Opinion
SC: 163567 COA: 353832
06-02-2023
Patricia BATISTA, David Britten, Timothy Donahue, Aaron Gaffney, John Hewitt, Ronald Koehler, Amy Swantek, Chris Thomson, and Michigan Association of Superintendents and Administrators, Plaintiffs-Appellees, v. OFFICE OF RETIREMENT SERVICES, Michigan Public School Employees Retirement System, Michigan Public Employees Retirement System Board, Public School Employees Retirement System Board Members, and Executive Director of Retirement Services, Defendants-Appellants.
Order
On April 5, 2023, the Court heard oral argument on the application for leave to appeal the August 12, 2021 judgment of the Court of Appeals. On order of the Court, the application is again considered. MCR 7.305(H)(1). In lieu of granting leave to appeal, we AFFIRM in part, VACATE in part, and REVERSE in part the judgment of the Court of Appeals, and we REMAND this case to that court for further consideration.
We AFFIRM the Court of Appeals’ holding that the Office of Retirement Services (ORS) lacks the authority to create and implement its own normal salary increase schedules. As aptly explained by the Court of Appeals, nothing in the Michigan Public School Employees Retirement Act (the Retirement Act), MCL 38.1301 et seq. , explicitly or implicitly grants ORS this authority. However, we do not address whether the phrase "normal salary schedule" in MCL 38.1303a(3)(f) refers only to a provision contained in a collective-bargaining agreement. To the extent the Court of Appeals’ holding that ORS lacks the authority to create and implement its own normal salary increase schedules was based on such a conclusion, we VACATE that part of its opinion. The Court of Appeals should consider this issue on remand if necessary to resolve this appeal.
We REVERSE the Court of Appeals’ holding that MCL 38.1303a(3)(f) does not govern public school employees who work pursuant to personal employment contracts rather than collective bargaining agreements. The Retirement Act provides that a "member" in certain circumstances is entitled to a retirement allowance, MCL 38.1381, and defines "member" to include most public school employees, MCL 38.1305(1). The Retirement Act does not exclude public school employees who work pursuant to personal employment contracts from being members. Id. Moreover, MCL 38.1303a(1) explains that "[e]xcept as otherwise provided in this act, ‘compensation’ means the remuneration earned by a member for service performed as a public school employee." (Emphasis added.) Subsections (2) and (3) then provide a list of items that do and do not constitute "compensation" for the purpose of determining a member's retirement allowance. As recognized by the Court of Appeals, there is no indication that MCL 38.1303a does not generally apply to all members. However, the Court of Appeals erred by holding that MCL 38.1303a(3)(f) uniquely applies only to the subset of members who work pursuant to collective bargaining agreements. Nothing in MCL 38.1303a(3)(f) makes such a distinction.
We REMAND this case to the Court of Appeals to address how MCL 38.1303a(3)(f) applies to public school employees who do not work pursuant to collective bargaining agreements and to further address how this holding affects plaintiffs’ claims in this case. In its discretion, the Court of Appeals may also address plaintiffs’ other preserved claims and any other issue that is necessary to resolve this appeal.
We do not retain jurisdiction.