[J-15-2017]

IN THE SUPREME COURT OF PENNSYLVANIA

MIDDLE DISTRICT

SAYLOR, C.J., BAER, TODD, DONOHUE, DOUGHERTY, WECHT, MUNDY, JJ.

OFFICE OF ADMINISTRATION AND 

PENNSYLVANIA STATE POLICE,

Appellants

v.

STATE EMPLOYEES' RETIREMENT 

BOARD, BRUCE A. EDWARDS, 

JOSEPH R. KOVEL, JOSEPH E. SARKIS, 

PA STATE TROOPERS ASSOCIATION,

Appellees

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No. 77 MAP 2016

Appeal from the Order of the 

Commonwealth Court at No. 925 CD 

2015 dated December 29, 2015 

Affirming the Decision of the State 

Retirement Board issued on May 6, 

2015 at Nos. 2012-12, 2012-13, and 

2012-24

ARGUED: March 8, 2017

OPINION

JUSTICE DONOHUE DECIDED: March 16, 2018

Section 5302(b)(2) of the State Employees’ Retirement Code, 71 Pa C.S. §§

5101-5956 (“Retirement Code”), requires a public employer to permit an employee to

take leave to serve as a fulltime officer of a statewide employee organization (a union). 

71 Pa.C.S. § 5302(b)(2). While on leave, the public employer “shall fully compensate 

the member, including, but not limited to, salary, wages, pension and retirement 

contributions and benefits, other benefits and seniority, as if he were in full-time active 

service,” and the union must reimburse the employer for all amounts so paid. Id. In the 

present case, we must determine whether compensation paid at higher amounts to 

employees on leave must be considered when computing the employee’s retirement 
[J-15-2017] - 2

benefit under the Retirement Code. To this end, we must decide whether our holding in 

Kirsch v. Pub. Sch. Emp.’ Ret. Bd., 985 A.2d 671 (Pa. 2009), in which we decided the 

same issue under the companion Public School Employees Retirement Code, 24 

Pa.C.S. §§ 8101–9102 (“PSERC”), also applies here. We conclude that the relevant 

statutory provisions of the Retirement Code and PSERC differ significantly and thus 

compel a contrary result. Accordingly, we affirm the order of the Commonwealth Court.

I. Factual and Procedural History

The facts and procedure underlying this matter, while lengthy, are necessary for 

resolution of this appeal. Bruce Edwards, Joseph Sarkis and Joseph Kovel (collectively, 

“Claimants”) are Pennsylvania State Police (“PSP”) officers and members of the 

Pennsylvania State Troopers Association (“PSTA”). The Commonwealth of 

Pennsylvania (“Commonwealth”) and PSTA were parties to a collective bargaining 

agreement, which expired on June 30, 2008.1 During negotiations for a successor 

agreement, the Commonwealth and PSTA reached an impasse regarding, inter alia, 

union officer leave. An Act 111 interest arbitration panel was convened, and it issued 

an award on December 24, 2008 (“December Award”) that included, in relevant part, the 

 

1 The right of firefighters and police officers to collectively bargain for purposes of 

wages, hours, and working conditions is secured through the Police and Firemen 

Collective Bargaining Act, commonly known as Act 111. See 43 P.S. §§ 217.1 - 217.10. 

The dispute resolution process utilized when an Act 111 public employer and bargaining 

agent are at impasse and unable to agree to a new contract is known as “interest 

arbitration.” See 43 P.S. § 217.4. This may be contrasted with the process by which 

parties to a collective bargaining agreement resolve disputes that arise under an 

existing contract, which is known as “grievance arbitration.” Michael Lutz Lodge No. 5. 

v. City of Philadelphia, 129 A.3d 1221, 1222-23 (Pa. 2015). While the collective 

bargaining agreement at issue here was between the Commonwealth and PSTA, the 

Commonwealth acted, ostensibly, on behalf of PSP. 
[J-15-2017] - 3

following leave provision providing for compensation for those officers while on leave 

serving their union:

Upon written request by PSTA, Union officers shall be released from duty.

Union officers released from duty pursuant to State law shall 

be paid by the Commonwealth at the amount designated by 

PSTA Board of Directors, not to exceed the rate of the 

highest ranking member of the bargaining unit with 

appropriate longevity. Any amount paid by the 

Commonwealth, including the cost of all benefits, shall be 

reimbursed by the PSTA to the Commonwealth, in 

accordance with law.

Pa. State Police v. State Emp.’ Ret. Bd., 131 A.3d 136, 137-38 (Pa. Commw. 2015)

(“PSP v. SERB”) (quoting December Award). The Office of Administration (“OA”)2 and 

PSP (collectively, “Appellants”) appealed the December Award to the Commonwealth 

Court, arguing that the arbitration award violated the creditable leave provision found in 

section 5302(b)(2) of the Retirement Code, 71 Pa.C.S. § 5302(b)(2), as, in their view, 

that section obligated the Commonwealth to pay

 

2 The OA is the administrator of the Commonwealth’s collective bargaining 

agreements, and interest arbitration awards, with the unions representing the 

Commonwealth’s employees, including the PSTA. Appellants’ Brief at 5.
[J-15-2017] - 4

a trooper on union leave only the compensation that the trooper would receive “as if he 

were in full-time active service.”3,

4

Id. 

