Armstrong v. School Dist. Five, Lexington, Richland, Civ.A. 3:997-903-0.
| Decision Date | 15 October 1998 |
| Docket Number | No. Civ.A. 3:997-903-0.,Civ.A. 3:997-903-0. |
| Citation | 26 F.Supp.2d 789 |
| Parties | Eva Dell H. ARMSTRONG, et al., Plaintiffs, v. SCHOOL DISTRICT FIVE OF LEXINGTON AND RICHLAND COUNTIES, Defendant. |
| Court | U.S. District Court — District of South Carolina |
Richard Mark Gergle, W. Allen Nickles, III, Gergle, Nickles and Grant, Columbia, SC, for Plaintiffs.
Vance J. Bettis, Marvin Richbourg Robinson, Gignilliat, Savitz, Bettis and Grant, Columbia, SC, for Defendant.
This matter is before the Court on cross motions for summary judgment. For the following reasons, the Plaintiffs' motion is granted and the motion of the Defendant is denied.
To grant a motion for summary judgment, this Court must find that "there is no genuine issue as to any material fact." Fed. R.Civ.P. 56(c). The judge is not to weight the evidence, but rather to determine if there is a genuine issue for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). If no material factual disputes remain, then summary judgment should be granted against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case and on which the party bears the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). All evidence should be viewed in the light most favorable to the non-moving party. Perini Corp. v. Perini Constr., Inc., 915 F.2d 121, 123-24 (4th Cir.1990). "[W]here the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, disposition by summary judgment is appropriate." Teamsters Joint Council No. 83 v. Centra, Inc., 947 F.2d 115, 119 (4th Cir.1991).
The material facts necessary to render a judgment in this action are stipulated by the parties or are established beyond dispute. The Plaintiffs are 132 employees of the Defendant School District Five of Lexington and Richland Counties ("District"). Plaintiffs employed as teachers receive, as a matter of state statute, contracts of employment for periods of nine to twelve months annually. Plaintiffs employed in non-teaching positions receive annual "assurances" of employment.
The District is a public school district organized under the laws of South Carolina and subject to all statutes which govern its operation. The District stipulates that any policies adopted by its Board must conform to State law. In this case, the Plaintiffs challenge the District's revised leave policy. Throughout the period relevant to this action, South Carolina law entitled public school employees to earn and accumulate sick leave. The relevant statutory language provides:
All full time employees of public schools accrue sick leave on the basis of one and one fourth days of sick leave for each month of active service or twelve days for nine months of active service. Sick leave accrued but not used may be accumulated up to ninety days if the employees do not violate their respective contracts. S.C.Code Ann. § 59-1-400 (1976, as amended).1
The Plaintiffs in this action are each long time employees of the District who chose to accumulate benefits earned over a number of years. In other words, Plaintiffs placed accumulated benefits "in the bank," saving these leave days for use at their daily rates for any approved absence from employment. Additionally, the saved benefits guaranteed Plaintiffs substantial lump sum retirement compensation (up to 90 days pay, almost one-half of a typical teacher's annual compensation). Because State law prohibits districts from reducing teacher pay, each employee choosing to save a day of leave had a reasonable expectation that its value would increase with additional years of service and normal increases in salary. See, S.C.Code Ann. § 59-20-50 (1976, as amended.) Indeed, the policy under which Plaintiffs saved these benefits guaranteed payment at the daily rate on use, separation or retirement. That policy, entitled GBRI, complied with State law in allowing employees to use sick leave during the contract year earned. Effective August 12, 1996, the District's Board adopted a revision to the leave policy. The revised policy, entitled GBRI/GCRG, retained the twelve days of leave accrued per contract year for nine month employees, but included an implementation schedule attached as "Appendix A" to the policy. Plaintiffs assert that the implementation schedule violates their contractual and constitutionally protected property interests in providing that:
After the effective date of this revised policy GBRI/GCRG, all requests for leave for employees having an accrued leave balance shall be paid first from pre-amendment accrued leave. Bonuses for employees having accrued leave in excess of 90 days shall also be paid first from any pre-amendment accrued leave days.
