Did a Washington school district have to cut an existing employee insurance contribution in 1981?

Plain-English summary

A legislator asked whether a Washington school district with an existing collective bargaining agreement had to reduce its employee insurance contribution when the agreement reopened. The contribution already exceeded the threshold mentioned in the 1981 budget. The AG said no: the relevant compensation restrictions counted increases in fringe-benefit contributions, while keeping the same previously established rate did not increase the rate. The answer was limited to continuing that rate, rather than granting a new increase.

“continuation of the same (although higher) rate of contribution does not constitute an increase.” (Official opinion)

Currency note

This opinion was issued in 1981. 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.

Common questions

Q: Did exceeding the budget threshold automatically require a cut?
A: No. The AG said a previously established higher contribution could be continued.

Q: Why was renewal at the same rate allowed?
A: The opinion read the relevant laws as addressing increases; unchanged contributions did not constitute an increase.

Q: Did the opinion authorize a new increase above the existing rate?
A: It addressed continuation of the prior rate and did not treat a new increase as equivalent.

Background and statutory framework

The opinion read chapter 16, Laws of 1981 with section 92 of chapter 340, Laws of 1981. Both provisions considered increases in employee fringe-benefit contributions when measuring compensation limits.

Citations and references

The opinion discussed chapter 16 and chapter 340, Laws of 1981.

Source

• Landing page: https://www.atg.wa.gov/ago-opinions/continuation-previous-rate-employees-insurance-benefits

Original opinion text

Attorney General Ken Eikenberry

DISTRICTS ‑- SCHOOL ‑- EMPLOYEES ‑- INSURANCE ‑- COLLECTIVE ‑- BARGAINING ‑- CONTINUATION OF PREVIOUS RATE FOR EMPLOYEES' INSURANCE BENEFITS

In the event that a certain school district previously entered into a collective bargaining agreement covering its employees under which the district agreed, among other things, to make monthly payments for employees' insurance benefits at a rate in excess of $121 per fulltime equivalent staff unit per month, and the collective bargaining agreement is now open for renegotiation, the district need not now negotiate a decrease in insurance benefits instead of continuing at the same rate in order to avoid a conflict with either chapter 16, Laws of 1981 (SHB 166) or the budget appropriation in § 92, chapter 340, Laws of 1981 (SSB 3636).

July 21, 1981

Honorable Frank J. Warnke
St. Rep., 30th District
29457-51st Avenue S.
Auburn, Washington 98002

Cite as: AGO 1981 No. 8

Dear Sir:

By recent letter you have requested our opinion on a question which we paraphrase as follows:

In the event that a certain school district previously entered into a collective bargaining agreement covering its employees under which the district agreed, among other things, to make monthly payments for employees' insurance benefits at a rate in excess of $121 per full-time equivalent staff unit per month, and the collective bargaining agreement is now open for renegotiation, must the district now negotiate a decrease in insurance benefits instead of continuing at the same rate in order to avoid a conflict with either [[Orig. Op. Page 2]] chapter 16, Laws of 1981 (SSB 166) or the budget appropriation in § 92, chapter 340, Laws of 1981 (SSB 3636)?

We answer the foregoing question in the negative.

ANALYSIS

We begin with a reference to chapter 16, Laws of 1981 (SHB 166). That act, which contained an emergency clause and thus took effect when signed by the Governor on March 20, 1981, relates to public school districts and generally regulates various aspects of school employees' salaries and compensation. Among its provisions is one (§ 2) which adds the following new section to chapter 28A.58 RCW:

"(1) Every school district board of directors shall fix, alter, allow, and order paid salaries and compensation for all district employees. No school district board of directors may grant salary and compensation increases from any fund source whatsoever in excess of the amount and or percentage as may be provided for employees as set forth in the state operating appropriations act in effect at the time the compensation is payable.

