Kontgis v. Salt Lake City Corp.

SUSI KONTGIS Plaintiff, v. SALT LAKE CITY CORPORATION, RALPH BECKER, DAVID EVERITT, RALPHCHAMNESS, DEBRA ALEXANDER, AND JOHN DOES I-X, Defendants.

Case No. 2:11CV1078 DAK

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH CENTRAL DIVISION

March 25, 2015

MEMORANDUM DECISION AND ORDER

This matter is before the court on Defendants' Motion for Summary Judgment¹ and on Plaintiff Susi Kontgis's Motion for Partial Summary Judgment. A hearing on the motion was held on January 14, 2015. At the hearing, Plaintiff was represented by Chad M. Steur. Defendants were represented by Jonathan G. Pappasideris and Margaret D. Plane. Before the hearing, the court carefully considered the memoranda and other materials submitted by the parties. Since taking the motions under advisement, the court has further considered the law and facts relating to the motions. Now being fully advised, the court renders the following Memorandum Decision and Order.

I. FACTUAL BACKGROUND²

Ms. Kontgis was a long-time employee of the City. At the time of her layoff, she was employed as a Senior Administrative Analyst for the City. At the time of the actions at issue, Ralph Becker ("Mayor Becker") was the Mayor of Salt Lake City. David Everitt ("Mr. Everitt") was the City's Chief of Staff, Debra Alexander ("Ms. Alexander") was the Director of the City's Human Resources Department, and Ralph Chamness ("Mr. Chamness") was a Senior City Attorney in the Salt Lake City Attorney's Office.

In February 2009, Ms. Kontgis was assigned to the City's Capital Asset Management ("CAM") Division within the Administrative Services Department. The CAM consisted of five total employees, including Ms. Kontgis. In April 2009, faced with a difficult economic climate, City Administration began to discuss, among other things, the possibility that layoffs might be necessary at some point in the future. Toward that end, the City Administration started examining, among other things, the City's existing layoff ordinance.

The City's existing Layoff Ordinance provided that "whenever it is necessary to reduce the number of employees in any city department because of lack of work or lack of funds, the city shall wherever possible attempt to minimize layoffs by readjustment of personnel throughreassignment of duty in other departments." This process of reassigning employees was known as "bumping rights." Where reassignment was not possible, the Layoff Ordinance stated that seniority was the sole consideration in designating employees for layoff. Specifically, the ordinance stated that "[p]ermanent employees shall be the last to be laid off, in inverse order of the length of service of employees in the same job classification performing the same job functions and duties."

The practice of using seniority as the sole consideration for layoff and reassignment, however, directly conflicted with the City's goal of minimizing the impact of layoffs. For example, the practice of "protecting" employees with seniority through "bumping" (where the most senior employee, who was typically the highest paid, bumped a less senior employee and took their position) caused the City to actually have to eliminate more positions in order to achieve the desired cost savings. In addition, relying solely on seniority for the purpose of layoff designations without considering an employee's entire job history and performance resulted in undesirable inefficiencies.

City Administration proposed amending the layoff ordinance to remove the requirement of seniority being the sole factor in layoff designations and eliminate the practice of "bumping." In addition, City Administration recommended changing the Employee Appeals Board Ordinance. The Employee Appeals Board Ordinance provided a grievance procedure, in accordance with state statute, for discharged employees. Because the relevant state statutes (Sections 10-3-1105 and 10-3-1106 of the Utah Code) had recently been amended by the legislature, the City needed to amend the Employee Appeals Board Ordinance accordingly tocomply with the changed state law. As part of this ordinance amendment process, and even though state statute did not require it, City Administration proposed providing laid-off employees with a right to appeal to the Employee Appeals Board.

Although not obligated to do so, City Administration discussed these proposed changes to the Layoff and Employee Appeals Board Ordinances with the three-member Executive Committee of the Professional Employees Council ("PEC"). The PEC was an informal loosely organized employee group that purported to represent the interests of all City employees whose terms and conditions of employment were not covered by a memorandum of understanding with an AFL-CIO affiliated trade union (i.e., non-represented employees). The PEC was not a bargaining unit. While the City historically sought the input of the PEC on issues pertaining to non-represented employees, the PEC's role consisted of nothing more than expressing its opinion.

In September 2009, following a series of meetings in which the proposed changes to the Layoff and Employee Appeals Board Ordinances were explained, the Executive Committee of the PEC tentatively approved the changes. On October 14, 2009, Mr. Everitt transmitted the proposed amendments to the Layoff and Employee Appeals Board Ordinances to the City Council. With respect to the Layoff Ordinance, Everitt noted that the proposed amendment "eliminates the requirement that City seniority be the deciding factor in making layoff decisions."

On November 4, 2009, the Executive Director of the City Council informed City Administration that the City Council would receive a briefing on the proposed ordinancechanges on November 10, 2009 and would vote on whether to adopt them on November 17, 2009. Approximately one week later, on November 10, 2009, the City Council received a memo from Sylvia Richards (a member of the City Council staff) summarizing the proposed changes to the Layoff and Employee Appeals Board ordinances. That night, Richards, Alexander, and Chamness briefed the City Council on the proposed changes.

On November 12, 2009, Pat Peterson ("Peterson"), the President of the PEC, transmitted copies of the proposed new Layoff and Employee Appeals Board ordinances to PEC representatives. Some PEC representatives provided negative feedback to Peterson regarding the proposed amendments. As a result, Peterson scheduled a meeting with the PEC representatives for November 16, 2009 to discuss their objections. Following the November 16, 2009 meeting, Peterson asked the City Council to postpone the vote on the Layoff and Employee Appeals Board ordinances. The City Council declined to do so.

On November 17, 2009, the City Council passed the new Layoff and Employee Appeals Board ordinances. Despite the opportunity to do so, neither Peterson nor any other member of the PEC Executive Committee attended the City Council meeting to object to the proposed changes. In December 2009, the City revised its internal procedures pertaining to layoffs and the Employee Appeals Board to comport with the newly amended Layoff and Employee Appeals Board ordinances.

In April 2010, City Administration determined that, due to the City's financial situation, layoffs of City employees would be necessary. Ultimately, City Department Directors designated approximately twenty-five (25) individuals for layoff. Ms. Kontgis was not amongthem. In fact, when Mayor Becker transmitted his Recommended Budget to the City Council, he specifically recommended no personnel changes within CAM. In other words, as of April 2010, City Administration had not designated Ms. Kontgis for layoff.

However, in late May 2010, the City Council-per its legislative prerogative-opted to disregard the Mayor's budget recommendations with respect to CAM and elected to eliminate two specific positions-Capital Asset Management Director and Senior Administrative Analyst (Ms. Kontgis' position)-in order to realize approximately $240,000 in savings.

On June 1, the City Council formally voted to eliminate the two CAM positions, including Ms. Kontgis' position. Ms. Kontgis was verbally notified of this decision the following day. As a result of the City Council's decision, Mr. Everitt informed Ms. