Organizing v. City of Milwaukee & Milwaukee Employees' Ret. Sys.

Docket Number2019AP1319
Decision Date21 March 2023
Citation406 Wis.2d 279,2023 WI 20,986 N.W.2d 801
Parties MILWAUKEE POLICE SUPERVISORS ORGANIZATION, John Cwiklinski, Cheryl Ferrill, Kimberlee Foster, Dale Grudzina, April Hoffman, Joel Kujawa, Christopher Lehner, William McKeown, Jason Mucha, Brenda Nogalski, Tony Snow, Albert Carl Sunn, Jr., William Welter, Mark Zaremba and Joe Farina, Plaintiffs-Respondents, Milwaukee Professional Firefighters’ Association Local 215, Intervenor-Respondent-Petitioner, v. CITY OF MILWAUKEE and Milwaukee Employees’ Retirement System, Defendants-Appellants.
CourtWisconsin Supreme Court

For the intervenor-respondent-petitioner, there were briefs filed by Christopher J. MacGillis, Wauwatosa, Sean E. Lees, and MacGillis Wiemer, LLC. There was an oral argument by Christopher J. MacGillis and Sean E. Lees.

For the defendants-appellants, there was a brief filed by Patrick J. McClain, assistant city attorney. There was an oral argument by Patrick J. McClain.

REBECCA GRASSL BRADLEY, J., delivered the majority opinion for a unanimous Court.

REBECCA GRASSL BRADLEY, J.

¶1 The Milwaukee City Charter entitles firefighters injured on the job to duty disability retirement (DDR) benefits, which provide monthly wage replacement payments to firefighters unable to continue active service. As with all pension benefits provided to City of Milwaukee employees, the City of Milwaukee Employees’ Retirement System (MERS) administers DDR benefits. Under the Milwaukee City Charter, MERS must pay an eligible DDR beneficiary a percentage of the "current annual salary for such position which he held at the time of such injury." MCC § 36-05-C-1-a. "Current annual salary" is undefined in the Charter, and its meaning is the subject of this dispute.

¶2 Under the 20132016 collective bargaining agreement between Milwaukee Professional Firefighters’ Association Local 215 and the City of Milwaukee (CBA1 ), certain Milwaukee firefighters are entitled to a 5.8% "pension offset payment" conditioned on an employee-paid pension contribution equal to 7% of salary. Currently, all active Local 215 members make this contribution, but DDR beneficiaries do not. Prior to 2017, MERS included the pension offset payment in the "current annual salary" for purposes of calculating the amount of DDR benefits. In 2017, however, MERS excluded the pension offset payment from the calculation of DDR benefits.

¶3 The Milwaukee Police Supervisors Organization (MPSO) and Milwaukee Professional Firefighters’ Association Local

215 (Local 215) challenged MERS's shift in policy. The circuit court2 granted summary judgment in favor of MPSO and Local 215. The court of appeals reversed the circuit court's grant of summary judgment to Local 215 but affirmed with respect to MPSO, extinguishing MPSO's involvement in this appeal. Milwaukee Police Supervisors Org. v. City of Milwaukee, No. 2019AP1319, unpublished slip op., ¶24, 2021 WL 4533242 (Wis. Ct. App. Oct. 5, 2021) (per curiam).

¶4 Before this court, Local 215 argues the pension offset payment must be included in the calculation of DDR benefits for beneficiaries hired before October 3, 2011. We agree, and therefore reverse the court of appeals. Under the CBA, the current annual salary includes the 5.8% pension offset payment; therefore, the plain language of the Charter requires MERS to include the pension offset payment in the calculation of DDR benefits.

I. BACKGROUND

¶5 Chapter 36 of the Milwaukee City Charter, titled the Employes’ Retirement System Act (ERSA), establishes DDR benefits for any firefighter whose duty-related injuries cause disability. MCC § 36-05-3-c-1-a. 3

The Charter entitles a qualifying firefighter each year to "75% of the current annual salary for such position which he held at the time of such injury." Id. A firefighter who sustains a career-ending disability "that would impair the member's (retiree's) ability to earn a livelihood" shall receive "90% of his current annual salary" in DDR benefits each year. § 36-05-3-c-1-b.4 Although the Charter does not define the phrase "current annual salary," the parties agree the phrase garners meaning from the CBA.

¶6 The process by which Local 215 members contribute toward their pensions is established primarily in Articles 23 and 10 of the CBA. Article 23 requires each firefighter who is a MERS member to contribute 7% of his "earnable compensation." To compensate for this cost to the firefighter, Article 10 of the CBA establishes "pension offset payments" in the amount of 5.8% of the biweekly wage, thereby increasing employees’ taxable compensation. Article 10 entitles only those employees who make the member contribution to receive a pension offset payment.5 The parties agree DDR recipients cannot make the 7% contribution, but they disagree whether the 5.8% pension offset payment must be included as part of the "current annual salary" used to calculate DDR benefits under ERSA.

