Rendell and the Furloughs

Sounds like a really, really, really bad college band, doesn’t it?

Anyway, I don’t want to brag, but I told you so.  According to a story on WHTM:

The state Supreme Court said Monday it agreed with state workers’ unions and ruled against the position that Gov. Ed Rendell had taken leading up to the July 2008 budget deal. The unions had argued that the federal Fair Labor Standards Act trumped a section of the state constitution that requires an appropriation in order for money to be paid out of the state treasury.

This is a huge victory for us bottom-of-the-ladder state workers.  But it’s a hollow victory, because although it reaffirms what we’ve known all along, the state still chose to knowingly break the law.

Remember that state employees are covered under the Fair Labor Standards act (see Garcia v San Antonio Metropolitan Transit Authority, 469 U.S. 528 (1985)).  The FLSA states, in part, that employees must be paid their full wages on time, no matter what.  Numerous court cases have repeatedly upheld that employes are still responsible for timely payment even if they lack the money to do so.

This was a point of contention, as the Governor (and legislature, by proxy) argued that the Pennsylvania Constitution trumped federal law, and thus workers were not entitled to timely payment.  The Pennsylvania Supreme Court’s decision effectively destroys the Governor’s and legislature’s position.  And should they choose to appeal, the United States Supreme Court has said time and time again that the FLSA trumps state law in these circumstances.

What’s interesting is that once an employer is late in making payment to its employees, that employer is liable for damages to each employee.  In fact, the Pennsylvania Office of Administration concluded that a budget impasse would cost the state $3,000,000 — $3 million — per day.  And in United States v Klinghoffer Bros. Realty Corp (285 F.2d 487, 491 (2d Cir. 1960)), the court stated that even after an employer makes its back payment of wages, the employer is still liable for damages.

It’s kind of like stealing from your neighbor.  Even if you give the item back, you can still be prosecuted for criminal activity.

The legislature and the governor know that state employees can do little to collect these damages.  The reason for this is a complex issue involving state sovereignty, but can be summarized simply as “you can’t sue the state”.  The only entity that can hold the legislature and governor responsible for their actions is the US Department of Labor.

In the end, this is good news for state employees — despite some naysayers who say otherwise.  But it remains to be seen whether or not they’ll actually pass a budget on time this year.  Predictions?


  1. DGS peon says:

    It ain’t bragging if it’s true… good on ya!

    What is kind of fascinating to me – and which I think we all have glossed over – is the Department of Labor’s “collusion” in this whole sordid affair. My recollection is that the DLA’s advice to affected employees was (initially) call us when you’ve actually missed a paycheck. When that day came, the DLA’s phones went to voicemail, precluding anyone from actually filing a complaint. DLA was our recourse – as you pointed out – but they punted on this one. My perspective from the “peanut gallery”…

  2. Stacy P says:

    What about a federal class action suit against Ed,house,senate reps, and Pa. We can’t sue the state as an individual, but the Obama administration can.

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