Binder v. Cuyahoga Cnty.

161 Ohio St.3d 395

163 N.E.3d 554

BINDER et al., Appellees,

v.CUYAHOGA COUNTY, Appellant.

No. 2019-1232

Supreme Court of Ohio.

Submitted August 4, 2020

Decided November 4, 2020

The Roberts Law Firm and Kevin T. Roberts ; and Cohen, Rosenthal & Kramer, L.L.P., Joshua R. Cohen, and Ellen M. Kramer, Cleveland, for appellees.

Michael C. O'Malley, Cuyahoga County Prosecuting Attorney, and David G. Lambert and Brian R. Gutkoski, Assistant Prosecuting Attorneys, for appellant.

Bricker & Eckler, L.L.P., and Brad E. Bennett, Columbus, urging reversal for amici curiae County Commissioners Association of Ohio, Ohio Municipal League, Ohio Public Employer Labor Relations Association, and Ohio Job and Family Services Directors' Association.

French, J. {¶ 1} In this discretionary appeal, we consider whether R.C. 124.34 allows civil-service employees to file a civil action in common pleas court to redress an alleged reduction in pay in violation of the statute. Appellees, Richard Binder, Gerald Butterfield, and other named class representatives, filed two consolidated class-action lawsuits against appellant, Cuyahoga County. Appellees seek a declaratory judgment that the county reduced their compensation in violation of R.C. 124.34. They also seek back pay and lost benefits.

{¶ 2} As R.C. 124.34 allows aggrieved employees to file an appeal with the State Personnel Board of Review ("SPBR") or their local civil-service commission and authorizes no alternative, we conclude that R.C. 124.34 does not allow a civil-service employee to file an action in common pleas court to vindicate alleged violations of the statute by an appointing authority. We therefore reverse the judgment of the Eighth District Court of Appeals affirming the trial court's class-certification order and remand the matter to the trial court.

FACTS AND PROCEDURAL BACKGROUND

Cuyahoga County's transition to charter government

{¶ 3} In November 2009, the citizens of Cuyahoga County voted to adopt a charter form of government as authorized under Article X, Section 3 of the Ohio Constitution. The county charter went into effect on January 1, 2010. The charter created the office of the county executive and conferred legislative and taxing authority on the county council. The charter also abolished certain elected positions, such as county auditor, treasurer, recorder, and engineer, and replaced them with officials appointed by the county executive.

{¶ 4} The transition to charter government also required reclassification of the county's employees. The charter mandated the implementation of a uniform classification and salary system covering employees of every county office, department, or agency. The Personnel Review Commission, formerly known as the Human Resource Commission, assumed responsibility for implementing and administering the county's civil-service system and hears all employee appeals previously under the jurisdiction of the SPBR. The charter provides that the county's human-resources policies shall be established by ordinance.

{¶ 5} Before the charter and ordinance took effect, some county employees worked 35 hours per week with unpaid lunch breaks, while other employees worked 40 hours per week, which included a one-hour paid lunch break. In January 2012, the county council enacted an ordinance requiring all full-time employees to work 40 hours per week, including a one-hour paid lunch period. The transition did not change the employees' annual salary. But employees who formerly worked 35 hours per week saw their hourly pay rate reduced.

The employee lawsuits

{¶ 6} Beginning in 2013, numerous county employees filed four lawsuits in Cuyahoga County common pleas court—we will refer to them as Dolezal , Corrigan , Binder , and Butterfield —challenging the transition to a 40-hour work week and other aspects of the county's personnel restructuring. The four lawsuits were consolidated before the judge assigned to Dolezal .

{¶ 7} Dolezal. In the first of these lawsuits, Dolezal v. Cuyahoga Cty. , Cuyahoga C.P. No. CV 13 801116, the plaintiffs asserted four claims. Relevant here, Count Two sought declaratory relief and damages for the alleged reduction in compensation and benefits in violation of R.C. 124.34. The plaintiffs also sought class-action certification, which the trial court denied. The plaintiffs did not appeal the denial of class certification.

{¶ 8} The trial court granted summary judgment to the plaintiffs on Count Two, concluding that the change to a 40-hour week resulted in a reduction in pay. The court of appeals dismissed the county's appeal for lack of a final, appealable order.

{¶ 9} Corrigan . The plaintiffs in Corrigan filed a lawsuit alleging that the county unlawfully reduced their compensation and benefits in violation of R.C. 124.34. Corrigan v. Cuyahoga Cty. , Cuyahoga C.P. No. CV 16 863441. The plaintiffs sought declaratory relief and damages but did not seek class certification. The trial court denied the county's motion to dismiss for lack of subject-matter jurisdiction and the county's motion for judgment on the pleadings. The trial court granted the plaintiffs' motion to consolidate with Dolezal.

