STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
PAUL F. MELOY, and the ALVA FIRE ) PROTECTION AND RESCUE SERVICE ) DISTRICT, )
)
Petitioners, )
)
vs. ) Case No. 01-2821
)
DEPARTMENT OF MANAGEMENT )
SERVICES, DIVISION OF )
RETIREMENT, )
)
Respondent. )
__________________________________)
RECOMMENDED ORDER
Administrative Law Judge (ALJ) Daniel Manry conducted the administrative hearing of this case on September 20, 2001, in Ft. Myers, Florida, on behalf of the Division of Administrative Hearings (DOAH).
APPEARANCES
For Petitioners: J. Frank Porter, Esquire
Porter & Jessell, P.A.
P.O. Box 2199 1424 Dean Street
Ft. Myers, Florida 3902-2199
For Respondent: Thomas E. Wright, Esquire
Division of Retirement
P.O. Box 3900
Tallahassee, Florida 32315-3900 STATEMENT OF THE ISSUES
The issues for determination are whether Petitioner,
Paul F. Meloy (Meloy), is an employee of Petitioner, Alva Fire
Protection and Rescue District (District), and is entitled to participate in the Florida Retirement System (FRS) pursuant to Section 121.051, Florida Statutes (2001). (All references to statutes are to Florida Statutes (2001) unless otherwise stated.)
PRELIMINARY STATEMENT
By letter dated November 1, 2000, Respondent issued a letter advising Meloy and the District that Meloy is excluded from participation in the FRS. Petitioners timely requested an administrative hearing. On June 14, 2001, Respondent referred the matter to DOAH to conduct the administrative hearing.
At the hearing, Petitioners presented the testimony of three witnesses and submitted four exhibits for admission into evidence. Respondent presented the testimony of one witness and submitted 10 exhibits for admission into evidence.
The identity of the witnesses and exhibits, and the rulings regarding each, are set forth in the Transcript of the hearing filed on November 7, 2001. Petitioners and Respondent timely filed their respective proposed recommended orders (PROs) on November 15 and 19, 2001.
FINDINGS OF FACT
Section 121.051 requires participation in the FRS by all employees hired after December 1, 1970. The District
hired Meloy after 1970. Meloy has worked for the District as the fire chief and administrator since the District's inception in 1976. Meloy was instrumental in establishing the District.
The other requirement imposed by Section 121.051 for participation in the FRS is that Meloy must be an employee. Section 121.021(11), in relevant part, defines an employee as any person receiving salary payments for work performed in a regularly established position.
Respondent denies that the payments Meloy receives from the District are salary payments. Respondent asserts that the payments are reimbursement for expenses.
Respondent denies that the payments to Meloy are compensation. Section 121.021(22) defines the term "compensation" to mean:
. . . the monthly salary paid a member by his or her employer for work performed arising from that employment.
The payments from the District to Meloy since October 1990 have been compensation. In October 1990, the District began paying Meloy a monthly salary "for work performed arising from his employment with the District."
Before October 1990, the District reimbursed Meloy for expenses he incurred in housing fire trucks in the garage at Meloy's auto service business. The District also
reimbursed Meloy for the maintenance and repair of District vehicles.
In 1988, the District began reporting the payments made to Meloy as salary for purposes of the federal income tax. Each year from 1988 to the present, the District has reported the payments to Meloy on a W2 Wage and Tax Statement.
Between 1988 and October 1990, the District stopped housing vehicles in Meloy's garage, and Meloy stopped servicing vehicles for the District. In October 1990, the amount of the monthly payment to Meloy increased substantially. Thereafter, the District provided annual cost of living increases to Meloy.
The payments to Meloy from October 1990 to the present have been unrelated to expenses incurred by Meloy. Those payments have been regular monthly salary payments for work performed to implement the policy of the District and to administer the day-to-day operations of the District.
Even if the payments are salary payments, Respondent argues that Meloy did not receive those payments for work performed in a regularly established position. Section 121.021(52)(b) defines a regularly established position as one that will be in existence for six months.
