Read the January 2013 issue of Court Report, which includes such topics as the Fair Dismissal Act/reduction in force, immunity and real property. This newsletter is an ACSBA member benefit.

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January 2013 Issue of Court Report

• Fair Dismissal Act – Reduction in Force
  

 

Huntsville City Board of Education v. McLemore, -- So.3d --, 2012 WL 6554430 (Ala.Civ.App. Dec. 14, 2012)

In this case, tried before the Students First Act went into effect, the board terminated a classified employee after declaring a reduction in force. The employee claimed that the board’s RIF policy permitted him to return to a previously held lower position if one was vacant. The employee was interviewed for two such positions, but was not selected. The hearing officer found that the board had cause for the termination, but ultimately reversed the termination holding that the employee had a “right to retreat” to his previously held lower position. The board appealed to the Court of Civil Appeals arguing that the hearing officer had no jurisdiction to consider the employee’s right to retreat. Moreover, the board argued that no true vacancy existed because the subject positions were to be filled by transferring current employees. Vacancy notices were only posted in order to comply with the posting statute.

The Court held that the hearing officer properly examined whether the RIF policy was followed. It also noted that the “arbitrary and capricious” standard of review is “extremely deferential” to the hearing officer’s decision. Because the record sufficiently established that a vacancy existed as evidenced by the fact that the employee was interviewed, the hearing officer’s decision would not be reversed.

• Fair Dismissal Act – Reduction in Force

Huntsville City Board of Education v. Frasier, -- So.3d --, 2012 WL 5974553 (Ala.Civ.App. Nov. 30, 2012)

This case also involved the board’s decision to terminate several employees after declaring a reduction in force due to financial difficulties. It also occurred before the Students First Act went into effect. The hearing officer reversed the terminations asserting that the board had failed to demonstrate how the terminations would improve the board’s financial condition. The hearing officer also held that the board provided insufficient notice of the reasons for the reduction in force because it did not include every reason the RIF was necessary. The board appealed to the Court of Civil Appeals arguing that the hearing officer applied the wrong burden, improperly required the board to establish financial savings and improperly found the notice insufficient.

The Court agreed with the board that the hearing officer improperly required the board to demonstrate that the terminations would improve the board’s financial condition. Rather, the issue that the hearing officer was required to determine was whether the board had demonstrated a justifiable decrease in positions--not whether a particular employee’s termination was justifiable. In doing so, the hearing officer usurped the role of the board and exceeded his discretion. The Court reversed the hearing officer’s decision and remanded the case to the hearing officer to determine only whether there was a justifiable decrease in positions.

The Court also addressed the hearing officer’s finding that the board’s notice was insufficient because it failed to include overstaffing as a reason for its financial difficulties. The Court noted that the Fair Dismissal Act required only a short, plain statement of facts supporting the board’s financial difficulty; not a recitation of every reason underlying that financial difficulty. Therefore, the Court held that the board’s notice was sufficient.

• Fair Dismissal Act – Reduction in Force

Huntsville City Board of Education v. Stranahan, -- So.3d --, 2012 WL 5374134 (Ala.Civ.App. Nov. 2, 2012)

This case also involved the board’s decision to terminate employees following a reduction in force before the Students First Act went into effect. The superintendent notified the employees that the reason for the recommendation was due to financial circumstances which were requiring it to reduce the number of employees. The hearing officer reversed the board’s decision finding that the termination recommendation failed to provide sufficient notice. Specifically, the hearing officer found the notice was vague and failed to provide enough information to allow an employee to mount a defense. The board argued that the Fair Dismissal Act only required it provide a short, plain statement of the facts supporting its decision; not a detailed recitation of its funding shortfalls.

The Court agreed with the board and held that once the board established that financial circumstances warrant the implementation of the reduction in force, the hearing officer had no authority to consider whether individual employees should be terminated. Again, to do so would usurp the authority of the school board. Because the hearing officer could not consider the termination of a particular employee pursuant to a reduction in force, the board had no requirement to provide justification for individual employees in its notice. Accordingly, the hearing officer’s decision was reversed and remanded for further proceedings.

• Immunity – Breach of Contract

Ex parte Phenix City Board of Education, -- So.3d --, 2012 WL 5077227 (Ala. Oct. 19, 2012)

In this case, a construction contractor was hired by the board to build a school facility. After a dispute arose during construction, the contractor sued the board for breach of contract. The board moved to dismiss the case on the grounds of absolute immunity. The trial court refused to dismiss the case and the board petitioned the Supreme Court to review that order. The contractor conceded that the board was immune from suit, but argued that the immunity did not apply because the board had voluntarily executed the contract. The Supreme Court disagreed with the contractor and held that the board was absolutely immune from suit as an agency of the state.

• Immunity – Salary Schedules

Massey v. Womack, -- So.3d --, 2012 WL 3871467 (Ala.Civ.App. Sept. 7, 2012)

In this case, a nurse working for the Head Start program sued the board members in their official capacities because she was not paid according to the salary schedule required for nurses in K-12 schools. The defendants argued that the nurse was not entitled to be paid according to the minimum salary schedules for school nurses because she was not a K-12 nurse. The defendants also argued that they were entitled to absolute immunity for the nurse’s claims. The trial court entered summary judgment in favor of the defendants and the nurse appealed.

The nurse asserted that the board members were not entitled to absolute immunity because her suit sought to compel them to perform a ministerial act. The Court agreed that the board members could be compelled to perform duties required of them by law, but disagreed that the nurse was one employed in a K-12 public school as required by the minimum salary schedule statute. Therefore, the nurse was not entitled to be paid by that salary schedule and the Court upheld the trial court’s decision.

• Real Property

A.G. No. 2013-008 (Oct. 29, 2012)

The superintendent sought guidance as to whether the board could donate a closed school and the surrounding property to a private association, and if not, whether it could sell the property for a nominal amount. The school at issue had fallen into such disrepair that it was appraised as having no value. The association sought to use the property for the betterment of the community in a variety of ways. Ala. Code §16-8-40 gives school boards the authority to convey title to real property as long as the proceeds of the sale are applied to school purposes. While the school may have been assessed as having no value, the Attorney General opined that the surrounding property should contain some value which would need to be appraised. Because boards must receive adequate consideration for its property, the property could not be donated or sold for a nominal amount.

 

— Jayne Harrell Williams

Jayne is a shareholder with the law firm of Hill, Hill, Carter, Franco, Cole & Black

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