Vol. 27 No. 4 – AB 1028 – Rehire of CalPERS Annuitants


Assembly Bill 1028 (AB 1028) was signed by the Governor in October 2011 and became effective January 1, 2012.

This Bill amended certain portions of the Govt. Code having to do with PERS annuitants. Of particular interest to Chiefs and Sheriffs, AB 1028 amended Govt. Code §§ 21221, 21224 and 21228 having to do with the temporary appointments by a PERS contracting agency of a PERS annuitant or retiree. As these amendments appear to have generated substantial discussion and concern, a detailed analysis may be helpful.

The current language in the legislation could create some potential problems for retired annuitants. Our legal interpretation is set forth below and may raise some concerns on the part of our clients. With that said, however, we have been informed that John Lovell, Legislative Advocate for the California Police Chiefs’ Association, is actively working with PERS and the Assembly Public Employees Retirement & Social Security Committee to amend the language and clarify its intent.

Nonetheless, as the reader considers these amendments, and our discussion, it must be borne in mind that appointments of annuitants carry very real and very substantial risks to the annuitant which must be understood and taken into account. These post-retirement appointments are not without potential risk to the annuitant’s retirement benefits, both received and to be received.

As a first step, the analysis of these amendments will perhaps be better understood if we see the “before” and “after” of these statutes.

Language in these statutes which existed before the amendments of, and which remain unchanged by, AB 1028 are shown in regular text. Amendments adding language are shown below by bold faced italics; and, language which has been deleted is shown byoverstrike.

Govt. Code §21221

A retired person may serve without reinstatement from retirement or loss or interruption of benefits provided by this system, as follows:

(h) Upon interim appointment by the governing body of a contracting agency to a vacant position during recruitment for a permanent appointment and deemed by the governing body to be of limited duration and requiring require specialized skills or during an emergency to prevent stoppage of public business. These appointments, in addition toincluding any made pursuant to Section 21224 or 21229, shall not exceed a total for all employers of 960 hours in any fiscal year. The compensation for the interim appointment shall not exceed the maximum published pay schedule for the vacant position. When an appointment is expected to, or will, exceed 960 hours in any fiscal year, the governing body shall request approval from the board to extend the temporary employment. The governing body shall present a resolution to the board requesting action to allow or disallow the employment extension. The resolution shall be presented prior to the expiration of the 960-hour maximum for the fiscal year. The appointment shall continue until notification of the board’s decision is received by the governing body. The appointment shall be deemed approved if the board fails to take action within 60 days of receiving the request. Appointments under this subdivision may not exceed a total of 12 months. The governing body of a contracting agency shall appoint a retired person only once under this subdivision. The interim appointment made under this subdivision shall not continue under Section 21224 or 21229 after the 12 months.

Govt. Code §21224

(a) A retired person may serve without reinstatement from retirement or loss or interruption of benefits provided by this system upon temporary appointment by the appointing power of a state agency or public agency employer either during an emergency to prevent stoppage of public business or because the retired employee has specialized skills needed in performing work of limited duration. These appointments shall not exceed a total for all employers of 960 hours in any fiscal year, and the rate of pay for the employment shall not be less than the minimum, nor exceed that paid by the employer to other employees performing comparable duties.

[The balance of 21224 deals with persons who collected unemployment insurance during the prior 12 month period.]

Govt. Code §21228

A person retired for disability who has not attained the mandatory age for retirement applicable to persons in the employment in which he or she will be employed, and whom the board finds not disabled for that employment, may be employed by any employer without reinstatement from retirement in a position other than that from which he or she retired or a position in the same member classification. His or her disability retirement pension shall be reduced during that employment to an amount that, when added to the compensation received, shall equal the maximum compensation earnable by a person holding the position that he or she held at the time of his or her retirement. Any employment shall terminate upon his or her attainment of the mandatory retirement age for persons in that employment. A person employed under this section shall not be concurrently employed under Section 21224, 21225, 21226, 21227, or 21229, or subdivision (h) of Section 21221.

General Rules of Statutory Construction

As the Courts have often said, the Legislature is presumed to have known what it was doing when it created or amended statutes.

A corollary to this principle of statutory construction is that when the Legislature says something in one statute and says something different in another statute, the difference was intended.