The Commonwealth Court agreed with Appellants, basing its reasoning on this 

Court’s holding and analysis in Kirsch v. Public School Employees’ Retirement Board, 

985 A.2d 671 (Pa. 2009), and concluded that the union officer leave provision of the 

December Award violated section 5302(b)(2)’s creditable leave provision because it 

required the Commonwealth to pay officers on union leave more than they would 

 

3 Section 5302(b)(2) provides, in relevant part:

(b) Creditable leaves of absence.–

* * *

(2) An active member on paid leave granted by an employer 

for purposes of serving as an elected full-time officer for a 

Statewide employee organization which is a collective 

bargaining representative under the act of June 24, 1968 

(P.L. 237, No 111), referred to as the Policemen and 

Firemen Collective Bargaining Act . . . : Provided, That for 

elected full-time officers such leave shall not be for more 

than three consecutive terms of the same office . . . ; that 

the employer shall fully compensate the member, 

including, but not limited to, salary, wages, pension and 

retirement contributions and benefits, other benefits and 

seniority, as if he were in full-time active service; and 

that the Statewide employee organization shall fully 

reimburse the employer for all expenses and costs of such 

paid leave.

71 Pa.C.S. § 5302(b)(2) (emphasis added). Section 5302 was amended by Act 2015-

93 (H.B. 1332), § 10, approved December 28, 2015, effective that same date, and 

subsequently by Act 2017-5 (S.B. 1), § 306, approved June 12, 2017, effective that 

same date, but these amendments do not alter the relevant sections of the statute for 

purposes of our decision today.

4 For purposes of our Opinion, the rate of pay paid to union officers on fulltime leave is 

referred to as the “union rate of pay.” Further, the difference between Claimants’ union 

rate of pay and Claimants’ rate of pay in fulltime active service, the first generally being 

greater than the second, is herein referred to as the “union differential.”
[J-15-2017] - 5

receive if they were not on leave. Commonwealth v. Pa. State Troopers Ass’n, 979 

A.2d 442 (Pa. Commw. 2009) (“PSTA I”).5

By way of background, in Kirsch, recently retired public school employees on 

union officer leave sought to utilize the compensation that they had received as union 

officers – a compensation greater than they would have received had they remained in 

their positions in the school district – for purposes of retirement computation. In this 

regard, the school district had traditionally reported to the Public School Employees’ 

Retirement System (“PSERS”) only the compensation the union-leave employees would 

have earned had they remained in their pre-union-leave positions with the school 

district. However, after the school district and the union entered into a collective 

bargaining agreement that required the school district to report to PSERS the actual, 

higher wages received by union-leave employees, those employees, upon retirement, 

sought to have the higher salaries they had received while on leave, determined on an 

annual ad hoc basis, included in their retirement benefit calculations. PSERS opposed 

the retired employees’ request, arguing the retirees were not entitled to inflated pension 

benefits under the definition of “leave for service with a collective bargaining 

organization,” found in section 8102 of PSERC.

Our Court considered the plain language of the definition, the context of the 

statute, and its legislative background and purpose, and concluded that the “as if he 

 

5 Notably, Judge Pellegrini dissented on this issue, concluding that the majority’s 

reliance on Kirsch was inapt because the court was not being asked to review a Public 

State Employees’ Retirement Board decision as to what pension credit a police officer 

would receive when that officer retires. Rather, in Judge Pellegrini’s view, only when 

the officers retire and the Public State Employees’ Retirement Board makes a decision, 

which could then be appealed, would Kirsch be applicable. PSTA I, 979 A.2d at 448 

(Pellegrini, J., concurring and dissenting).
[J-15-2017] - 6

were in full-time active service” compensation language in the definition precluded the 

school employees from receiving retirement credit for the higher salaries they were paid 

while serving as union officials. Kirsch, 985 A.2d at 677. We further reasoned that, 

because the salaries received by the school employees while on union leave were 

determined on an ad hoc annual basis, and not pursuant to the standard salary 

schedule, they were excluded from the definition of “compensation” under PSERC. 

Therefore, our Court held that the union differential was not retirement-covered 

compensation, and that only the salary corresponding with the position held at the 

school district during the approved leave should be credited to the retiree’s retirement 

earnings. Id. at 678.

In the instant case, on appeal from PSTA I, a plurality of our Court found reliance 

on Kirsch to be premature, concluding section 5302(b)(2) of the Retirement Code “does 

not purport to address the pre-retirement concern of the level or amount of employee 

salaries,” and that, therefore, the December Award did not violate the Retirement Code. 

Commonwealth v. Pa. State Troopers Ass’n, 23 A.3d 966, 973 (Pa. 2011) (plurality) 

(“PSTA II”).6 Of relevance here, in distinguishing Kirsch and finding that the December 

Award was within the authority of the Act 111 arbitration panel and, as such, was 

beyond the scope of our review, id. at 977, Justice McCaffery, writing for the plurality, 

observed that “[t]he only issues in Kirsch [] were whether the employees should receive 

credit for [the union differentials] for purposes of computing their retirement pension 

 

6 Justice McCaffery authored the Opinion Announcing the Judgment of the Court, 

joined by Justices Baer and Todd. Justice Orie Melvin concurred in the result. Chief 

Justice Castille filed a dissenting opinion in which Justice Eakin joined, and Justice 

Saylor filed a dissenting opinion in which Chief Justice Castille joined. 
[J-15-2017] - 7

benefits,” id. at 974, and that “the instant case does not involve the calculation of 

pensions but the essential authority of an Act 111 interest arbitration panel to set 

salaries,” id. at 975. Noting that Kirsch arose from an appeal of a decision of the Public 

School Employees’ Retirement Board (“PSERB”) interpreting its mandate under 

PSERC, and not from an appeal of an interest arbitration award under Act 111 or the 

Public Employee Relations Act, Justice McCaffery observed that Kirsch “dealt with postemployment retirement matters, not the salary requirements of present employees, 

which are at issue in the instant case.” Id. at 976.

