Administrative Law

This summary also appears under School Law


Issues: Claim that the hearing officer (HO) lacked jurisdiction to consider the appellees-teachers' complaints of violations of the Payment of Wages & Fringe Benefits Act (PWFBA)(MCL 408.471 et seq); Oshtemo Charter Twp. v. Kalamazoo Cnty. Rd. Comm'n; Bowie v. Arder; Oshtemo Charter Twp.; Herrick Dist. Library v. Library of MI; MCL 408.481(1)-(3) (§§ 11(1)-(3)); "Department" defined; MCL 408.471(1)(a); MCL 408.481(4); MCL 408.481(6)-(9); The Administrative Procedures Act (APA)(MCL 24.201 et seq.); MCL 408.481(7); MCL 408.477(1) & (2) (§§ 7(1) & (2)); Const. 1963, art. 6, § 28; Huron Behavioral Health v. Department of Cmty. Health; Department of Cmty. Health v. Anderson; MCL 24.306(1)(a) & (b); Statutory interpretation; Autodie, LLC v. Grand Rapids; Michigan Educ. Ass'n v. Secretary of State (On Rehearing); In re Complaint of Rovas Against SBC MI; § 15 of the Public Employment Relations Act (PERA)(MCL 423.201 et seq.); Detroit Police Officers Ass'n v. Detroit; Contract interpretation; Wilkie v. Auto-Owners Ins. Co.; Century Sur. Co. v. Charron; Port Huron Educ. Ass'n v. Port Huron Area Sch. Dist.; Detroit Public Schools (DPS); Collective bargaining agreement (CBA); Detroit Federation of Teachers (DFT); Termination Incentive Plan (TIP)

Court: Michigan Court of Appeals (Published)

Case Name: Detroit Pub. Schs. v. Conn

e-Journal Number: 58673

Judge(s): Per Curiam – Boonstra, Markey, and K.F. Kelly


The court found no merit to the appellants' arguments that the HO lacked jurisdiction to consider the appellees' complaints of violations of the PWFBA, but held that the HO and the circuit court erred in their interpretation of the PWFBA and by finding that its provisions were violated. These conclusions rendered moot the other issues raised in these appeals. Thus, it reversed the circuit court's order affirming the 7/13/12 decision of the HO, vacated that decision, and remanded for entry of an order or orders dismissing appellees' complaints. DPS and the Department of Licensing & Regulatory Affairs/Wage & Hour Division appealed the circuit court order of 6/12/13, affirming the HO's decision. Appellees are teachers and members of the DFT employed by DPS. DPS and the DFT entered into a CBA on 12/18/09 that contains a provision known as the TIP. Appellees filed complaints with the Wage & Hour Division. They asserted that the TIP provision violates the PWFBA. The HO ruled that the TIP violated several provisions of the PWFBA. The court held that the statute plainly provides for the appointment of a HO to hear and decide an appeal of a decision by the Wage & Hour Division regarding a complaint alleging violation of the PWFBA. The review "occurs in accordance with trial-like procedures of a contested case" under the APA. At the conclusion of the contested case proceedings, the HO "shall affirm, modify, or rescind the order of the department . . . ." Thus, "the statute 'by clear and unmistakable statutory language' confers the power and authority of the wage & hour division to interpret and apply the PWFBA on the [HO] to review the agency's determination of complaints filed under the act." The court held that the circuit court and HO erred by not applying the clear and unambiguous provisions of § 7(1), and by reading § 7(2) "as a limitation on § 7(1) that is 'not within the manifest intent of the Legislature as derived from the act itself.'" This "substantial and material misinterpretation of the act as to § 7(1) and § 7(2)" led the HO and circuit court to reach the "erroneous and unsupported conclusion that the deduction or reduction at issue violated other provisions of the PWFBA." The court also held that there was "no basis to conclude that the TIP deduction or reduction constitutes a violation of § 6(1), MCL 408.476 regarding the manner and method of paying wages." Similarly, "§ 8(1), MCL 408.478, prohibiting an employer from demanding a fee, gift, tip, gratuity, or other remuneration as a condition of employment or continued employment," was not violated. "The TIP deduction or reduction involves a deferred bonus, not an illegal fee, gift, tip, gratuity as consideration for employment or continuation of employment."


Full Text Opinion
Back to e-Journal Mobile
News/Moves | Classifieds | Contacts | Full Version

© 2014 State Bar of Michigan