California, the Prison Industry Authority, the California Earthquake Authority, the California Housing Finance Agency and the California State Lottery will receive back pay without interest for days that they were forced to take off without pay in 2009 and 2010. State workers represented by other bargaining units and managers in those organizations aren't part of the settlement, said Lynelle Jolley, spokeswoman for the state Department of Personnel Administration.

The agreement is a good deal for the state on two fronts:

• It costs taxpayers nothing, since all five departments are completely self-funded -- which was the basis of the argument that their employees shouldn't have been put on furlough in the first place.

• SEIU also agreed to drop four other furlough lawsuits pending in Alameda, Sacramento and San Francisco courts, Jolley said. Those lawsuits had the potential to cost the state tens of millions of dollars in back wages and interest for roughly 80,000 of the 95,000 workers the local represents. The litigation argued that for a variety of reasons furlough policy itself was illegal, not merely its application to a select departments.

IMAGE: www.yolocourts.ca.gov

January 31, 2012
Special fund furlough litigation settled; more details to come

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgEmployees in five departments will receive back pay for wages lost to furloughs according to a settlement reached between labor and Gov. Jerry Brown's administration.

The deal includes workers at First 5 California, the Prison Industry Authority, the California Earthquake Authority, the California Housing Finance Agency and the California State Lottery, according to sources familiar with the agreement who spoke on condition of anonymity because the affected employees hadn't been told as of this morning.

The number of employees affected and the amount of money they'll receive aren't yet known, although one source said that the back pay will not include interest. The departments are all relatively small.

We expect more details later today as the unions and the departments divulge them to their employees.

The settlement lays to rest union litigation that argued that it was illegal to furlough employees in departments that received a significant portion of their budgets from outside the state's beleaguered general fund.

IMAGE: www.yolocourts.ca.gov

January 26, 2012
Read the agreement that 'unfires' Caltrans worker Duane Wiles, allows him to retire

From reporter Charles Piller's story in today's Bee:

Duane Wiles, recently fired by the California Department of Transportation for fabricating bridge tests, has been allowed to resign instead.

This marks the second time Wiles has been "unfired" by Caltrans. The first was in 1998 for incompetence, insubordination, dishonesty and other problems, but the agency was overruled by the State Personnel Board.

This week's settlement agreement with Caltrans prevents a public airing of Wiles' admitted fraud and errors, and removes a public forum for examining whether agency higher-ups responsibly addressed the problem.

Here's the stipulated settlement agreement signed by Wiles, his attorney and Caltrans representatives.
Duane Wiles Settlement Agreement with Caltrans

January 17, 2012
CCPOA deposits reach $1 million in Dawe defamation case

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgThe California Correctional Peace Officers Association last month made a second court-ordered $500,000 security deposit while it appeals its loss in the Dawe v. Corrections USA case.

A the embedded document below shows, CCPOA made the payment on Dec. 20.

Federal Judge Lawrence Karlton ordered the payments last September as part of a cash-and-property collateral securing the $5 million awarded to businessman Brian Dawe after a jury found that CCPOA defamed him. Two other men also received smaller awards in the case.

While the union presses its appeal, it must make quarterly half-million-dollar payments into a court-controlled account until the amassed money equals 125 percent of the judgement.

A federal jury originally awarded a total of $12 million to Dawe, but Karlton lowered that to $5 million. While the union is trying to get the decision overturned, Dawe is appealing to get the original award restored. Here's an earlier post with more background and court documents.

Thanks to Blog User T for asking whether the second payment had been made.

CCPOA's Notice of Second Deposit

IMAGE: www.yolocourts.ca.gov

January 4, 2012
CCPOA settles former employee's discrimination lawsuit

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgThe California Correctional Peace Officers Association has settled a discrimination and unfair treatment lawsuit brought by a former longtime employee whose husband had been a 2008 candidate for the union's presidency.

The terms of the settlement are confidential.

CCPOA spokesman JeVaughn Baker said that the union "rejects all of the allegations," but made a "pragmatic business decision" to settle.

"At some point you have to count the beans," Baker said this morning. "This is a low-level employment issue, an internal issue."

A call to former employee Sharon Rafferty's attorney, James E. McGlamery, wasn't immediately returned.

December 6, 2011
Furlough lawsuit court hearing postponed

An Alameda Superior Court judge has pushed back a hearing to debate whether employees in five or six "special fund" departments were illegally furloughed.

Judge Frank Roesch originally scheduled Yvonne Walker and SEIU Local 1000 v. Schwarzenegger for hearing at the end of this month, with the first deadline for filing documents with the court set for Friday.

Click here for background on the case, which concerns employees at First 5 California, the Prison Industry Authority, the California Earthquake Authority, the California Housing Finance Agency and the Office of Administrative Hearings. Local 1000 is hoping to add the California State Lottery Commission to the list.

Local 1000 and the Department of Personnel Administration requested more time. Judge Patrick Zika granted it on Monday. The hearing is now scheduled for Feb. 16 The administration's brief in defense of the furlough policy is due Jan. 23. The union has until Feb. 2 to file its response.
Alameda furlough litigation continuance

December 5, 2011
Special fund furlough lawsuit revived in Oakland court

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgA remnant of the "special funds" furlough litigation pressed by SEIU Local 1000 is set for a court hearing later this month.

The matter, Service Employees International Union Local 1000 and Yvonne Walker v. Arnold Schwarzenegger, revisits the union's argument that furloughs were illegally applied to departments that receive money outside of the general fund.

Local 1000 initially won that argument for 63 departments, but San Francisco's 1st District Court of Appeal in July overturned that ruling. It made exceptions for five departments that it said deserved further argument in the lower court: First 5 California, the Prison Industry Authority, the California Earthquake Authority, the California Housing Finance Agency and the Office of Administrative Hearing. Click here for more background.

The local asked the California Supreme Court to consider the case. It refused.

The case covering those five departments -- and a sixth that the union wants to bring into the case, the California State Lottery Commission -- gets its first court hearing on Dec. 29 at 3:45 p.m. in Alameda Superior Court in Oakland. The state has until Friday to file its arguments with the court. The union has until Dec. 23 to file a response.

We expect the Department of Administration, which handles furlough litigation for the state, to ask for a continuance, given the relatively short time between Alameda Superior Judge Frank Roesch's Nov. 22 order and the Friday deadline for the state's filing.
Walker and SEIU Local 1000 v. Schwarzennegger


November 23, 2011
Drug agents sue Jerry Brown over impending layoffs

Thumbnail image for 100609 gavel.jpgThe Association of Special Agents is suing Gov. Jerry Brown and Department of Finance Director Ana Matosantos over targeted Department of Justice layoffs that the agents contend are politically motivated. The agents group is an affiliate of the California Statewide Law Enforcement Association.

Click here for Kevin Yamamura's report on Capitol Alert. Read our recent story about the political history that prompted the association's complaint by clicking here.

And here's the complaint filed in Sacramento Superior Court today:
Association of Special Agents v. Jerry Brown

November 14, 2011
So what's up with the SEIU Local 1000 furlough case?

Thumbnail image for Thumbnail image for 100609 gavel.jpgAn attorney with SEIU Local 1000 says the union will continue to press litigation against "special fund" furloughs, even though the courts have slimmed down the case to covering employees in just a handful of state departments.

Local 1000 had identified 63 "special fund" departments that it said shouldn't have been included in the Legislature's furlough authorization. The union won that argument in Alameda Superior Court, but San Francisco's 1st District Court of Appeal in July overturned that ruling. It made exceptions for five departments that it said deserved further argument in the lower court. (For more background, click here.)

SEIU appealed to theCalifornia Supreme Court, which refused take up the matter.

The union said it would keep fighting for its members in those five departments -- First 5 California, the Prison Industry Authority, the California Earthquake Authority, the California Housing Finance Agency and the Office of Administrative Hearings -- even though the remanded case now covers relatively few of its 95,000 employees.

The State Worker caught up with SEIU Local 1000 attorney Felix De La Torre to ask about the status of the case. Is the union still planning to continue the fight? If so, what's the hold up? Here's part of an email De La Torre fowarded to us last week, which is his response to an SEIU member who asked the same question:

October 4, 2011
CCPOA loses furlough argument in appellate court

Thumbnail image for Thumbnail image for 100609 gavel.jpgAnother union furlough argument fell Monday when San Francisco's 1st District Court of Appeal told a trial court to change a favorable ruling to an unfavorable one against the California Correctional Peace Officers Association, which had claimed the policy as carried out for its members was an illegal pay cut.

The appellate court's decision in Brown v. Superior Court of Alameda County was a blow to the union whose 32,000 or so members stood to collectively gain millions of dollars -- no one is sure exactly how much -- in back pay and interest had the decision gone the other way. CCPOA says that it is deciding its next move in a case that stretches back more than two years.

CCPOA did win that argument in Alameda County Superior Court, claiming that "self-directed" furloughs -- which cut a prison officer's pay but deferred his or her corresponding time off -- violated state laws, including its minimum wage statute.

The appellate court action bogged down while attorneys for the union and then-Gov. Arnold Schwarzenegger argued over whether the trial court decision could be appealed and while other litigation that examined furlough authority and furlough process took the legal limelight.

October 3, 2011
Guards' union makes first $500,000 deposit while appealing lawsuit

Last month, the California Correctional Peace Officers Association made its first court-ordered $500,000 deposit while it appeals a multimillion-dollar defamation case that it lost last year.

