Longley v. State Employees Retirement Com'n

• Decision Date: 02 October 2007
• Docket Number: No. 17617.,17617.
• Citation: 931 A.2d 890,284 Conn. 149
• Court: Connecticut Supreme Court
• Parties: Donald M. LONGLEY et al. v. STATE EMPLOYEES RETIREMENT COMMISSION.

931 A.2d 890

284 Conn. 149

Donald M. LONGLEY et al. v. STATE EMPLOYEES RETIREMENT COMMISSION.

No. 17617.

Supreme Court of Connecticut.

Argued November 20, 2006.

Decided October 2, 2007.

Daniel J. Klau, with whom was Richard F. Wareing and, on the brief, Joseph J. Chambers, Hartford, for the appellant (defendant).

Donald M. Longley, pro se, with whom was Richard K. Greenberg, pro se, the appellees (plaintiffs).

BORDEN, NORCOTT, PALMER, VERTEFEUILLE and SHELDON, Js.^*

PALMER, J.

Under the State Employees Retirement Act (act), General Statutes § 5-152 et seq., state employees who retire after ten or more years of state service are entitled to retirement income based on the length of their state service and their "base salary," which is defined as the average annual salary that a retiree receives in his three highest paid years of state service. This certified appeal requires us to decide whether, under General Statutes §§ 5-162¹ and 5-154,² the dollar value of a lump sum payment to a state retiree for accrued, unused vacation time³ and the dollar value of the retiree's final, prorated longevity payment⁴ must be added directly to the salary that the retiree earned in his final year of state employment for the purpose of calculating his "base salary." The defendant, the state employees retirement commission (commission), appeals from the judgment of the Appellate Court, claiming that that court incorrectly concluded that both the accrued vacation time payment and final longevity payment must be added to the annual salaries of the plaintiffs, Donald M. Longley and Richard K. Greenberg, in their final year of employment for the purpose of calculating their base salaries. We agree with the Appellate Court's treatment of the plaintiffs' final longevity payments but disagree with the Appellate Court's treatment of the plaintiffs' accrued vacation time payments. We therefore affirm in part and reverse in part the judgment of the Appellate Court.

The opinion of the Appellate Court sets forth the following undisputed facts and procedural history. "Pursuant to the 2003 Early Retirement Incentive Program; [see] Public Acts 2003, No. 03-02[§ 6]; the plaintiffs, [both of whom are] former assistant attorneys general . . . retired from active employment with the state on June 1, 2003.⁵ Each retired as a vested Tier I, Plan B member of the state employees retirement system. Accordingly, the act and related statutes govern the calculation of their retirement benefits.

"Pursuant to § 5-162, a retiree's income, for retirement purposes, is determined by his average covered earnings for his three highest paid years of state service. The plaintiffs' three highest paid years of state service were June 1, 2000, through May 31, 2001; June 1, 2001, through May 31, 2002; and June 1, 2002, through May 31, 2003.

"During each of these years, the plaintiffs received two longevity payments, and, subsequent to retirement, each plaintiff also received payment for his accrued but unused vacation time and a final, prorated longevity payment.⁶ When [the plaintiffs] retired, their accrued vacation time also was recognized for a second purpose, as state service, in addition to their actual state service of more than thirty years. See General Statutes § 5-154(m) (6).

"[Prior to their retirement date, the plaintiffs filed separate petitions for declaratory ruling in which they asked the commission to calculate their base salaries by adding the dollar value of their accrued vacation time and their final, prorated longevity payments directly to their regular salaries earned in their final year of employment.] They recognized that this salary calculation might be subject to reduction if it resulted in an annual salary of more than 130 percent of the average of their two previous years' covered earnings. See General Statutes § 5-162(b)(2). Apart from such a reduction, however, [the plaintiffs] maintained that their base salary should be calculated by including the vacation and longevity payments in their annual salary during [their] last year of state employment.

