Are NC public employee retirement benefits part of the public salary information that must be open to inspection, or are they confidential personnel data?
Plain-English summary
Senators Tony Rand and David Hoyle asked the AG whether Session Law 2007-508, which expanded the definition of public "salary" information to include benefits and all other compensation, made retirement benefit information part of the confidential personnel file or kept it open to inspection.
The AG's answer: open to inspection. The legislature's intent was clearly to expand transparency, and the literal-text problem the Senators identified was resolvable through ordinary statutory construction.
Here was the literal-text problem. Session Law 2007-508 amended § 126-23 to add: "For the purposes of this section, the term 'salary' includes pay, benefits, incentives, bonuses, and deferred and all other forms of compensation paid by the employing entity." Retirement benefits are paid by the Teachers' and State Employees' Retirement System, not by an individual "employing entity." If "paid by the employing entity" was read literally, retirement benefits would not be part of the public salary information for most state employees. The only employees whose retirement benefits would be public would be employees of the Department of State Treasurer (because the Treasurer was the employing entity that also ran the Retirement System).
The AG called that result absurd. The cardinal principle of statutory construction was to discern legislative intent (State v. Jones, 359 N.C. 832, 616 S.E.2d 496 (2005)). When a literal interpretation produced absurd results or contravened the manifest purpose of the legislation, the reason and purpose of the law controlled (Frye Regional Medical Center v. Hunt, 350 N.C. 39, 510 S.E.2d 159 (1999)). The legislature was assumed to have acted in accordance with reason and common sense.
The AG looked at the whole bill. Session Law 2007-508 amended nine separate statutes, all in the direction of making more compensation information public. The intent was disclosure, not confidentiality. Reading the "paid by the employing entity" phrase to carve out retirement benefits, especially given the Treasurer-only weird result, would defeat that intent. So the AG concluded retirement benefit information was open to public inspection along with other compensation.
Currency note
This opinion was issued in 2008. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.
The public-personnel-record statutes in Chapter 126 and parallel local-government provisions have been amended multiple times since 2008. Anyone responding to a current request for retirement benefit information should check the current version of § 126-23 and the State Personnel Manual or its successor.
Common questions
Q: At the time of the opinion, could someone get a public employee's retirement benefit amount under a public records request?
A: Yes. The AG concluded that retirement benefit information was part of the public salary information under § 126-23 as amended by Session Law 2007-508.
Q: Why was there confusion in the first place?
A: The amended statute said benefits were public when "paid by the employing entity." Retirement benefits are paid by the Retirement System, a separate state entity, not by the agency that actually employs the worker. Read literally, that phrasing seemed to leave retirement benefits out.
Q: What was the absurd-result argument?
A: A literal reading would have made retirement benefits public only for employees of the State Treasurer (whose Retirement Systems Division was both employer and benefit payer). For everyone else, retirement benefits would have been confidential. That uneven outcome could not have been the legislature's intent.
Q: Did the AG cite a related personnel-file change?
A: Yes, in passing. Section 4.5 amended § 136-22 to put certain Retirement Systems Division information into the "personnel file" category not subject to public inspection. The AG noted that change supported a literal reading but did not control, because the absurd-result argument cut the other way.
Background and statutory framework
Session Law 2007-508 (Senate Bill 1546) was a public-personnel-records transparency bill ratified August 2, 2007 and signed August 30, 2007. Its title summarized its purpose: "An Act to Clarify the Public's Access to Public Employee Personnel Records." The legislature amended nine separate statutes to:
- Expand the information required to be open about employment contract terms.
- Expand the definition of public "salary information" to include benefits, incentives, bonuses, deferred compensation, and all other forms of compensation.
- Address public-hospital employee compensation while keeping competitive health-care information confidential.
The statutes touched included those governing local boards of education, community colleges, mental health authorities, public health authorities, counties, cities, water and sewer authorities, and the State (§ 126-23 for state employees). The language across statutes was "virtually identical."
The structural reading the AG applied was: across nine parallel statutes, the legislature consistently moved in the direction of openness. A single phrase in one section that, taken literally, carved out retirement benefits could not be read to contradict the consistent expansionary intent.
The opinion was signed by Chief Deputy Attorney General Grayson G. Kelley for Attorney General Roy Cooper.
Citations
- N.C.G.S. § 126-23 (State public personnel records)
- N.C.G.S. § 135-2 (establishment of Teachers' and State Employees' Retirement System)
- N.C.G.S. § 135-5(a)(1) (retirement benefit application procedure)
- N.C.G.S. § 136-22 (Department of State Treasurer personnel-file definition)
- Session Law 2007-508 (S.B. 1546)
- State v. Jones, 359 N.C. 832, 616 S.E.2d 496 (2005)
- Frye Regional Medical Center, Inc. v. Hunt, 350 N.C. 39, 510 S.E.2d 159 (1999)
- State ex rel. Commissioner of Insurance v. North Carolina Automobile Rate Administrative Office, 294 N.C. 60, 241 S.E.2d 324 (1978)
Source
Original opinion text
February 5, 2008
The Honorable Tony Rand
North Carolina Senate
300 N. Salisbury Street, Room 300-C
Raleigh, NC 27603-5925
The Honorable David W. Hoyle
North Carolina Senate
300 N. Salisbury Street, Room 300-A
Raleigh, NC 27603-5925
Re: Advisory Opinion: Confidentiality of Retirement Benefit Information; Session Law 2007-508
Dear Senator Rand and Senator Hoyle:
I am responding to your request to Attorney General Roy Cooper for our opinion as to the proper interpretation of certain provisions of Session Law 2007-508 (Senate Bill 1546). Specifically, you have asked whether statutory amendments enacted by the General Assembly in this legislation made information concerning retirement benefits a part of the confidential information in a state employee's personnel file and not subject to public inspection or examination.
