ALJDEC decisions subject to certification as final
22F-001-ADM · Department of Administration · 2023-07-05
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
REGINALD GIVENS,
Appellant,
v.
ARIZONA DEPARTMENT OF ADMINISTRATION,
Respondent.
No. 22F-001-ADM
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: June 19, 2023 at 9:00 AM.
APPEARANCES: Monique Wilhoit, Esq. appeared on behalf of Reginald Givens (“Appellant”) with Appellant and Emily Parish as witnesses. Assistant Attorneys General Pamela Sullivan, Esq. and Lena Kalkbrenner, Esq. appeared on behalf of the Arizona Department of Administration (“Department” and “Respondent”) with Tracey Smith as a witness. Kimberly Suciu and Dawn Robinson-Givens observed.
ADMINISTRATIVE LAW JUDGE: Jenna Clark.
_____________________________________________________________________
After review of the hearing record in this matter, the undersigned Administrative Law Judge makes the following Findings of Fact and Conclusions of Law, and issues this Recommended Order to the Director of the Department.
FINDINGS OF FACT
Background and Procedure
The Department operates as the administrative and business hub for the State of Arizona. The Department provides several benefits to state employees, including the Retiree Accumulated Sick Leave (“RASL”) Program.
Under the RASL Program, eligible state employees receive a portion of unused sick leave upon retirement. To be eligible for the program, the individual must meet the following requirements per Arizona Revised Statutes (“Ariz. Rev. Stat.”) § 38-615:
Have an accumulated sick leave balance of 500 or more hours at the date of termination from employment,
The accumulated sick leave hours must be available for use at the time of termination,
Must establish a retirement date from an Authorized Retirement System that is effective within 31 calendar days after the date of termination from state employment, and
Complete and return the RASL Program Application and Certification Form (i.e. GAO-SL-50) and appropriate Checklist to the Department’s General Accounting Office (“GAO”) within 180 calendar days following the effective retirement date.
RASL payments are issued to payees in 3 equal annual installments or via lump sum.
State employees are able to learn about the RASL Program by reviewing section II-R of the Arizona Accounting Manual and the Employee Handbook, participating in a State-sponsored retiree seminars, or by contacting the GAO directly for more information.
The Introduction of the Accounting Manual notes that the RASL Program was established by Ariz. Rev. Stat. § 38-615 and administered by the GAO’s Central Payroll Unit in compliance with Ariz. Rev. Stat. § 38-616.
Section 11 State Agency Responsibilities, subsection 6.7 of the Accounting Manual, notes that to allow employee participation each agency is responsible for disseminating the information regarding the policies and procedures governing the RASL Program to their employees.
Between 2012 and 2021 the RASL Program received 7,969 applications; 7,861 of which were approved for disbursement.
On May 04, 2021, Appellant was separated from his position as Deputy Director for the Arizona Department of Housing (“Housing”), a position he held for 2 out of 10 years of State service.
At the time of separation, Appellant received an Employee Separation Information Sheet from Housing which provided the following, in pertinent part:
SICK LEAVE
An employee terminating from ADOA is not paid for unused sick accruals.
An employee retiring with accrues sick leave between 500 and 1500 hours may be eligible to receive a payment based on a percentage of their current salary. The RASL application must be submitted within 180 days of retirement. Unused balances of less than 500 hours or more than 1500 will be forfeited.
ADOA – General Accounting Office
(602) 542-5601
www.gao.az.gov/payroll/rasl
At no time prior to the submission of his RASL Application did Appellant call the GAO, or access additional information from the aforementioned State link.
On July 27, 2021, Appellant, EIN No. 128045, submitted his RASL Program Application and Certification Form (“RASL Application”) to the GOA with a retirement date of July 27, 2021, and a check next to the “ASRS” Retirement System. On August 03, 2021, Appellant’s RASL Application was timely received, with a Checklist signed by Appellant and Housing designee, by the GOA.
On October 21, 2021, the GAO issued a Letter of Ineligibility to Appellant which held, in pertinent parts, as follows:
Your separation date from the Arizona Department of Housing was 05/04/2021. The last date that you could have returned from the Arizona State Retirement System (ASRS) and still met the 31-day requirement was 06/04/2021. On 09/03/2021, the ASRS confirmed that you retired on 07/27/2021, 84 days after your separation date. Therefore, unfortunately, you do not qualify for the RASL benefit.
