NANCY BANDEEN V PUBLIC SCHOOL EMPLOYEES RETIREMENT BD
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STATE OF MICHIGAN
COURT OF APPEALS
NANCY BANDEEN,
FOR PUBLICATION
February 24, 2009
9:10 a.m.
Petitioner-Appellant,
v
PUBLIC SCHOOL EMPLOYEES RETIREMENT
BOARD,
Respondent-Appellee.
No. 279363
Calhoun Circuit Court
LC No. 2006-003711-AA
Advance Sheets Version
Before: Saad, C.J., and Fitzgerald and Beckering, JJ.
PER CURIAM.
Petitioner, Nancy Bandeen, appeals by leave granted the circuit court order affirming the
administrative decision of respondent, Public School Employees Retirement Board, to deny
petitioner’s application to purchase maternity/child-rearing service credit for purposes of
calculating petitioner’s retirement pay. We affirm.
FACTS AND PROCEDURAL HISTORY
The facts are not in dispute. Petitioner obtained a Bachelor’s Degree in Education in
1971. She relocated from Michigan to Boston and registered there as a substitute teacher.
Petitioner taught approximately 8 to 12 days for the Lincoln Public School District in Boston
during the first half of the 1973 school year. Petitioner discontinued her service as a substitute
teacher on December 21, 1973. She did not resume teaching after the holiday break because “I
was pregnant. I wanted to stay home with my children, so I stayed home.”1 Petitioner’s first
baby was born in May 1974, and she had another baby 18 months later. Petitioner returned to
full-time teaching in 1985. She worked as a full-time teacher until her retirement in August
2005.
Before her retirement, petitioner filed two applications with the Michigan Office of
Retirement Services (ORS). The first application requested to purchase out-of-system public
1
At that time, petitioner was five months pregnant.
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education service credit for the time petitioner spent working as a substitute teacher in Boston.
The Boston school administrator certified that petitioner worked as a day-to-day substitute
teacher during the fiscal year of 1973-1974 and earned total wages of $144. ORS granted
petitioner’s request to purchase out-of-system public education service credits for 0.0235 years.2
The second application requested to purchase 3.1 years of maternity/child rearing service credit
for part of the period between when she stopped substitute teaching in 1973 and when she began
teaching full-time again in 1985.3 By letter of January 27, 2005, ORS denied that request on the
basis of the following reasoning:
Our statute allows members to purchase Maternity/Child Rearing service
when regular employment is interrupted by an official maternity or child rearing
leave of absence. Your application stated that you were a casual substitute
teacher, which is not established employment, thus making you ineligible. If you
were granted a leave of absence from Lincoln Public Schools for the purpose of
Maternity/Child rearing we would need proof that you were granted this leave as
your separation reason from Lincoln schools on their letterhead.
Petitioner’s file was referred to ORS analyst Lois Musbach for review. Musbach noted that the
Lincoln Schools had certified that petitioner last worked on December 21, 1973, and that her
child was not born until May 17, 1974. Musbach concurred with the original determination of
ineligibility but further clarified ORS’s position:
The first consideration is the length of time between her last employment
and the birth of her child. MCL 38.1375 is clear that the member must leave
employment “for purposes of maternity, paternity or child rearing”. As an “at
will” employee, Ms. Bandeen chose to stop working well before the birth of her
child. Without further documentation that Ms. Bandeen was medically required
to leave her employment that far in advance of the birth of her child, her reason
for leaving employment could not be connected to her pregnancy.
The second consideration is the position that Ms. Bandeen held. As an “at
will” employee, she chooses to work or not, purely at her choice or the choice of
the school. Our policy regarding substitute employment is clear in that a
substitute is only considered employed on the day they are actively working. At
the conclusion of each day, Ms. Bandeen is unemployed. Ms. Bandeen chose to
no longer work after December 21, 1973, therefore, she had no employment from
which she could claim a separation for maternity reasons. A substitute employee
who is attempting to purchase service credit must make payment on a day that
they are working. Being on a substitute call list is also not considered to be
2
Petitioner purchased the service credits.
3
When petitioner retired she had 26.9 years of service and needed the additional 3.1 years to
reach 30 years of creditable service, which would then allow her to obtain a full retirement
allowance.
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employment. The policy is based on the statutory definition of a member. Only a
member can make a purchase. A member is defined as a public school employee.
Musbach further stated that the ability to purchase maternity/child rearing service credits was
designed to mitigate the damage to an employee’s career when she leaves work for maternity or
parenting reasons, and that a day-to-day substitute teacher, “who has no promise of future
employment, could not claim this harm.”
