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Cypen & Cypen
FEBRUARY 26, 2009

Stephen H. Cypen, Esq., Editor


U.S. Representative Gary Ackerman (D-NY), Senior Member of the House Financial Services Committee, has introduced H.R. 710, the “Public Retiree’s Investment Act of 2009.” The legislation would provide a vehicle for billions of dollars in private capital to be injected into banks and financial institutions, mitigating the need for additional taxpayer bailouts of the financial sector, while simultaneously guaranteeing public pension funds a steady rate of return. The measure, introduced to curtail the ongoing economic meltdown and lack of credit market liquidity, would allow public employee pension plans throughout the nation that choose to invest in banks and financial institutions to earn a guaranteed rate of interest (8.5% per year) fully backed by the United States Treasury. The goal is for the legislation to open the door for banks and financial institutions initially to receive up to $50 Billion in private capital for loans and mortgages, while public pension funds simultaneously secure an acceptable and guaranteed return on their investments despite dismal market conditions. Initial enthusiasm on the part of public employee pension funds suggests their willingness to put significantly more money into the program. Under the bill, money from public pension funds will only be invested with banks and financial institutions that are currently on the federal government’s Troubled Asset Relief Program (TARP) list and that intend to use the funds in order to expedite making credit available to customers. The legislation would also help offset losses suffered by public pension funds whose portfolios have plunged due to poor economic conditions. Without the bill, many of these plans would look to local governments and taxpayers -- already strained severely by the economic crisis -- to cover their obligations to millions of public employees. In addition to guaranteeing the interest rate, the principal amount of the investments would also be backed by the Treasury Department. Approximately 25 million Americans participate in public employee pension plans. They include plans for state and municipal employees such as police officers, firefighters, teachers and sanitation workers.


Employer’s insulin-dependent diabetic employee whose limitations now prevent him from responding to occasional power outages is terminated, and sues under the Americans With Disabilities Act. There is no need to decide whether the new expanded statutory definition of “disability” applies retroactively from its January 1, 2009 effective date, as, even under preexisting law, he must provide evidence sufficient that he is a “qualified individual” with a “disability.” Eating is a major life activity; and, in light of the new amendments, impairments are to be evaluated in their unmitigated state, so that, for example, diabetes will be assessed in terms of its limitations on major life activities when the diabetic does not take insulin injections or medicine and does not require behavioral adaptations such as a strict diet. Further, his condition did not prevent him from performing the bulk of his job, which was mostly office work. Chuck Carlson provided the foregoing analysis of Rohr v. Salt River Project Agricultural Improvement and Power District, Case No. 06-16527 (U.S. 9th Cir., February 13, 2009).


Under Idaho law, a public employee may elect to have a portion of his wages deducted by his employer and remitted to his union to pay union dues. He may not, however, choose to have an amount deducted and remitted to the union’s political action committee, because Idaho law prohibits payroll deductions for political activities. A group of unions representing Idaho public employees challenged this limitation. They conceded that the limitation was valid as applied at the state level, but argued that it violated their First Amendment rights when applied to county, municipal, school district and other local public employers. The United States Supreme Court did not agree. The First Amendment prohibits government from “abridging the freedom of speech;” it does not confer an affirmative right to use government payroll mechanisms for the purpose of obtaining funds for expression. Idaho’s law does not restrict political speech, but rather declines to promote that speech by allowing public employee checkoffs for political activities. Such decision is reasonable in light of the state’s interest in avoiding the appearance that carrying out the public’s business is tainted by partisan political activity. That interest extends to government at the local as well as state level, and nothing in the First Amendment prevents a state from determining that its political subdivisions may not provide payroll deductions for political activities. Ysursa v. Pocatello Education Association, Case No. 07-869 (February 24, 2009).