Meloy's position has been in existence since 1976.
It will be in existence for six months.
Respondent asserts that the position occupied by Meloy is a temporary position defined in Section 121.021(53)(b). Section 121.021(53)(b) defines a temporary position as one that will exist for less than six months or as defined by rule, regardless of its duration.
Respondent claims that the position occupied by Meloy is a temporary position because it is an "on call position" defined in Florida Administrative Code Rule 60S- 1.004(5)(d)5. The rule defines an on call position as one filled by employees who are called to work unexpectedly for brief periods and whose employment ceases when the purpose for being called is satisfied. (All references to rules are to rules promulgated in the Florida Administrative Code in effect on the date of this Recommended Order.)
Meloy performs some of his duties unexpectedly when called anytime 24 hours a day. He performs his other duties in the normal course of business. Meloy does not maintain any time sheets, and the District does not require Meloy to perform his duties within an established work schedule.
Meloy does not occupy an "on call position" within the meaning of Rule 60S-1.004(5)(d)5. Meloy's employment does not cease when the purpose of his being called is satisfied. Meloy has been performing his on-call duties and his other duties for approximately 25 years.
In 1994, Mr. William D. Wilkinson became the Chairman of the District (Wilkinson). Wilkinson is also the Court Administrator for the Circuit Court in the Twentieth Judicial Circuit of Florida, in which the District is located. After Wilkinson became Chairman, he determined that Meloy receives compensation in a regularly established position and is entitled to membership in the FRS.
Wilkinson testified at the hearing. Meloy has sole responsibility for implementing the District's policy and administering the day-to-day operation of the District. Relevant portions of Wilkinson's testimony are instructive.
Q. And whose job is it to carry out that policy?
A. Mr. Meloy.
Q. When you came on board in 1994, Mr. Meloy, was he employed by the district?
A. That's correct.
Q. How many other administrators does the district employ?
A. None.
Q. Who runs the day-to-day affairs of the fire district?
A. Mr. Meloy.
Q. He is required to work a certain work schedule?
A. No, sir.
Q. What is he required to do as far as hours go?
A. Once we set the policy, then we expect, you know, the chief to carry that out. And for however many hours it takes during the week, you know, the month to see it is fulfilled.
Q. Do you know if he is on call?
A. He is on call 24/7.
Q. And what does that mean?
A. 24 hours a day, seven days a week.
Q. Is that 365 days a year?
A. That's correct.
* * *
Q. Let me ask you to put your other hat on as the court administrator for the 20th Judicial Circuit. Are you involved with the Florida Retirement System?
A. Yes, I am.
Q. And you are a participant?
A. Yes, I am.
Q. Your duties as the court administrator, how would you compare that to Mr. Meloy's duties as the fire chief administrator of the Alva Fire District?
A. Well, with the exception that I certainly make a lot more than he does for the duties that he has, it is similar. You know, I'm paid an annual salary and expected to get the job done. If you have to work 60 hours, you have to work 60 hours. If you get through sooner, hopefully you do. But that never happens.
The District requires Meloy to spend as much time as is needed to implement the policy of the District and to administer the day-to-day business of the District. The hours vary, and there are no set hours. Some days, Meloy's day begins at 6:00 a.m. Other days, Meloy does not get to work until 9:00 a.m. or noon. Some days, Meloy leaves work at
5:00 p.m. and then must return immediately to the office. "It is whatever is needed."
The District employs four individuals. One is Meloy. Two are certified firefighters. The other is a part- time bookkeeper. The bookkeeper and the two certified firefighters are members of the FRS.
The two full-time firefighters maintain time sheets, and the District pays them for overtime. The District compensation of its full-time firefighters is consistent with compensation on an hourly basis.
Meloy is not a certified firefighter, and the District does not compensate Meloy on an hourly basis. Meloy does not maintain or submit time sheets. The District does not pay Meloy for overtime.