Then-Justice, now-Chief Justice Saylor, joined by Chief Justice Castille, authored

a dissenting opinion, offering that the General Assembly’s intent in compensating an 

employee on leave for union service “as if he were in full-time active service” was to 

“preserve the ongoing accrual of retirement benefits for employees.” Id. at 979 (Saylor, 

J., dissenting). Doing otherwise, according to the dissent, would “create an untenable 

administrative burden on the Commonwealth and the retirement system.” Id. Chief 

Justice Castille also authored a dissenting opinion, joined by Justice Saylor, in which he 

would have found the Court’s prior decision in Kirsch — in which the Court considered 

identical language and excluded union-approved salary from retirement calculation to 

the extent it exceeded the school district’s standard salary — to be controlling.

Following the issuance of our decision in PSTA II, Appellants complied with the 

December Award and paid Claimants at the union rate of pay. All pay for members of 

the bargaining unit of troopers is determined through collective bargaining. The 

collective bargaining agreement between the Commonwealth and PSTA’s, during 

relevant times, based salary on rank (Trooper through Major) and years of service. 
[J-15-2017] - 8

More specifically, Claimant Edwards, who was on full-time union officer leave from 

January 2007 through January 2012, during which he served as President of the PSTA, 

was paid at the rate commensurate with the rank of a Major, although he held the rank 

of a Sergeant while at PSP; Claimant Sarkis, who was on full-time officer leave from 

October 2009 to January 2012, during which time he served as Vice President of the 

PSTA, was paid as a Captain, although he held the rank of a Corporal while at PSP; 

and beginning in January 2012, when he assumed the Presidency of the PSTA, 

Claimant Kovel was paid as a Sergeant, although he previously held the rank of 

Corporal. Although the Commonwealth paid Claimants at the union rate of pay, it did 

not report the union differential as retirement-covered compensation or deduct pension 

contributions based on the higher amounts. Instead, the Commonwealth reported only 

Claimants’ rate of pay as if they were in fulltime active service as retirement-covered 

compensation and deducted pension contributions accordingly.

In July 2011, the PSTA asked the interest arbitration panel to reconvene. PTSA 

sought a declaration from the panel that the union differentials were retirement-covered 

compensation and that pension contributions should be withheld accordingly. The 

panel issued an Implementation Order on September 26, 2011 which, in relevant part, 

directed that the Commonwealth:

Deduct and continue to deduct from . . . all . . . wages paid 

while on union leave all appropriate contributions, including 

mandatory employee pension contributions from all sums 

paid to the affected members pursuant to [the union officer 

leave provision], effective retroactive to pay date January 7, 

2011. . . .

PSP v. SERB, 131 A.3d at 139 (citing the Implementation Order). After exhausting all 

appeals of the Implementation Order, Appellants, in separate actions, requested a 
[J-15-2017] - 9

decision from the State Employees’ Retirement System (“SERS”) regarding how 

Appellants should report Claimants’ union officer leave; how much compensation should 

be reported under the Retirement Code; and what contributions should be made to 

SERS for Claimants Edwards, Sarkis and Kovel. SERS ultimately determined that the 

retirement computation should be based on the compensation Claimants would have 

received if they had not been on union leave:

[T]he compensation that the affected officers would have 

received in their positions as a State Police officer had they 

not been on union officer leave should be reported to SERS. 

Employer and member contributions should be made to 

SERS only on the compensation that the affected officers 

would have received as State Police officers had they not 

been on union officer leave. 

Id., (citing SERS decision). The PSTA and Claimants appealed SERS’s determinations 

to the State Employees’ Retirement Board (“Board”). Thereafter, Appellants filed a 

petition to intervene, which the Board granted. A hearing officer was appointed and the 

appeals were consolidated.

On January 24, 2014, the hearing officer issued a decision concluding the union 

differentials were not retirement-covered compensation under the Retirement Code. 

Finding Kirsch controlling, the hearing officer reasoned that only the salaries Claimants 

would have earned “as if” they were in fulltime active service were retirement-covered 

compensation. The hearing officer rejected Claimants’ argument that the different 

definitions of “compensation” contained in the Retirement Code and PSERC, compare

71 Pa.C.S. § 5102, with 24 Pa.C.S. § 8102, rendered Kirsch distinguishable as in PSTA 

II. The hearing officer further examined the legislative history of section 5203(b)(2), 

offering that PSP employees on fulltime union leave were able to receive retirement 
[J-15-2017] - 10

credit only after section 5203(b)(2) was amended in 2006. More specifically, the 

hearing officer observed that, when the 2006 amendment was originally proposed in the 

