vs.
Respondent.
Case No. 21-0001
Pursuant to notice, a final hearing was held in this case on February 19, 2021, by Zoom conference, before E. Gary Early, a designated Administrative Law Judge of the Division of Administrative Hearings.
For Respondent: Ruth E. Vafek, Esquire
Whether Petitioner, Angela Williams (Petitioner or Ms. Williams), was properly enrolled in the Florida Retirement System (“FRS”) Investment Plan upon the expiration of her election period after she was employed by the Department of Corrections (“DOC”) in March 2019.
On January 31, 2020, the State Board of Administration (“Respondent” or “SBA”) filed its Response to Request for Intervention by which it denied Petitioner’s request to enroll her in the FRS Pension Plan. The basis for the denial was Petitioner’s failure to elect to participate in the Pension Plan within the requisite time period after she commenced employment with DOC.
On February 24, 2020, Petitioner timely filed her Investment Plan Petition for Hearing, in which she disputed the basis for the denial of her request.1
The Petition was initially heard on October 20, 2020, as an informal hearing pursuant to section 120.57(2), Florida Statutes. During that hearing, Ms. Williams raised an issue of the adequacy of notice, which the presiding officer accepted as a dispute of material fact. Thus, this matter was referred to the Division of Administrative Hearings on January 4, 2021.
The final hearing was scheduled for February 19, 2021, and was convened and completed on that date.
At the final hearing, Ms. Williams testified on her own behalf. Petitioner’s Exhibits 1 through 9 were received in evidence. SBA presented the testimony of Allison Olson, its Director of Policy, Risk Management, and Compliance.
Respondent’s Exhibits 1 through 10 were received in evidence.
On March 10, 2021, a one-volume Transcript of the proceedings was filed, and notice thereof was entered on the docket. The parties timely filed their
1 In her Petition, Ms. Williams indicated that she received SBA’s Notice on February 7, 2021.
post-hearing submittals, which have been considered in the preparation of this Recommended Order.
Petitioner was employed by the Seminole State College of Florida, in an FRS-eligible position, from 1990 through 1998. At that time, the Pension Plan was the only retirement program available for eligible employees.
In 2002, the Investment Plan became available for employees participating in the FRS. Petitioner was not employed in an FRS-eligible position at that time.
Petitioner began employment with DOC, an FRS-participating employer, in March of 2019.
Following her return to FRS-eligible employment, Petitioner was provided an initial choice period with a deadline of December 31, 2019, by 4:00 p.m., Eastern Time, to elect the Pension Plan or the Investment Plan. Since the Plan Choice Administrator received no election from Petitioner by the December 31, 2019, deadline and Petitioner was not employed in a Special Risk Class position, Petitioner was enrolled in the Investment Plan.
Respondent has no record of Petitioner utilizing an election during her initial choice period.
On or about January 24, 2020, Petitioner submitted a Request for Intervention (“RFI”) asserting that she had been “erroneously enrolled in the Investment Plan” and requesting that she be “placed back into the Pension Plan, along with any choices associated with that plan.” Petitioner asserted she thought she should have defaulted into the Pension Plan, since she had been previously enrolled in that plan during her 1990-1998 employment. Petitioner’s RFI was denied.
On February 24, 2020, Petitioner filed a Petition for Hearing disputing that “it was compulsory to make an election” and that the default into the
Investment Plan was “erroneously done.” She alleged that “Florida Statutes 121.4501(4)(b) and 121.4501(4)(f) [we]re incorrectly quoted” in the response to her RFI, and that her “login and activity are not being correctly recorded.” An informal proceeding pursuant to section 120.57(2) followed.
At the informal hearing, Petitioner stated that, “on May 27th [2019], the website [MyFRS.com] indicated that I was in the Pension Plan and if I wanted to stay in the Pension Plan, that I should not have to make an election.”
On December 14, 2020, the Hearing Officer issued an Order of Transfer to DOAH, citing Petitioner’s statements at the hearing, such as quoted in the preceding paragraph, as raising a disputed issue of material fact. This proceeding thus ensued.