Like the certified firefighters, Meloy performs some of his duties when called anytime, 24 hours a day. However, neither the certified firefighters nor Meloy has the option to refuse to work when called. The employment positions of the
certified firefighters and Meloy do not cease when the purpose for being called is satisfied.
Although the bookkeeper for the District is never on call, she maintains a schedule similar to that of Meloy. She works those hours necessary to perform her duties. Like Meloy, the bookkeeper's position does not cease when she completes her work.
The District pays compensation to Meloy in accordance with an annual salary rather than an hourly rate. Meloy does not have an established schedule during which he must implement the board's policy and administer the day-to- day operations of the District.
Meloy occupies a regularly established position within the meaning of Section 121.021(52)(b). Meloy is the District administrator. The position has been in existence since 1988 and is not a temporary position within the meaning of Section 121.021(53)(b) or Rule 60S-1.004(5).
Respondent's final argument is that a determination of Petitioners' request to enroll Meloy in the FRS is barred by the judicial doctrines of res judicata or collateral estoppel. Respondent argues that final agency action determined that the payments received by Meloy through
June 29, 1992, are reimbursement for expenses. Respondent
argues that nothing has changed since that time, and Meloy cannot now revisit the issue of his compensation.
Findings regarding Respondent's final argument require some historical perspective. The District joined the FRS in 1988. At that time, the District purchased past service credit for a number of employees, including Meloy. Meloy enrolled as a member of the Special Risk Class.
When Meloy enrolled as a member of the Special Risk Class, a question in the enrollment form asked Meloy if the applicant was certified as a firefighter or required to be certified as a firefighter. Meloy answered in the affirmative.
Meloy has always been required to be certified as a firefighter in order to receive retirement benefits as a member of the Special Risk Class. However, Meloy has never been certified as a firefighter pursuant to Section 633.35. Meloy has never completed an essential firefighting course that is a statutory prerequisite to certification.
By letter dated June 29, 1992, Respondent notified Meloy that Respondent was terminating Meloy's membership in the FRS. The letter stated two grounds for termination. One ground was that Meloy had not completed the firefighting course required for membership in the Special Risk Class. The second ground was that the payments Meloy received from his
employer are reimbursement for expenses rather than compensation.
Meloy did not appeal either ground stated by Respondent on June 29, 1992, for the termination of benefits. Meloy does not contest the first ground and is not now seeking enrollment in the FRS as a member of the Special Risk Class. Rather, Meloy now seeks benefits as a member in a regularly established position defined in Section 121.021(52)(b).
Meloy does contest the second ground stated by Respondent on June 29, 1992, for terminating Meloy's membership in the FRS. Respondent determined that Meloy did not receive compensation from 1988 through June 29, 1992. The time for appealing that determination has expired, and Meloy cannot now amend the scope of this proceeding to include any payments he received on or before June 29, 1992.
Respondent asserts that its determination on June 29, 1992, also establishes that payments received by
Meloy after June 29, 1992, are not compensation. Respondent argues that Meloy's duties have not changed, and the payments Meloy receives are reimbursement for expenses.
On June 1, 1999, Respondent sent a letter to Wilkinson explaining Respondent's denial of Meloy's application for enrollment in the FRS. In relevant part, the letter stated:
By certified letter dated June 29, 1992 (copy enclosed), the State Retirement Director, Mr. A.J. McMullian III, advised Mr. Meloy that he was inelligible for Florida Retirement System (FRS) participation since the monthly payments he received were for "expenses" and not compensation. Subsequent to Mr.
McMullian's letter, a hearing was conducted by the Division of Administrative Hearings and Mr. Meloy's payments were defined as expenses as a statement [sic] of fact (copy enclosed).
In light of this, the Division has already made a determination that Mr. Meloy is ineligible for FRS participation from 1979 through 1992. Since your letter indicates that Mr. Meloy's duties and payments he has received have not changed since 1988, he remains ineligible for FRS participation.