Senate, it read, in relevant part, that the member on leave would be paid “by an 

employer for purposes of serving as an appointed or elected full-time official or officer at 

his union rate of compensation.” However, the Hearing Officer stressed that the final 

version of the 2006 amendment did not include the phrase “at his union rate of 

compensation,” suggesting the union differential would not be the proper amount for 

computing retirement benefits. PSP v. SERB, 131 A.3d at 140 (citing Hearing Officer’s 

Opinion and Recommendation). Further, the hearing officer concluded that, to allow the 

union differentials paid to Claimants to be considered retirement-covered compensation 

would essentially allow a collective bargaining agreement or arbitration award to dictate 

the pension rights of state employees, in disregard of section 5955 of the Retirement 

Code which precludes, inter alia, collective bargaining agreements or arbitration awards 

from altering pension rights. 71 Pa.C.S. § 5955.7 Claimants filed exceptions to the 

hearing officer’s determination.

 

7 Section 5955 of the Retirement Code provides:

Regardless of any other provision of law, pension rights of 

State employees shall be determined solely by this part or 

any amendment thereto, and no collective bargaining 

agreement nor any arbitration award between the 

Commonwealth and its employees or their collective 

bargaining representatives shall be construed to change any 

of the provisions herein, to require the board to administer 

pension or retirement benefits not set forth in this part, or 

otherwise require action by any other government body 

pertaining to pension or retirement benefits or rights of State 

employees.

(continued...)
[J-15-2017] - 11

The Board adopted the hearing officer’s findings of fact, but rejected her 

conclusions of law, analysis, and recommendation, determining that she erred in finding 

Kirsch controlling, and that the differences between the definition of “compensation” 

found in the Retirement Code8 and PSERC9 prevented the Board from simply adopting 

 

(...continued)

71 Pa.C.S. § 5955. Section 5955 was amended by Act 2015-93 (H.B. 1332), § 10, 

approved December 28, 2015, effective that same date, and subsequently by Act 2017-

5 (S.B. 1), § 306, approved June 12, 2017, effective that same date, but these 

amendments do not alter the relevant sections of the statute for purposes of our 

decision today.

8

“Compensation” is defined in the Retirement Code, in relevant part, as:

[p]ickup contributions plus remuneration actually received as 

a State employee excluding refunds for expenses, 

contingency and accountable expense allowances; 

excluding any severance payments or payments for unused 

vacation or sick leave; and excluding payments for military 

leave.

71 Pa.C.S. § 5102. Section 5102 was amended by Act 2015-93 (H.B. 1332), § 10, 

approved December 28, 2015, effective that same date, and subsequently by Act 2017-

5 (S.B. 1), § 306, approved June 12, 2017, effective that same date, but these 

amendments do not alter the relevant sections of the statute for purposes of our 

decision today.

9

“Compensation” is defined in PSERC, in relevant part, as:

[p]ickup contributions plus any remuneration received as a 

school employee excluding reimbursements for expenses 

incidental to employment and excluding any bonus, 

severance payments, any other remuneration or other 

emolument received by a school employee during his school 

service which is not based on the standard salary schedule 

under which he is rendering service, payments for unused 

sick leave or vacation leave, bonuses or other compensation 

for attending school seminars and conventions, payments 

under health and welfare plans based on hours of 

employment or any other payment or emolument which may 

be provided for in a collective bargaining agreement which 

may be determined by the Public School Employees’ 

(continued...)
[J-15-2017] - 12

the Hearing Officer’s application of Kirsch to resolve Claimants’ appeals. Concluding, 

as we noted in PSTA II, that the definition of compensation is broader in the Retirement 

Code than in PSERC, and that, in contrast to Kirsch, the Retirement Code definition 

was broad enough to encompass the union differentials received by Claimants, the 

Board further noted that Claimants’ union differentials were a product “derived from the 

normal salary schedule” found in the collective bargaining agreement, unlike the union 

pay rate in Kirsch, which was negotiated annually on an ad hoc basis. Therefore, the 

Board reasoned that, because the union differential “does not fall into any of the 

categories of non-compensation payments found in section 5102’s definition, it must 

therefore be ‘compensation’ for purposes of [the Retirement Code] and thus includible 

as part of . . . Claimants’ retirement-covered compensation.” PSP v. SERB, 131 A.3d at 

141 (quoting Board Decision at 37). Accordingly, the Board overruled the hearing 

officer’s determination and granted Claimants’ request that SERS treat the union 

differentials as retirement-covered compensation.

On appeal, the Commonwealth Court affirmed. Appellants argued that the Board 

erred as a matter of law in concluding the union differentials were retirement-covered 

compensation because, in their view, the Board’s interpretation was contrary to Kirsch, 

and, further, that the December Award created or modified retirement benefits in 

 

(...continued)

Retirement Board to be for the purpose of enhancing 

compensation as a factor in the determination of final 

average salary, and excluding payments for military leave.