Following a hearing on the matter, hearing referee Carol Smith issued a proposal for
decision in which she adopted Musbach’s reasoning. Smith stated that “MCL 38.1375 requires,
in relevant part that in order to be eligible to purchase the service credit for maternity, paternity,
or child rearing purposes, a person must be a public school employee or a person performing out
of system public education service at the time they leave their employment to have or raise their
child.” Smith stated that petitioner’s employment as a day-to-day substitute teacher ended at the
end of the given day she worked. Furthermore, there was insufficient evidence that future dates
of employment were guaranteed because there is no evidence of a contractual relationship
between the school district and petitioner. There was no evidence that petitioner told the school
district that she was leaving for pregnancy or child-rearing purposes, and there was no formal
maternity leave given by the school district. Smith proposed that petitioner’s application be
denied because she failed to meet the requirements set forth in MCL 38.1375. The board
adopted Smith’s proposal for decision and denied petitioner’s application.
Petitioner appealed to the circuit court, which reviewed petitioner’s decision to determine
if it was clearly erroneous. The circuit court concluded that the board’s interpretation and
application of the statute to the present facts was not clearly erroneous. The court denied the
appeal on that ground.
I
Petitioner first argues that the circuit court erred by failing to review the board’s final
agency decision de novo when the facts were not in dispute and the only question presented to
the court was whether the board correctly interpreted MCL 38.1375. The standard of review
appropriate to a particular decision is a question of law that this Court reviews de novo. Palo
Group Foster Care, Inc v Dep’t of Social Services, 228 Mich App 140, 145; 577 NW2d 200
(1998).
Traditionally, a circuit court’s review of an administrative agency’s decision is limited to
determining whether the decision was contrary to law, was supported by competent, material,
and substantial evidence on the whole record, was arbitrary or capricious, was clearly an abuse
of discretion, or was otherwise affected by a substantial and material error of law. Dignan v Pub
School Employees Retirement Bd, 253 Mich App 571, 576; 659 NW2d 629 (2002). However, it
is axiomatic that questions of statutory interpretation are reviewed by appellate courts de novo.
Shinholster v Annapolis Hosp, 471 Mich 540, 548; 685 NW2d 275 (2004). See also Ronan v
Pub School Employees Retirement Sys, 245 Mich App 645, 648; 629 NW2d 429 (2001).
Here, both parties agreed that the facts were not in dispute. The issue to be resolved was
whether petitioner, as a day-to-day substitute teacher, was a “public school employee” at the
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relevant time, as that term defined in MCL 38.1306(5), and was therefore entitled to purchase
maternity/child rearing service credit pursuant to MCL 38.1375. The meaning of “public school
employee,” as defined in MCL 38.1306(5), is an issue of statutory interpretation that should have
been reviewed de novo by the circuit court. Shinholster, supra at 548. Although the circuit court
initially applied a “clearly erroneous” standard of review, in ruling on petitioner’s motion for
reconsideration, the circuit court indicated that application of a de novo standard of review
would not have changed its ruling.4 Thus, it would be a waste of judicial resources for this Court
to grant petitioner’s requested relief in the form of a remand for the circuit court to consider the
matter in light of the correct standard of review.
II
Petitioner argues that the circuit court erred by affirming the board’s decision to deny her
application to purchase maternity/child rearing service credit. “This Court reviews a lower
court’s review of an administrative decision to determine whether the lower court applied correct
legal principles and whether it misapprehended or misapplied the substantial evidence test to the
agency’s factual findings, which is essentially a clearly erroneous standard of review.”
VanZandt v State Employees Retirement Sys, 266 Mich App 579, 585; 701 NW2d 214 (2005).
Therefore, a circuit court’s factual determination is reversed only if this Court is “left with a
definite and firm conviction that a mistake was made.” Id. at 585. In addition, the proper
construction and interpretation of a statute are questions of law, which are reviewed de novo by
this Court. See People v Sierb, 456 Mich 519, 522; 581 NW2d 219 (1998).
The Michigan public school employees’ retirement system was created to provide
retirement benefits for public school employees of this state. MCL 38.1321. For public school
employees who do not meet the full eligibility requirement, the system allows employees in
certain instances to purchase service credit at an actuarially determined cost. MCL 38.1361
through 38.1379(a). One situation is where a public school employee leaves employment for
reasons of maternity, paternity, or child rearing. See MCL 38.1375,5 which provides in pertinent
part:
A member who left or leaves service as a public school employee for
purposes of maternity or paternity or child rearing, and returns to service as a
4
The circuit court’s order denying reconsideration stated in relevant part:
After reviewing the record once again in this case, this Court is not
convinced that a different disposition of the Motion for judicial review would
result, even with a de novo review on appeal. Specifically, it is this Court’s
opinion that the manner in which the agency applied the essentially undisputed
facts in this case to the applicable statute was not contrary to the legislature’s
intent or the language of the statute.
5
MCL 38.1375 was amended by 2006 PA 617, effective January 1, 2009. Any reference in this
opinion to MCL 38.1375 refers to the former version of MCL 38.1375.
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public school employee, or a person performing out of system public education
service who leaves that service for purposes of maternity, paternity, or child
rearing and who subsequently becomes a member of this retirement system, . . .
may purchase service credit for the time period or periods during which the
person was separated from service as a public school employee or during which
the person was separated from performing out of system public education service
because of maternity or paternity or child rearing, upon request and payment to
the retirement system of the actuarial cost. . . . A member requesting purchase of
service credit under this section shall certify to the board the purpose for which
the member took leave and was separated from service as a public school
employee.
