Dunn v. City of Kenner
170 So. 3d 1065
La. Ct. App.2015Background
- Kenner merged its municipal firefighter retirement system into the statewide Firefighters’ Retirement System (FRS) in 1999 but continued its prior method of calculating pension contributions.
- Under Kenner’s pre-merger practice it did not include educational incentive pay, seniority incentive pay, acting pay, or holiday pay in “earnable compensation” for pension contribution calculations.
- Firefighters filed a class action (2010) seeking retroactive correction and inclusion of those four pay types as earnable compensation under La. R.S. 11:233.
- At summary judgment the trial court held the four pay types were not “earnable compensation”; the City later began remitting contributions on acting and holiday pay (July 2010) but not on the incentive pays.
- On appeal the appellate court conducted a de novo review, found the statute ambiguous as to these pay types, admitted evidence submitted by the Firefighters, and reversed the trial court — rendering summary judgment for the Firefighters as to all four pay types.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether educational incentive pay is "earnable compensation" under La. R.S. 11:233 | Educational pay is earned (meets qualifications) and paid regularly (monthly); thus it must be included | It is a gratuitous bonus, not earned compensation | Included as earnable compensation; summary judgment for Firefighters |
| Whether seniority incentive pay is "earnable compensation" | Seniority pay is earned by meeting service thresholds and paid regularly (monthly accrual/annual payout); therefore included | It is analogous to a bonus and thus excluded as irregular/nonrecurring | Included as earnable compensation (majority); summary judgment for Firefighters (one judge dissents on this point) |
| Whether acting pay is "earnable compensation" | Acting pay is regularly paid when a firefighter fills a higher post and was received by many firefighters frequently — thus earned and recurring | It is irregular and nonrecurring and therefore excluded | Included as earnable compensation; summary judgment for Firefighters |
| Whether holiday pay is "earnable compensation" | Holiday pay is statutorily-mandated remuneration for work on holidays and was regularly received; thus included | It is effectively a bonus (comparable to overtime which is excluded) | Included as earnable compensation; summary judgment for Firefighters |
Key Cases Cited
- Fishbein v. State ex rel. Louisiana State Univ. Health Sci. Ctr., 898 So.2d 1260 (La. 2005) (supplemental salary tied to duties is earnable compensation)
- Bruno v. New Orleans, 583 So.2d 10 (La. App. 4 Cir. 1991) (addressing inclusion of supplemental pay in holiday wage calculations)
- Swift v. State of Louisiana, 342 So.2d 191 (La. 1977) (ambiguities in pension statutes resolved in favor of beneficiaries)
- Williams v. City of W. Monroe, 403 So.2d 842 (La. App. 2 Cir. 1981) (treating state supplemental pay in calculation of longevity/holiday/overtime pay)