24 Pa.C.S. § 8102. Section 8102 was amended by Act 2015-93 (H.B. 1332), § 10, 

approved December 28, 2015, effective that same date, and subsequently by Act 2017-

5 (S.B. 1), § 306, approved June 12, 2017, effective that same date, but these 

amendments do not alter the relevant sections of the statute for purposes of our 

decision today.
[J-15-2017] - 13

violation of section 5955 of the Retirement Code. The Board countered that its 

conclusion was correct because it believed Kirsch was not controlling, maintaining that 

the December Award did not alter the benefits formula or eligibility criteria established 

by the Retirement Code, and, therefore, did not usurp its authority in violation of section 

5955. Id. at 141.

The Commonwealth Court acknowledged that the central issue in the case was 

the proper interpretation of the relevant provisions of the Retirement Code: the 

definition of “compensation” in section 5102 and the creditable leave provision in section 

5302(b)(2). Id. at 142. Noting that, as SERS members, Claimants’ retirement benefits 

are calculated using a formula that takes into account both the amount of credited 

service and the amount of compensation paid during such credited service, the court 

observed that, although it is questionable whether union officer leave would be 

considered state service without section 5302(b)(2), that section explicitly provides that 

such time shall be credited to a state employee “as if he were in full-time active service.” 

Id. Thus, under section 5302(b)(2), the court reasoned the salary received by those on 

fulltime union leave is considered the salary received by a state employee. Id. Under 

section 5102 of the Retirement Code, “remuneration actually received as a State 

employee” is considered retirement-covered compensation unless it falls into one of the 

enumerated exclusions: refunds for expenses, contingency and accountable expense 

allowances; severance payments or payments for unused vacation or sick leave; and 

payments for military leave. Id. Therefore, the court concluded, because it was 

undisputed that the salaries received while on fulltime union leave did not fall into any of 
[J-15-2017] - 14

the exclusions listed in the definition of compensation, the remuneration received by 

PSP officers on fulltime union leave was retirement-covered compensation. Id.

With regard to Appellants’ contention that the Board’s interpretation was contrary 

to our holding in Kirsch, the Commonwealth Court embraced the Board’s reasoning 

that, because the definition of compensation in PSERC differed from the definition of 

compensation in the Retirement Code, the Board was not compelled to apply the 

holding in Kirsch to the instant case

In both Kirsch and the present case, employees on full-time 

union leave could only receive retirement credit “as if [they] 

were in full-time active service.” The difference between 

Kirsch and the instant case is that in Kirsch, the school 

employees, even if not on union leave, would not have been 

entitled to have any portion of their salary outside of the 

standard salary schedule credited as retirement-covered 

compensation, while Claimants here, whether on full-time 

union leave or not, are entitled to have all remuneration 

credited as retirement-covered compensation (except for 

exclusions not applicable here). The Board’s interpretation 

and application, therefore, were not contrary to law or clearly 

erroneous.

Id. at 144.

Finally, as to Appellants’ claim that the Board erred in concluding the union 

differentials were retirement-covered compensation because, in doing so, it allowed the 

December Award to create or modify Claimants’ retirement benefits in violation of 

section 5955, the Commonwealth Court disagreed, citing Weaver v. State Emp’ Ret.

Bd., 129 A.3d 585 (Pa. Commw. 2015), wherein the court held that section 5955 should 

be construed to prohibit only bargaining for greater pension benefits than that allowed in 

the Retirement Code, and that the Code does not prohibit bargaining with respect to 

pension benefits or prohibit pension benefits from being impacted by an arbitration 
[J-15-2017] - 15

award. Id. at 591. Rather, the court in Weaver found that section 5955 of the 

Retirement Code prohibits only a collective bargaining agreement from determining 

pension rights. Id. In the present case, noting that the Board did not allow the award to 

determine Claimants’ pension benefits, but, instead, based its determination on the 

requirements set forth in sections 5102 and 5302(b)(2) of the Retirement Code, the 

Commonwealth Court concluded that the arbitration award affected the pension 

benefits, as permitted by the Retirement Code, but did not increase them in violation of 

section 5955. PSP v. SERB, 131 A.3d at 145. Accordingly, the court affirmed the 

Board’s order.

II. Arguments

Appellants’ primary focus, and first contention, is that our decision in Kirsch is 

controlling. Appellants point out that, in that matter, school district employees were on a 

leave of absence to work for their union, and in doing so, were paid a higher rate of 

salary by the unions than they would have been paid had they continued in their school 

employee positions. According to Appellants, our Court in Kirsch reasoned that, 

pursuant to the language of PSERC, the individuals were not entitled to benefits based 

upon their enhanced salaries. Appellants maintain that, in reaching this conclusion, we 

expressly relied upon language in PSERC that is identical to that found in the 

Retirement Code: that retirement is authorized for compensation paid “as if [the 

employee] were in full-time active service.” Kirsch, 985 A.2d at 675. Building on this 

argument, Appellants offer that our Court reasoned that, while the General Assembly

did not limit the salary to be paid to union officials while on leave, the most common 

interpretation of the language used, “‘as if,’ denotes the idea of ‘to the same degree,’ 
[J-15-2017] - 16

and is not most commonly used to mean ‘in the same manner,’” as one of the parties in 

Kirsch argued. Id. at 676. Further, Appellants emphasize that the facts in the two 

matters are virtually identical, with union officers on leave being compensated at a 

higher rate of pay than they would have earned working for the school district.

Appellants also reject the Commonwealth Court’s reliance on the Retirement 

Code’s definition of “compensation” in reaching its conclusion. According to Appellants, 

the concept of union differentials is not specifically included in, or excluded from, the 

definition of compensation. Moreover, Appellants claim that union differentials could not 

have been contemplated by the General Assembly as within the definition of 

compensation, as the pertinent section of the definition of “compensation” was already 

in place when section 5302(b)(2) was amended to grant employees leave to serve their 

union. Thus, according to Appellants, but for section 5302(b)(2), none of the 

compensation earned by union officers while on leave would have been considered 

retirement-covered compensation.