Senate Bill 1546, entitled "An Act to Clarify the Public's Access to Public Employee Personnel Records and to Make Changes to the Law Pertaining to Confidentiality of Competitive Health Care Information," was ratified by the General Assembly on August 2, 2007, signed by the Governor on August 30, 2007, and subsequently codified as Session Law 2007-508. In general, the legislation amended various statutes governing the personnel records of public employees by extending the information required to be open for public inspection to the terms of employment contracts and by expanding the definition of public salary information to include benefits, incentives, bonuses, deferred compensation and all other forms of compensation. Statutes applying to employees of local boards of education, community colleges, mental health authorities, public health authorities, counties, cities, water and sewer authorities and the State were amended in this manner by virtually identical language. Section 5.5 and Section 8.5 also amended certain provisions of Chapter 131E to make public additional information concerning the compensation packages of public hospital employees while maintaining the confidentiality of competitive health care information.
The question you pose is raised by the amendments in Section 4 of the legislation, which amend NCGS §126-23. This statute requires each department, agency, institution, commission and bureau of the State to maintain a public record of each of its employees which makes available for inspection certain specified employment-related information. Prior to the enactment of Session Law 2007-508 "current salary" was one category of information available to the public. Section 4 amended this term by adding: "For the purposes of this section, the term 'salary' includes pay, benefits, incentives, bonuses, and deferred and all other forms of compensation paid by the employing entity." Based upon the plain language of this amendment, information showing benefits paid to an employee by the employing entity is now a part of the record required to be maintained for public inspection.
The concerns which have generated your question, however, involve the interpretation of the phrase "paid by the employing entity." It has been noted that retirement benefits are paid by the Teachers' and State Employees' Retirement System of North Carolina rather than by any individual "employing entity." NCGS §135-2 states: "A Retirement System is hereby established and placed under the management of the Board of Trustees for the purpose of providing retirement allowances and other benefits under provisions of this Chapter for teachers and state employees of the State of North Carolina." Members of the Retirement System who retire must apply to the Board of Trustees to receive a retirement benefit. NCGS §135-5(a)(1). It is therefore accurate to conclude that retirement benefits are paid by a state entity other than the "employing entity" of most state employees. A literal application of this premise requires a conclusion that the General Assembly did not intend for information concerning retirement benefits to be available for public inspection. This interpretation finds a measure of support in Section 4.5 of the legislation which amended NCGS §136-22 to add employment-related information gathered by the Retirement Systems Division of the Department of the State Treasurer to the definition of "personnel file" information which is not subject to public inspection.
A literal interpretation of the amendment, however, also requires a conclusion that only the Department of State Treasurer is required to maintain a record of the retirement benefits of its own employees, since these benefits are in fact paid by the "employing entity." To accept this analysis, of course, requires some basis upon which to conclude that the General Assembly intended for the retirement benefit information of all public employees to be confidential, except that of employees of the State Treasurer.
We cannot conclude that the General Assembly intended such a result. The cardinal principle of statutory construction is to discern the intent of the legislature. State v. Jones, 359 N.C. 832, 616 S.E. 2d 496 (2005). Furthermore, where a literal interpretation of the language of a statute will lead to absurd results, or contravene the manifest purpose of the legislation, as otherwise expressed, the reason and purpose of the law shall control and the strict letter thereof shall be disregarded. Frye Regional Medical Center, Inc. v. Hunt, 350 N.C. 39, 510 S.E. 2d 159 (1999). In construing statutes, courts normally adopt an interpretation which avoids absurd or bizarre consequences, the presumption being that the legislature acted in accordance with reason and common sense and did not intend unfounded results. State ex rel. Commissioner of Insurance v. North Carolina Automobile Rate Administrative Office, 294 N.C. 60, 241 S.E. 2d 324 (1978).
A careful review of the amendments contained in Session Law 2007-508 reflects new language added to nine separate statutes which expands the employee-related information available for public inspection. Most notably, the definition of "salary" is amended in each statute by clarifying that public salary information is not restricted to pay, but also includes benefits and all other forms of compensation. Read within this context, it is clear that the primary intent of the legislature in enacting these amendments was to make available for public inspection complete information as to the compensation of public employees. An interpretation of the amended definition of "salary" in a manner which makes public all information regarding compensation and benefits, except benefits paid by the Retirement System, contravenes this intent. When the absurd consequence that a literal interpretation places on employees of the Treasurer's Office is added to the analysis, it is clear that the General Assembly could not have intended such a result.
It is therefore our opinion that the General Assembly, in enacting Session Law 2007-508, did not intend to exclude retirement benefit information from the records required to be maintained for public inspection by each department, agency, institution, commission and bureau of the State in accordance with NCGS §126-23. Such information, upon request, should be made available for inspection and copying.
Very truly yours,
Grayson G. Kelley
Chief Deputy Attorney General