Facts Adduced at Hearing
Ms. Williams testified that upon her employment with DOC, she received a letter by U.S. Mail at her listed address with a PIN to establish an online FRS account. She then logged onto MyFRS.com on or about May 27, 2019. She testified that she also logged into her MyFRS.com account in the fall of 2019. She stated that during both logins, she was presented with a screen that informed her that she was enrolled in the Pension Plan. She also testified that the login screen included a statement that if she intended to remain in the Pension Plan, she did not need to do anything further. However, there was no screenshot or extrinsic evidence offered in evidence to corroborate that testimony. Ms. Williams’s testimony alone is insufficient to support a finding of fact as to the substance of any logged-in online activities. Furthermore, Ms. Olson testified credibly that a screen providing information as described by Ms. Williams does not exist in the SBA system.
Ms. Williams further testified that the next communication she received from SBA by U.S. Mail came in January 2020, informing her that she was enrolled in the Investment Plan.
Ms. Williams called the number provided in the mailed notice on January 13, 2020, and spoke with Graham, an FRS plan administrator.
Ms. Williams advised Graham of her belief that she was erroneously enrolled in the Investment Plan. By that time, the election period had passed.
Graham indicated that he would investigate the matter.
On January 22, 2020, Ms. Williams received a message to call Graham. She did so, but the call was “dropped.” She called back and spoke with Carrie. That call was transcribed and is in the record of this proceeding.
The transcript of that call reveals that none of the parties to the call had a precise explanation of or answer for the events. It would not be inaccurate to say that Carrie and the MyFRS.com financial guidance representative who joined the call were uncertain about the circumstances of Ms. Williams's account. However, there was no statement made by either of the FRS representatives that could be construed as being contrary to the position SBA has taken in this case. More to the point, since the call was placed on January 22, 2020, after the election period had expired, the discussion between Ms. Williams and the persons on the call could not have formed the basis for any reliance or change in position detrimental to
Ms. Williams.
Ms. Williams believed that certain of her keystrokes while on her two visits to the MyFRS.com website were not recorded by the transaction server, which she surmised was the result of errors in the system. She testified to her belief that “Alight [the SBA contractor] has a -- quite a serious issue with communication -- with communication defaults, with losing communication between MyFRS.com website and the transaction server. It’s happened to me, you know, several times. So, I -- I don’t believe that you can trust what is being printed by Alight as being accurate.” However, there was no testimony or evidence of such beyond Ms. Williams’s speculation.
Evidence was received of five emails sent from the SBA contractor to Ms. Williams between July 22, 2019, and December 30, 2019, advising her of
the deadline for making an election. The emails were sent to an email address that Ms. Williams acknowledged she used.
The documentary evidence included read-receipts of Ms. Williams having opened only one of the emails during the election period. Ms. Williams went through each of the emails, explaining why she could not have opened those emails at the times indicated. However, her testimony for three of the emails was intended to show that she could not have opened the emails at the times indicated, though the times indicated were the “sent” times, not the “opened” times. Thus, her testimony that she did not open those emails is credited, though for the reason that she simply did not open them rather than that the time shown for her having opened them was incorrect.
The only email for which there is evidence of its having been opened within the election period was sent on October 7, 2019, at 8:03 a.m., and first opened that same date at 7:56 p.m. Ms. Williams had no recollection of reading that email. She testified that the recorded time of her opening it again -- Saturday, October 12, 2019, at 9:27 a.m. -- was unlikely because she “was actually getting a fridge delivered that day. So, I would not have been on the internet reading my e-mail while my fridge was being delivered.” It seems a stretch that anyone would forego checking emails for a full weekend day for a refrigerator delivery. That a read-receipt record would be randomly generated without a document having been opened is implausible.
The read-receipt record indicated that the October 7, 2019, email was last opened on January 22, 2020, at 5:16 p.m. Another indicated that an August 15, 2019, email was first opened on January 22, 2020, at 5:21 p.m., minutes before Ms. Williams returned Graham’s call. Ms. Williams indicated that reading the email at that time did not make sense to her, stating “if I had that e-mail and I was going to log -- and I was going to read it, I would have done it after the first phone call on the 13th, not right before I dialed in to talk to Graham.” To the contrary, it seems quite normal for one to review emails from SBA prior to discussing a retirement plan election with an SBA
representative investigating the election.
The email records are, themselves, hearsay.2 However, they are not accepted by the undersigned for the truth of the matters set forth, i.e., the dates and times that they were sent to and opened by Ms. Williams, but rather for the more general purpose of showing that she had been provided with notice of issues regarding her retirement plan that required attention. Thus, they are accepted and given weight for that purpose.