Respondent's Exhibit 10.
The DOAH hearing referred to in the letter on June 1, 1999, involved allegations that Meloy had violated
state ethics laws when he first attempted to enroll in the FRS in 1988. In 1992, the Florida Commission on Ethics (Commission) investigated Meloy's participation in the FRS. The Commission entered an order finding probable cause that Meloy violated Section 112.313(6) when he submitted his enrollment form for retirement benefits by corruptly using or attempting to use his official position to retain retirement benefits for himself and his assistant fire chief when neither was qualified to receive benefits. The findings concerning
the assistant fire chief are neither relevant nor material to this proceeding.
Meloy requested an administrative hearing, and the Commission referred the matter to DOAH to conduct the hearing. ALJ Susan B. Kirkland conducted the administrative hearing and entered a Recommended Order on July 8, 1994. The Recommended Order found that Meloy misrepresented his entitlement to membership in the Special Risk Class and did so with wrongful intent. The Order concluded that Meloy violated the relevant statute because Meloy attempted to use his position, or the property and resources entrusted to him, to secure a benefit. The Order recommended a civil penalty, public censure, and a reprimand. The Final Order of the Commission adopted the Recommended Order.
The Recommended Order contains three paragraphs that discuss the payments received by Meloy. Those three paragraphs state:
3. In 1976, the . . . District was established. The firefighting equipment and vehicles were originally located in Meloy's garage, where he maintained an automotive repair shop. Meloy received a fixed reimbursement from the District each month for the use of his garage and for repair services which he rendered for the District.
* * *
5. In 1988, the District joined the . . . (FRS). At that time the District employed
four full-time firefighters and a part-time secretary. Meloy worked part-time as the administrator of the District but did not draw a salary and continued to receive remuneration in the form of the monthly reimbursement for expenses. . . .
* * *
18. By letter dated June 29, 1992, [Respondent] notified Meloy that his membership in the FRS . . . was being terminated. The grounds for termination were that Meloy had been receiving payments for expenses and not compensation. . . .
The Recommended Order does not operate under the judicial doctrines of res judicata or collateral estoppel to preclude a determination of whether the payments received by Meloy after 1988 are compensation. The Recommended Order limits the finding that Meloy received payments for expenses to those received in 1988. Paragraph 5 expressly states, "At that time. . . Meloy . . . continued to receive . . .
reimbursement for expenses. . . ." The findings in paragraph
18 merely recite the grounds stated by Respondent but do not make findings on the merits of the stated grounds. The findings in paragraph 3 are not probative.
The Recommended Order made no findings concerning the payments Meloy received after 1988. Respondent determined that the payments between 1988 and June 29, 1992, were payments for expenses rather than compensation. Irrespective of whether Respondent's determination was legally and
factually correct, Meloy did not appeal Respondent's determination.
The determination by Respondent on June 29, 1992, involved a separate and distinct application from the application at issue in this case. No determination has been made that the payments since June 29, 1992, either are or are not compensation.
The application at issue in this case is a new application for different benefits. Meloy is not applying for benefits to which he would be entitled if he were a member of the Special Risk Class. Nor can Meloy apply for benefits related to the payments received on or before June 29, 1992.
Respondent argues that nothing has changed in the course of Meloy's tenure with the District. Payments that were reimbursement for expenses before 1992 arguably have not now been transformed into compensation.
Respondent is incorrect. Something has changed in the course of Meloy's tenure with the District.
Sometime after September 1990, the payments to Meloy changed from reimbursement for expenses to monthly salary payments. The District no longer housed equipment at Meloy's garage, Meloy no longer serviced the equipment at the garage, and the amount of the monthly payments to Meloy increased from
$540 to $833.
Relevant portions of the transcript of the administrative hearing in the ethics case are instructive. Meloy asserted in the ethics case that in 1988, he was a volunteer fireman. As a volunteer, rather than a salaried employee, Meloy argued that he was not required to be certified as a firefighter. The attorney who represented the Commission sought to show that Meloy was not a volunteer after 1990 but was a salaried employee of the District.