The payment is part of the cash-and-property collateral ordered last month by federal Judge Lawrence Karlton while the union appeals Dawe v. CUSA. While the union presses its case, it must make quarterly half-million-dollar payments into a court-controlled account. The money and four union-owned properties, including CCPOA's West Sacramento headquarters, are collateral securing the $5 million it currently owes businessman Brian Dawe and two other men after a federal jury decided the union had defamed them.

September 30, 2011
Blog back: Those other 'special funds' departments

Blog backs review your thoughtful and provocative online comments, amplify points, answer questions, correct our mistakes and humbly accept your warranted criticism.

Sharp-eyed blog user WilliesCons had a question about our post that the California Thumbnail image for Thumbnail image for 100609 gavel.jpgSupreme Court had refused to take a "special funds" furlough case that SEIU Local 1000 had won at the trial court level and then lost when the government appealed. Weren't there some departments that the 1st District Court of Appeal said might still be in play for a successful "special funds" argument?

September 22, 2011
Commission OKs fines for CalPERS administrators, employees

The Fair Political Practices Commission signed off on fines for more than a dozen current and former CalPERS board members and employees today, closing the books on an investigation that started with 58 people connected to the mammoth pension fund.

110922 FPPC logo.JPGThe action today rubber stamped penalties already agreed to by 16 individuals who violated state law by failing to report meals, alcohol, clothing, sports and entertainment tickets and other gifts received from CalPERS investment partners since 2006.

The fines ranged from $3,600 against portfolio manager Shaun Greenwood to $200 for Sue Kane an adviser to CalPERS' board President Rob Feckner.

September 22, 2011
California Supreme Court refuses to hear SEIU furlough case

Thumbnail image for 100609 gavel.jpgThe California Supreme Court has refused a union request to consider whether furloughing employees in so-called "special fund" departments was illegal.

The court refused the petition for review by SEIU Local 1000 on Wednesday. The union had hoped to have another crack at litigation that it won in Alameda Superior Court nearly two years ago and then lost last July in San Francisco's 1st District Court of Appeal.

The high court's refusal to look at SEIU's case underscores that the special funds argument against furloughs is essentially dead, as legal observers have been telling The State Worker for quite some time.

Click here for the court docket that lays out the events leading up to the Supreme Court's refusal to review the case.

IMAGE: www.yolocourts.ca.gov

September 15, 2011
Column Extra: Exonerated CalPERS staff and administrators

With just 400 to 450 words for our weekly State Worker column, most of what we learn each week never sees print. Column Extras give you some of the notes, the quotes and the observations that inform what's published.

Our column in today's fiber/cyber Sacramento Bee takes a longer look at the results of the recent gift-reporting investigation of CalPERS staff and administrators, both former and current. We noted that Fair Political Practices Commission investigators determined that half of the 58 individuals investigated did nothing wrong and seven received warning letters and nothing more.

Here are the names of 25 of the 29 individuals who received no punishment or warning letter from the FPPC, according to a list provided by CalPERS and researched by The Bee. The FFPC says that 29 cases were dropped because the individuals were blameless, so we're short four names. We'll amend this post when we get them.

Current staff and board members
Amit Aggarwal
Judy Alexander
Eric Baggesen
Derek Bergquist
Eric Busay
Dave Carmany
Diego Carrillo
Craig Dandurand
Joseph Dear
Jane Delfendahl
George Diehr (board)
Al Grijalva
Derek Hayamizu
Ken Huettl
J.J. Jelincic (board)
Lynn Keay
Henry Lam
Farouk Majeed
Randy Pottle
Michael Riffle
Brian Russell
Eric Schlendker
Dan Tanner

Former staff
Fred Buenrostro
Mary Cotrill

September 15, 2011
Column Extra: Memo puts CalPERS' staff disclosure errors in context

With just 400 to 450 words for our weekly State Worker column, most of what we learn each week never sees print. Column Extras give you some of the notes, the quotes and the observations that inform what's published.

Our column in today's Bee looks at the final chapter of the Fair Political Practices Commission's investigation into gift reporting lapses at CalPERS.

Bottom line: The investigation turned up paperwork gaps and 16 people have agreed to pay fines totaling about $20,000 for failing to disclose some freebies they received from companies doing business with CalPERS.

In an unusual move, FPPC Chief of Enforcement Gary Winuk, wrote a memo to commissioners about the investigation in advance of the Sept. 22 hearing set to consider the 16 stipulated settlements reached. He concluded that there were several factors working in CalPERS favor, including the employees' and board members' cooperation, confusion between an in-house reporting mandate and what the law requires and CalPERS' "strict no-gifts rule for staff and ethics training programs that go beyond the requirements of state law."
CalPERS investigation memo by FFPC Enforcement Chief Gary Winuk

September 6, 2011
UPDATE: CalPERS official's sexual harassment reprimand upheld

4:05 p.m.: This post has been updated with a statement from CalPERS.

The State Personnel Board has upheld a formal reprimand against Joseph John Jelincic Jr. over claims that he sexually harassed co-workers at the California Public Employees' Retirement System. The incidents occurred before and after he took an at-large seat on the fund's 13-member board in January 2010.

Jelincic worked in CalPERS' investments office until early July, when the fund released him to do board work full time. Three women complained that Jelincic's long looks and language had made them uncomfortable. The Bee is not naming the women because of the nature of the case.

In a telephone interview this afternoon, Jelincic said that he hadn't seen the decision and couldn't yet comment on it.

CalPERS spokesman Brad Pacheco issued a statement via e-mail: "CalPERS has a zero tolerance policy for harassment of any kind. We are committed to ensuring that our employees have a work environment that is professional, safe, and free from harassment."

September 2, 2011
CCPOA ordered to post property, deposit cash during appeal

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgA Sacramento federal judge has ruled that the California Correctional Peace Officers Association can put up four properties it owns, including its West Sacramento headquarters, as collateral for several million dollars it owes from a defamation lawsuit loss while it appeals the decision.

But Judge Lawrence Karlton said in his order Thursday that the union also must pay $500,000 every three months into a court-controlled account while the appeal plays out.

The decision is the latest twist in Dawe v. Corrections USA, in which a federal jury decided the union had defamed businessman Brian Dawe and two other individuals. The jury awarded a total $12 million to the plaintiffs, but Karlton reduced that to $5 million. Dawe is appealing the reduction. (Click here for more about the case.)

August 30, 2011
Constitutional officers lose furlough appeal

Less than a week after lawyers debated whether employees of constitutional officers should have been furloughed like state workers elsewhere, Sacramento's 3rd District Court of Appeal said that there's no special status for the constitutionals' staff.

The unanimous ruling by Justices Vance Raye, George Nicholson, Ronald Robie, released this afternoon, doesn't affect the pay of the roughly 16,000 employees who work in departments and agencies headed by officials elected via statewide vote, including the lieutenant governor, the secretary of state, the treasurer, the controller, the attorney general, the superintendent of public instruction, the insurance commissioner and the Board of Equalization.

None went along with then-Gov. Arnold Schwarzenegger's veto order in February 2009. They argued that as independently elected executives that they had authority to control their staffing. The administration sued in Sacramento Superior Court and won. The constitutionals appealed the decision and kept their employees on full hours and pay.

August 29, 2011
Judge weighing $500,000 quarterly CCPOA payment plan

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgThe California Correctional Peace Officers Association may have to start making $500,000 payments every three months and put up its West Sacramento headquarters and other property as it appeals its loss in a federal defamation case.

After hearing arguments this morning, Judge Lawrence Karlton is still deciding what to do about CCPOA's inability to buy a bond to cover a judgment rendered last October in his Sacramento courtroom -- eventually reduced from a total $12 million to $5 million by the court -- while the union appeals to San Francisco's 9th Circuit Court.

Plaintiff Brian Dawe is appealing to the same court to restore the full award.

CCPOA said last month that it didn't have enough liquid assets to buy a bond to cover an amount equal to 125 percent of the $5 million award Dawe is due pending appeal and asked to use its properties as collateral instead. Dawe attorney Daniel Baxter objected for several reasons, including the expense of taking over the properties.

August 25, 2011
The latest on the constitutional officer employee furlough fight

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgThree justices from Sacramento's 3rd District Court of Appeal took turns on Wednesday, grilling an attorney who argued that they should overturn a lower court's ruling that constitutional officers' employees should have been furloughed along with other state workers.

Meanwhile, the panel lobbed legal softballs to a Brown administration lawyer who contended that the constitutional furlough issue had substantially changed since Gov. Arnold Schwarzenegger first sued the constitutionals in February 2009 to force them to comply with his furlough order.

August 25, 2011
Court filings reveal more CCPOA financial details

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgWith the next round of debate looming in the a multimillion-dollar defamation lawsuit it lost, the California Correctional Peace Officers Association's latest federal court filings offer up more information about the union's finances.

The documents filed Monday in federal court in Sacramento indicate that the union is scaling back spending as it braces for the possibility it might lose its appeal of the nearly $5 million judgment leveled against it in Dawe v. Corrections USA, CCPOA, et al.

August 19, 2011
Justices hear CCPOA 'self-directed' furlough case

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgThe arguments are in. Now a panel of appellate justices must decide whether the state illegally furloughed some 32,000 correctional officers by cutting their pay by up to 15 percent per month but deferring the commensurate time off.

In documents filed in San Francisco's 1st District Court of Appeal and during courtroom debate on Thursday, lawyers for the California Correctional Peace Officers Association said the so-called "self-directed" furloughs were an illegal pay cut.

Attorneys for the Department of Personnel Administration, which handles furlough litigation for the state, argued that a 2010 furlough ruling by the California Supreme Court invalidated CCPOA's claim.

