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Cypen & Cypen
MARCH 3, 2005

Stephen H. Cypen, Esq., Editor

Never Forget - September 11, 2001


Section 286.011, Florida Statutes, the Government in the Sunshine Law, requires that meetings of a public board or commission be “open to the public.” In the absence of a specific exemption provided by law, covered boards or commissions must meet in the sunshine. Public access to meetings of public boards or commissions is a key element of the Sunshine Law. The term “public” means “the people as a whole” and the phrase “open to the public” means open to all persons who choose to attend. The requirement that members of the public must provide identification prior to their attendance at a public meeting could have a chilling effect on the public’s willingness to attend. Nothing in the Sunshine Law imposes such a requirement. In providing an opportunity for public participation, reasonable rules and policies that ensure the orderly conduct of a public meeting and that require orderly behavior on the part of those attending may be adopted. However, the requirement that persons attending a public meeting must provide identification as a condition of their attendance would not appear to be related to those goals. Nevertheless, an agency may impose certain security measures on members of the public entering a public building, such as requiring the public to go through metal detectors or have their purses or briefcases searched. The foregoing is set forth in a recent Florida Attorney General Opinion. AGO 2005-13 (February 16, 2005).


As we previously reported (see C&C Newsletter for October 21, 2004, Item 6), the U.S. Securities and Exchange Commission has requested documents from six companies to determine how they made assumptions about their pension plans and how that affected their bottom lines. At time of our earlier report, it was rumored that GM, Ford and Delphi were on the list. We now know that information is accurate, and that the others are Boeing, Navistar and Northwest Airlines. Strangely, according to CFO magazine, with no apparent trigger for timing of the investigation, the corporate world is buzzing with speculation about how and why the companies were chosen. The six under investigation are not those with the highest or most erratic rate-of-return assumptions. GM and Delphi, for example, held assumptions steady at 10% from 2000 to 2002, and dropped them to 9% a year later. (Three other companies not under investigation -- Honeywell, Pfizer and Delta -- did exactly the same thing.) The assumptions do not appear to be outlandish: a recent report commissioned by the Committee on Investment of Employee Benefit Assets put the actual median annualized asset returns for large corporate pension funds at 9.4% from 1993 through 2003 -- higher than the average 8.8% return those companies assumed. Emphasizing that none of the companies is suspected of any particular wrongdoing, an SEC spokesman said they were looking to see if companies reverse-engineered the rates to get to a certain financial result.


Full-time police officers of Hampton Township, Pennsylvania, sued to recover overtime pay under the Fair Labor Standards Act. The officers contended that the Township’s method of calculating overtime shortchanged them under FLSA, even though they agreed to that method in a collective bargaining agreement. The Township argued that, while the officers bargained away in the agreement one of their rights under FLSA, the Township overcompensated them by bargaining away a more valuable right under FLSA, thus offsetting the Township’s liability under the FLSA. The United States District Court upheld the Township’s position, finding that the collective bargaining agreement satisfied overall requirements of FLSA, even though it contained concessions by both parties not envisioned in FLSA. On appeal, the United States Court of Appeals for the Third Circuit reversed. Although the Township did not have to agree to a collective bargaining agreement that included non-work pay in its regular rate, no precedent holds that its doing so supports a credit against other statutory obligations. “We hold that longevity pay, educational incentive pay and senior officer pay must be added to the collective bargaining agreement’s basic annual salary calculation.” The appellate court left open the question as to inclusion of annual uniform allowance (but intimated that such would not be included). Wheeler v. Hampton Township, Case No. 04-1728 (U.S. 3rd Cir., January 24, 2005).


Fred Gawryk, at age 41, retired from service as a firefighter with the Chicago Fire Department. He was not, however, eligible to begin receiving retirement annuity payments until age 50. One trustee on the retirement board is an “annuitant of the fund or a fireman pensioner,” for whom only annuitants or pensioners are allowed to vote. When the retirement board found Gawryk ineligible to vote, he filed suit. The trial court granted summary judgment against Gawryk, and the appellate court affirmed. While a pension act should be liberally construed to effect the object sought to be accomplished, yet if the legislative intention is obvious from the language used that intention must be made effective, and the judiciary will not be warranted in giving the act a meaning not expressed in it. It is clear that the legislature defines the term “annuitant” as one who is actually receiving, not merely expecting, an annuity. The appellate court also relied upon the provisions of another statute, governing firefighters’ pension plans in smaller municipalities, which specifically allows “deferred pensioners” to vote. Gawryk v. Firemen’s Annuity and Benefit Fund of Chicago, Case No. 01 CH 17375 (Ill. App. 1st Dist., February 16, 2005).


The statute governing the Oak Park Police Pension Fund provides that if a police officer marries subsequent to retirement on any pension, the surviving spouse shall receive no pension on death of the officer. (Otherwise, a surviving spouse is entitled to the pension to which the police officer was then entitled, until death or remarriage.) Thomas Stec received a non-duty disability pension and subsequently remarried. After his death, his widow made a claim for survivor’s benefits. The board of trustees denied the claim, but, on administrative review, the circuit court reversed. On further review, the appellate court agreed with the board of trustees and reinstated its denial of survivor’s benefits. The surviving spouse unsuccessfully argued that her late husband was not “retired” because of the board’s authority to “recall” disableds upon recovery. However, such authority does not change the pensioner’s employment status as one who retired as a disabled officer. The obligations only implicate his right to continue receiving benefits. Stec v. Board of Trustees of the Oak Park Police Pension Fund, Case No. 03 CH 9537 (Ill. App. 1st Dist., February 17. 2005).

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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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