¶7 Article 10 of the CBA also contains two sets of salary grids detailing the biweekly wages of Local 215 members. One set of grids (Section 10(C)) lists the wages for employees hired before October 3, 2011. Another set of grids (Section 10(B)) lists the wages for those hired on or after October 3, 2011. Within each set, individual grids are labeled with the titles of the positions they cover—firefighter, fire captain, fire lieutenant, etc. Each grid includes a wage ladder, the numbered steps of which correspond with the number of years worked in a particular position. To illustrate, the grid below applies to firefighters and fire paramedics hired before October 3, 2011:

a. Firefighter
Fire Paramedic
Step 1. $1,683.57Step 2. 1,751.05Step 3. 1,940.59 Step 4. 2,130.65Step 5. 2,340.21Step 6. 2,571.33Step 7. 2,801.98

A first-year firefighter earned $1,683.57 biweekly. In his second year, his biweekly compensation increased to $1,751.05.

¶8 Prior to 2017, MERS used the pre-October 3, 2011 grids to calculate DDR benefits for recipients hired before that date. The pre-October 3, 2011 grids include the 5.8% pension offset payment without reduction for the requisite 7% pension contribution by the employee. The 7% contribution is typically withheld as a payroll deduction from an employee's base wages. The figures in the pre-October 3, 2011 grids are therefore higher than a Local 215 member's biweekly take home pay.

¶9 In 2017, MERS changed how it calculated DDR benefits. Prior to implementing that change, MERS asked the Milwaukee City Attorney's Office "whether the 5.8% ‘pension offset payment’ for represented public safety employees is includable in ‘current annual salary’ for purposes of MCC 36-05-3-c-1-a." In a memorandum, the Assistant City Attorney opined that "the 5.8% pension offset payment is not includable in ‘current annual salary’ as that phrase is used in Chapter 36 of the City Charter." MERS accordingly notified DDR beneficiaries it would no longer include the pension offset payment in the calculation of their DDR benefits. Thereafter, MERS used the post-October 3, 2011 grids to calculate DDR benefits in lieu of the pre-October 3, 2011 grids. Because the post-October 3, 2011 set excludes the 5.8% pension offset payment, the amount of DDR benefits decreased. MERS also clawed back excess benefits from each DDR benefit recipient on the pre-October 3, 2011 roll, directing some DDR beneficiaries to return pension payments of up to $6,000 per beneficiary.

¶10 In response, MPSO sought a declaratory judgment and injunctive relief against the City and MERS. Local 215 intervened, and the cases were consolidated. MPSO and Local 215 both moved for summary judgment, arguing the 5.8% pension offset payment must be included in the DDR benefits calculation. In turn, MERS and the City also moved for summary judgment, arguing the pension offset payment cannot be included. After a hearing, the circuit court granted summary judgment in favor of MPSO and Local 215, concluding the pension offset payment must be included in calculating DDR benefits because the CBA provides such payments are "base building and pensionable."

¶11 The court of appeals reversed, reasoning the CBA conditions receipt of the 5.8% pension offset payment on the 7% member contribution. Milwaukee Police Supervisors Org., No. 2019AP1319, at ¶19. Because DDR recipients do not make that contribution, the court concluded DDR recipients cannot receive the pension offset payment. Id., ¶20. According to the court of appeals, "current annual salary" equals whatever an employee would earn had he never made the 7% contribution or received the 5.8% pension offset payment. Id. Local 2156 filed a petition for review, which we granted.

II. STANDARD OF REVIEW

¶12 This case requires us to review a grant of summary judgment. "Summary judgment is appropriate when there is no genuine dispute of material fact and the moving party is entitled to judgment as a matter of law." Brey v. State Farm Mut. Auto. Ins. Co., 2022 WI 7, ¶8, 400 Wis. 2d 417, 970 N.W.2d 1 (quoting Kemper Indep. Ins. Co. v. Islami, 2021 WI 53, ¶13, 397 Wis. 2d 394, 959 N.W.2d 912 ); Wis. Stat. § 802.08(2) (2021–22) ("The judgment sought shall be rendered if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law."). Because the parties in this case have stipulated to the facts, we need only interpret ordinances and a contract to resolve this dispute. See Lewis v. Physicians Ins. Co. of Wis., 2001 WI 60, ¶9, 243 Wis.2d 648, 627 N.W.2d 484 ("This case is before us on a grant of summary judgment. Because the parties have stipulated to the facts, this appeal only raises a question of law") (citing L.L.N. v. Clauder, 209 Wis. 2d 674, 682, 563 N.W.2d 434 (1997) ).

¶13 To determine whether the circuit court properly granted summary judgment to Local 215, we must interpret the Mi...

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