Similarly, something said somewhere in one statute and not said in another was consciously intended by the Legislature to have been included in the one and deliberately left out of the other.

Finally, absent evidence of some contrary intent, words in a statute are presumed to have their ordinary English language meaning.

Distinction Between Appointing Authorities

We note that §21221 relates to appointments by “the governing body of a contracting agency,” whereas §21224 speaks to appointments by “the appointing power of a state agency or public agency employer.”

Following accepted rules of statutory construction, and especially considering that this difference appears in the text of a single Bill of the Legislature, it may be presumed that the Legislature meant in §21221 to refer to appointments made by a governing body – i.e., a Board of Supervisors, City Council, etc. – and meant in §21224 to refer more generically to “appointing power(s)” and not simply to governing bodies.

In municipalities with a council-manager form of government, the governing body usually appoints officials such as the city manager, the city attorney, and perhaps the city clerk. But officials such as a chief of police or fire chief are usually appointed by the city manager and not the governing body.

In county government, and as germane to law enforcement, a board of supervisors might appoint the sheriff in the event of a vacant office, but otherwise is not the appointing power for the sheriff’s department – the appointing authority would be the sheriff.

This would suggest that the provisions of §21221 will, in the main (a possible exception is discussed below), apply only to appointments made by a governing body; and that appointments made by other government officials – city managers, etc. – are governed only by §21224.

A governing body may make an appointment of a PERS annuitant, but only on an interim basis to a vacant position during a recruitment to fill the position and if the vacant position requires specialized skills; or, may make an appointment during an emergency as necessary to avoid a stoppage of government business. But such appointments must not exceed 12 months and can only be made once.

There appears to be a belief in some quarters that the governing body may use the provisions for an extension of the 960 hour limitation in order to make successive 960 hour appointments from fiscal year to fiscal year. However, please note that the language of §21221 provides that appointments under this statute may only be made once. Therefore, the language regarding extensions of the 960 hour limit must be read to refer to such extensions as necessary within the one and only 12 month period.

Elements of §21224 – Appointments by an Appointing Power

·         temporary appointment

·         by the appointing power

·         during an emergency to prevent stoppage of public business or

·         because the retired employee has specialized skills needed in performing work of limited duration.

·         shall not exceed a total of 960 hours in any fiscal year,

·         rate of pay for the employment shall not be less than the minimum, nor exceed that paid by the employer to other employees performing comparable duties.

[The balance of §21224 refers to conditions pertinent to an annuitant who received unemployment insurance benefits in the 12 months preceding appointment under this statute.]

We note that the only cross reference from §21221 to §21224 is where the former statute provides that “These appointments, including any made pursuant to Section 21224 …, shall not exceed a total for all employers of 960 hours in any fiscal year.” As this is the only express application by §21221 of its terms to appointments made under §21224, it must be presumed that the Legislature did not intend for the other terms and conditions found in §21221 and not found in §21224 to be applicable to appointments made pursuant to §21224, i.e., appointments by an “appointing power.”

For instance, therefore, the 12 month and single appointment limitations would not appear to apply to appointments by a local appointing power made under the authority of §21224.

However, this necessarily raises another issue. There is no provision for appointments by an appointing power for an extension of the 960 hour limitation. Yet we are informed anecdotally that agencies have in the past sought and obtained from PERS extensions of the 960 hours limitation.

And although the twelve month and single appointment limitations for governing body appointments are not found in the statute dealing with appointing power appointments, §21224 does add language making these appointments “temporary” and always had language referring to appointments as being of “limited duration.” If these do not, as appears to be the case, mean the express limitations of twelve months and single appointment, then what meaning is assigned to “temporary” and “limited duration?’

On these issues we contacted CalPERS and received a very courteous and helpful return phone call from an official at CalPERS who has worked extensively in this area, and who provided the following answers to our questions:

Does CalPERS consider that the extension request procedures of §21221 are also applicable to §21224?

Although the appointment procedures under §21224 do not include a process for seeking an extension, a local agency can request an extension for a §21224 appointment by using the procedures in §21221, i.e., city council resolution, etc. However, if such a request for extension is made relative to a §21224 appointment, CalPERS will treat the appointment as having been made under §21221 and will apply the restrictions of §21221 to this §21224 appointment, i.e., one time only, maximum of a twelve month period, for the purpose of filling a vacancy, etc.