As long as I'm volunteering, I don't have to have it.
Q. Okay. You are also the administrator for the full-time firemen, is that right?
A. Yes.
Q. You have the power to hire and fire them?
A. Yes.
Q. You set their hours?
A. Yes.
Q. The district also has a part-time secretary, is that right?
A. Yes.
Q. And currently that's Ms. Connie Bull?
A. Correct.
Q. She handles payroll matters?
A. Yes.
Q. She writes checks?
A. Yes.
Q. Pays bills?
A. Yes.
Q. She and you both answer questions that the full-time firemen might have about vacation or sick leave or retirement, is that right?
A. To the best of our ability, yes.
Q. Okay. Now, before 1990 you were not an employee of the fire district, is that right?
A. According to how you define it, I guess. I was paid more as an expense type arrangement up until sometime around '90. I don't remember the exact date.
Q. Okay, you received the expense reimbursement prior to 1990 for working on the fire equipment; is that right?
A. It covered a lot of things. We worked on the fire equipment there in my business, we housed a lot of equipment there, used my facilities for -- well, we have used my facilities as a station for awhile.
Q. When you say your facilities, you mean the Alva garage that you used to own?
A. Right.
Q. When you got the expense reimbursement, you would get the same amount every month, is that right?
A. Yes.
Q. It changed some over time, though, didn't it from '73 to 1990?
A. Yes.
Q. You got that same reimbursement amount regardless of the number of hours that you worked for the district?
A. Yes.
Q. And regardless of what any actual expenses might be?
A. Correct.
Q. Now, sometime in 1990 you became an employee of the district on a part-time basis; is that right?
A. That's when they started taking out taxes and all and that reverted to more of a salary type reimbursement rather than expense. In other words, I was paying income tax and Social Security and everything and at that time it was considered more of a salary.
Q. And they started doing that in 1990 sometime?
A. I don't remember the date. It was approximately then.
Q. When you started receiving a salary, you stopped getting the reimbursement; is that right?
A. Right.
Q. Isn't it true that when you first started getting the salary that the amount of the salary was several hundred dollars a month more than what the reimbursement had been?
A. I couldn't tell you.
Q. Isn't it a fact that the last--
A. I don't believe that would be right, though, because it didn't go up very much any one time, I don't think.
I would have to see the figures to tell for sure.
Q. All right. Isn't it a fact that the last time you received a monthly reimbursement you were receiving about $540 a month?
A. I don't have those figures in front of me.
Q. You don't remember?
A. No.
Q. Isn't it a fact that when you first got a salary in October 1990, you got $833 a month?
A. I still couldn't tell you. I don't have those figures in front of me. I have them wrote down if I can get my papers.
Q. All right. You don't know how much you get now?
A. Yeah, but this ain't 1990.
Respondent's Exhibit 3 at 29-32.
The state argued in the ethics case that Meloy has been salaried since October 1990 and was required to be certified as a firefighter before enrolling in the FRS as a member of the Special Risk Class. The state now argues that Meloy has never been salaried and cannot enroll in the FRS as member of the regular class. The state cannot have it both ways.
Meloy is entitled to membership in the FRS for the period after June 29, 1992. During that time, the District
has paid a salary to Meloy that is compensation for duties performed in a regularly established position.
CONCLUSIONS OF LAW
DOAH has jurisdiction over the parties and the subject matter in this proceeding. Sections 120.569 and 120.57(1). The parties received adequate notice of the administrative hearing.
Petitioners have the burden of proof in this proceeding. Petitioners must show by a preponderance of the evidence that Meloy is entitled to membership in the FRS. Section 120.57(1)(j); Young v. Department of Community Affairs, 625 So.2d 831 (Fla. 1993) Florida Department of Transportation v. J.W.C. Co., 396 So.2d 778 (Fla. 1st DCA 1981); Balino v. Department of Health and Rehabilitative Services, 348 So.2d 349 (Fla. 1st DCA 1977); and.