Click here for more about the legal history of the case. The appellate court has 60 days to issue a decision.

August 15, 2011
Last 'special funds' furlough appeal set for September hearing

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgSan Francisco's 1st District Court of Appeal has set Sept. 1 at 9 a.m. to hear oral arguments in California Attorneys, Administrative Law Judges and Hearing Officers in State Employment v. Schwarzenegger.

The case is the last chance for the appellate court to confirm one of three rulings by an Alameda Superior Court judge that state workers in so-called "special fund" departments were illegally furloughed.

Click here to see the court's case calendar.

August 2, 2011
FPPC begins closing CalPERS gift reporting investigation

The Fair Political Practices Commission has spared at least six current and former CalPERS officials from paying fines for failing to report gifts on official disclosure forms.

The FPPC opened an investigation earlier this year over allegations that 49 CalPERS board members and employees failed to accurately report gifts from lobbyists, contractors and other entities during the past five years. Six letters released last month are among the first results from the investigation. More findings are likely to be released over the next several weeks.

FPPC staff closes investigations by concluding there was no violation, advising an individual that he or she nearly committed a violation, issuing a warning that recognizes a violation was not worthy of a fine or asking the commission to approve a fine of up to $5,000 for each violation.

August 1, 2011
CCPOA defamation lawsuit hearing postponed

100609 gavel.jpgA court hearing scheduled for this morning in the multimillion dollar defamation lawsuit against the California Correctional Peace Officers Association has been delayed until Aug. 29.

The attorney for businessman Brian Dawe, who successfully argued that CCPOA ruined his livelihood, asked the judge for more time to file a brief opposing the CCPOA's request to put up a handful of properties the union owns as security in the case.

Under the new mutually agreed to timeline, attorney Daniel Baxter has until Wednesday to file the opposition brief. CCPOA will have until Aug. 22 to reply.

The union said last month that it didn't have enough cash to acquire a bond to cover an amount 125 percent above the $5 million award Dawe is due, pending appeal.

A jury original awarded Dawe $12.5 million, but Judge Lawrence Karlton, who heard Dawe v. Corrections USA, CCPOA, et al., lowered the award to about $5 million. While CCPOA and Corrections USA appeal the overall decision, Dawe is appealing the judge's lowering of the award.

The properties CCPOA has asked the court to accept as security include its headquarters, two homes in Natomas and land in Rancho Cucamonga.

The five-year-old case stems from when CCPOA ousted Dawe from the board of directors of Corrections USA. Dawe claimed the firing was unjust, and that CCPOA officials discredited him without merit. As a result, he said he was unable to earn a living and damaged his company, Flat Iron Mountain Associates.

110731 Dawe Notice

IMAGE: www.yolocourts.ca.gov

July 19, 2011
Ex-CCPOA head Don Novey submits revised bankruptcy plan

Editor's note: This post was corrected on July 20 to report the correct September hearing date.

A bankruptcy court told Don Novey, the former head of the California Correctional Peace Officers Association, to submit a new bankruptcy plan after questions arose about his original filing -- and he has.

Federal Judge Thomas Holman's tentative ruling Wednesday accepted some of the concerns about Novey's plan raised by the bankruptcy trustee and an attorney for CCPOA, which Novey owes $20,000 from an arbitrated contract disagreement.

Today Novey attorney Peter Macaluso filed an amended bankruptcy plan. Creditors and the trustee can now review it. Another hearing to confirm or further modify the plan is set for Sept. 6. Here's background on the case.

July 18, 2011
Judge issues tentative ruling in Don Novey bankruptcy

Thumbnail image for 110623 Novey file photo 2002.JPGDon Novey, the former president of the California Correctional Peace Officers Association, will have to submit a new bankruptcy plan after a creditor and a trustee both objected to his first one.

Bankruptcy court Judge Thomas Holman's decision prolongs a proceeding that has highlighted Novey's bitter falling out with his former union, which fired him in 2009 over allegations he breached his consulting contract with the organization. Novey still owes CCPOA $20,000 from an arbitrated settlement, but he is seeking to shed that obligation and others through bankruptcy.

Union attorney Barry Spitzer has vigorously challenged Novey's bankruptcy plan, implying that he and his wife, Carol, have hidden some of their assets and understated the value of others to shield them from the proceedings.

July 18, 2011
Appellate court delays furlough arguments until September

100602 yolo county gavel.jpgA hearing in the last undecided "special fund" furlough case in San Francisco's 1st District Court of Appeal has been delayed until September.

California Attorneys, Administrative Law Judges and Hearing Officers in State Employment v. Schwarzenegger was set for hearing on Aug. 3. There's no specific date set for the September debate. The court will do that later, according to a notice published just a few minutes ago.

The case appeals the third of three key furlough decisions issued in 2009 by Alameda Judge Frank Roesch that found furloughing workers in so-called "special fund" departments was illegal. His decisions against the state in the first two cases have been either partially or entirely overturned.

IMAGE: www.yolocourts.ca.gov

July 8, 2011
CCPOA appeals judgment, asks to use property as collateral

The California Correctional Peace Officers Association has appealed a multimillion federal defamation lawsuit ruling to the U.S. Court of Appeals for the 9th Circuit in San Francisco, a move that has led the union to offer its West Sacramento headquarters and three other properties it owns as collateral for a multimillion judgment against it.

Lawsuit appellants normally have to post a "supersedeas bond" to cover 125 percent of the awarded amount. CCPOA's court filing says it can't because "it has insufficient liquid assets to satisfy bank requirements."

Judge Lawrence Karlton, who heard Dawe v. CUSA and lowered the $12 million awarded by a jury last fall to about $5 million, has the discretion to reset the bond amount or waive it entirely.

CCPOA says that its headquarters, the two Natomas homes it owns and the land it owns in Rancho Cucamonga are worth a total of $6.2 million. The union is offering them as security while the appeal goes forward. A hearing is scheduled for Aug. 1.

CCPOA is appealing a decision that its representatives defamed businessman Brian Dawe and his associates and damaged his livelihood. Attorney Dan Baxter, who represents Dawe, has cross-appealed Karlton's decision to reduce the award.

Click here for earlier posts about the case that include court documents and a transcript. Here's the union's request to use the property as security during the appeals process. (Hat tip to Blog User J for flagging this for The State Worker.)
CCPOA's Alternate Security Motion

June 30, 2011
Column Extra: Union says Don Novey playing bankruptcy games

With just 400 to 450 words for our weekly State Worker column, most of what we learn each week never sees print. Column Extras give you some of the notes, the quotes and the observations that inform what's published.

Our column in today's Bee notes that the California Correctional Peace Officers Association is both a debtor and a creditor.

Debtor: The state is restarting litigation to force the union to pay millions of dollars owed on its union paid leave tab with the departments of Mental Health and Corrections and Rehabilitation. The sides disagree on how much is owed.

Creditor: A lawyer representing the state's prison officers' union has filed several objections to a bankruptcy plan submitted by the former president of the state's prison officers' union that dumps tens of thousands of dollars in debt he owes.

Don Novey's plan would shed all unsecured debts, including the $20,000 he owes to the California Correctional Peace Officers Association from an arbitrated resolution to a contract dispute. Novey and his wife, Carol, owe much more than that in credit card and other unsecured debt, but CCPOA was the lone creditor to question the Noveys during a contentious bankruptcy hearing last week. This post has more details about the bankruptcy filing itself.

CCPOA attorney Barry Spitzer, whose questions during the hearing indicated he thought the couple undervalued or hid their assets, put his suspicions in writing and filed them with the court on Thursday.

"(CCPOA) hereby objects to the confirmation of the Debtors Chapter 13 plan as not being proposed in good faith," Spitzer wrote in a three-page document. Among his allegations:

>> The Noveys' gross income totaled more than $1.5 million from 2008 to 2010, during which time they didn't pay some taxes and ran up credit cards, "yet claim no significant assets." So where's the money?
>> The Noveys have overstated their IRS tax debt by about $30,000.
>> The Scottsdale, Ariz., condo they've claimed is a rental (and therefore protected property in bankruptcy) is actually a second home.

A hearing date is set for July 19 at 9:32 a.m.
Objection to confirmation of Novey bankruptcy plan

June 30, 2011
U.S. Supreme Court takes SEIU fee hike case

Thumbnail image for 100609 gavel.jpgThe U.S. Supreme Court agreed Monday to review an appeals court's ruling that a union isn't obligated to send a second notice when adopting a temporary, midterm fee increase in addition to an annual fee notice to members.

The high court's Monday decision to consider the case revives a dispute that started in 2005, when union officials issued a "special assessment" to raise money from all state employees, regardless of their membership status, for a union political fund.

In 2007, a district court ruled that the union should have given notice and allowed employees to opt out. It ordered refunds of the money with interest. San Francisco's 9th Circuit Court reversed that decision as "practically unworkable."

The National Right to Work Legal Defense Foundation, based in Springfield, Va., has represented Dianne Knox and other plaintiffs in the class-action case. Its website describes the nonprofit as a "charitable organization providing free legal aid to employees whose human or civil rights have been violated by abuses of compulsory unionism."

Click here for our earlier reporting on the case. This link opens the Supreme Court's "Granted & Noted List," which details the cases it has decided to consider. Knox is listed on page 3.

IMAGE: www.yolocourts.ca.gov

June 29, 2011
What's next for Don Novey's bankruptcy?

Several blog users have asked what's next for Don Novey, the former head of the state correctional officers' union who has filed for bankruptcy.

According to this schedule of deadlines and meeting dates, creditors and the bankruptcy trustee have until Thursday to file objections to Novey's filing. A hearing, should it be needed, is already set for July 19 on the sixth floor of the federal courthouse in Sacramento.