May an appointee under §21224 be reappointed in more than one fiscal year and/or more than 12 months, or do the 12 month and single appointment restrictions of §21221 also apply to §21224?

A person appointed under §21224 may only serve a maximum of 960 hours in any one fiscal year, but may be “reappointed” in  succeeding years. There is no twelve month or one time only restriction unless as noted above there is a request within the context of a single fiscal year for an extension of the 960 hour period of service.

Notwithstanding the very helpful assistance provided us by CalPERS, we would sound a note of caution regarding the continuation of an “appointing power” appointment under §21224 to successive fiscal years. Legally erroneous advice of a government employee, no matter how well-intentioned, provides no defense to a charge of having violated the law.

Too, it must be observed that the Legislature added the word “temporary” to appointments made under this section. There being no definition of the word “temporary” set forth in the statute, we turn to the commonly understood meaning of that word in the English language: “lasting, existing, serving or effective for a time only; not permanent;  syn. impermanent, passing; implies an arrangement established with no thought of continuancebut with the idea of being changed soon.” (emphasis added) [Webster’s Unabridged Dictionary; Random House; 2nd Ed.; 2001; at p. 1955]

That word not having been there before, and now having been added, suggests as a matter of statutory construction that the Legislature must not have meant for §21224 appointments to continue indefinitely as to the same person and position. 

We are furthermore told by CalPERS that they intend to begin asking for recruitment flyers and such with regard to §21221 appointments, perhaps at the outset, and certainly where an extension is requested. This, they say, is to better ensure that the intent of the Legislature is fulfilled and that appointments are for the typically stated reason of an interim appointment pending the recruitment for and filling of a vacant position.

The CalPERS official told us that additional documentation on these issues will be forthcoming later in January, and that our office will be included in that distribution. Once those documents are reviewed, it can be anticipated that a further Client Alert will be issued.


There are stated policy purposes for appointments made under either §21221 (governing body) or §21224 (local appointing authority).

While we necessarily credit the presently stated position of CalPERS vis-à-vis procedures for seeking extensions of annuitant appointments, we must reiterate a strong note of caution with regard to the words “interim” as to governing body appointments and “temporary” as to local appointing authority appointments. In our view, these terms strongly mitigate in favor of a short term view of appointments under either §21221 or §21224.

For governing body appointments under §21221, this impermanence found in the word “interim” is self-fulfilling in that the very terms of that statute provide for one time appointments which cannot under any circumstance exceed a single 12 month period.

More problematic, and hence of greater potential peril to the annuitant, are appointing authority appointments made pursuant to §21224. Here, if one ignores the word “temporary”, there is no per se prohibition against appointments in successive fiscal years. But ignoring a word very deliberately placed by the Legislature into the statute is done at one’s peril.

Upon challenge of an appointment, a court would be bound to apply the rules of statutory construction and give meaning to the word “temporary.” Might an annuitant and an appointing authority avoid challenge on a single successive 960 hour appointment? Perhaps this would pass muster, but the risks to the annuitant would, in our judgment, increase exponentially with each successive appointment as the meaning of the word “temporary” begins to be stretched beyond all reason.

The risk to the annuitant is that CalPERS might act to effectively “un-retire” the annuitant and insist on repayment of all pension benefits paid, with interest; and payment by the agency and the annuitant of their respective CalPERS contributions for the period of the appointment.

It is for these reasons that local agencies and annuitants should contemplate a strong justification for any extensions or successive appointments lest CalPERS, acting through the language of the statutes and policies adopted thereto, or the Legislature, wielding its law-making sword, assert themselves with more restrictive and prohibitory measures. Hopefully, these concerns will be rectified through legislative action.

It is imperative for cities and counties, and for retirees, to seek advice and guidance from their legal advisers on matters as sensitive and complex as these.

As always, if you wish to discuss this matter in greater detail, please don’t hesitate to contact us at (714) 446 -1400 or via e-mail at prc@jones-mayer.com or mjm@jones-mayer.com.

Information on www.jones-mayer.com is for general use and is not legal advice. The mailing of this Client Alert Memorandum is not intended to create, and receipt of it does not constitute an attorney-client relationship.