Gipson, a City of Orlando police officer, sought review of City of Orlando Police Pension Board of Trustees’ order denying his application for service-connected disability pension benefits. Court review of an administrative agency decision is governed by a three-part standard of review: (1) Whether procedural due process was afforded; (2) whether essential requirements of law were observed; and (3) whether the decision was supported by competent substantial evidence. On the first point, Gipson claimed the Board deprived him of procedural due process by failing to engage in official deliberations prior to denying his application. Procedural due process requires both fair notice and a real opportunity to be heard at a meaningful time and in a meaningful manner. It was undisputed that Gipson was given a fair notice and afforded an opportunity to be heard by the Board. Gipson was represented by counsel and both he and his wife were permitted to testify at the hearing. The fact that there may have been no Board discussion during the actual deliberation phase does not evidence deprivation of procedural due process rights. On the second point, Gipson was required to be “permanently and totally disabled.” Board’s use of the term “partial” in its order was not a misapplication of law, but rather a reference to the term used by Gipson’s own treating physicians. On the third point, Gipson’s treating physicians did opine that there was a medical condition present that prevented Gipson from performing his job as a police officer. However, the independent medical examiner stated he would not place any permanent physical restrictions on Gipson. That doctor’s opinion and testimony, which is in conflict with the other doctors, is neither inherently credible nor improbable, and thus alone constitutes competent substantial evidence to support the Board’s order of denial. Gipson v. City of Orlando Police Department, Case No. 07-CA-9861 (Fla. 9th Cir., December 1, 2008).


Section 440.092(4), Florida Statutes, provides that an employee who is required to travel in connection with his employment who suffers an injury while in travel status should be eligible for workers’ compensation benefits only if the injury arises out of and in the course of employment while he is actively engaged in the duties of employment. Under the general rule, where an employee, as part of his duties, must remain in a particular place or locality until directed otherwise, or if for a specified length of time, such an employee is not expected to wait immobile, but may indulge in any reasonable activity at that place, and if he does so, the risk inherent in such activity is an incident of employment. (The most prevalent example finds a flight attendant away from home, in between assignments.) Here, the decedent, a resident of Jacksonville, was required to be in South Florida on a Monday morning. For personal reasons, she flew to South Florida on the Saturday before her training assignment was to begin. After dining out with a co-worker Saturday night, decedent and the co-worker went window shopping and then went to a night club. As decedent was attempting to cross the street, she was struck and killed by a car. Her personal representative sought payment of death benefits and funeral expenses, asserting that decedent was a traveling employee at time of her death. On appeal from an adverse ruling of the Judge of Compensation Claims, the appellate court found that decedent was not a traveling employee when the accident occurred. Unlike a flight attendant obligated to remain away from home between assignments, decedent’s presence in South Florida at the time of the accident was purely voluntary. Further, the court also rejected the alternative theory of recovery that decedent had been in the course and scope of her employment when the accident occurred. Houck v. Tarragon Management, Inc., 34 Fla. L. Weekly D424 (Fla. 1st DCA, February 24, 2009).


A researcher from the Center for State and Local Government Excellence recently presented a paper at the Labor and Employment Relations Association meeting. Here are some highlights:

  • The public sector workforce tends to be older than the private sector’s.
  • The public sector workforce is more educated than that of the private sector’s.
  • Job opening and turnover rates (layoffs, discharges, quits) are lower in the public sector, although retirement rates are about the same as those in the private sector.
  • Employment in state and local government is expected to increase by 8 percent overall between 2006 and 2016, with a 10-year growth rate of 11 percent for education positions and more than 20 percent for health care positions.
  • State and local government leaders view competition for talent, location of positions and family considerations as the major challenges to recruiting and retaining the public sector workforce of the future.

Verrrrry interesting.


ATTORNEY: Now doctor, isn't it true that when a person dies in his sleep, he doesn't know about it until the next morning?

WITNESS: Did you actually pass the bar exam?


“Never keep up with the Joneses -- drag them down to your level.” Quentin Crisp

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Items in this Newsletter may be excerpts or summaries of original or secondary source material, and may have been reorganized for clarity and brevity. This Newsletter is general in nature and is not intended to provide specific legal or other advice.

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