From the contentious tone of the creditors' hearing last week, we expect California Correctional Peace Officers Association attorney Barry Spitzer will file an objection on behalf of his client.

We wouldn't be surprised if he resurrects questions he raised in the hearing about the Noveys' cash and bank accounts (they told the court that they have about $2,700 in total) and whether their Scottsdale, Ariz., condo is truly a rental property. The Noveys said last week that it is, even though they bought it in 2006 but have never rented it out. (A rental property that generates revenue might not be seized in bankruptcy, whereas a second residence, such as a winter home, could be.)

Novey, CCPOA's former president, adjusted his bankruptcy filing in Sacramento's federal court last week. The amended documentation, which you can view here, adds minor property holdings, increases the estimated value of a pair of boxing gloves signed by Mohammed Ali from $250 to $1,200 and offers proof for the $5,000 estimated value of family jewelry, among other changes.

The amended filing also adds two timeshare properties, one in Cancun and another in Hawaii, worth a total $2,200.

Novey and his wife, Carol, filed Chapter 13 to avoid paying about $181,000 in credit card and other unsecured debts, including $20,000 from a stipulated settlement with CCPOA. The plan they filed with the bankruptcy court pays $82,000 owed in state and federal taxes and reschedules debts on their Rocklin home and the Arizona condo.

June 27, 2011
Blog Back: Journalism or just jumping on a good man?

Blog backs review your thoughtful and provocative online comments, amplify points, answer questions, correct our mistakes and humbly accept your warranted criticism.

Last week's news that former CCPOA President Don Novey has filed for bankruptcy protection stirred plenty of comment about the man, his legacy, his split from the union he led for 20 years and the motivation behind The State Worker's coverage.

June 23, 2011
Don Novey grilled by union attorney at bankruptcy hearing

110623 Novey file photo 2002.JPGDuring a tense bankruptcy hearing this morning, the former president of the state's correctional officers association sparred with an attorney for his former union over everything from his earnings and property holdings to the value of sports memorabilia and jewelry.

Don Novey and his wife Carol Novey sat at one leg of a u-shaped conference table on the 7th floor of the federal courthouse in downtown Sacramento to go over their court filing with trustee Jan Johnson and to give creditors a chance to probe their finances.

June 22, 2011
Former CCPOA president Don Novey files bankruptcy

Don Novey, the former head of the California Correctional Peace Officers Association, has filed for bankruptcy in Sacramento's federal court.

A May 17 court filing (see the link below) provides a window into the life of the former military intelligence officer and amateur boxer who has been credited with building one of the most powerful labor organizations in California. It also hints at what happened after CCPOA and Novey split amid accusations he had breeched his consulting contract with the union.

Reached today by phone, Novey declined comment. "I can't talk to you," he said.

Novey and his wife, Carol, filed for Chapter 13 protection, stating that their liabilities total $630,000 against assets of about $354,000. From December through May, which is the period of time the bankruptcy court is considering their income, Don Novey has earned an average $28,205 per month,which works out to an annualized earnings of about $338,470. Much of that income is exempt from creditors' claims.

That's down significantly from his 2008 income of $673,443 and the $576,225 he made in 2009.

Among the Novey's debts: $55,000 in federal taxes, another $27,000 in taxes owed to the state and unsecured debt of $181,000. Most of that is revolving lines of credit, but it also includes $20,000 owed to CCPOA from an "arbitration award," the bankruptcy filing shows.

Apparently that's money that Novey is paying after the union terminated his three-year, $150,000-per-year consulting contract late 2009 and then sued him. CCPOA alleged that Novey had spent time and used resources for other clients that should have been dedicated to CCPOA matters.

At the time, Novey linked the termination to his public criticism of CCPOA leaders' decision to suspend four retired union members. He also was publicly critical of the union's decision to hire a parolee, a move that was eventually upheld by the state's Office of Inspector General.

Mike Jimenez , CCPOA's current president, declined to comment on the Novey lawsuit during a May interview, citing terms of the stipulated settlement.

Novey's bankruptcy filing shows he's taken some real estate hits, too. He owes about $272,000 on loan taken out in 2009 on a Rocklin home he first purchased in 37 years ago. In 2006 Novey bought a condo in Scottsdale, Ariz., for $154,500. He still owes about $95,000 on it, but it's valued at just $48,000, according to the bankruptcy filing.

Novey, 63, retired from the CCPOA presidency in 2002 after more than 20 years in command. During his watch, union membership exploded as California built dozens of new prisons. Novey amped up the group's influence by using the millions its members provided to sponsor tough-on-crime ballot measures, elect legislators, punish political enemies and back union-friendly gubernatorial candidates.

But the falling out with his former union and his advice to several of his law enforcement clients to back GOP gubernatorial candidate Meg Whitman last year instead of the eventual winner, Democrat Jerry Brown, dinged Novey's reputation.

The case is scheduled for a hearing Thursday in Judge Thomas Holman's courtroom at 10:30 a.m.

Click here to download the 50-page bankruptcy filing.

June 17, 2011
Furlough case back in appellate court; ruling to follow

100602 yolo county gavel.jpgYour humble blogger was away from work the last few days, so we're just now catching up with a backlog of events and e-mails, including this week's oral arguments in SEIU Local 1000 v. Brown before San Francisco's 1st District Court of Appeal.

The court heard both sides and now has up to 90 days from Wednesday's hearing to render a decision. You can view the court's case docket here.

The case (formerly SEIU Local 1000 v. Schwarzenegger) continues debate over whether employees in so-called "special fund" departments were illegally furloughed. This May 27 item and its companion June 3 post can give you more context and court documents.

At stake: millions of dollars in wages lost to furloughs plus interest for tens of thousands of state employees in those special fund departments.

The Union of American Physicians and Dentists made a similar argument in another case, won in the lower court but then lost on appeal with a different panel of justices in the 1st District Court.

A third special funds case on appeal, California Attorneys, Administrative Law Judges and Hearing Officers in State Employment v. Brown, also is with the 1st District Court. There's no oral argument date set yet. Click here to see the court's calendar for that case.

The best that state workers can hope for at this point is conflicting appellate court decisions. If at least one of the 1st District Court panels upholds the lower court's ruling, the California Supreme Court would almost certainly have to specifically address the special funds argument that it avoided in the seminal PECG v. Schwarzenegger decision last October.

IMAGE: www.yolocourts.ca.gov

June 3, 2011
Furlough appeal focuses on defining 'special fund department'

So what's a "special fund department," anyway?

That's a key question that San Francisco's 1st District Court of Appeal wants answered as the June 15 date for oral arguments in SEIU v. Schwarzenegger approaches.

As we reported last week, the court asked the Gov. Jerry Brown's administration and SEIU Local 1000, to answer a series of questions. Several focused on figures provided by Veronica Chung-Ng, a finance employee who found that 30 of 69 departments SEIU orginally Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgdeclared were "special fund" actually received no general fund money. She also found that 62 of the 69 had money that the general fund could borrow.

A few blog users have asked if we could dredge up Chung-Ng's data. We combed though a few dozen blog posts with links to court documents and finally turned up this item, which contains a link to the court filing with the Chung-Ng declaration and spreadsheet.

Here's how to find the court document (you'll need Java to download the file):

Click here to open the file on the court document server.
The Chung-Ng declaration and list of departments are contained in the 12 pages under file No. 16249126 in the list on left margin of the page. The spreadsheet that breaks down department funding starts on page 8.

May 26, 2011
Court grills both sides in 'special funds' furlough debate

Thumbnail image for 100609 gavel.jpgIf you're a furlough lawsuit junkie (and you know who you are) the latest twist in SEIU Local 1000 v. Schwarzenegger is tailor-made for you.

Last week, San Francisco's 1st District Court of Appeal revived debate in a case that appeared was headed for a ruling. It's one of three lower court decisions that the Schwarzenegger administration lost and appealed -- and now carried on by Gov. Jerry Brown -- to overturn a trial court decision that so-called "special fund" departments should have been exempt from furloughs.

The governor has already won one of the appeals, but if the unions win at least one of the other two, it's likely the whole thing will go to the state Supreme Court. Hundreds of millions of dollars in back pay and interest are at stake.

Last week the 1st District Court vacated an earlier order that put SEIU on a path for a ruling. It ordered attorneys for the union and the state to gear up for oral arguments that must address a total of 17 legal questions. Many probe how to define a "special fund" department. Others go to earlier administration arguments about gubernatorial furlough authority.

On Monday the court set June 15 at 9:30 a.m. for the debate.

Here are the questions it put to both sides:

May 17, 2011
Appeals court reverses 'special fund' furlough decision

Thumbnail image for Thumbnail image for 100609 gavel.jpgState workers paid with federal money or other sources outside of the general fund were legally furloughed by former Gov. Arnold Schwarzenegger, according to a court ruling issued late Monday.

The decision published by San Francisco's 1st District Court of Appeal reverses a lower court decision that parsed the legality of furloughs by the source of an employee's pay and deals a blow to a key union argument against the policy.

Union of American Physicians and Dentists v. Brown (formerly UAPD v. Schwarzenegger) was one of three parallel cases that successfully argued in trial court in 2009 that the furlough policy was illegal. Alameda Superior Court Judge Frank Roesch reasoned that Schwarzenegger's blanket furloughs failed to take into account the "varying needs of the different state agencies" as required by state law and that closing special fund departments three days per month illegally interfered with their "respective missions."