Appellants further assert that the legislative history underlying the enactment of 

the Retirement Code establishes that the General Assembly did not intend for 

employees on leave to serve their union to receive greater retirement credit than those 

who continue to work for their employer, as both PSERC and the Retirement Code were 

amended at the same time to allow employees to earn retirement credit while on leave 

to work for their union, and, according to Appellants, to restrict the retirement credit to 

that which would have been earned had they continued to work for their public 

employer. Appellants posit that this effort to preserve the status quo for employees on 

leave to work for their union does not mean an enhanced retirement benefit to union 
[J-15-2017] - 17

officers on leave, but merely the ability to earn the same retirement benefit the 

employee would have earned had the employee not taken a leave of absence for union 

business. Moreover, Appellants point to a failed 2006 attempt to amend the Retirement 

Code to specifically allow for union salaries to be counted as retirement-covered 

compensation.

Appellants add that the Commonwealth Court misconstrued our decision in 

PSTA II, emphasizing that our Court stated our decision was “not about how the award 

will one day be interpreted by the agency charged with administering the [Retirement 

Code]. . . . This is a case falling under Act 111.” PSTA II, 23 A.3d at 972. Thus, 

Appellants stress that PSTA II involved whether an interest arbitration panel had the 

authority to award a higher rate of pay to union officers who were on leave to work for 

the union, and not whether union differentials should be considered retirement-covered 

compensation. Finally, Appellants highlight section 5955, contending that the provision 

prohibits arbitration awards from being used to create or modify retirement rights.

The Board counters that the Retirement Code permits union officers on leave to 

receive retirement credit and benefits when they serve as union officers. The Board 

points to section 5302 of the Retirement Code which, in relevant part, grants retirement 

service credit for active members on paid leave to serve as an officer for a union, and 

“that the employer shall fully compensate the member, including, but not limited to, 

salary, wages, pension and retirement contributions and benefits, other benefits and 

seniority, as if he were in full-time active service.” 71 Pa.C.S. § 5302(b)(2). The Board 

asserts that Kirsch is distinguishable. Specifically, the Board offers that the union 

officers’ salaries in that case were negotiated annually on an ad hoc basis, and were not 
[J-15-2017] - 18

based upon the salary scales contained in the collective bargaining agreement, as in 

the matter sub judice. While the school district in Kirsch reported the full amount of the 

payment to the officers’ annual payment to PSERS, it did not fully recognize the 

amounts reported as the union officers’ compensation for retirement purposes. The 

Board explains that our Court looked to the definition of “compensation” under PSERC, 

which is defined more narrowly than under the Retirement Code, and found that the ad 

hoc personally-negotiated salaries of the union officers were excluded from their 

pensionable salary as they were not based upon the standard salary schedule for the 

school district as required by PSERC. Thus, according to the Board, Kirsch did not 

create a blanket rule that union salaries may not be used as compensation for pension 

purposes, but, rather, that only compensation not based on the standard salary 

schedule was excluded from pension calculations. From this, the Board argues that not 

only must the provision authorizing pension benefits be considered, but other terms 

used to calculate the benefits payable in a particular case must be taken into account.

Further, the Board rejects Appellants’ assertion that Kirsch’s holding should apply 

equally in this case, because PSERC and the Retirement Code employ different 

definitions of “compensation,” stressing the broader definition under the Retirement 

Code. The Board continues that, under the Retirement Code, as long as the payment is 

“remuneration actually received as a State employee” while the employee is on union 

leave and not a prohibited reimbursement, it is “compensation” and includible in the 

calculation of the member’s pension benefit. As the wages paid to the Claimants are 

derived from the PSP’s pay schedule through the collective bargaining process, and not 
[J-15-2017] - 19

an ad hoc stipend personally negotiated by the parties, the Board claims such wages 

are includable in their pension calculation.

The Board then addresses section 5955’s prohibition against collective 

bargaining or arbitration awards changing retirement benefits. The Board submits that 

the Commonwealth Court properly concluded that the Retirement Code does not 

prohibit arbitration awards from impacting pension benefits, but, rather, only prohibits 

agreements from determining pension rights. The Board notes that the terms of the 

arbitration award in this case do not require it to provide benefits outside of the formulas 

and classes established by statute. According to the Board, the award does nothing 

more than establish compensation for a specific class of employees, which is within the 

authority of an arbitration panel, and a collective bargaining agreement or arbitration 

award granting such an increase in pay which creates a rise in the employee’s pension 

does not violate section 5955. The Board emphasizes that this is especially true here, 

where the payments were based upon the employer’s standard pay schedule. Thus, 

the Board contends the award neither violates section 5955 nor oversteps the panel’s 

authority.

Claimants and PSTA, as intervenors, largely echo the Board’s arguments, 

highlighting that the distinction between the statutory language in PSERC and in the 

Retirement Code renders Kirsch distinguishable. Because the bargained-for union 

differential was “compensation” under the Retirement Code, for which the 

Commonwealth must fully compensate Claimants, Claimants and PSTA maintain that 

such amounts are properly used to calculate pension benefits under the Retirement 

Code. 
[J-15-2017] - 20

III. Analysis

This Court granted discretionary review to address the following question: 

Did [the] Commonwealth Court erroneously affirm the 

decision of the State Employees’ Retirement Board that 

union stipends, paid to union officers to work exclusively for 

the union, are retirement-covered compensation, when that

decision was clearly contrary to the mandates of the State 

Employees’ Retirement Code and inconsistent with 

decisions of this Honorable Court?