Several notices were also sent to Ms. Williams by U.S. Mail at her correct address. She acknowledged receipt of the letter containing her PIN in May 2019, and the letter informing her that she was enrolled in the Investment Plan in January 2020, but denied having received any of the others. There was simply no credible explanation why notices, mailed in the normal course of SBA’s duties to an address of record, would not have been delivered by the U.S. Postal Service.
Regardless of whether emails were or were not read, the enrollment of Ms. Williams in the Investment Plan is controlled by application of section 121.4501, Florida Statutes. Ms. Williams addressed what she believed to be the ambiguity of section 121.4501, particularly subsections (4)(b)1. and (3)(a), which she believed to be “open to an interpretation.” That issue will be addressed in the Conclusions of Law that follow.
CONCLUSIONS OF LAW
Jurisdiction
The Division of Administrative Hearings has jurisdiction over the subject matter of this proceeding and of the parties thereto pursuant to sections 120.569 and 120.57(1), Florida Statutes (2020).
2 In all likelihood, the email records would fall under an exception to the hearsay rule as either business records, pursuant to section 90.803(6), Florida Statutes, or public records, pursuant to section 90.803(8). However, the predicate for making a finding to that effect, i.e., testimony of a records custodian or evidence of the duty imposed by law to keep such records, was not established.
Burden and Standard of Proof
Petitioner bears the burden of proving her entitlement to inclusion in the FRS Pension Plan by a preponderance of the evidence. § 120.57(1)(j),
Fla. Stat.; Dep’t of Transp. v. J.W.C., Inc., 396 So. 2d 778 (Fla. 1st DCA 1981).
Standards
FRS offers two retirement plans: the Pension Plan, a defined benefit plan; and the Investment Plan, a defined contribution plan. §§ 121.021(3), 121.051, and 121.451, Fla. Stat.
SBA administers the FRS Investment Plan and has the authority to adopt rules necessary to administer the Investment Plan in coordination with the Pension Plan. § 121.4501(8), Fla. Stat.
Section 121.4501(4)(b) provides, in pertinent part, that:
With respect to employees who become eligible to participate in the investment plan by reason of employment in a regularly established position commencing on or after January 1, 2018, or who did not complete an election window before January 1, 2018, any such employee shall be enrolled in the pension plan at the commencement of employment and may, by the last business day of the eighth month following the employee’s month of hire, elect to participate in the pension plan or the investment plan. Eligible employees may make a plan election only if they are earning service credit in an employer-employee relationship consistent with s. 121.021(17)(b), excluding leaves of absence without pay.
The employee’s election must be made in writing or by electronic means and must be filed with the third-party administrator. The election to participate in the pension plan or investment plan is irrevocable, except as provided in paragraph (f).
3.a. Except as provided in subparagraph 4., if the employee fails to make an election to either the pension plan or the investment plan during the
8-month period following the month of hire, the employee is deemed to have elected the investment plan and shall default into the investment plan retroactively to the employee’s date of employment. The employee’s option to participate in the pension plan is forfeited, except as provided in paragraph (f).[3]
Analysis
Ms. Williams first become eligible to participate in the Investment Plan by reason of her employment with DOC on March 29, 2019.
Since Ms. Williams’s prior employment in an FRS position ended in 1998, before the creation of the Investment Plan, she did not complete an “election window” before January 1, 2018.
Under the plain meaning of the statute, Ms. Williams was “enrolled in the pension plan at the commencement of employment” with DOC. That would explain why, when she logged into the MyFRS.com system in May 2019, her status would have shown as being in the Pension Plan. However, she then had an obligation, created by law, to make an election to participate in the Pension Plan or the Investment Plan. That election had to be made by December 31, 2019, which was the last business day of the eighth month following her March 29, 2019, employment with DOC. Failing to do so,
Ms. Williams was “deemed to have elected the investment plan and shall default into the investment plan retroactively to [her] date of employment.”
The undersigned recognizes that it might have been clearer, and even intuitive, if Ms. Williams’s initial enrollment upon her employment with DOC was to the default plan into which she would be enrolled if no action was taken. Nonetheless, the Legislature established the system to provide for initial enrollment into the Pension Plan, with a default into the Investment Plan in the absence of an election. While the enrollment criteria might not be
3 Section 121.4501(4)(f) establishes a one-time opportunity for an active employee to move from the Pension Plan to the Investment Plan or from the Investment Plan to the Pension Plan. That option has not been exercised, and is not at issue in this proceeding.
intuitive, it is also not ambiguous. It is not the duty of the undersigned to second-guess the Legislature’s policy decision, but rather to apply the law as enacted.