"(2) Increases in school district employee fringe benefit contributions by school districts shall be included for purposes of determining salary and compensation increases under this section if contributions to fringe benefits provided by a district exceed or, by virtue of the increase, will exceed the amount provided for fringe benefits in the state operating appropriations act in effect at the time the compensation is payable.

"(3) For purposes of this section, salary and compensation shall not include the following:

"(a) Payment for unused leave for illness or injury under RCW 28A.58.097,

[[Orig. Op. Page 3]]

"(b) Employer contributions for the following employee fringe benefits:

"(i) Old Age Survivors Insurance

"(ii) Workers' Compensation

"(iii) Unemployment Compensation

"(iv) Retirement benefits under the Washington State Retirement System.

"(4) Provisions of any contract in force on the effective date of this amendatory act which conflict with requirements of this section shall continue in effect until contract expiration. After expiration, any new contract executed between the parties shall be consistent with this section." (Emphasis supplied)

The other legislative enactment here to be noted is a portion of § 92, chapter 340, Laws of 1981 (SSB 3636), the Omnibus 1981-83 Appropriations Act. By that section the sum of $182,988,000 was appropriated from the state General Fund for school employees' salary and compensation increases. The appropriation is, however, subject to a number of specified conditions and limitations including, in subsection (7), the following:

"(7) For purposes of chapter 16, Laws of 1981, the following conditions and limitations shall apply:

"(a) Districts may provide salary and insurance benefit increases for nonstate‑supported activities at rates not exceeding those specified by LEAP Document 2 for state‑supported basic education certificated staff in each school year of the biennium for each district.

"(b) Insurance benefit increases granted employees shall constitute a portion of the salary increase specified in LEAP Document 2 [[Orig. Op. Page 4]] whenever a district's contribution to employee insurance benefits will exceed, by virtue of increases provided in 1981-82 or 1982-83, $121 per full time equivalent staff unit in 1981-82 and $137 per full time equivalent staff unit in 1982-83.

"(c) Increments granted by school districts to certificated staff shall constitute salary increase only to the extent that the aggregate of increments granted by a district in accordance with its salary schedule exceeds the aggregate of increments which are provided pursuant to LEAP Document 1."

The issue you have raised may be restated as follows: In the execution of a new collective bargaining agreement, would a continuation of the previously established rate of insurance contribution‑-at a rate in excess of $121 per full-time equivalent staff unit per month‑-be prohibited by § 3(4) of chapter 16,supra, because of an inconsistency with the provisions of that section, or by the above‑quoted language of § 92 of the Appropriations Act.

We think not, and thus answer your question, as above paraphrased, in the negative.

The critical point to be understood is that a mere continuation of the previously established higher rate of insurance contributions is not inconsistent with either of the two 1981 enactments above referred to. Why? Because both of those laws expressly recognize and provide that onlyincreases, per se, in the rate of insurance contributions which cause the rate to exceed $121 per FTE staff unit are to be considered for purposes of determining the existence of salary and compensation increases within the purview of chapter 16 supra. But obviously, continuation of the same (although higher) rate of contribution does not constitute an increase.

Of the two provisions involved, § 92(7)(b) of the Appropriations Act most clearly makes the foregoing point. It states that only insurance benefit increases shall be [[Orig. Op. Page 5]] used for computing salary increases in those cases in which a district's contributions will exceed the $121 rate therein provided for. And likewise, although it also contains some rather confusing language later on, § 2(2) of chapter 16,supra, is prefaced with the wording,

"Increases in school district employee fringe benefit contributions by school districts shall be included for purposes of determining salary and compensation increases under this section . . ."

(Emphasis supplied)

But this language brings us right back to the point, above made, that a mere continuation of a previously-established rate of contribution, although it exceeds the $121 rate, is in effect "grandfathered" in and thus is not to be considered a salary or compensation increase for purposes of the subject law.

We trust that the foregoing will be of assistance to you.

Very truly yours,
KENNETH O. EIKENBERRY
Attorney General

ROBERT E. PATTERSON
Assistant Attorney General