Employees at State Compensation Insurance Fund (SCIF) should be $23 million richer pretty quickly. That’s how much a San Francisco judge says they are owed for being illegally forced to take 16 furlough days this year. Gov. Arnold Schwarzenegger ordered the furlough, and State Fund management, led by soon-to-depart president Janet Frank, fought it tooth and nail. Service Employees International Union (SEIU) was also involved in the litigation as were State Fund’s unionized lawyers.
The Governor’s Office filed a notice of appeal in the case, but Judge Charlotte Woolard’s final ruling in the lawsuit ordered the furloughs to cease and employees to be made whole. That’s now in the works.
“Our payroll staff had to recalibrate the September payroll, but we’ve begun repaying back wages according to our payment schedule,” says a spokesman for Controller John Chiang. The Controller’s Office held off processing the back-pay request until Woolard put pen to paper on the final order in the lawsuit. That didn’t occur until September 24, which caused some last-minute scrambling. “It will take us a couple weeks to bring everybody up to date, but it should be no later than the second week of October,” says Chiang’s spokesman.
Overall, the total payout is expected to reach $23.3 million. An earlier ruling by Judge Peter Busch in a lawsuit filed by State Fund’s in-house attorneys resulted in a payout of $1.59 million for the 10 days that the lawyers were forced to forgo.
Even with back-pay checks on their way, there are still a few unresolved issues. Woolard’s order also granted SEIU’s request for interest on the overdue back pay, and that’s still to be calculated and processed. Woolard’s order granted 7% interest on overdue wages.
And there is still a pending dispute over how back pay will be accounted for — either as a straight payment to the workers or perhaps deducted from their accrued vacation time since the workers didn’t work for the days involved.
“The issue of time has not yet been resolved. The people who need to work this out are State Fund, the Department of Personnel Administration and the employee organizations. We still need to sit down and discuss how to handle it,” State Fund spokeswoman Jennifer Vargen tells Workers’ Comp Executive. “DPA has been very concerned with the gifting of time. Although we’re a unique organization, a lot of our employees are members of SEIU and other unions that are [also active] in other state agencies, so it’s not just a matter of what State Fund alone wants.”
In the meantime, workers are back on their regular schedules and are expected to remain there for the foreseeable future.