May 3, 2011
Union loses court battle to retroactively enhance pension benefits

Thumbnail image for Thumbnail image for 100609 gavel.jpgThe California Statewide Law Enforcement Association's quest to apply enhanced pension benefits retroactively died a quiet death last month after the state Supreme Court declined to consider the union's appeal.

The union had asked the court to review the decision of Sacramento's Third District Court of Appeal, which had ruled that the negotiated safety retirement benefits for Bargaining Unit 7 didn't apply to service prior to July 1, 2004.

The high court's April 27 declination ends a long battle over the benefit between CSLEA and the Department of Personnel Administration. Click here for more history on the case. This link opens the court's calendar of events in CSLEA v. DPA.

IMAGE: www.yolocourts.ca.gov

March 25, 2011
Poll: Does CalPERS deserve praise?

Pensions & Investments, a leading financial publication that closely follows CalPERS, featured an article on Thursday that said the fund is getting a grip on scandals that have embarrassed the organization.

A couple of paragraphs from the P&I piece that comments on the investigation CalPERS commissioned and the board's reaction to it:

CalPERS trustees deserve praise for coming to grips with the dimensions of the problem, dealing with weaknesses, and strengthening structures.

The review doesn't close the case or end the need for further reforms. The pending criminal cases, and investigations by the Securities and Exchange Commission and others, could produce revelations of more abuses that CalPERS trustees will have to address.

But this review helps CalPERS get on track to overseeing the investment of its assets with proper fiduciary care.

So what do you think?

March 24, 2011
Read the court order reducing punitive damages in CCPOA case

100602 yolo county gavel.jpgWe reported on Wednesday that a federal judge has reduced what the California Correctional Peace Officers Association must pay for punitive damages in a defamation case from $10 million to about $2.5 million. Judge Lawrence Karlton's Dawe v. Corrections USA, CCPOA, et al. decision can be challenged by the plaintiffs with either a new trial that focuses on the punitive phase of the case or taken to the 9th Circuit Court of Appeal.

Here's Karlton's order:
Judge's ruling on damages awarded in Dawe v. CUSA, CCPOA
IMAGE: www.yolocourts.ca.gov

March 23, 2011
$12 million award against CCPOA reduced; plaintiffs may appeal

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgA federal judge has reduced a $10 million punitive damages award leveled against the California Correctional Peace Officers Association last year, although the plaintiffs in the case can appeal the reduction or seek a new trial that focuses on what the award should be.

Sacramento Federal Court Judge Lawrence Karlton rendered the decision last week, cutting what was a total $12.5 million decision against CCPOA -- compensatory and punitive damages awards combined -- to about $5 million.

The decision is the latest turn in Dawe v. Corrections USA, CCPOA, et al. Last October a jury unanimously found that CCPOA had spread falsehoods about Brian Dawe, a founder and former executive director/treasurer of Auburn-based Corrections USA.

CUSA is a national law enforcement coalition, and CCPOA is a member. The union eventually took over the organization's board then ousted Dawe five years ago after he raised questions about the coalition's finances.

Dawe successfully argued that the unjust firing and remarks by CCPOA officials and publications issued to explain his departure hampered his ability to earn a living and damaged his company, Flat Iron Mountain Associates. The jury awarded Dawe and his $2 millionin compensation. Another former Corrections USA employee involved in the matter, Gary Harkins, won a $315,000 defamation compensation claim against the union.

But Karlton took issue with the jury's punitive awards: $9 million to Dawe and his firm and another $1 million to Harkins. The judge lowered those amounts to match the compensatory awards. The punitive damages were "unconstitutionally excessive," Karlton said, noting that CCPOA's net worth was a factor in his decision.

That's not the end of the matter, however. Karlton gave the plaintiffs three weeks to ask for a new trial to argue for a higher punitive damages award. They also have the option to appeal Karlton's decision to a higher court.

Plaintiffs' attorney Dan Baxter couldn't be reached by phone, but he sent the following e-mail in response to a message we left with his office:

March 3, 2011
Unions ask Alameda Superior Court judge to stop furloughs

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgEditor's note: This post has been changed to clarify the impact of furloughs on employee pay for the 2010-11 fiscal year.

Five of six state employee unions without contracts whose members are furloughed three days per month have asked an Alameda Superior Court judge to stop the policy.

Professional Engineers in California Government, California Association of Professional Scientists, California Correctional Peace Officers' Association and California Attorneys, Administrative Law Judges, and Hearing Officers in State Employment are the union plaintiffs in the lawsuit now before Judge Steven Brick.

The Association of California State Supervisors, which speaks on behalf of management-level exempt workers, is also a party to the lawsuit.

California Statewide Law Enforcement Association didn't join the other unions in the litigation, which names Gov. Jerry Brown as defendant.

A hearing is set for Friday, April 8, at 9 a.m. in Alameda Superior Court.

February 23, 2011
UPDATE: More about the postponed furlough hearing

Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgAs we reported this morning, a furlough case hearing originally scheduled for 9:30 a.m. today before the 1st District Court of Appeal was put off until next month.

We now know why. Lynelle Jolley, spokeswoman for the Department of Personnel Administration, said that one of the justices who was supposed to hear the case was ill.

Look for a new date for oral arguments in Service Employees International Union Local 1000 et al. v. Schwarzenegger et al to be set for late next month.

January 31, 2011
'Special funds' furlough hearing set for February

Thumbnail image for Thumbnail image for 100609 gavel.jpgAn appeals court has set a Feb. 23 hearing to debate whether state workers in so-called "special fund" departments have been illegally furloughed.

SEIU v. Schwarzenegger involves three Alameda Superior Court decisions that determined furloughs for special-fund departments were irrational, arbitrary and interfered with those departments' ability to legally function. The rulings, which were consolidated when Gov. Arnold Schwarzenegger appealed his loss to San Francisco's 1st District Court, affected employees covered by SEIU Local 1000, the Union of American Physicians and Dentists and California Attorneys, Administrative Law Judges and Hearing Officers in State Employment.

The case went on hold while the California Supreme Court took up PECG v. Schwarzenegger, which involved the larger question of whether the governor could unilaterally impose furloughs. (No, the court said on Oct. 4, but the Legislature can and did by approving a budget that assumed furlough savings.)

Then the 1st District Court told the SEIU parties to submit new arguments in light of PECG. They did, so now we have a hearing date. Whether it will go off isn't clear. The Brown administration has asked for hearing delays in other labor litigation, including another furlough case (involving State Compensation Insurance Fund employees) with the 1st District Court. The court granted the delay in that matter.

IMAGE: www.yolocourts.ca.gov

January 26, 2011
State worker union to fight property sale

SEIU Local 1000 has asked to join the legal fight to keep the state from selling 11 properties that former Gov. Arnold Schwarzenegger put on the sales block to help close California's budget deficit. Gov. Jerry Brown criticized the plan when he was running for office, but earlier this month said that he is weighing whether to continue the previous administration's sale lease-back plan because ending the deal would increase the state's budget gap by about $1 billion.

As the union notes in the amicus brief (embedded below) filed in the 6th District Court of Appeal in San Jose, state custodians would lose their jobs if the building sale goes through because the buyer, California First LLC, intends to use private sector employees to perform those duties.

Meanwhile, the state has pushed back the layoff date for employees affected by the pending sale. Originally their positions were set for elimination on March 30. The new date is May 1. (Click here for a previous post about the pending layoffs.)

Fans of William Shakespeare will appreciate union attorney Anne Giese's reference to "King Lear" to fortify her argument that the sale is illegal, and foolish to boot:

Since the actions of Schwarzenegger -- during repeated budget crises -- frequently appeared like tragedies of Shakespearean proportions, it is fitting, then, to compare his poor real estate decisions to those of King Lear.

You can read the rest of her analogy here. Scroll down to PDF page 9:

January 25, 2011
Analyst recommends tweaking pension transparency law

The Legislative Analyst's Office has taken a look a pension bill that was key to last year's budget deal and concluded that it was well-intentioned but flawed.

Senate Bill 867, authored by Republican Dennis Hollingsworth and backed by Gov. Arnold Schwarzenegger, established several new public reporting requirements and, most significantly, told CalPERS to make estimates of its unfunded liabilities based on the so-called "zero-risk rate."

The LAO concluded that the bill has "serious drafting problems" that make it needlessly alarmist or unworkable:

As part of its efforts to encourage scrutiny of CalPERS' investment return assumptions, SB 867 requires CalPERS to calculate pension liabilities in its reports to the Legislature and others using "a discount rate equal to the rate of the 10-year United States Treasury (UST) Note as of 30 days before the date of the report." This means that instead of calculating liabilities using CalPERS' annual assumed investment return (currently 7.75 percent), this report would require liability reporting assuming a much lower discount rate. As of January 21, 2010, the 10-year UST yield is 3.4 percent. Using such a lower discount rate would result in CalPERS calculating a much higher amount of liabilities and, therefore, future state and local costs, compared to standard public pension reporting methods.

January 20, 2011
Brown, constitutionals ask for more time in furlough lawsuit

Correction, Jan. 20, 11:30 p.m.: An earlier version of this post incorrectly reported that attorney David Tyra signed the letter submitted to the 3rd District Court of Appeal.

Thumbnail image for 100609 gavel.jpgCiting "the unique circumstances" of transition to a new administration, attorneys representing Gov. Jerry Brown and Attorney General Kamala Harris have asked an appellate court to push back deadlines for submitting briefs in what has been a running feud over furloughs between the executive branch and other statewide-elected officials.

The request asks the 3rd District Court of Appeal in Sacramento to add at least 30 days to the Jan. 26 date that the first documents are due. The court had said on Jan. 11 that it wouldn't grant any extensions.