Office of Admin. v. SERB, 163 A.3d 395 (Pa. 2016) (per curiam). This question may be 

separated into two distinct issues. First, whether the Commonwealth Court

misinterpreted the retirement compensation provisions of the Retirement Code in a 

manner inconsistent with this Court’s interpretation in Kirsch of the corresponding 

provisions of PSERC. Second, whether the December Award violated section 5955 of 

the Retirement Code by permitting the pension rights of certain state employees to be 

modified by an arbitration award. We will address these two issues in turn. Because 

resolution of both issues require that we engage in statutory interpretation, they present 

pure questions of law, for which our standard of review is de novo and our scope of 

review is plenary. See, e.g., Scungio Borst & Assocs. v. 410 Shurs Lane Developers, 

LLC, 146 A.3d 232, 238 (Pa. 2016).

Pursuant to the Statutory Construction Act, “the object of all interpretation and 

construction of statutes is to ascertain and effectuate the intention of the General 

Assembly.” 1 Pa.C.S. § 1921(a). It is well settled that the best indication of the General 

Assembly’s intent may be found in a statute’s plain language. See id., § 1921(b). Thus, 

“when the language of a statute is plain and unambiguous and conveys a clear and 

definite meaning,” we must give the statute this plain and obvious meaning. Mohamed 
[J-15-2017] - 21

v. Commonwealth Dep’t of Transp., 40 A.3d 1186, 1194 (Pa. 2012). In ascertaining 

legislative intent, courts may apply certain presumptions, including that General 

Assembly does not intend a result that is absurd, impossible of execution, or 

unreasonable. 1 Pa.C.S. § 1922(1); Commonwealth v. Shiffler, 879 A.2d 185, 189–90 

(Pa. 2005).

A. Retirement-Covered Compensation

The Commonwealth Court ruled that given the differing statutory provisions in 

PSERC and the Retirement Code, the Board was not required to apply our holding in 

Kirsch in this case. Appellants contend that in Kirsch, this Court focused on PSERC’s 

definition of “leave for service with a collective bargaining organization,” including in 

particular its language requiring that the employer fully compensate the employee on 

union leave “as if he were in full-time active service.” Appellants argue that in Kirsch we 

ruled that this language precludes the inclusion of union differentials in pension benefits 

calculations, and that, as such, the Board was compelled to similarly interpret the

Retirement Code, which contains the same language. The Board, Claimants and PSTA 

posit instead that Kirsch did not create a blanket rule applicable under both PSERC and 

the Retirement Code, and that the differing definitions of the term “compensation” in the 

two statutory schemes properly accounts for the contrasting results in the two cases. 

We agree with the Board, Claimants and PSTA that Kirsch did not create any 

such blanket rule. In Kirsch, this Court began with the above-referenced language in 

PSERC that the employer fully compensate the employee on union leave “as if he were 

in full-time active service.” Kirsch, 985 A.2d at 675 (citing 24 Pa.C.S. § 8102). We 

interpreted this provision to “remove any impediments which precluded retirement 
[J-15-2017] - 22

service credit from being attributed to employees on leave of absence to serve the 

union.” Id. at 677. We recognized that, on the one hand, this language did not 

expressly limit the salary that an employee on union leave could receive, but, on the 

other, it also did not suggest any legislative intent that employees on union leave should 

receive greater retirement benefits than those received by employees not on leave. Id.

at 676-77. Instead, we concluded that the General Assembly’s intent was to “equalize 

the playing field by providing retirement benefits for school employees regardless of 

whether they serve outside the school for a limited time.” Id. at 677. 

With respect to whether union differentials could be used in the computation of 

retirement benefits, in Kirsch we turned to PSERC’s definition of “compensation,” which 

specifically excludes remuneration “which is not based on the standard salary schedule 

under which he is rendering service... .” Id. Based upon this definition, we concluded 

that any remuneration in excess of that which is based on the standard salary schedule 

for school employees does not constitute “compensation,” and thus must be excluded 

from the computation of retirement benefits. Id. at 678. Because it was admitted that 

the higher salaries paid to school employees while on union leave were not based upon, 

and were in fact higher than, those available under the standard salary schedule for 

school employees generally, they were properly excluded as not constituting 

“compensation” for purposes of calculating pension benefits. Id.
[J-15-2017] - 23

The language of the Retirement Code,10 however, including in particular its 

sharply differing definition of “compensation,” demonstrates that the General Assembly 

manifestly intended the opposite result to obtain for police officers and firefighters than 

for school employees. Unlike the restrictive and limiting definition of language in 

PSERC, in the Retirement Code, “compensation” is defined as all “remuneration 

actually received,” excluding certain expenses not at issue here. 71 Pa.C.S. § 5102 

(emphasis added). Accordingly, unlike in Kirsch where, pursuant to PSERC any 

remuneration in excess of that available under the standard salary schedule does not 

constitute “compensation,” under the Retirement Code, all remuneration actually 

received (other than an excluded reimbursement) does constitute “compensation” and 

thus is included in the calculation of pension benefits. Under the Retirement Code, 

unlike under PSERC, union differentials actually received is “compensation” for 

purposes of pension benefit computations. 