"The commission [unanimously] denied the plaintiffs' prayers for relief.⁷ It assigned dispositive meaning to the temporal constraints imposed by §§ 5-162 and 5-154. In particular, it noted that `base salary . . . is the average salary received for the three highest paid years of state service' and that subsection (n) of § 5-154 defines a year of state service as twelve consecutive months. According to the commission, a lump sum payment for accrued vacation time cannot be factored into the final year's salary directly, as the plaintiffs contend. To do so would impermissibly add time to the calculation of a retiree's three highest paid years of state service because, under § 5-154(m), state service is defined as including `accrued vacation time,' and, under § 5-154(n), a year of state service can include only twelve calendar months.⁸

"The commission took the position, therefore, that compliance with the applicable statutory mandates requires recalculation of a retiree's final three years of service. This recalculation involve[d] adding the [dollar value of the] number of months of service to which a retiree is entitled by virtue of his accrued vacation time to the final year of his state employment, at his then prevailing salary, and subtracting the [dollar value of the] same number of months of service at the beginning of the three year period of state employment, presumably at a lower salary.⁹ In the view of the commission, this methodology [gave] the plaintiffs the benefit of credit for their accrued vacation time . . . without impairing the underlying time constraints that it view[ed] as embedded in the structure of the retirement program."¹⁰ (Emphasis in original.) Longley v. State Employees Retirement Commission, 92 Conn.App. 712, 715-17, 887 A.2d 904 (2005).

In rejecting the claim that the plaintiffs' final, prorated longevity payments must be added to their salaries in their final year for the purpose of calculating their base salaries, the commission relied primarily on General Statutes § 5-213, which provides that a state employee is entitled to two lump sum longevity payments each year. The commission reasoned that adding the retiree's final, prorated longevity payment directly to the retiree's salary in his final year would be inconsistent with § 5-213 because that final prorated payment would represent a third longevity payment that the retiree would receive in a twelve month period. The commission further stated that the interpretation of the act that the plaintiffs advocated "would violate the express statutory mandate that the base salary consist of the three highest paid years of state service."

The plaintiffs appealed from the declaratory rulings of the commission to the trial court,¹¹ which concluded that the commission's formula for computing retirement income was compelled by the plain language of the act. The trial court further explained that, even if the statutory scheme could be characterized as ambiguous, there were several considerations that supported the interpretation advanced by the commission. First, the trial court noted that the commission's formula took into account all of the provisions of the complex statutory scheme, whereas the plaintiffs' interpretation "ignore[d] the full logical implications of § 5-154(m), which provides that state service includes a period equivalent to accrued vacation time." (Emphasis in original.) In other words, as the Appellate Court explained, "[t]he trial court agreed with the commission that, although accrued vacation time and longevity payments are salary, these payments cannot be added directly to the plaintiffs' annual salar[ies] [in] their final year of state service. In the [view of the trial court and the commission], to do so would add time to that year beyond the twelve month limitation imposed by § 5-154(n). This [view] is premised on the applicability of § 5-154(m)(6), which provides that state service [shall include] a period equivalent to accrued vacation time for which payment is made under [General Statutes § ]5-252. . . . The commission [argued, and the trial court agreed] that this additional period cannot simply be added at the end of a retiree's state service without running afoul of § 5-154(n), which defines year of state service to mean any period of twelve consecutive calendar months of state service, but no month shall be counted in more than one year. . . ." (Emphasis in original; internal quotation marks omitted.) Longley v. State Employees Retirement Commission, supra, 92 Conn.App. at 720, 887 A.2d 904. In essence, therefore, the trial court concluded that the plaintiffs' interpretation of the statutory scheme failed to account for the statutory requirement that retirement income be calculated on the basis of the retiree's three highest paid years, not the three highest paid years plus the additional period attributable to any accrued, unused vacation time.

Second, the trial court concluded that the commission's interpretation was entitled to "some consideration" because the commission has been designated by the legislature to compute retirement income, and it has been doing so in a manner consistent with its declaratory rulings in the present case for a significant period of time. Finally, the trial court concluded that the commission's interpretation avoided the "bizarre results" that flowed from the approach advanced by the plaintiffs, namely, that two similarly situated retirees, one of whom has used all of his vacation time prior to retiring and one of whom has accumulated the maximum amount of unused vacation time, would be entitled to grossly disparate annual retirement benefits.¹² The trial court observed that it was not likely that the legislature "intended to reward, to the tune of [$9000] a year in [each of] the [plaintiffs' cases], a practice of not taking vacation days. ...