The District contends that its implementation schedule merely substitutes one form of leave for another so that Plaintiffs are not deprived of any vested benefits. This argument ignores controlling State law and undisputed material facts. When earned, leave accumulated by Plaintiffs under policy GBRI had a specifically stated cash value. For any leave accumulated before revision to this policy, the District is obligated to pay the Plaintiffs their per diem rate not only for approved leave days, but also upon retirement or separation following a stated period of service. By contrast, leave accumulated following policy revision GBRI/GCRG has a declining redemption value.
The declining value of sick leave accumulated following the policy revision is illustrated in a "Summary of Leave Policy GRBI/GCRG" prepared by the District. This Summary shows that in contrast to the guaranteed daily rate for sick leave accumulated under policy GBRI, leave accrued and accumulated after the revision will ultimately provide retiring or separating employees a "substitute rate of pay" which is less than 20% of the average daily rate paid to teachers in the District.
Plaintiffs filed a grievance with the District in protest to the raiding of their leave benefits. In response to this grievance, the District for the first time examined the financial impact of its implementation schedule on employees. Dr. Charles R. Lee, the District's chief financial officer, analyzed employee leave records and projected that requiring exhaustion of leave accumulated under prior contracts will cause employees to lose approximately $2,842,586.00. When the District refused to reconsider its action, the Plaintiffs filed suit in the Court of Common Pleas for Richland County. The District removed the litigation to this Court.
A.
As employees of public schools, Plaintiffs are entitled to compensation guaranteed by State law and District policy. See, generally, Ayres v. Crowley, 205 S.C. 51, 30 S.E.2d 785 (S.C.1944); City of North Charleston v. North Charleston, 289 S.C. 438, 346 S.E.2d 712, 715 (S.C.1986) (contracts incorporate State law); see, also, Hogsed v. Lancaster Area Schools Board Trustees, 283 S.C. 42, 320 S.E.2d 724, 727 (S.C.App.1984) (). Similarly, the Fourth Circuit has held that "a statute is itself treated as a contract" and that "contracts generally are understood to incorporate existing law." Baltimore Teachers Union v. Mayor, City Council of Baltimore, 6 F.3d 1012, 1016 (4th Cir.1993). Accordingly, a statute becomes a part of a contract "even if the parties have not expressly incorporated it." Baltimore, at 1017, citing United States Trust Company of New York v. New Jersey, 431 U.S. 1, 20, n. 17, 97 S.Ct. 1505, 1516, n. 17, 52 L.Ed.2d 92 (1977).
The South Carolina General Assembly has determined that public school employees are entitled to "use" sick leave and to "accumulate" sick leave at the end of the school year, provided the employees "do not violate their respective contracts." S.C.Code Ann. § 59-1-400 (1976, as amended). Separate legislation provides that employees having accumulated sick leave may redeem or "cash in" those benefits on retirement. See, S.C.Code Ann. §§ 9-1-1140; 1180 (1976, as amended).
Leave available to public school employees falls into two categories, accrued and accumulated. Accrued leave is earned during a current contract. Accumulated leave is that which remains at the end of the contract term. Under its prior policy, the District did not compel the exhaustion of accumulated leave until all accrued or current leave had been used. This was consistent with the statutory provision that leave accrued by public school employees in a current year may be used and accumulated at the discretion of the employees. S.C.Code Ann. § 59-1-400 (1976, as amended). By policy, District employees have the right to cash in up to ninety (90) days of leave accumulated under their respective annual contracts and assurances. Prior to the adoption of the implementation schedule challenged in this action, the District guaranteed that employees retiring from the District "will receive full pay for each day of annual and cumulative leave not taken." In addition, employees were entitled to annual bonus payments each year in which their leave balance exceeded 90 days. These bonus payments were without cost to the employees and involved no deduction from their accumulated leave balances.
In the challenged implementation schedule, the District for the first time imposed an exhaustion requirement as a condition for using accrued current sick leave. Unlike the prior policy, the District's implementation schedule for GBRI/GCRG conditions use of accrued, current leave upon exhaustion of accumulated leave. In requiring exhaustion of accumulated leave, without any finding that Plaintiffs "violated their respective contracts," the District invades benefits earned and vested...
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