Double-Dipping

The joys of newspaper blogs and “dead tree” printing of those blogs presents an interesting dilemma.  The blogs may not match the printed article.  For fun, today’s article is provided first, with the two days of “blog” entries next. 

Today’s issue?  Using retired employees.  This worked fine for me for the December and April property tax due dates, when work spiked.  Hiring a retiree was much more efficient than using a temporary service.

This practice has been around for some time now.  To be surprised that it is going on makes one wonder.  Have you not been paying attention?  Were you aware, but cast a blind eye to the practice?  Or is making an issue of it now a bargaining stunt, garnering a little press attention, to put pressure on a department head?  Or, better yet, are you now suffering from the rule of unintended consequences?

Back room pre-arranged deals should definitely be avoided and prohibited.  But, needing experienced individuals for specific short-term or part-time projects often cannot be avoided.  Let’s hope the effort put into this matter provides a balanced policy for the future.

County looks at ‘double-dippers’

Some retirees continue to work government jobs while drawing a pension – and it’s frustrating some employees.

By Jennifer Muir

Hundreds of retired workers are returning to county government jobs and collecting paychecks in addition to pensions.

Estimates of how many retired employees are still on the county payroll vary.

An internal county audit found approximately 212 county retirees working part time last fiscal year.  Board Chairwoman Pat Bates, in a memo, cited figures provided by the county CEO indicating that as of June 18, 136 retired employees had worked at the county during the fiscal year, at a cost of $3,487,574.

That practice, known as “double-dipping,” is legal – but it sticks in the craw of some county workers who haven’t even retired once and are threatened with pay cuts, furloughs and even layoffs. 

Nick Berardino, general manager for the Orange County Employees Association, says the practice of hiring retired county employees to return and perform part-time work is wrong.  At a time when the county continues laying off employees, it’s not fair to keep retirees on the county’s payroll while they’re also collecting pensions, he says.

“If they eliminate this abuse, they’ll have room for people continuing to work who are paying for their retirement,” Berardino said.  “Double-dippers under any circumstances are wrong.”

Berardino’s criticism comes amid discussions with the Sheriff’s Department over plans to lay off 29 nonsworn sheriff’s workers represented by the union.  He’s hoping to persuade the department to find other ways to save money in hopes of saving jobs.  And he’s arguing that full-time employees pay into the pension fund, while working retirees just suck it dry.

After The Watchdog wrote about the double-dippers Tuesday, Supervisor Pat Bates expressed concern about the practice and asked the county’s CEO to come up with a policy to ensure “proper succession planning” and to “avoid any potential indiscretions regarding the use of retirees.”  She asked for quarterly reports about the county’s working retirees, including the employees’ current and former pay and the justification for keeping them on the county rolls.

(These numbers don’t include people who have retired from other public agencies.  For example, Sheriff Sandra Hutchens retired from Los Angeles County before taking her job in Orange County.  The Watchdog will be looking at these double-dippers in another column soon.)

The Sheriff’s Department employs 70 county retirees for part-time work.  Most of them work periodically or seasonally and are not needed full-time, sheriff’s officials say.  Others have specialized experience and skills that can’t be filled by just anyone. 

“We are not keeping these people in lieu of the laid-off people,” Lt. Steve Kea said.

The county’s internal auditor reviews working retirees’ hours annually t ensure they’re not working more hours than they’re allowed to:  The limit is 960 hours a year for regular retirees and 720 for those who retire early.  (Last year’s audit found 12 employees exceeded the limits.)

“Not so long ago, the idea was once a person was retired, they should be retired and not be drawing a salary from their place of retirement,” internal auditor Peter Hughes said in an interview last month.  “But that’s before we looked at the costs of bringing back a retiree.  We don’t have to pay back into medical plan and retirement costs…so we’re finding more and more use – and cost-effective use – of retirees.”

Hughes says many of the county’s working retirees come back for a short period, some reluctantly.  They’re asked to stick around to finish up a project, provide expertise or help train people.

But Berardino points out that some of the Sheriff’s Department retirees have returned and been working for a number of years.  For example, 20 have been working part-time since 2004, according to a spreadsheet of the retired workers.

Berardino sent a letter to county supervisors saying he was dismayed to learn how many retirees were working for the Sheriff’s Department, saying the practice “promotes cronyism and a culture of favoritism.”

Supervisor John Moorlach wondered why Berardino is so outraged since the union chief helped negotiate the contract that allows members to retire at age 55, with a sizeable pension.  When Moorlach was a county department head, he preferred to hire experienced retirees when he needed seasonal help because they were already trained, he said.

“The retiree didn’t create the situation, Nick did,” Moorlach said.  “From a management standpoint, to watch talented employees walk out at 55, that’s a heartbreaker.”

Union rep blasts so-called “double-dippers” for pension abuse

September 15th, 2009, 6:00 am · posted by Jennifer Muir

An unlikely voice has joined the pension debate, singling out what he calls “pension abuse” in Orange County.

Nick Berardino (left), general manager for the Orange County Employees Association, says the countywide practice of hiring retired county employees to return and perform part time work is wrong. At a time when the county continues laying off employees, it’s not fair to keep retirees on the county’s payroll while they’re also collecting pensions, he says.

