To: Superintendents, Member School Districts (K-12)

From: Margaret M. Merchat, General Counsel

Date: May 29, 2009

Subject: STATE BUDGET SHORT-FALL LAYOFF PROCESS -
“SUMMER LAYOFFS”

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As of 1983, the Education Code has provided a means by which school agencies could do a certificated layoff in the summer as a result of a short-fall in funding. Given the current State economy and the fact that the 2009-10 Budget Act was enacted and signed into law in February, school districts will be able to use the short-fall budget layoff process this summer (a.k.a. summer layoffs) as set forth in Education Code section 44955.5 to further reduce certificated staff if necessary. The authority to act is conditioned on (1) districts being able to prove that their total revenue limit per unit of ADA has not increased by at least two percent (2 %) and (2) the legislature does not adopt any law eliminating/changing application of Section 44955.5 as has occurred in some prior years. Also, the fact that the Legislature and Governor are now in the process of revising the 2009-10 State budget does not prevent districts from proceeding at this point.

PROCESS

To proceed with the summer layoff, district boards and county superintendents must adopt a Schedule of Notice and Hearing and a layoff resolution.

1. Schedule of Notice and Hearing

Each district will need to adopt its own schedule which identifies the timelines for the initial resolution, initial layoff notice and hearing requests, and final action. We are recommending that districts and county offices give serious consideration to taking action as soon as possible, but no later than July 17. A sample schedule is available, but we would like to talk with you about the individual needs of your district as it relates to the schedule. The governing board or county superintendent will need to take action on the schedule prior to or in conjunction with a resolution to layoff. Please note that Education Code section 44955.5 does not specify a date by which the Board resolution and initial notice of layoff must be issued, and this issue has yet to be tested in court. However, we have interpreted the statute to mean that all action, including the hearing and final notice, must be taken by August 15, 2009. Since August 15 is a Saturday, everything should be completed by Friday, August 14, 2009. In light of the time necessary for a hearing, we believe that school agencies should take action on the layoff as soon as possible, and we are recommending no later than mid-July. In order to shorten the typical timeframe for a layoff, we are also recommending that at the time that initial notices of layoff are issued, districts also include the accusation packet.

2. Resolution

With regard to the layoff resolution, it must provide a fact-based determination regarding 2009-10 revenue and the lack thereof. Districts must be prepared to substantiate the calculations and in some cases may need to retain the services of a fiscal/financial expert to review and confirm them. This may be necessary at the board meeting where the resolution is being considered and at the layoff hearing itself. This expert evidence is critical, as it is anticipated that unions may focus their challenge of summer layoffs on the calculations of the district and whether proceeding under Section 44955.5 is even permissible.

Further, the resolution should include a statement that as a result of the short-fall in the State budget and district ADA funding, it has become necessary to reduce the number of certificated employees in the district. The resolution must identify the particular kind of certificated services to be reduced/eliminated in the same manner as the traditional layoff resolution.

3. Serving Timely Notices on Affected Staff

Immediately after the Board adopts the layoff resolution, the district must serve each affected staff member with the layoff notices and accusation packet. Service should be done by certified mail since personal service will be hard to accomplish during the summer.

4. State Hearing by Office of Administrative
Hearings (OAH)

The hearing process is identical to the traditional layoff hearing. Once an individual requests a hearing, they will be given a notice of hearing and dates will be coordinated with OAH. Districts who have not done a layoff in the past two years will need to have a contract with OAH to do the hearing, and they do charge for conducting the hearing.

5. Post-Hearing Action

The proposed decision of the Administrative Law Judge is advisory to the district and will have to be reviewed and acted upon by the district. Assuming that the board confirms some or all of the layoffs, final notices must be prepared and served on affected individuals, including those that did not request a hearing, no later than Friday, August 14, 2009.

6. Notice to Administrators

Education Code section 44955.5 expressly references Section 44951 which addresses the notice to administrative and supervisory employees. As part of the schedule, you may adopt a new notice timeline by which you give notice of release from an administrative position. Release may include a change in compensation, work year, and/or assignment. There are special service requirements in Section 44951, so again certified mail is recommended.

Our office has available the necessary model resolutions, notices, and accusation packet to implement the summer layoff process for those clients that desire to proceed. We also can facilitate contracts with OAH and the setting of hearing dates. We will have a workshop on the issue of summer layoffs on Tuesday, June 23, 2009 from 1:00 – 4:00 p.m. You may sign up for the workshop by calling our office at (707) 524-2690.

If your district feels proceeding with the summer layoff process may be necessary, please contact Margaret Merchat, Carl Corbin, or Loren Soukup at our Santa Rosa office, Nancy Klein at our Marin office, or Janna Lambert at our Hayward and Santa Cruz offices.