January 14, 2011
UPDATE: Judge rules against prison officers in furlough lawsuit

110114 Newton v. Schwarzenegger ruling
Update, 1:49 p.m.: This story has been updated with a response from CCPOA.

A judge in San Francisco has struck down a class action lawsuit over correctional officer furloughs that alleged the policy violates federal labor laws. The case is the first furlough litigation orally argued by state attorneys since Gov. Jerry Brown took office on Jan. 3.

"We are disappointed in the court's ruling today and will be reviewing the decision to determine what steps to take next." said Ryan Sherman, spokesman for the California Correctional Peace Officers Association, which backed the lawsuit.

The ruling by U.S. District Court Judge Vaughn Walker comes just one day after arguments in Newton v. Schwarzenegger. The union's attorneys argued that "self-directed" furloughs of correctional officers violated the Fair Labors Standards Act. The case applied only to members of Bargaining Unit 6.

CCPOA said that cutting employee pay but deferring the furlough time off violates the law because employees aren't paid in full for hours worked within a given pay cycle, that time worked on an unpaid furlough day should be calculated in figuring overtime and that the state hasn't kept adequate payroll records.

In essence, the judge ruled that the plaintiffs didn't make the case to support their claims or misinterpreted the policy as forcing employees to work for free. "The furlough program, while perhaps convoluted in execution, ensures that plaintiffs are compensated for all hours worked during the pay period," Walker wrote. "Because plaintiffs are compensated for all hours worked, and because that compensation exceeds federal minimum standards, plaintiffs claim of violation of FSLA fails."

And federal law, Walker said, authorizes only the secretary of labor to sue for recordkeeping violations, so "plaintiffs here lack standing to raise a separate claim relating to alleged recordkeeping violations."

Click here for a previous post with more details and documents about the lawsuit. We've embedded Walker's decision above.

January 13, 2011
Federal court hears furlough debate; informal labor talks begin

Attorneys representing the state and the California's prison officers' union argued the legality of furloughs in San Francisco's U.S. District Court this morning. The court didn't issue a ruling and might not for several weeks.

The California Correctional Peace Officers Association filed the class action lawsuit, Newton v. Schwarzenegger, contending that its members' furloughs -- which deduct pay now but defer the corresponding time off -- violate the Fair Labor Standards Act. Click here for more background and court briefs.

Thumbnail image for Thumbnail image for Thumbnail image for 110105 Ron Yank.JPGMeanwhile, The State Worker has heard from several sources that the Department of Personnel Administration is scheduling or has already engaged in informal labor contract talks with the six bargaining units still without agreements. DPA Director Ron Yank also has been meeting and greeting leaders of the other bargaining units.

Yank's goal: Get contracts negotiated with all six units by the end of February/beginning of March.

PHOTO: Ron Yank, 2007 / Courtesy Carroll Burdick & McDonough LLP

January 13, 2011
Federal furlough case set for hearing today

Thumbnail image for Thumbnail image for Thumbnail image for 100602 yolo county gavel.jpgNewton v. Schwarzenegger is set for hearing in San Francisco's U.S. District Court today at 10 a.m.

The class-action case, which applies only to members of the California Correctional Peace Officers Association, is challenging furloughs as a violation of the Fair Labor Standards Act. The arguments in this December 2009 complaint include:

  • Cutting pay but deferring the furlough time off violates the law because employees aren't paid in full for hours worked within a given pay cycle.
  • Time worked on an unpaid furlough day should be calculated in figuring overtime.
  • The state hasn't kept adequate payroll records.

The state says in its last brief that CCPOA doesn't have standing to file suit, that there's no material fact establishing that employees haven't been compensated for all hours worked and that the assigning the eventual time off is a form of compensation under federal law.

There's a slew of documents in the case. CCPOA has posted a few on its website, but the rest are only available online through the court's electronic document system, and you have to register and then pay document fees.

Or you can look at the last two briefs that lay out each side's arguments via The State Worker's Scribd embeds:

December 28, 2010
Litigation over third furlough order sent back to trial court

100609 gavel.jpgThe 1st District Court of Appeal has lifted an decision that stopped union challenges to Gov. Arnold Schwarzenegger's last furlough order, referring the matter to Alameda Superior Court for more litigation as that court "may deem appropriate."

The matter landed in the appellate court after Judge Steven. A. Brick's Aug. 8 ruling that Schwarzenegger couldn't relaunch three-days-per-month furloughs for roughly 144,000 state workers because the order violated state laws.

The governor quickly asked the appellate court to put a hold on the lower court's decision and allow furloughs to proceed. The appellate court denied that request, but the California Supreme Court, which by then was knee deep in furlough litigation, took the case and then allowed furloughs to resume.

On Oct. 4 the high court ruled that Schwarzenegger's 2009 furloughs were illegal but that the Legislature tacitly approved them in subsequent budget legislation. It didn't rule on the latest furlough case, however, and in November returned the matter to the 1st District Court of Appeal.

Now the appellate court has passed the case -- which is actually a consolidation of lawsuits by Professional Engineers in California Government, SEIU Local 1000 and six other employee groups -- back down to the Alameda court. (Click here for a list of all the parties involved.)

It's not clear whether either side should take heart from the appellate court's action, but you can be certain that there's more litigation ahead.

Just don't count on SEIU Local 1000 to be part of the proceedings. Its new contract accepted the last round of furloughs from August through October.

Here's the appellate court's instructions to the trial court:

In light of (1) the California Supreme Court's decision in Professional Engineers in California Government v. Schwarzenegger (S183411, October 4, 2010), (2) the enactment of the Budget Act of 2010, (3) the motion filed by plaintiffs in the California Supreme Court on October 26, 2010, and (4) any other potentially relevant development, the temporary restraining order that is the subject of the appeal in this action is vacated and the matter is remanded to the superior court for such further proceedings as the superior court may deem appropriate in light of these intervening developments.

Click here to read the appellate court docket, which shows the up-and-down history of the case.

December 21, 2010
The latest on CCPOA's $4.4 million union paid leave dispute

Thumbnail image for 100602 yolo county gavel.jpgThe ongoing union paid leave dispute between the state's prison officers' union and the California Department of Corrections and Rehabilitation is entering a new phase next week, when a Sacramento court will rule whether the the matter should go to binding arbitration.

December 14, 2010
Attorneys' union: Return 'special fund' case to trial court

Editor's note, 2 p.m.: We have added a Scribd version of the Dec. 7 CASE court filing to the end of this post.

California Attorneys, Administrative Law Judges and Hearing Officers in State Employment filed a letter brief last week with San Francisco's 1st District Court of Appeal.The union's aim: convince the justices to return a so-called "special funds" case to the trial court with "directions to reconsider its ruling in light of the (California) Supreme Court's decision."

CASE attorney Patrick Whalen's 13-page letter is a response to a Nov. 22 brief filed by the Schwarzenegger administration that argues for killing the case.

Whalen contends that the high court's ruling in PECG v. Schwarzenegger, which said the state Legislature tacitly approved furloughs by assuming payroll savings from the policy in its budget actions, left open many questions that need to be hashed out in the lower court.

CASE makes these arguments:

December 10, 2010
SEIU Local 1000 wins union fee case in 9th Circuit Court

Thumbnail image for 100609 gavel.jpgThe U.S. 9th Circuit Court of Appeals has overturned a lower court's decision that SEIU Local 1000 didn't appropriately notify members and fair-share payers when it temporarily raised fees in 2005 and 2006.

The union raised about $12 million from the fee increase. Local 1000 attorney Anne Giese said this afternoon that if SEIU lost, it probably would have paid "nominal damages" of about $1 per union member.

The plaintiffs can ask the U.S. Supreme Court to review the 9th Circuit ruling, but the high court rarely accepts such requests.

Justices David R. Thompson and Sidney R. Thomas ruled in favor of the union with Justice J. Clifford Wallace dissenting.

The lawsuit was backed by the National Right to Work Legal Defense Foundation, which describes itself as "nonprofit, charitable organization providing free legal aid to employees whose human or civil rights have been violated by abuses of compulsory unionism."

We'll knit together the essentials of the case from the 43-page court decision that we've Scribd at the end of this post:

December 2, 2010
Catch up on the latest furlough litigation news

Thumbnail image for 100609 gavel.jpgLots of ground to cover here: three unions, three lawsuits, four court filings and plenty of links to prior State Worker posts for background. Hang on.

CCPOA v. Schwarzenegger
The Schwarzenegger administration filed this brief on Tuesday in response to CCPOA's Nov. 19 filing to San Francisco's 1st District Court of Appeal. Gov. Arnold Schwarzenegger and the prison officers' union are battling over an Alameda judge's decision that "self-directed" furloughs are illegal.

The big question with this furlough case and the other two we'll mention is this: Given the California Supreme Court's October furlough decision that the Legislature tacitly approved furloughs through budget legislation, is the lower court litigation still worth considering?

Click here and then here for more background on CCPOA v. Schwarzenegger. Both posts have plenty of history and links to earlier key court documents.

There's no oral argument date set for this case.

November 23, 2010
Has Schwarzenegger handed off minimum wage case to Brown?

Thumbnail image for 100609 gavel.jpgA key court date set for the end of this month in the state worker minimum wage case has been postponed with no new date set.

Judge Patrick Marlette had scheduled the minimum wage hearing in Sacramento Superior Court for Nov. 29. The two sides were supposed to present evidence about whether the controller has the computer capacity to pay state employees minimum wage during a budget impasse.

