CHARLESTON – A class-action case regarding the state auditor’s office alleged failure to properly calculate and pay the wages of up to 40,000 public employees has been assigned a judge.
Senior Status Judge Thomas C. Evans III was recalled to handle the case because all of the judges in Kanawha Circuit Court have a conflict on interest in the case, namely that they received a one-time payment that is at the crux of the lawsuit.
Evans was a circuit judge for the Fifth Circuit that includes Calhoun, Jackson, Mason and Roane counties. The Spencer native retired in 2016, but has worked since then. He filled in when Kanawha Circuit Judge Jim Stucky retired because of medical issues earlier this year.
According to an amended complaint filed in June, the auditor’s case involves more than 20,000 salaried and hourly public employees who were not fully paid in the 2017 calendar year because of the state’s switch from twice monthly pay to biweekly. A letter notifying the state of the lawsuit before it was filed said those identified then included employees of the state Supreme Court, the Department of Health and Human Resources and the State Police, but more agencies could be included.
The claims against Auditor John B. McCuskey’s office seek recovery for all employees who were underpaid, and the claims are made under the West Virginia Wage Payment and Collection Act, which applies to state government the same as it applies to private industry. Additionally, West Virginia law does not allow state employees to be paid in arrears beyond one pay period, which is the only arrears authorized by the state.
“There are only a few universal truths in life, but one of them is you don't mess with people's paychecks,” said Teresa Toriseva, one of the plaintiff’s attorneys handling the case. “The West Virginia Auditor created an arrearage in pay for many, and maybe all, public employees, when payroll switched from twice monthly to every two weeks.
“However, a one-time payment to clear the arrearage was made to elected officials only. Public employees want what they have earned, too.”
By changing the pay period in which the salaried employees are paid, an underpayment to each salaried employee was created in 2017 that has not been remedied as of the date of the filing, according to
“This problem is so well known that hotlines were created and countless hours of time has been spent by the auditor’s office trying to convince employees that the underpayment is allowed and proper,” according to a letter sent by the plaintiff’s attorney notifying the state of the pending lawsuit.
Despite the lawsuit, the auditor's office stands behind how it has handled the situation.
“Although it is our general policy to not publicly comment regarding potential or ongoing litigation, we have received notice from media sources of a potential claim concerning the State’s conversion to biweekly pay," Lisa A. Hopkins, general counsel and Senior Deputy Commisioner of Securities in the office, said earlier this year before the case officially was filed. "We are confident that the conversion was executed in compliance with statutory requirements and in accordance with agency directives and the law and that all State employees were paid for every hour worked."
The notification letter also says the changeover in pay periods was “a fiasco” and was halted, changed and criticized for failing to properly anticipate problems. It says the changeover happened in three waves. “Wave 3” occurred in Spring 2017 and included court employees, DHHR employees and State Police employees.
This arrearage “was widely known, understood and admitted to in writing by state employees working on the problem,” the notice stated. “For example, court employees were advised they would receive the arrearage (about 1.6 percent of each employee’s wages) at the end of calendar year 2017. That did not occur. The arrearage was never paid (or made up).”
In short, the affected employees received their regular salary in 2016, but received about 1.6 percent less in 2017 because of the changeover. And they’ll receive their regular salary again in 2018. The notice says about 1,400 court employees, 6,000 DHHR workers and 1,000 State Police employees might have these issues.
It says the shortages range from about $500 to several thousand, depending on base pay. It also says agencies involved in Wave 1 and Wave 2 did pay the arrearage created by the changeover to all elected officials.
“In other words, elected officials got a one-time payment to correct their arrearage,” the notice states. “Public employees got told they will get it back over time. This is illegal and improper.
“Wages are due when earned, except that public employees are allowed one pay in arrears (which occurs at the beginning of employment). To be clear, the payment to elected officials was proper. What is illegal is the failure to pay the public employees for the same arrearage created in their pay.”
A Sept. 13, 2015, letter from Legislative Auditor and Legislative Manager Aaron Allred addressed some “areas of concern,” including the governor’s salary.
“Code … sets the governor’s calendar year salary at $150,000,” Allred wrote. “With the conversion to a bi-weekly pay period the governor earned $150,206.04 during FY (Fiscal Year) 2015, however he would have received less than $150,000. The governor’s office verbally informed me that they forced an increase to the governor’s final paycheck in FY 2015 for the difference between his annual salary and the actual amounts paid during FY 2015. Conversely, other state employees did not receive the same consideration.”
Allred’s letter also mentions that about every 11 years, there would be a year that would have 27 pay periods instead of 26. And that in 2023, the next such year, the state would need an additional $33 million for that extra pay period.
The lawsuit seeks to gain full lost wages and benefits to all affected salaried employees plus other compensatory and general damages, interest from the date the funds should have been paid along with court costs and attorney fees.
The plaintiffs are being represented by Toriseva of Toriseva Law In Wheeling; J. Michael Ranson and Cynthia M. Ranson of Ranson Law Offices in Charleston; G. Patrick Jacobs of Jacobs Law Office in Charleston; and Robert McCoid of McCamic, Sacco & McCoid in Wheeling.
Kanawha Circuit Court case number 18-C-549