Michigan Coalition of State Employee Unions v. State of Michigan
498 Mich. 312
Mich.2015Background
- Plaintiffs are unions representing Michigan classified civil-service employees who participate in the State Employees’ Retirement Act (SERA) pension system. They challenged 2011 PA 264, which (1) changed how overtime is counted toward final average compensation and (2) required current members to elect and/or contribute to remain in the defined‑benefit plan or move to a Tier 2 defined‑contribution plan.
- Plaintiffs argued SERA pension provisions are either “rates of compensation” or “conditions of employment” under Const 1963, art 11, § 5, and therefore immune from unilateral legislative change because that sphere is exclusively governed by the Civil Service Commission.
- The Court of Claims and Court of Appeals held 2011 PA 264 unconstitutional; the State appealed to the Michigan Supreme Court.
- The Michigan Supreme Court reviewed constitutional and statutory interpretation de novo and framed two main questions: (1) whether “rates of compensation” includes pensions, and (2) whether pensions as “conditions of employment” prevent the Legislature from amending SERA without Commission consent—or whether Commission acquiescence matters.
- The Court assumed, without deciding, for some parts of the analysis that pensions could be “conditions of employment,” but ultimately held (a) “rates of compensation” as ratified meant salaries/wages, not fringe benefits like pensions, and (b) even if pensions fall within “conditions of employment,” the Commission had acquiesced to SERA’s application to classified employees, so the 2011 amendments did not present a justiciable constitutional infringement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether SERA pensions are "rates of compensation" under Const 1963, art 11, § 5 | Pensions are part of compensation and thus within the Commission's exclusive authority; Legislature may not alter them | "Rates of compensation" as used in 1963 Constitution meant salaries/wages (paycheck amounts), not fringe benefits | Held: "rates of compensation" does not include pensions; 2011 PA 264 does not infringe Commission power over rates of compensation |
| Whether pensions are "conditions of employment" and thus immune from legislative change | Pensions are conditions of employment; Legislature's amendments intrude on Commission's plenary authority to regulate conditions of employment | Even if pensions are conditions of employment, the Commission lacks legislative/appropriative power; it cannot enact or veto statutes; legislative action is permissible unless the Commission objects and has not done so | Court assumed (without deciding) pensions could be "conditions of employment," but held that because the Commission has acquiesced to SERA applying to classified employees (Civ Serv R 5‑13), the 2011 amendments do not present a constitutional problem as applied now |
| Whether the Commission's historical acceptance of SERA prevents it from objecting to 2011 PA 264 (acquiescence/waiver) | Plaintiffs: prior Commission conduct does not waive its constitutional protections; acquiescence to practical necessities should not validate unconstitutional incursions | State: Commission rule making SERA applicable to classified employees constitutes acquiescence; separation of powers forbids Commission from using judiciary to resurrect prior statutory regimes | Held: Commission’s rule making (Rule 5‑13) and long acquiescence made SERA (and its amendments) applicable; the Commission may not now compel revival of prior statute by judicial means, so plaintiffs’ challenge fails as applied given Commission’s acquiescence |
Key Cases Cited
- Council No 11, AFSCME v. Civil Serv. Comm., 408 Mich. 385 (1980) (describes scope of Civil Service Commission authority over employment matters)
- Judicial Attorneys Ass’n v. Michigan, 459 Mich. 291 (1998) (separation of powers; limits on legislative intrusion into judicial personnel matters and discussion of acquiescence/accommodation)
- McDougall v. Schanz, 461 Mich. 15 (1999) (distinguishes constitutional rule‑making authority over procedure from substantive law)
- Perin v. Peuler, 373 Mich. 531 (1964) (judicial acquiescence principle regarding court rule‑making retention)
- Plec v. Liquor Control Comm’n, 322 Mich. 691 (1948) (separation of powers; caution against creating an extra government department)
- Immigration & Naturalization Serv. v. Chadha, 462 U.S. 919 (1983) (federal separation of powers principle invalidating legislative veto; cited on separation‑of‑powers limits)
- McDougall and related authorities were used to explain limits on a constitutional actor’s power and to contrast judicial acquiescence doctrines with the executive/commission context.