The delay injects new uncertainty into the legal battle between the lame duck Schwarzenegger administration and Controller John Chiang. Gov. Arnold Schwarzenegger leaves office in January, and it's difficult to envision a lower court decision in the minimum wage litigation before that.

And even in the unlikely event that happens, the matter would drag well past January -- and into Gov.-elect Jerry Brown's term -- if the losing side appealed a December ruling.

Chiang has twice refused to withhold state worker pay, contending that the state's payroll technology and state payroll procedures prohibit it. Schwarzenegger has said the controller is defying established case law and cannot assume failure.

According to this court document, both sides agreed to put off the hearing:

After some discussion with all counsel, it was agreed that the November 29, 2010. Evidentiary Hearing would be vacated. The Court ordered that counsel meet and confer regarding trial dates and a briefing and discovery schedule.

We've asked the controller and the Department of Personnel Administration to explain what happened and whether this means Schwarzenegger is handing the issue off to Brown. We'll let you know what we hear.

IMAGE: www.yolocourts.ca.gov

November 22, 2010
UPDATE: CCPOA files appellate brief in 'self-directed' furlough case

Editor's update, 8 p.m.: This post now includes a Scribd download of the CCPOA brief filed with the 1st District Court of Appeal.

The California Correctional Peace Officers Association filed a 42-page brief on Friday, arguing that the California Supreme Court's furlough ruling last month didn't wipe out an Alameda judge's earlier ruling that "self-directed" furloughs are illegal.

"The governor says that the (Supreme Court's) ruling is a big blanket that you can throw over all furloughs," said Gregg Adam, one of the attorneys with San Francisco law firm Carroll, Burdick & McDonough, which represents CCPOA. "Obviously, we disagree."

Self-directed furloughs deduct an employee's pay at the furlough rate of roughly 15 percent per month, but the time off is deferred. The 32,000 or so correctional officers represented by CCPOA continue to work under self-directed furloughs. They're among the roughly 63,000 state workers represented by unions without current labor pacts.

Alameda Superior Court Judge Frank Roesch ruled that self-directed furloughs are illegal. Schwarzenegger appealed the ruling to San Francisco's 1st District Court, where it was on hold until the state Supreme Court ruled on furloughs last month.

The appellate court then asked the governor and the prison officers' union to update their arguments in light of the high court's decision. Schwarzenegger opened with a Nov. 9 filing (click here to read more about it).

CCPOA's response includes these arguments:

November 22, 2010
SEIU files 'special fund' furlough brief in San Francisco

Thumbnail image for 100609 gavel.jpgSEIU Local 1000 filed a supplemental brief in San Francisco's 1st District Court of Appeal last Friday. It's a response to Gov. Arnold Schwarzenegger's Nov. 8 filing that argues the California Supreme Court's furlough decision knocked out an Alameda judge's ruling that forcing unpaid days off on so-called "special fund" departments is illegal.

Local 1000 attorney Felix De La Torre's 19-page letter brief makes several arguments:

November 10, 2010
Governor's lawyer argues to kill 'special fund' furlough rulings

A state appeals court should reverse a lower court's ruling that state workers in "special fund" departments were illegally furloughed, an attorney for Gov. Arnold Schwarzenegger argues in documents filed this week in San Francisco.

Attorney David Tyra contends in two mirror-image briefs submitted to the 1st District Court of Appeal that last month's furlough decision by the California Supreme Court "fully disposes of the issues" raised in SEIU Local 1000 v. Schwarzenegger et al. and UAPD v. Schwarzenegger et al..

Nearly a year ago, Alameda Superior Court Judge Frank Roesch ruled in both cases that furloughing employees in departments funded entirely or in part with money outside the general fund was an "arbitrary, capricious and unlawful" act. He then ordered those workers returned to full hours and pay. Schwarzenegger immediately appealed, which kept furloughs in place.

Then the state Supreme Court ruled on Oct. 4 that the Legislature had tacitly approved Schwarzenegger's furloughs, which made the policy legal. On Oct. 7, the 1st District Court issued a letter to both state and union attorneys about the SEIU and UAPD cases:

Dear Counsel: As you are undoubtedly aware, on October 4 the Supreme Court filed its opinion in Professional Engineers in California Government v. Schwarzenegger, S183411. Should you conclude that the opinion does not resolve all issues in this appeal, the Court has directed me to inform you that additional briefing addressing the impact of the Supreme Court's decision may be submitted according to the following schedule. Appellants may file an initial supplemental brief no later than November 8, 2010. Respondent may file its brief on or before November 19, 2010. Appellants may file a reply brief no later than November 30, 2010.

That same day, the appellate court set a briefing schedule for California Correctional Peace Officers Association v. Schwarzenegger, another Roesch furlough ruling appealed by the governor. Click here for our recent post about that appeal.

The 1st District Court hasn't yet set a date for oral arguments in any of the cases.

What follows is Tyra's 10-page SEIU brief , which essentially says that applying the guidelines set down by the Supreme Court's ruling undercuts the Roesch decisions. (This link opens a virtually identical Tyra brief addressing the UAPD case.)

Plaintiff's brief in SEIU Local 1000 v.Schwarzenegger

November 9, 2010
Schwarzenegger argues CCPOA furlough lawsuit win invalid

An attorney for Gov. Arnold Schwarzenegger said that the California Supreme Court's Oct. 4 furlough decision has invalidated a lower court's furlough lawsuit ruling in favor of the California Correctional Peace Officers Association.

David Tyra, the administration's lead furlough lawsuit lawyer, argued in papers filed on Monday that the high court's decision settles all of the issues raised in CCPOA v. Schwarzenegger, et al..

CCPOA successfully argued to Alameda Superior Court Judge Frank Roesch that "self-directed" furloughs of prison staff and other state workers at 24/7 facilities violated labor law that stipulates compensation must be paid within a given pay cycle. The union maintained the policy is illegal because workers under self-directed furloughs may lose their pay but not take the time off for weeks, months or years.

The law also requires payment rendered in cash, but unredeemed furlough time after June 2012 would have no value, and that was illegal too, CCPOA said. After losing the case and appealing Roesch's ruling to San Francisco's 1st District Court, the administration extended the furlough redemption time indefinitely. It also said that furloughs violated provisions of the Labor Code.

Three days after the state Supreme Court issued its decision that the Legislature tacitly approved Schwarzenegger's furloughs through language tucked into a February 2009 budget bill, the 1st District Court asked the administration and CCPOA to submit arguments on how the Supreme Court's ruling impacted CCPOA v. Schwarzenegger.

Tyra filed his 15-page letter on Monday. His argument, in sum: The Supreme Court said that the Legislature OK'd the governor's furloughs as they existed, making all of CCPOA's arguments moot. The Labor Code argument doesn't hold up, either, because that law doesn't apply to state employers and employees.

The union has until Nov. 19 to respond. The governor may file a reply brief no later than Nov. 30. The court hasn't set a date for oral arguments.

Click here to read the Tyra brief. He also filed a brief in the 1st District Court for Service Employees International Union Local 1000 et al. v. Schwarzenegger et al., which concerns the legality of furloughing "special fund" department employees. We'll have that posted this afternoon, so check back.

November 3, 2010
Read correctional union official's testimony about spending, revenue

As we reported last week, documents aren't publicly available that detailed the California Correctional Peace Officers Association's budgets and balance sheets in an Oct. 22 federal court hearing that produced a $10 million punitive damages verdict against the union. (That was in addition to about $2 million in actual damages the jury concluded CCPOA should pay.)

But the transcript of the Dawe v. CUSA, CCPOA hearing wasn't shielded. The State Worker acquired 60 pages of key testimony. They're posted below.

The conversation touches on a number of subjects, such as the decline of CCPOA's net worth; homes, cars and sports season tickets it has purchased; the union's employee payroll costs; property it owns in Southern California; member dues; the union's legal costs; it's fight with the state over union paid leave; unspecified political spending and more.

Before you start reading, here's the cast:

Mr. Nicolaysen - CCPOA chief financial officer Jeff Nicolaysen
Mr. Baxter - plaintiff Brian Dawe's lawyer Daniel Baxter
Mr. Mastagni, Sr. - David Mastagni, Sr., attorney for CUSA and CCPOA
Court - federal Judge Lawrence Karlton

101101 Jeff Nicolaysen Testimony

October 28, 2010
View the $10 million punitive damages verdict against CCPOA

The State Worker has accessed the 7-page court document that details a federal jury's $10 million punitive damages verdict in Dawe v. Corrections USA and CCPOA. You can view the verdict by clicking this link.

The same jury decided that CCPOA should pay $2 million actual damages.

CCPOA has said it will appeal. The union has posted on its website an open letter explaining its side of the matter. The letter says that, "If there are any damages, those will not need to be paid until the appeal is complete - probably years from now." It also assures members that the union isn't bankrupt.

Bee columnist Dan Morain observes in today's Bee that, "The once-mighty California Correctional Peace Officers Association has fallen far." This link opens his column. Clicking here opens our report last week about the Dawe verdict and revelations in court about CCPOA's assets, revenues and spending.

October 25, 2010
So what will the constitutionals do about furloughs now?

We've been asking constitutional officers for reaction to new furlough instructions from the Department of Personnel Administration, acting on budget bills that allow the administration to furlough state workers.

The instructions, part of a set of Personal Management Liaison memos issued late Thursday afternoon, say that rank-and-file state employees in unions without contracts will continue furloughs of three days per month in November. That includes folks working for the lieutenant governor, the secretary of state, the treasurer, the attorney general, the controller, the superintendent of public instruction and the insurance commissioner.