{¶ 10} Binder. Richard Binder and other plaintiffs filed a class-action lawsuit alleging that the county violated R.C. 124.34 by increasing their work week to 40 hours from 35 without increasing their compensation. Binder v. Cuyahoga Cty. , Cuyahoga C.P. No. CV 15 851760. In addition to class certification, the plaintiffs sought declaratory relief and compensatory damages, including back pay and compensation for loss of benefits. The trial court granted the county's motion to dismiss and found that the change in lunch-break policy did not result in an increase in work-week hours or a reduction in pay. The Eighth District reversed. On remand, the trial court granted the plaintiffs' motion to consolidate their lawsuit with Dolezal.

{¶ 11} Butterfield . Gerald Butterfield and other plaintiffs filed a class-action lawsuit requesting a declaratory judgment in conformity with the Dolezal decision that the change to a 40-hour work week resulted in a reduction in pay and lost benefits. Butterfield v. Cuyahoga Cty. , Cuyahoga C.P. No. CV 16 864446. The trial court denied the county's motion to dismiss and granted the plaintiffs' motion to consolidate their lawsuit with Dolezal .

Class certification in Binder and Butterfield

{¶ 12} After consolidation of all four cases, the Binder and Butterfield plaintiffs filed a joint motion for class certification. The county opposed class certification, arguing, among other things, that the employees did not have a private cause of action to redress alleged violations of civil-service protections. The trial court granted the motion for class certification.

{¶ 13} The county appealed the class-certification order to the Eighth District Court of Appeals. The judges of the Eighth District recused themselves, and a panel from the Seventh District Court of Appeals heard the county's appeal. The county again argued that class certification is improper because public employees do not have a private cause of action, apart from remedies provided by statute and the administrative process, to redress alleged violations of civil-service protections. The county also argued that the trial court lacked subject-matter jurisdiction because the plaintiffs' declaratory-judgment actions improperly bypassed the special statutory procedure created in R.C. 124.34 for civil-service employees to appeal a reduction of pay or position. And the county argued that the plaintiffs lacked standing and failed to meet the requirements in Civ.R. 23 for class certification. The court of appeals affirmed the trial court's judgment and certified the following class definition:

The Court certifies the Binder and Butterfield cases as a class action on the sole issue raised in those cases, the request for a declaration on the alteration of the plaintiffs' work week and whether it had any impact on their rate of pay. The class includes all non-salaried full-time employees of the County who were and are subject to alteration of their work week with the addition of the paid lunch hour each day and the change from a 35-hour work week to a 40-hour work week.

2019-Ohio-1236, 134 N.E.3d 807, ¶ 155.

QUESTIONS PRESENTED

{¶ 14} We accepted the county's discretionary appeal, 157 Ohio St.3d 1495, 2019-Ohio-4840, 134 N.E.3d 1209, which presents four propositions of law:

1. R.C. 124.34 does not provide classified civil servants with an independent cause of action in the court of common pleas. As such, Ohio courts lack subject matter jurisdiction to certify a class action under Civ.R. 23 when the cause of action is based upon R.C. 124.34. Anderson v. Minter , 32 Ohio St.2d 207, 291 N.E.2d 457 (1972), applied.

2. R.C. 124.34 establishes a specialized statutory proceeding through the State Personnel Board of Review or civil service commission for classified civil service employees to challenge a claimed "reduction in pay." Ohio courts lack jurisdiction over declaratory-judgment proceedings that attempt to bypass the specialized statutory proceeding established under R.C. 124.34. State ex rel. Albright v. Court of Common Pleas , 60 Ohio St.3d 40, 572 N.E.2d 1387 (1991), applied.

3. Class action plaintiffs who fail to exhaust available administrative appeals designated to hear their claims necessarily lack standing to pursue those claims in judicial forums.

4. In conducting the required "rigorous analysis" under Civ.R. 23, a court may not disregard the proposed class definition and, sua sponte, certify the ultimate issue for class treatment.

ANALYSIS

No right of action under R.C. 124.34

{¶ 15} At the time of their request for class certification, the Binder and Butterfield plaintiffs asserted two claims in the common pleas court: a claim for declaratory judgment that the county had violated R.C. 124.34 by reducing their compensation and a claim for damages under R.C. 124.34. We...