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Susan D. Abele is properly classified in Category Three pursuant to the Newton Retirement Board's June 1, 1987 creditable service supplementary regulation because Ms. Abele worked both full-time and part-time during her employment with the City, even where the full-time work lasted only five months.
The Petitioner, Susan D. Abele, appealed timely under G.L. c. 32, § 16(4) the April 16, 2009 decision of the Respondent, Newton Retirement Board, to classify her as a Category Three employee pursuant to the Board's June 1, 1987 creditable service supplementary regulation. (Exs. 8, 10.)
I held a hearing on October 6, 2009 at the office of the Division of Administrative Law Appeals, 98 North Washington Street, Boston.
I admitted eleven documents into evidence. (Exs. 1-11.) The parties submitted fifteen stipulations of fact, which I marked for identification as A. The Petitioner testified on her own behalf. The Respondent called no witnesses. There is one cassette tape of the hearing.
Based on the evidence presented by the parties, I make the following findings of
1. Susan D. Abele, d.o.b. 10/12/40, has worked for the City of Newton at the Jackson Homestead museum since July 1992. She worked nineteen hours per week and received no fringe benefits. Her title was Senior Curator and Curator of Manuscripts and Photographs. (Stipulation; Ex. 1.)
2. Ms. Abele has a master's degree from Simmons College's School of Library Science in library science and archive management. (Testimony.)
3. In July 1998, Ms. Abele began working the same job at the museum for twenty-four hours per week, and she began to receive health insurance and became a member of the Newton Retirement System. (Stipulation.)
4. In July 2003, Ms. Abele began working an average of 35.75 hours per week while she continued her duties as Senior Curator and performed additional duties as interim archivist for the City. She worked these duties until July 1, 2005, when she reverted to working twenty-four hours per week as Senior Curator only. (Stipulation.)
5. In January 2006, the Director of the museum, David Olson, became Newton City Clerk and asked Ms. Abele to assume the role of Acting Director of the museum. (Stipulation.)
6. Ms. Abele accepted the position of Acting Director, which included an increase in salary from $701.06 per week to $1,222.03 per week. Mr. Olson told her that it would be temporary, but did not say how long Ms. Abele would hold the position. She began working 37.5 hours per week when she accepted the position. Retirement contributions were deducted from the full amount of her salary. (Stipulation; Testimony; Ex.4.)
7. Ms. Abele did not consult with the City Human Resources Department or the Board regarding the effect that taking the Acting Director position would have on her rights under the retirement law and regulations. Neither the human resources department nor the Board affirmatively informed Ms. Abele that taking the Acting Director position would have any effect on her retirement rights. (Testimony.)
8. Ms. Abele continued her duties as Senior Curator during the period that she was Acting Director of the museum. (Stipulation; Testimony.)
9. In June 2006, a new Director was hired and Ms. Abele returned to her twenty-four hour per week schedule and pay as Senior Curator. (Stipulation; Testimony.)
10. In May 2008, Ms. Abele submitted a Benefit Estimate Request Form seeking a retirement allowance estimate for an effective date of retirement of October 12, 2008. (Stipulation; Ex. 2.)
11. The Board informed Ms. Abele that she had accumulated seven years and nine months of creditable service and thus did not have the requisite ten years of creditable service to receive a retirement allowance. (Stipulation; Ex. 3.)
12. The Board arrived at its calculation because it considered Ms. Abele a Category Three employee under the Board's supplementary creditable service regulation, which places employees who work both part-time and full-time in Category Three. Category Three employees receive creditable service on a pro-rated basis, while Category One (strictly full time) and Category Two (strictly part-time) employees receive twelve months of creditable service for each year of employment. (Stipulation; Exs. 3, 11.)
13. Ms. Abele subsequently asked the Board to calculate her retirement allowance as though she had worked for ten years at twenty-four hours per week. (Stipulation.)
14. On June 13, 2008, the Board wrote to the Public Employee Retirement Administration Commission (PERAC) and posed the following question: "Could the Newton Retirement System calculate Ms. Abele's pension by only using 24 hours of her full-time 37.5 hour salary, therefore omitting the need to pro-rate her creditable service. I believe if this was allowed we would refund her the contributions made on salary in excess of 24 hours per week." (Ex. 5.)
15. On June 20, 2008, PERAC opined that this treatment of Ms. Abele would not be consistent with the Board's regulations and would not be authorized under any provision of chapter 32 of the General Laws. (Ex. 6.)
16. On June 23, 2008, the Newton Retirement Board informed Ms. Abele of PERAC's response and of her appeal rights. (Ex. 7.)
17. Ms. Abele filed a timely appeal with the Division of Administrative Law Appeals on June 29, 2008. (Ex. 8.)
18. On February 10, 2009, Ms. Abele's attorney, Nicholas Poser, wrote a letter to the Board requesting reconsideration of the Board's decision to treat Ms. Abele as a Category Three employee for retirement purposes. (Stipulation; Ex. 9.)
19. On April 16, 2009, the Board affirmed its previous position that Ms. Abele is a Category Three employee and should have her creditable service calculated accordingly. (Stipulation; Ex. 10.)
The decision of the Newton Retirement Board is affirmed. Susan D. Abele is properly classified in Category Three pursuant to the Board's June 1, 1987 creditable service supplementary regulation.