On October 28, 2021, Appellant submitted a Request for Reconsideration to the GAO.
On December 10, 2021, the GAO issued a Final Determination Letter to Appellant which upheld its initial RASL Program ineligibility determination. It was further noted that the 31-day deadline was further supported by the State of Arizona Accounting Manual, 5575-2.4, which requires state employees to retire from an authorized State retirement system within 31 calendar days following separation of employment from State service.
On December 17, 2021, Appellant timely submitted an Informal Settlement Conference and State Fair Hearing request.
On January 14, 2022, and February 04, 2022, Informal Settlement Conferences were held between the parties.
On February 25, 2022, the GAO issued a Ineligibility Affirmation Letter to Appellant which held, in pertinent parts, as follows:
The additional information you provided is not sufficient to change the prior final determination ... Your “authorized retirement system or plan of this state” is the Arizona State Retirement System (ASRS) ... You do not qualify for the RASL benefit.
On March 04, 2022, Appellant submitted a second request for State Fair Hearing.
On April 27, 2022, the Department referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on June 22, 2022. Per the May 10, 2022, Notice of Hearing the issue(s) to be determined are whether ground exists for the Department to deny Appellant’s RASL Application pursuant to Ariz. Rev. Stat. § 38-615 et. seq.
Stipulated Evidence
Appellant’s last day of work for the State was May 05, 2021.
At the time of his separation, Appellant’s sick leave balance was 984.10 hours.
Appellant’s RALS Application was timely received by GOA.
Hearing Evidence
Appellant testified on his own behalf, called and Emily Parish as a witness, and submitted Exhibits A-F into the record. The Department called Tracey Smith as a witness and submitted Exhibits 1-115 into the record. The Notice of Hearing and Minute Entry – Granting Continuances issued June 06, 2022, August 29, 2022, October 27, 2022, and March 02, 2022, were also admitted into the record. The substantive evidence of record is as follows:
On July 28, 2021, after his RASL Application was submitted, a Human Resources Administrator from Housing advised Appellant of the 31-day RASL eligibility requirement. Appellant was advised to contact ASRS and inform them of the circumstances regarding his involuntary dismissal, and that Appellant was unaware of his retirement eligibility, to see if the effective date of Appellant’s retirement could be changed.
On July 28, 2021, Appellant contacted the GAO to advise that he was unaware of the RASL Program’s 31-day requirement, and asked for an “allowance” regarding his eligibility.
On August 02, 2021, the GAO contacted Appellant to advise
The Retiree Certifications portion of GAO-SL-50 requires an applicant to initial in 8 separate and distinct sections. Appellant only initialed 6 sections and failed to provide his initials for the following 2 sections:
I understand that I must retire from an authorized State of Arizona retirement system with an effective retirement date not later than 31 CALENDAR DAYS following my separation of employment from State service. If I retire any later, I will not be eligible for RASL.
(Emphasis in original.)
On or about September 03, 2021, Appellant’s social security number was corrected by the GAO.
Additional Evidence
On July 28, 2021, Appellant submitted a Benefit Options Retiree/LTD Enrollment form to the Department’s Benefit Services Division (“BSD”). In his request for dental, vision, and medical with Medicare, and prescription drug coverage, Appellant offered that his last day of work for Housing was May 04, 2021, and that he had retired from ASRS May 15, 2021. Appellant’s request was approved on appeal.
Approximately 2 weeks later Appellant contacted BSD to remove his spouse from his health plan coverage, which was approved on appeal.
On August 17, 2022, BSD issued correspondence to Appellant, after an audit of his insurance benefits which note, in pertinent parts, as follows:
On May 14, 2021, a COBRA enrollment packet was mailed to you as an option for you to enroll for a continuation of insurance benefits. On August 2, 2021, per your request, you were emailed a Retiree Enrollment Form which ADOA-Benefits received back that same day. On the Retiree Enrollment Form you indicated that your retirement date was May 15, 2021. There was no initial verification of retirement made directly with [ASRS]. The ADOA-Benefits staff enrolled you in health insurance, without a gap in coverage, based on the ‘retirement’ date you provided. On December 17, 2021, you provided ADOA-Benefits with a copy of your ASRS retirement approval letter stating your retirement date was July 27, 2021.
