February 2018 Newsletter – School Districts
Employers Face Penalties for Assigning More Than 960 Hours of Out-Of-Class Work
When dealing with a vacant position, school and community college district employers frequently assign an employee in one classification to job duties in the vacant classification. These assignments are referred to as working “out-of-class.” Previously, there was generally no limit to the amount of time that an employee could be assigned to an out-of-class position, so long as after a specified period of time the employer adjusted the employee’s salary upward for the entire period the employee is required to work out-of-class and in amounts that reasonably reflect the out-of-class duties.
Beginning January 1, 2018, Assembly Bill 1487 imposes significant restrictions on an employer’s flexibility to assign out-of-class work. Specifically, notwithstanding there being effectively no time limitations in the Education Code, Government Code section 20480 prohibits any public agency (including school and community college districts) that participates in the CalPERS retirement system from assigning a participating employee to an out-of-class appointment for more than 960 hours in a fiscal year.
As a result, this effectively places a 960 hour limit on out-of-class work, where there was no prior limit.
In addition, the new law requires the employer to:
- Track the number of hours worked by an employee in an out-of-class appointment,
- Report out-of-class service to CalPERS no later than 30 days following the end of the fiscal year, and
- Only appoint an employee to out-of-class service pursuant to collective bargaining agreement or public available pay schedule.
The new law only applies to out-of-class appointments to a vacant position during recruitment for a permanent appointment. It does not apply when a position is temporarily available due to another employee’s leave of absence.
An employer who fails to comply with the new law faces penalties amounting to three times the amount of employee and employer contributions for the additional out-of-class pay for the entire period the employer works out-of-class. The employer must also reimburse CalPERS for the administrative expenses of responding to the violation.
Going forward, we recommend that all school districts and community college districts closely track the out-of-class hours worked by CalPERS eligible employees to ensure that it does not exceed 590 hours and, at the end of the fiscal year, report all hours worked out-of-class to CalPERS. Further, to avoid a penalty, we recommend employer limit out-of-class work for CalPERS eligible employees to roughly 120 – 128 days (depending on whether they are assigned 8 or 7.5 hour shifts). This equates to approximately 24 – 25.5 weeks, or about 5.5 – 6 months.
If you have any questions or concerns, or if you wish to discuss any of these issues, please feel free to contact our law firm.
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