Council 13 v. Commonwealth

954 A.2d 706, 2008 Pa. Commw. LEXIS 378, 2008 WL 3366487
CourtCommonwealth Court of Pennsylvania
DecidedJuly 23, 2008
Docket322 MD 2008
StatusPublished
Cited by4 cases

This text of 954 A.2d 706 (Council 13 v. Commonwealth) is published on Counsel Stack Legal Research, covering Commonwealth Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Council 13 v. Commonwealth, 954 A.2d 706, 2008 Pa. Commw. LEXIS 378, 2008 WL 3366487 (Pa. Ct. App. 2008).

Opinion

OPINION BY

Judge LEAVITT.

Before this Court is a petition for review in the nature of a request for declaratory relief filed by three unions (collectively, Unions) 1 against the Commonwealth of Pennsylvania, Governor Edward G. Ren-dell, Secretary of Administration Naomi Wyatt, Secretary of the Budget Michael *709 Masch and Treasurer Robin L. Wiess-mann. The Unions represent approximately 16,000 Commonwealth employees who are not exempt from the wage and hour requirements of the federal Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201-219. These so-called “FLSA Covered Non-Critieal” employees would have been furloughed on July 1, 2008, if Governor Rendell and the General Assembly had not agreed on the framework for a general appropriation act for the 2008-2009 fiscal year by June 30, 2008. 2 The Unions seek a declaration from this Court that the Governor’s furlough plan is not “legally required” by Article III, Section 24 of the Pennsylvania Constitution and the FLSA, as the Governor’s Office has asserted in public statements.

The Commonwealth’s fiscal year begins at 12:00 a.m. on July 1 of every calendar year and ends at 11:59 p.m. on June 30 the following year. Upon expiration of every fiscal year, almost all of the line item appropriations in the general appropriation act for that year lapse, and, with limited exceptions, all of the Commonwealth agencies, boards, commissions, departments, offices and other entities of the executive, legislative and judicial branches have their funding terminate. Further, they lose the ability to draw on funds in the State Treasury by reason of Article III, Section 24 of the Pennsylvania Constitution, which states:

No money shall be paid out of the treasury, except on appropriations made by law and on warrant issued by the proper officers; but cash refunds of taxes, licenses, fees, and other charges paid or collected, but not legally due, may be paid, as provided by law, without appropriation from the fund into which they were paid on warrant of the proper officer.

Pa. Const, art. Ill, § 24 (emphasis added). In sum, if the General Assembly has not enacted a general appropriation act for the new fiscal year by 11:59 p.m. on June 30 of the expiring fiscal year, then at that moment “no money shall be paid out of the treasury’ as needed to conduct most of the business of the Commonwealth.

In anticipation of a general appropriation act not being enacted by June 30, 2008, Governor Rendell devised a contingency plan intended to comply with the mandate of Article III, Section 24 while at the same time protecting the basic health, safety and welfare of the public until a budget was in place. The plan assumed that many Commonwealth employees are not exempt from the wage and hour provisions of the FLSA and must be paid on time if they were required to work. Section 6 of the FLSA, 29 U.S.C. § 206. 3 The Governor’s contingency plan was described in an Interagency Agreement between the Governor and the State Treasurer finalized on May 28, 2008, which contemplated that

(1) employees covered by the FLSA whose duties are not necessary to insure the health, safety and welfare of the citizens, cannot be permitted to perform *710 their duties since the Commonwealth has no authority to make payments to those employees; (2) employees whose duties are necessary to insure the health, safety and welfare of the citizens must continue to perform their duties and, notwithstanding the Constitutional prohibition against payments, those employees who are covered by the FLSA must be paid in a timely manner; (3) employees not covered by the FLSA may continue to perform their duties and may be paid in arrears when an Operating Budget is enacted; .and (4) employees paid from sources other than an Operating Budget may continue to perform their duties and may be paid in a timely manner.

Petition for Review, Exhibit D, Inter-agency Agreement at 2-3 (emphasis added).

In order to implement the Interagency Agreement, Secretary of Administration Naomi Wyatt sent a memorandum to all agency heads on June 6, 2008, directing them to categorize all agency employees by whether they are covered by the FLSA and whether they are critical to the health, safety and welfare of the public. Specifically, Secretary Wyatt directed that employees be placed into one of the following categories:

FLSA Covered Critical: Positions who perform functions essential to protect the health, safety and welfare of the public. Examples include State Police Officers, Corrections Officers, nurses in veterans’ homes and state hospitals, and emergency management personnel. These employees will work and will be paid on time.
FLSA Covered Non-Critical: Position performing important work, but which are not critical to the health, safety and welfare of citizens. Examples include clerks who process drivers’ licenses and motor vehicle renewals, maintenance staff at state parks who maintain, repair and renovate buildings, financial examiners who review records for compliance with regulations, Civil Service staff who conduct civil service testing. These employees will be furloughed.
FLSA Exempt: These are employees who are not covered by the wage and hour provisions of the federal Fair Labor Standards Act. Generally, these are executives, employees in policy positions, attorneys and employees in similar positions. These employees will work but will not be paid until after a budget has been passed.
Special Funded: Positions not affected by a budget impasse because they are paid from special funds that are permanently or continually appropriated via their enabling acts and that do not fall under the General Appropriations Act.... These employees will work and will be paid on time.

Memorandum from Naomi Wyatt, Secretary of Administration, June 6, 2008, at 1-2; Exhibit D to Petition for Review (emphasis original).

Secretary Wyatt gave instructions on what would happen if a budget were not enacted by June 30, 2008. First, Commonwealth employees who continued to work after June 30 would be paid on a biweekly schedule if they were (1) FLSA Covered Critical employees or (2) Special Funded employees. Second, all FLSA Covered Non-Critical employees were to be furloughed effective July 1, 2008. In accordance with Secretary Wyatt’s directive, approximately 25,000 FLSA Covered Non-Critical employees were advised of their possible furlough. The Unions in the present action represent approximately 16,000 of these non-critical employees.

Presently, the Unions explain that they are not challenging the Governor’s authori *711 ty to furlough state employees or to classify them as critical or non-critical.

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Related

COUNCIL 13, EX REL. FILLMAN v. Rendell
986 A.2d 63 (Supreme Court of Pennsylvania, 2009)
No.
Colorado Attorney General Reports, 2009

Cite This Page — Counsel Stack

Bluebook (online)
954 A.2d 706, 2008 Pa. Commw. LEXIS 378, 2008 WL 3366487, Counsel Stack Legal Research, https://law.counselstack.com/opinion/council-13-v-commonwealth-pacommwct-2008.