The ASRS establishes your retirement date while ADOA-Benefits determined only your health insurance eligibility, coverage, and enrollment dates. The May 15, 2021, date you initially provided on your Retiree Enrollment Form is inaccurate and conflicts with your retirement date of July 27, 2021. Upon review, you were not eligible to enroll in retiree health insurance coverage beginning May 15, 2021, which is the day after your active employee coverage ended on May 14, 2021, through your actual retirement date of July 27, 2021.
The Retiree Enrollment Form explains that ADOA-Benefits has the right to retroactively terminate benefits due to ineligibility. Upon review, ADOA-Benefits determined that you were only eligible to have been enrolled in COBRA from May 15, 2021, through July 31, 2021. The earliest date that retiree insurance coverage could begin was August 1, 2021, the date ASRS confirmed you retired. Therefore, ADOA-Benefits will update your enrollment as referenced in the attachment. Additionally, the COBRA premium for that time period is $1,950.13 and you paid $2,833.28 in retiree insurance premiums. A refund of the overpayment in premiums will be mailed directly to you within two weeks of the date of this letter.
On August 18, 2021, Appellant submitted a Retiree Enrollment Appeal Request Form to BSD. In Section C: Appeal Reason of the form, Appellant indicated that the submission was due to an error with enrollment. In an attached letter, Appellant provided the following:
Due to insufficient and or misinformation provided at the time of my separation my initial retirement documents were not properly filed. Based on this the filing was approved and dated back to May 15, 2021. The standard filing process allows for changes within 30 days of filing the retirement form. This request is consistent with that process and therefore I am requesting it be approved.
Closing Arguments
In closing, the Department argued that Appellant’s RASL Application had been denied because he failed to retire from an authorized State retirement system within 31 calendar days following his separation of employment from Housing, which was required by statute. The Department also argued that Appellant’s post-separation health insurance eligibility date was not synonymous with a retirement date from an authorized State retirement system. To that end, the Department argued that ASRS was the “authorized retirement system” Appellant retired from, effective July 27, 2021. The Department denied that it had any statutory authority or discretion to amend, correct, or otherwise modify Appellant’s retirement date.
Per the Department, as the second in command for Human Resources at Housing, Appellant knew or should have known how to reasonably discover the RASL Program’s eligibility requirements.
The Department opined that it was neither a requirement nor the responsibility of the State to ensure that employees are made aware of all available employment benefits, only that information regarding said benefits be made available and accessible to them. The Department surmised that the onus was on Appellant to timely meet all required deadlines, and that Appellant’s failure to avail himself of the State’s available resources regarding the RASL Program was a failure that lead to consequences the GOA could not arbitrarily overlook.
In closing, Appellant argued that he reasonably relied on the Employee Separation Information Sheet he received from Housing the day his separation was thrust upon him unexpectedly. Appellant argued that had the document specifically advised him to retire from ASRS within 31 calendar days of his separation, he would have done so. Appellant argued that he did not know about the 31-day requirement, and opined that he acted swiftly and in good faith once it was brought to his attention.
Appellant opined that the Department could have made an exception, corrected, or otherwise backdated his retirement date as was the case for his health benefits and social security number.
Per Appellant, the Department’s denial of his RASL Application should be overturned because it was arbitrary and capricious, contrary to law, and an abuse of agency discretion.
CONCLUSIONS OF LAW
The Department has jurisdiction over this matter pursuant to STATUTE et. seq. The matter was properly brought before OAH pursuant to Ariz. Rev. Stat. §§ 41-1092 et seq.
Appellant bears the burden of proof to show that the Department erred when it denied his RASL Application. The standard of proof on all issues in this matter is that of a preponderance of the evidence.
“A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” A preponderance of the evidence is “[t]he greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”
An agency’s authority is limited to that which is found in its enabling legislation.
The primary goal when construing statutes is to fulfill the intent of the legislature.
Statutes shall be liberally construed to affect their objects and to promote justice. In interpreting a statute, “[w]e first consider the language of the statute and, if it is unclear, turn to other factors, including ‘the statute’s context, subject matter, historical background, effects, consequences, spirit, and purpose.”
Statutes should be interpreted to provide a fair and sensible result. “In applying a statute its words are to be given their ordinary meaning unless the legislature has offered its own definition of the words or it appears from the context that a special meaning was intended.”
The tribunal may not expand or extend a statute to include that which is not within its provisions. The Tribunal is required to apply equitable principles when rendering decisions. The application of equity entails offering a remedy to avoid an unconscionable or unjust result.