The Public School Employees Retirement Act, MCL 38.1301 et seq., defines “out of
system public education service” as “service performed in public education . . . .” MCL
38.1306(2). MCL 38.1308(1) defines “service” as “personal service performed as a public
school employee . . . .” And “public school employee” is defined as “an employee of a public
local school district, intermediate school district, public school academy, tax supported
community or junior college . . . .” MCL 38.1306(5). That provision lists various types of
employers and employment situations that qualify an employee as a “public school employee.”
The term “public school employee” specifically includes someone who otherwise meets the test
but is “on approved leave of absence.” MCL 38.1306(5). The term “employee” is not defined in
the statute. Where statutory terms are undefined, they should be given their ordinary and plain
meanings, and, in defining such terms, consulting a dictionary is proper. Rakowski v Sarb, 269
Mich App 619, 626; 713 NW2d 787 (2006). In Rakowski, this Court noted that the “Random
House Webster’s College Dictionary (1992), defines ‘employee’ as ‘a person who has been hired
to work for another.’” Id. When petitioner was hired to work as a substitute teacher, she
certainly could be considered an employee. However, she was not always “hired,” or under a
contract of hire, by the very nature of her employment. Thus, her status at the time she left
service for her alleged maternity/child rearing is at issue.
Petitioner admittedly was a day-to-day substitute teacher. The dispositive factor in the
board’s decision in this case was the board’s determination that petitioner’s position as a
substitute teacher was classified as a “day-to-day,” temporary assignment, without expectation of
future positions. The Random House Webster’s College Dictionary (2001) defines “substitute”
as “a person or thing acting in place of another.” And The American Heritage Dictionary (1985),
in its definition of “day-to-day,” includes “subsisting one day at a time with little regard for the
future.” Another word for such a situation is “temporary.” Black’s Law Dictionary (8th ed)
defines “temporary” as “[l]asting for a time only; existing or continuing for a limited time;
transitory.” Therefore, a day to day substitute teacher can properly be defined as a person
employed from day-to-day and taking the place of a regularly employed teacher on a temporary
basis or a daily basis with little regard to the future; someone who has no written agreement to
work for a school district, who reports for teaching only when contacted, and who may refuse
any offer of employment.
Because petitioner was a substitute teacher at the relevant time and hired only on a dayto-day basis, we conclude that she was not a public school employee at the time she decided to
no longer accept substitute teaching assignments after the 1973 holiday break. She was not
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“hired” to work at that time. Additionally, the statute includes as a “public school employee”
one who is on an “approved” leave of absence. A leave of absence presumes a relationship of
duration to which an employee would expect to return, and denotes a continuing relationship
between the employer and the employee. Black’s Law Dictionary (8th ed) defines “leave of
absence” as a “worker’s temporary absence from employment or duty with the intention to
return.” Petitioner worked only 8 to 12 days during the first half of the 1973 school year, and
then discontinued her service. Because petitioner was not a public school employee as defined
by MCL 38.1306(5), petitioner has failed to prove that the board’s interpretation of MCL
38.1375 was contrary to law and conflicted with the legislature’s intent. As a day-to-day
substitute teacher, petitioner could not be classified as having a temporary absence with the
intent to return. She was not guaranteed to return, and had no approval for a temporary absence.
Thus, the board’s determination that petitioner was not a public school employee for the purpose
of qualifying to purchase maternity/child rearing service credit was not clearly wrong nor was it
contrary to legislative intent.
Moreover, petitioner has not proven that the circuit court misapplied the substantial
evidence test in concluding that the board properly found that petitioner did not decide to
continue service as a day-to-day substitute teacher for maternity reasons. VanZandt, supra at
585. “Substantial evidence is that which a reasonable mind would accept as adequate to support
a decision, being more than a mere scintilla, but less than a preponderance of the evidence.” St
Clair Intermediate School Dist v Intermediate Ed Ass’n/Michigan Ed Ass’n, 218 Mich App 734,
736; 555 NW2d 267 (1996). Although some inconsistencies exist with regard to when petitioner
discovered that she was pregnant, the evidence showed that petitioner last worked as a substitute
teacher on December 21, 1973, and that her first baby was born in May 1974. Petitioner decided
not to accept offers of teaching assignments after the 1973 holiday break only because she “was
pregnant . . . and wanted to stay home.” The board determined that petitioner’s withdrawal from
teaching assignments five months before her baby was born was premature in the absence of any
documentation that she was medically unable to continue teaching and, therefore, that petitioner
did not prove that she left substitute teaching for maternity reasons. The length of time between
January 1974 and the birth of petitioner’s baby, together with the lack of any documentation that
petitioner was unable to teach because of a medical condition, are adequate reasons for the
board’s determination that petitioner did not leave for maternity reasons. Accordingly, the
circuit court properly affirmed the board’s decision.
Affirmed.
/s/ Henry William Saad
/s/ E. Thomas Fitzgerald
/s/ Jane M. Beckering
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