Petitioners satisfied their burden of proof.
Petitioners showed that Meloy is an employee entitled to compulsory participation in the FRS pursuant to Section 121.051.
Section 121.051 provides for compulsory participation in the FRS for all employees hired after December 1, 1970. In relevant part, Section 121.021(11) defines an employee as any person receiving salary payments for work performed in a regularly established position.
The preponderance of evidence shows that Meloy received salary payments after June 29, 1992. The remaining issue is whether Meloy received those payments in a regularly established position.
Section 121.021(52)(b), in relevant part, defines a regularly established position to mean:
a . . . position which will be in existence for a period beyond 6 consecutive months, except as provided by rule.
Neither party cited any rule that provided any other definition of a regularly established position.
A regularly established position is not a temporary position. Section 121.021(53)(b), in relevant part, defines a temporary position to mean:
(b) . . . an employment position which will exist for less than 6 consecutive months, or other employment position as determined by rule of the division, regardless of whether it will exist for 6 consecutive months or longer.
Rule 60S-1.004(5)(d)5 provides, in relevant part:
An employee who is filling a temporary position shall not be eligible for membership in the Florida Retirement System.
A position meeting the definition below shall be a temporary position.
(d) The following types of positions in a local agency are considered temporary positions for retirement purposes.
5. On call positions (positions filled by employees who are called to work unexpectedly for brief periods and whose employment ceases when the purpose for being called is satisfied).
Respondent claims that the position occupied by Meloy is a temporary position because it is an on call position within the meaning of Rule 60S-1.004(5)(d)5. Respondent cites the decision in Hillsborough County Hospital Authority v. State, Department of Administration, Division of Retirement, 495 So.2d 249 (Fla. 2d DCA 1986).
In Hillsborough County Hospital Authority, the court refused to extend FRS benefits to nurses who were in a nurse pool. The court held that positions held by individuals in a pool of nurses were on call positions because the individuals could refuse to work when called and the positions ceased when their work was completed.
The decision in Hillsborough County is inapposite to the facts in this case. Meloy is not a member of a pool of employees. He is the only administrator for the District. He is the only person who can implement the policy of the District and who can administer the day-to-day operations of the District. In addition, Meloy does not have the option of refusing to work when called. Finally, the position occupied by Meloy does not cease when Meloy completes his work.
Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent enter a Final Order granting Petitioners' request for Meloy to participate in the FRS.
DONE AND ENTERED this 7th day of January, 2002, in Tallahassee, Leon County, Florida.
_________ ________________ DANIEL MANRY
Administrative Law Judge
Division of Administrative Hearings The DeSoto Building
1230 Apalachee Parkway
Tallahassee, Florida 32399-3060
(850) 488-9675 SUNCOM 278-9675
Fax Filing (850) 921-6847 www.doah.state.fl.us
Filed with the Clerk of the Division of Administrative Hearings this 7th day of January, 2002.
COPIES FURNISHED:
J. Frank Porter, Esquire Porter & Jessell, P.A. 1424 Dean Street
Ft. Myers, Florida 33901
Thomas E. Wright, Esquire Division of Retirement
P.O. Box 3900
Tallahassee, Florida 32315-3900
Erin B. Sjostrom, Director Division of Retirement
Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560
Mallory Harrell, General Counsel Department of Management Services 4050 Esplanade Way
Tallahassee, Florida 32399-0950
NOTICE OF RIGHT TO SUBMIT EXCEPTIONS
All parties have the right to submit written exceptions within
15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the Final Order in this case.
| Issue Date | Document | Summary |
|---|---|---|
| Nov. 13, 2002 | Agency Final Order | |
| Jan. 07, 2002 | Recommended Order | Chief of fire district who had no established hours, did not submit time sheets, and was on call 24/7, was compensated by salary earned in regularly established position and an employee entitled to enroll in Florida Retirement System. |