(The Board of Equalization also is a constitutional agency, but it's among the eight departments and agencies whose employees are exempt from furloughs regardless of contract status.)

October 22, 2010
CCPOA airs its finances in federal court hearing

Thumbnail image for Thumbnail image for 100609 gavel.jpgThe California Correctional Peace Officers Association owns two homes in Sacramento, bought half the seats in an Arco Arena luxury suite as well as season passes to the local Triple A baseball team and purchased eight new vehicles last year, according to a federal court hearing this morning.

The inside glimpse into how the prison officers' union has spent its money was part of the punitive damages phase of Dawe v. Corrections USA, CCPOA, et al.. CCPOA is already on the hook for $2.3 million in damages after a jury on Monday found it guilty of defamation. Now the jury must determine how much in punitive penalties, if any, CCPOA will pay after losing the 3-year-old case in Sacramento.

(This is a very complex case, as evidenced by this 27-page verdict. For more background than we can share here, click here for Brian Dawe's side of the story and click here for CCPOA's version. )

Among the union financial figures presented at the morning hearing:

October 15, 2010
Minimum-wage case set for oral arguments in January

Thumbnail image for Thumbnail image for 100609 gavel.jpgWith all of the historic events of the last two weeks -- action on the state budget, the SEIU labor deal and the California Supreme Court decision on furloughs -- we almost forgot about another high-profile issue that's not yet resolved: state worker minimum-wage litigation.

Sacramento Superior Court Judge Patrick Marlette has scheduled Endsley v. Chiang for oral argument on Jan. 7. If Marlette's past decisions on furloughs and minimum wage are a guide, he'll issue a tentative decision ahead of the January hearing and then, unless an argument changes his mind, he'll quickly issue a final decision.

Thumbnail image for Thumbnail image for Thumbnail image for marlette.jpgBetween now and then, there's a Nov. 29 "evidentiary proceeding" during which witnesses will testify, possibly for an entire week. Each side will then submit more documents to Marlette, which he'll consider in the days leading up to oral arguments.

October 4, 2010
How the state Supreme Court reached its furlough ruling

100602 yolo county gavel.jpgWe don't know yet what the California Supreme Court will say about furloughs this morning, but we do have a sense of how the court reached its decision.

Here's a quick sketch of how the court writes its rulings:

October 1, 2010
State Worker furlough chat set for Tuesday

101001 caht logo.JPG

Next week, The State Worker blog will host an hour-long chat about the California Supreme Court's much-anticipated Monday morning furlough ruling. You can plug into the live session right here on Tuesday from 11 a.m. to noon. We'll take questions and ask some of our own during what is sure to be a lively 60 minutes.

(Yes, we know it's not an ideal time, but we'll be tied up Monday with the court news. Another chat has been scheduled for the noon hour on Tuesday. We figured Wednesday was too late. So we picked the least-bad time for our event.)

If you can't join the conversation live, you can replay it later on this blog, since The Bee archives chats.

IMAGE: sacbee.com/live

October 1, 2010
UPDATED: California Supreme Court to issue furlough ruling Monday

The California Supreme Court has just announced that it will publish its decision in the state worker furlough matter, Professional Engineers in California Government, et al. v. Schwarzenegger, et al. on Monday at 10 a.m. There's no tip in the announcement what the court has decided.

The ruling will affect more than 200,000 state employees forced to take unpaid days off by Gov. Arnold Schwarzenegger since February 2009. State workers absorbed 46 furlough days through June 30 of this year, cutting approximately $3 billion from state payroll costs. About half of that was general fund savings.

In August, after state budget talks deadlocked, Schwarzenegger restarted the "Furlough Friday" policy, which closes the government the second, third and fourth Fridays of the month until a 2010-11 budget deal is done.

SEIU Local 1000, which represents 95,000 state employees and unions for state attorneys and state engineers all sued the governor over the order nearly two years ago and lost in Sacramento Superior Court. The state Supreme Court last summer decided to take the three cases as one and ordered a quick schedule that culminated in a Sept. 8 hearing in San Francisco.

The court had 90 days after the hearing to render its decision, but legal experts figured a ruling would come much sooner, given the high-profile nature of the case and its potential impact on the state's budget.

There are roughly 40 furlough lawsuits in various lower courts around the state, but legal experts say Monday's ruling could settle them.

The state Supreme Court also took a fourth furlough case involving employees at the State Compensation Insurance Fund. It hasn't yet been scheduled for a hearing.

Click here to read the California Supreme Court's notice.

October 1, 2010
California Supreme Court to issue furlough ruling on Monday

The California Supreme Court has just announced that it will publish its decision in the state worker furlough matter, Professional Engineers in California Government, et el. v. Schwarzenegger, et al. on Monday at 10 a.m. There's no tip in the announcement what the court has decided.

Click here to read the court's notice.

September 30, 2010
Judge sides with unions on Lincoln's Birthday, Columbus Day

A Sacramento Superior Court judge has ruled that Gov. Arnold Schwarzenegger's and the Department of Personnel Administration's refusal to recognize Lincoln's Birthday and Columbus Day as state paid holidays violated collective bargaining laws.

In the same decision, Judge Timothy Frawley said that overtime rule changes enacted by the Legislature and enforced by the administration were legal.

Today's decision affects about 105,000 state workers represented by unions that were party to the lawsuit: SEIU Local 1000, California Association of Professional Scientists and California Association of Psychiatric Technicians.

Frawley's final writ is pending, but CAPT attorney Steve Bassoff said that the decision means that state workers in bargaining units covered by those unions will get whatever holiday compensation is owed to them for time worked on Columbus Day last year or Lincoln's Birthday this year.

"Whatever their contract provides for, that's what's in effect," Bassoff said this afternoon.

The unions acknowledged that lawmakers and Schwarzenegger changed state law last year to eliminate Columbus Day and Lincoln's Birthday as paid holidays. They also acknowledge that their contracts expired long before the holiday legislation.

But the three unions told Frawley that the Dills Act, which spells out state labor contract rules, keeps the provisions of expired contracts in place until new terms are negotiated. They argued that the administration's actions -- which included disciplining anyone who continued treating the holidays as a paid day off -- violated the law.

SEIU President Yvonne Walker flatly told members last fall that, "October 12, 2009, is a holiday and employees should not come to work."

Frawley agreed that lawmakers didn't supersede the Dills Act with last year's holiday legislation. Since the union contracts specified Columbus Day and Lincoln's Birthday were paid days off, the compensation terms for those days remained in force.

Today Walker said, "It's unfortunate that these questions had to be asked and litigated.
at a significant cost to the state, especially when it didn't need to happen."

Walker predicted that the administration will appeal, "no doubt."

The State Worker has contacted the administration for comment. It's not clear what the administration's position will be regarding Columbus Day on Oct. 11.

An administration appeal would automatically freeze any back wage payments to state workers and could allow the state to continue the no-holiday policy while the case runs through the court system. The unions could ask the court to go ahead with paying state workers while the case is appealed.

Frawley's ruling covers Columbus Day holidays and Lincoln's Birthday holidays denied since February 2009. His ruling for CAPT excludes holidays occurring after July 1 of this year, since the union has agreed to a contract from that date through July 2012 that eliminates both holidays.

The judge sided with the administration's position that changes to the law that eliminated counting leave time toward the threshold for overtime was legal. That change was part of the same legislative package that eliminated the two paid holidays.

September 10, 2010
From the notebook: Roussos analyzes Supreme Court hearing

"From the notebook" posts give State Worker blog users insights, notes and quotes that went into news stories that we write.

We quoted Athena Roussos, an Elk Grove-based appellate attorney who has argued before the California Supreme Court, in this story about the California Supreme Court hearing in the PECG v. Schwarzenegger furlough case.

Roussos said plenty more about the hearing when we spoke on Wednesday afternoon. Here are some of her thoughts after viewing the oral arguments:

September 7, 2010
Wednesday state Supreme Court hearing looms

Wednesday's California Supreme Court hearing is dead ahead, set for Wednesday morning at 9 a.m. and scheduled to run for 90 minutes. Here's a previous post with details about how you can watch the oral arguments in Professional Engineers in California Government v. Schwarzenegger on TV or the Internet.

It's been a long road to this key moment. Looking back at the 1,900 posts on this blog since it started a little over two years ago, references to the state Supreme Court taking and furloughs case go back to early 2009. We're talking about 60 items on The State Worker.

We'll be attending the hearing. Between now and then, we'll be looking through past stories and court filings leading up to the case and writing a bit for tomorrow's Bee. If you want to do the same, here are some links. Many of the blog posts link to court filings or other pertinent info:

September 3, 2010
Supreme Court furlough hearings to be broadcast on web, TV

The California Supreme Court has announced it will broadcast Wednesday's 9 a.m. oral arguments in Professional Engineers in California Government v. Schwarzenegger.

The California Channel will air events live on cable television and on its website, www.calchannel.com. We expect the hearing will run about 90 minutes.

The justices will hear debate over whether Gov. Arnold Schwarzenegger illegally furloughed state workers. The case has repercussions for roughly 40 furlough lawsuits in lower courts around the state.

The court will rule within 90 days, although legal experts we've interviewed expect a published decision much sooner. Click here to read more about what to expect during the state Supreme Court hearing and after it.

Hat tip to blog user M for flagging this.

August 26, 2010
Read CalPERS / CalSTRS furlough filing to Supreme Court

As we reported here, CalPERS and CalSTRS have filed a Petition for Writ of Mandate to the state Supreme Court, seeking to block Gov. Arnold Schwarzenegger's July 28 furlough order.