Details
of RTAC vs. CPS legal battle
January 10, 2008 - December 1, 2012
(See
below about CPS appeals and the final settlement.)
RTAC
WINS (so far) FOR THOSE RETIRED 1999 THROUGH 2004 WITH PETITION TO
INTERVENE IN
CPS LAWSUIT AGAINST
PENSIONERS
by James F. Ward
Traditionally the
salary deductions for pensions were deducted on the basis of a ten
month school year with ten day pay periods as the unit of credit.
In 1999 the CPS designed school calendars that did not quite fit the
system provided in the pension law for pension deductions. This
resulted in the unusual effect of having the pension salary be higher
that the contractual salary. The CPS and the Pension Board accounted
for the deductions as they always had with the pensions being slightly
higher that they would have been with straight forward ten month
calendars. In these years the teachers and the CPS paid for the
higher calculation.
Sometime in 2003 the
CPS saw that their strangely shaped school calendars were not dividing
the annual pay in equal parts and the yearly salaries were slightly
higher than the contracted salary. They said, “We will no longer
pay on the higher calculation. Use the lower amount.” The Pension
Board said, “What is done is done. We shall use the lower
calculation prospectively, but we cannot change the benefits already
granted to retirees from 1999 to 2004.”
The CPS sued in
Circuit Court. On June 15, 2007 the judge ruled the CPS is right
because the pension salary should not be higher than the contractual
salary. But the judge did not, as of July 31, 2007, rule on what
remedy should be imposed on the CPS, the Pension Board, or the 3500
pensioners. On July 31, 2007 attorneys for RTAC filed a petition
asking to be allowed to intervene in the case. The judge’s
decision was to grant the RTAC
the right to be a party to the suit and represent the 3500 affected
retirees. RTAC
instructed its attorneys to argue that the judge should hold the
pensioners harmless and make no changes to their benefits because they
come with clean hands. They did nothing wrong but relied on the
experts at the CPS and Pension Office to make irrevocable retirement
decisions. After months of nail biting and some $40,000 or more
in legal fees, your RTAC
board is proud to note that we won the case in late December.
What a Christmas present!
In short, Judge Nancy
J. Arnold dismissed the CPS
lawsuit and even vacated her original decision that the original
calculations were wrong. She said the CPS had a limited
time to file for corrections and the statutory time limit had
expired. Many
of the 3500 affected pensioners may never know what
RTAC did for them in
not HAVING THEIR PENSIONS REDUCED by 3-4% and paying back MANY
THOUSANDS of
dollars in what the CPS claimed was “overpayments.”
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~`
(Added by Webmaster)
CPS Appeals
(January 2011)
CPS has appealed Judge Arnold's
decision and the Appellate court set aside the decision and sent it
back to Judge Arnold. RTAC is fighting for the original decision
but our feeling is that CPS is just trying to wear us down and run us
out of money. The last hearing on the case was at the end of May
2011
where CPS asked for another continuance.
Another
Hearing (July 2011)
One of the latest developments is that Judge Arnold feels the Board of
Education needs to come up with the names and the amount they "owe"
since they were overpaid pension amounts during the years of about 1999
- 2004. The Board of Education is stating they were overpaid
while the Pension Fund feels the retirees in question earned the amount
they each received under the pension rules in effect then.
Since RTAC represents about 50% of all retirees, the judge wonders how
the rest of the "class" could be represented, thus having the names of
these retirees would be important. She feels they should have
their "day in court" just like everyone else. In short, this is
far from over and there are mixed signals from all the sides
represented in court at this time. Stay tuned!
Finally a Settlement (November 2012)
After much give and take, there was finally a settlement where the
pensioners were not required to refund the full amount of the 'error'
but to just have their pensions 'adjusted' back to what CPS claims they
should have been in the first place and to have their COLA adjusted
accordingly. See the PowerPoint that CTPF Executive Director
Kevin Huber presented at a Member Information Workshop on the Pension
Overpayment Settlement HERE.
In his verbal presentation, Mr. Huber indicated that the intervention
by RTAC played a
major part in reaching the settlement.
When you are looking
for someplace to send donations, please keep RTAC in mind. We need
the money for the next emergency affecting Chicago teacher
pensioners.
Back to the RTAC home page
Back to the CTPF information page