Having weighed and considered the testimony and evidence presented at the final hearing, and based upon the findings of fact made herein, the undersigned concludes that Petitioner did not prove, by a preponderance of competent substantial evidence, that she should have been enrolled in the FRS Pension Plan. Thus, upon the expiration of the initial choice period on December 31, 2019, Petitioner was correctly enrolled in the FRS Investment Plan.
Estoppel
Petitioner argues that SBA should be estopped from denying her request to participate in the Pension Plan.
The doctrine of estoppel would apply in this case if SBA, by word, act, or conduct, made before the expiration of her election period on December 31, 2019, willfully caused Ms. Williams to believe, to her detriment, that she was not required to make an election of her plan participation, and would be automatically enrolled in the Pension Plan without such an election. See Dep’t. of HRS v. S.A.P., 835 So. 2d 1091, 1096-97 (Fla. 2002). The word, act, or conduct must be that on which Ms. Williams had a right to rely. See Monroe Cty. v. Hemisphere Equity Realty, Inc., 634 So. 2d 745, 747 (Fla. 3d DCA 1994). Furthermore, equitable estoppel will apply against a governmental entity only in rare instances and under exceptional circumstances. See Assoc. Indus. Ins. Co., Inc. v. Dep’t of Labor & Emp. Sec., 923 So. 2d 1252, 1254-55 (Fla. 1st DCA 2006).
In Department of Revenue v. Anderson, 403 So. 2d 397 (Fla. 1981), the Florida Supreme Court discussed the application of estoppel against a state agency and held:
As a general rule, equitable estoppel will be applied against the state only in rare instances and under exceptional circumstances. North American Co. v. Green, 120 So. 2d 603 (Fla. 1959). Another general rule is that the state cannot be stopped through mistaken statements of the law. Department of Revenue v. Hobbs, 368 So. 2d 367 (Fla. 1st DCA), appeal dismissed, 378 So. 2d 345 (Fla. 1979); Austin
v. Austin, 350 So. 2d 102 (Fla. 1st DCA 1977), cert. denied, 357 So. 2d 184 (Fla. 1978). In order to demonstrate estoppel, the following elements must be shown: 1) a representation as to a material fact that is contrary to a later-asserted position;
2) reliance on that representation; and 3) a change in position detrimental to the party claiming estoppel, caused by the representation and reliance thereon. Greenhut Construction Co. v. Henry A. Knott, Inc., 247 So. 2d 517 (Fla. 1st DCA 1971).
The First District Court of Appeal further explained the actions that might constitute exceptional circumstances, holding that:
The additional “exceptional” circumstances necessary to invoke estoppel against a governmental agency consist of (1) conduct by the government that goes beyond mere negligence and that will cause serious injustice; and (2) a showing that the application of estoppel will not unduly harm the public interest. Equitable estoppel has been most
frequently invoked against government agencies in cases in which the government has either made affirmative representations or knowingly acquiesced in plaintiff’s conduct. (citations omitted).
Assoc. Indus. Ins. Co., Inc., 923 So. 2d at 1255.
There was no competent substantial evidence of any representative of SBA or FRS having made a representation as to a material fact contrary to SBA’s position taken in this case. The evidence was not sufficient to demonstrate that the MyFRS.com website contained information that was inaccurate or misleading. Ms. Williams was provided with information regarding her retirement plan that went largely unread. The telephone call
between Ms. Williams and FRS, that occurred well after the election period had closed, could not have been cause for any change in position detrimental to Ms. Williams.
Ms. Williams has demonstrated no exceptional circumstances which would estop SBA from enforcing her default to the Investment Plan as required by section 121.4501(4)(b).
It is concluded that Ms. Williams did not prove that SBA is estopped by virtue of statements or actions taken after her employment with DOC through the period of her election.
Upon consideration of the findings of fact and conclusions of law set forth herein, it is RECOMMENDED that the State Board of Administration enter a final order upholding the decision to enroll Petitioner, Angela Williams, in the Florida Retirement System Investment Plan pursuant to section 121.4501(4)(b), Florida Statutes.
DONE AND ENTERED this 5th day of April, 2021, in Tallahassee, Leon County, Florida.
E. GARY EARLY Administrative Law Judge 1230 Apalachee Parkway
Division of Administrative Hearings this 5th day of April, 2021.
Ruth E. Vafek, Esquire Ausley McMullen
Ash Williams, Executive Director and Chief Investment Officer State Board of Administration
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.
