Court Opinion

ID: 9561869
Source: CourtListenerOpinion
Date Created: 2023-08-21 18:17:48.903905+00
Date Added: 2024-06-11T09:13:08.219734
License: Public Domain

Hicks, J.
(concurring in part; dissenting in part)—I have no quarrel with the majority in its determination that inclusion of termination payments in an employee's pension base does no violence to the equal protection clause. I do, however, differ with the majority in its conclusion that an employee's pension base may include payments other than those earned as salary or wages for personal services rendered during the 2-year measuring period. The majority's reliance on Bakenhus v. Seattle, 48 Wn.2d 695, 296 P.2d 536 (1956) to support its decision, I believe, is misplaced.
*735The term "average final compensation" on which the computation of monthly pension payments is based is defined in RCW 41.40.010(15) as:
the annual average of the greatest compensation earna-ble by a member during any consecutive two year period of service for which service credit is allowed . . .
(Italics mine.) The term "earnable" does not mean "receivable". It seems to me that by its use of the word "earna-ble", the legislature restricts the pension base to salary or wages earned in a particular 2-year period. Termination or other additional amounts received by the employee during that 2-year period cannot be said to have been "earnable" during that period. If earned at all, such payments should be extended over the entire period of employment.
It is to be noted that in 1949 the legislature changed the statutory definition in RCW 41.40.010(15) from "compensation received" to "compensation earnable." That change would seem to indicate an intent to include in the pension base only that amount earned by the employee during the measuring period. This, to me, is evident from the definition of "compensation earnable" as "salaries or wages earned during a payroll period for personal services". RCW 41.40.010(8). In my view, the plain words of the statute exclude termination or other additional payments from use in the computation of pension payments.
Nor do I agree that the expectations of affected public employees require the result reached by the majority. Bakenhus v. Seattle, supra, does not compel such a result. At the time the employee commenced work in Bakenhus, an existing statute provided for a pension of one-half the salary received in the year preceding retirement. A subsequent statutory change placed a $125 limit on pensions, which was about one-third less than Bakenhus would have received under the prior statute. The limiting statute provided no corresponding benefit for the reduction in pension, nor was it shown that the reduction was necessary to preserve the integrity of the pension plan. Consequently, the statutory reduction in Bakenhus was held to be invalid.
*736The present case is markedly different from Bakenhus. Employees, whose pension base included amounts other than their wages and salaries "earnable" during the selected measuring period, had no statute authorizing such practice when they were first employed, nor have they had one at any time since upon which to base any such expectations. In my view, the relevant existing statute clearly excludes the termination payments which the majority finds were expected by the employees to be included in their pension base.
We have said that we will give great weight to contemporaneous construction placed upon a statute by those whose duty it is to administer its terms. Hama Hama Co. v. Shorelines Hearings Bd., 85 Wn.2d 441, 536 P.2d 157 (1975). In this case, the PERS Board of Directors is the entity charged with administering and managing the retirement system, which includes the statute herein concerned. That board made no construction of the statute to include termination or other payments in the pension base. The practice of such inclusion was initiated by an employee of PERS. Thus, any employee expectations which may have arisen over the years in this instance, followed from an unauthorized administrative practice of an employee of PERS, not from a statute or regularly adopted rule of the board of directors. No matter how one strains, such unauthorized practice cannot be brought within the rationale of Bakenhus.
The writ of mandate should be granted.
Wright, C.J., and Utter, J., concur with Hicks, J.