This could put DeKalb County Schools another $50 million in the hole. And just think what this has done for teacher morale over the past couple of years.
It’s difficult to see the school system winning this case on its merits. I don’t think its lawyer’s claim passes the straight-face test.
Here’s the deal: In 1979, the DeKalb County School System opted out of Social Security, electing instead to fund a teacher retirement plan. In 2009, the system quit funding it—without bothering to give teachers due notice.
A lawsuit was filed by teacher Elaine Gold (who taught my kids at Evansdale Elementary) and psychologist Amy Shaye. Only two plaintiffs? Well, they’re seeking to make it a class action lawsuit. A DeKalb Superior Court judge has ruled against the system’s claim of immunity from the suit, and that issue is now before the Georgia Court of Appeals.
The Atlanta Journal-Constitution reports:
The district also contends there was no contractual obligation to pay into the supplemental retirement fund, but the plaintiffs claim that the policy to do so was tantamount to a contract. The school board decided in 1979 to opt out of Social Security and instead pay into the annuity plan. The board adopted a policy that said the system would notify employees two years prior to canceling payments, which it did not do when it stopped paying in July 2009.
One of the three judges, Stephen Louis A. Dillard, had some observations Wednesday about the shift from Social Security.
“When you opt out of a federal program, I would think there are certain requirements that you have to meet,” Dillard said at one point in the hearing. Later, he said, “I just don’t see how that’s an alternative to Social Security if you’re not funding it.”
Thomas Bundy, a Washington, D.C., attorney representing the DeKalb school system, said payments into the annuity are not mandatory because it’s just one element of the supplemental retirement plan. Life insurance and long-term disability benefits are also included. He said the two-year provision applied to the entire package.