Ariz. Rev. Stat. § 12-821.01(A) provided that “[p]ersons who have claims against a public entity, public school or a public employee shall file claims with the person or persons authorized to accept service for the public entity, public school or public employee as set forth in the Arizona rules of civil procedure within one hundred eighty days after the cause of action accrues.”
Ariz. Rev. Stat. § 38-615(A)(2) that an officer or employee of this state ... who has at least seven hundred fifty but less than one thousand hours of sick leave, is eligible on retirement to receive payments equal to thirty-three per cent of the officer's or employee's salary at the officer's or employee's current hourly rate for each hour of accumulated sick leave.
Ariz. Rev. Stat. § 38-615(B)(1) provides that in order to be eligible to receive payments pursuant to subsection A of this section an officer or employee must establish a retirement date not later than thirty-one days after termination of employment by qualifying with an authorized retirement system or plan of this state.
Ariz. Rev. Stat. § 38-615(G) provides that this section applies to an officer or employee of this state who is eligible to participate in the Arizona State Retirement System, the Public Safety Personnel Retirement System, the Corrections Officer Retirement Plan, or in an Optional Retirement Program established by the Arizona Board of Regents.
Ariz. Rev. Stat. § 38-615(I) provides that this section applies only to officers or employees of this state whose compensation regulations provide for a forfeiture of sick leave on retirement.
Ariz. Rev. Stat. § 38-616(B) provides the Department of Administration shall pay the accumulated sick leave payment for each eligible state officer or employee pursuant to section 38-615.
Ariz. Rev. Stat. § 38-764(A) provides that “retirement” is deemed to commence on a date elected by the member, but that date shall not be earlier than the day following the date of termination of employment or the date ASRS receives the member's completed retirement application.
The material facts in the case at bar are clear.
Here, Appellant has not shown that the Department erred in denying his RASL Application.
It is a well-established legal principle that ignorance of the law is not an acceptable excuse or justification. Applicable statutes and regulations apply whether they are known or understood to those within their jurisdiction.
Although Appellant meets the requirements of having at least 500 hours of accumulated sick leave, and of having filed his RASL Application within 180 days of his retirement date, Appellant does not meet the requirement of having a retirement date within 31 days of separating from State service. Because Appellant’s date of separation from State service was May 04, 2021. Thusly, the last date that Appellant could have retired and met the 31 day requirement was June 04, 2021. The Department confirmed with ASRS that Appellant’s retirement date was July 27, 2021. This date was established between Appellant and ASRS, not the Department or GAO, and was 84 days after Appellant’s separation date. Notably, Appellant’s health plan date arguments are Red Herring fallacies as they improperly omit the “retirement” inference affixed to system and plan and attempt to correlate unrelated State benefits. Moreover, Appellant’s sole reliance on the Employee Separation Information Sheet he received at separation is not a reasonable justification or excuse for his inaction and/or untimeliness in light of the evidentiary record.
Appellant has not provided any legal authority establishing that the 31-day deadline to establish a retirement date from an Authorized Retirement System does not or should not apply to his RASL Application. Appellant further failed to establish that the Department and/or GAO violated, or failed to comply with any applicable statutes or rules. As such, Appellant has failed to establish that the Department erred in denying his RASL Application.
Consequently, Appellant’s appeal must be denied as he is ineligible for the RASL Program.
RECOMMENDED ORDER
Based on the foregoing,
it is ordered that Appellant’s December 17, 2021, RASL appeal be dismissed.
In the event of certification of the Administrative Law Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be the date of that certification.
Done this day, July 05, 2023.
Office of Administrative Hearings
/s/ Hon. Jenna Clark
Administrative Law Judge
Transmitted electronically to:
Andy Tobin, Director
c/o Kimberly Suciu, Associate General Counsel
Department of Administration
100 N. 15th Ave., Ste. 400
Phoenix, AZ 85007
[email redacted]
Lena Kalkbrenner, Esq., Assistant Attorney General
Pamela Peiser, Esq., Assistant Attorney General
Office of the Attorney General
2005 N. Central Ave.
Phoenix, AZ 85004
[email redacted]
Reginald Givens, Appellant
c/o Monique Wilhite, Esq.
Branscomb Wilhite Law, Counsel for Appellant
5045 W. Baseline Rd., Ste. 105-207
Laveen, AZ 85339
[email redacted]
By: OAH Staff