In this regard, we agree with the Commonwealth Court’s observation that under 

both the Retirement Code and PSERC, employees on union leave are only entitled to 

pension benefits “as if [they] were on full-time active service.” PSP v. SERB, 131 A.3d 

at 144. Under both statutory schemes, pension benefits are calculated based upon 

years of service and “final average salary.” 71 Pa.C.S. § 5702; 24 Pa.C.S. § 8342. 

“Final average salary” is in turn based on the “highest average compensation received 

as a member” during defined periods of service. 71 Pa.C.S. § 5102; 24 Pa.C.S. § 8102

(emphasis added”). Consequently, given PSERC’s definition of “compensation,” school 

 

10

 Because the language of the relevant provisions of the Retirement Code are 

unambiguous, we may not consider the arguments based upon legislative history 

proffered by Appellants. 1 Pa.C.S. § 1921(c).
[J-15-2017] - 24

employees are not entitled to have any portion of their remuneration in excess of that 

based upon the standard salary schedule be included in the calculation of “final average 

salary” – whether or not on union leave. Conversely, under the Retirement Code, 

police officers and firefighters, whether or not on union leave, are entitled to have all 

“remuneration actually received” included in “compensation” when computing their “final 

average salary.” Both the Retirement Code and PSERC permit union leave without any 

loss of pension benefits, and both require that employees on leave continue to be 

compensated “as if [they] were on full-time active service.” Because of the differing 

definitions of “compensation,” however, the levels of compensation received while on 

union leave are treated differently for purposes of computing pension benefits. Union 

differentials merely highlight the pointed distinction between the calculation of pension 

benefits under the Retirement Code and PSERC. 

For these reasons, we conclude that a police officer or firefighter may take leave 

to serve as a full time officer of his or her union, and all remuneration actually received 

while on leave is includible when calculating retirement benefits. The Commonwealth 

Court did not err in ruling that the union differentials received by Claimants in this case 

were properly included in their retirement benefit computations.

B. Violation of Retirement Code

Appellants next contend that the December Award, which set the salary levels for 

union officers on leave (including Claimants) at specified levels during the term of said 

leave violates section 5955 of the Retirement Code.11 Section 5955 provides that 

 

11 Section 5955 states:

(continued...)
[J-15-2017] - 25

pension rights of state employees are determined by the Retirement Code and that no 

collective bargaining agreement or arbitration award may change the provisions of the 

Retirement Code, require the Board to administer any other pension or retirement 

benefits, or require any action by any other government body with respect to pension or 

retirement benefits. 71 Pa.C.S. § 5955. According to Appellants, the December Award 

created union differentials for Claimants, and thus their increased retirement benefits 

are the impermissible result of implementation of the December Award. 

As indicated hereinabove, pursuant to the Statutory Construction Act, when 

construing legislative intent, courts may apply certain presumptions, including that 

General Assembly does not intend a result that is absurd, impossible of execution, or 

unreasonable. 1 Pa.C.S. § 1922(1). Based upon application of this presumption, we 

cannot agree with Appellants’ proposed interpretation of section 5955. In particular, it 

would be both absurd and unreasonable to interpret section 5955 in a manner that 

would preclude collective bargaining agreements or arbitration awards from including 

any negotiated salary increases. Under Appellants’ proposed interpretation, collective 

bargaining agreements or arbitration awards could never include negotiated salary 

 

(...continued)

Regardless of any other provision of law, pension rights of 

State employees shall be determined solely by this part or 

any amendment thereto, and no collective bargaining 

agreement nor any arbitration award between the 

Commonwealth and its employees or their collective 

bargaining representatives shall be construed to change any 

of the provisions herein, to require the board to administer 

pension or retirement benefits not set forth in this part, or 

otherwise require action by any other government body 

pertaining to pension or retirement benefits or rights of State 

employees.

71 Pa.C.S. § 5955.
[J-15-2017] - 26

increases, as such increases would, based upon the above-discussed methods of 

computation, typically result in increased retirement benefits. 

Instead, we agree with the Commonwealth Court that section 5955 of the 

Retirement Code does not restrict bargaining over pension benefits, and only prohibits 

collective bargaining agreements or arbitration awards from granting pension benefits 

not authorized or supported by the Retirement Code. Kirsch, 131 A.3d at 144; see Pa. 

State Troopers Ass'n v. State Emp' Ret. Bd., 677 A.2d 1329 (Pa. Commw. 1996) (“[A]s 

long as an arbitration award does not grant rights that are unsupported by the 

Retirement Code, then the award is not unlawful.”), appeal denied, 689 A.2d 237 (Pa. 

1997); Weaver, 129 A.3d at 591. As the Commonwealth Court also correctly observed, 

this Court upheld the December Award in PSTA II under the Retirement Code even 

though it provided for union differentials for those employees on union leave. PSP, 131 

A.3d at 144 (citing PSTA II, 23 A.3d at 977).

The order of the Commonwealth Court is affirmed. 

Justices Baer, Todd, Dougherty, Wecht and Mundy join the opinion.

Chief Justice Saylor did not participate in the consideration or decision of this 

case.