“If they eliminate this abuse, they’ll have room for people continuing to work who are paying for their retirement,” Berardino said. “Double dippers under any circumstances are wrong.”

Berardino’s criticism comes amid discussions with the sheriff’s department over plans to lay off  29 non-sworn sheriff’s workers represented by OCEA. He’s hoping to convince the department to find other ways to save money in hopes of saving jobs. And he’s arguing that full time employees pay into the pension fund, while working retirees just suck it dry.

According to a recent county internal audit, there were 212 working retirees last fiscal year, which ended in June. Those are people who have officially begun collecting their pensions from Orange County, but still work for the county part-time collecting an additional paycheck.

(They don’t include folks who have retired from other public agencies. For example, Sheriff Sandra Hutchens (below right) retired from Los Angeles County before taking her job in O.C.,

Image003

but she’s not included among the working retirees. We’re researching another post about how much employees, such as Hutchens, earn from pension plus their new full time gig. Check back here for a link to that.)

The sheriff’s department employs 70 county retirees for part-time work. Most of them work periodically or seasonally and are not needed full-time, sheriff’s officials say. Others have specialized experience and skills that can’t be filled by just anyone.

“We are not keeping these people in lieu of the laid off people,” Lt. Steve Kea said.

The county’s internal auditor reviews working retiree hours annually to ensure they’re not working more hours than they’re allowed to: 960 hours a year for regular retirees and 720 for those who retire early. (Last year’s audit found 12 employees exceeded the limits.)

“Not so long ago, the idea was once a person was retired, they should be retired and not be drawing a salary from their place of retirement,” internal auditor Peter Hughes said in an interview last month. “But that’s before we looked at the costs of bringing back a retiree. We don’t have to pay back into medical plan and retirement costs.  … So we’re finding more and more use — and cost-effective use — of retirees.”

Hughes says many of the county’s working retirees come back for a short period, some reluctantly. They’re asked to stick around to finish up a project, provide expertise or help train people.

Berardino points out that some of the sheriff’s department retirees who have been working for several years. For example, 20 have been working part-time since 2004, according to a spreadsheet of the retired workers.

He wrote in a recent letter to county supervisors that that he was dismayed to learn how many retirees were working for the sheriff’s department, saying the practice “promotes cronyism and a culture of favoritism.”

Supervisor John Moorlach wonders why Berardino is surprised since he negotiated a contract that allows OCEA members to retire young, at age 55, with a sizeable pension. When Moorlach was a county department head, he preferred to hire experienced retirees when he needed seasonal help because they were already trained, he said.

“The retiree didn’t create the situation, Nick did,” Moorlach said. “From a management standpoint, to watch talented employees walk out at 55, that’s a heart breaker.”

Updated: Supervisor calls for double-dipper policy

September 15th, 2009, 2:00 pm · posted by Jennifer Muir

UPDATED 3:45  p.m.: The county may soon get a new policy outlining when retired county workers can return to the county for part time work.

Supervisor Pat Bates said today she plans to direct county CEO Tom Mauk to establish a uniform policy that includes succession planning when folks retire. She also said in a memo to Mauk that creating a policy would help the county “avoid potential indiscretions regarding the use of retirees.”

Bates ordered quarterly reports about the county’s working retirees that should include the employee’s current and former pay and the justification for keeping them on the county rolls. She’s asking for the same information about any county contracts with retired county employees.

“We’ll be pursing that issue in more depth moving forward,” Bates said. “We’ve been monitoring it, and it has been a concern.”

The directive comes on the heels of union leader Nick Berardino singling out double dippers at the Orange County Sheriff’s department, calling the practice pension abuse.

The department is laying off 29 employees represented by the Orange County Employees Association, which Berardino manages. Berardino says it’s unfair for the department to employ 70 retirees, who are working part time while also collecting a pension, when the department is laying off other employees.

It’s not entirely clear how many retirees were working for the county last fiscal year. An internal county audit found approximately 212 county retirees working part time last fiscal year. In the Bates memo, she cited figures provided by the county CEO indicated that as of June 18, 2009, 136 retired employees had worked at the county during the fiscal year, at a cost of $3,487,574.80.

“I was glad to hear you are going to take a look at that,” Berardino told the board today.  “It’s very difficult for us to empericly prove. But these deals are made months before people retire.”

Sheriff’s officials say employing retirees on a part-time basis actually saves the department money and that many of the jobs are only seasonal or temporary, or require skills that the laid off employees don’t have.

FIVE-YEAR LOOK BACKS

September 16

1999

Ten years ago the Orange County Children and Families Commission began.  Also known as the “Prop. 10” or “First Five” Commission around the state, LA Times reporter David Reyes covered the milestone in “Tobacco-Tax Panel Gets Started—Commission created by Prop. 10 must devise a plan to aid children.  Money arrives next month.”

The commission already has $600,000, but next month the state is expected to dump $48 million more from the tobacco tax into the commission’s account.  The funds will be kept in an investment portfolio, analogous to a money-market fund, said John M. W. Moorlach, county treasurer-tax collector.

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