G.L. c. 32, § 1 defines creditable service as "all membership service, prior service and other service for which credit is allowable to any member under the provisions of [chapter 32,] sections one to twenty-eight inclusive." During her membership in the Newton Retirement System, Ms. Abele has worked twenty-four hours per week for approximately 8.5 years, 35.75 hours per week for approximately two years and 37.5 hours per week, which the Board considers full-time, for approximately five months. The only issue in this appeal is how the Newton Retirement Board should calculate the creditable service due to Ms. Abele.
Calculating creditable service for a strictly full-time member of a retirement system is straightforward; the employee is entitled to one month of creditable service for each month worked. There is, however, no universal method for calculating creditable service for part-time work, as G.L. c. 32, § 4(2)(b) gives retirement boards broad discretion to determine creditable service for part-time, provisional and temporary employees, subject to rules and regulations approved by PERAC. More specifically, G.L. c. 32, § 5(3)(c) permits retirement boards to promulgate rules and regulations to determine the amount of creditable service to which part-time employees are entitled. The Newton Retirement Board availed itself of this power on June 1, 1987 when it passed a regulation pertaining to creditable service. T
The Petitioner does not contest the validity of the regulation.
Newton's creditable service regulation classifies members in one of three categories. Category One is for those who work full-time, meaning a minimum of 37.5 hours per week on a regular basis. Category Two is for those who have only been employed as part-time, provisional, temporary or intermittent employees and have worked less than 37.5 hours per week but more than twenty hours per week. Category Three, in which the Board placed Ms. Abele, is for those who worked both full-time and part-time during their employment with the City.
Members in Category One receive creditable service of twelve months for each year of employment. Members in Category Two receive creditable service of twelve months for each year of employment, if and only if their part-time employment equals the total number of hours per week prescribed by the City for that job title or position. Category Three members receive twelve months of creditable service for each year of full time employment of 37.5 hours or more per week, and "a prorated period of years or fractions thereof equal to the percentage that their average actual hours worked per week bears to the average full time employment of 37.5 hours per week multiplied by the number of part time years of employment."
Petitioner argues that she should not be considered Category Three because she considers herself a career-long part-time employee at the museum. Petitioner asserts that during her entire employment while a member of the System, she worked part-time and received regular compensation for that work and that the additional 13.5 hours per week she worked and the concomitant near doubling of her salary when she was Acting Director are not regular compensation but rather are ad hoc payments and should therefore not be included when calculating whether she worked part-time or full-time during that five-month period. The Petitioner cites no authority for this interpretation of the regulation. Though it is a creative argument, it must fail.
A review of the City's payroll records shows that Ms. Abele's hours increased from 24.00 to 37.50 when she took the Acting Director position. There is no differentiation in the records between the twenty-four hours per week that she had been working and the "additional" 13.5 hours per week that she worked as Acting Director. Moreover, the Board's creditable service regulation considers any period during which a member works 37.5 hours per week as full-time work. Ms. Abele, therefore, clearly falls into Category Three since she worked both full-time and part-time during her employment with the City.
Ms. Abele further argues that placing her in Category Three, which would require her to work an additional thirty-nine months beyond ten calendar years to achieve ten years of creditable service and the attendant retirement allowance is a reduction ad absurdum. She cites Finkelstein v. Bd. of Reg. of Optometrists, 370 Mass. 476, 478 (1976), for the proposition that an agency's interpretation of a regulation will not be enforced when it is arbitrary, unreasonable or inconsistent with the plain terms of the rule itself. The Board applied the rule consistently in this case. And, Ms. Abele admits that the regulation is not arbitrary or unreasonable, as the purpose of the regulation appears to be to discourage employees from spending most of their careers as part-time employees and then increasing their retirement allowances by working full-time and using the full-time salary as a basis for calculating the retirement allowance. That Newton's rule is so stringent may show how strongly it wants to discourage its members from increasing their retirement allowance in this manner. The result in this case may be characterized as extreme, but it is not arbitrary or unreasonable. Perhaps the Board will take this opportunity to more carefully craft a creditable service regulation that achieves its goal but avoids more extreme cases like this one.
Finally, Ms. Abele claims that she reluctantly accepted the Acting Director position to help the museum, its former Director and the City while they looked for a permanent director. She did not consider the consequences that this employment may have on her retirement rights, and neither the City nor the Board informed her that she would be considered Category Three if she worked full-time at any point during her employment. Though the Petitioner's failure to consider the effect taking the position would have on her retirement rights may be regrettable, retirement boards do not owe any general fiduciary duty to their members, except as regards the investment of the boards' funds. Thorburn v. Worcester Reg'l Retirement Bd., CR-07-424 (DALA 2008) (citing Benoit v. Bristol County Retirement Bd., CR-04-291 (DALA 2005), aff'd (CRAB 2006)).
The Petitioner is, therefore, properly classified in Category Three pursuant to the Newton Retirement Board's June 1, 1987 creditable service supplementary regulation.
DIVISION OF ADMINISTRATIVE LAW APPEALS
/s/ Kenneth J. Forton___________________________
Kenneth J. Forton, Esq.
DATED: October 16, 2009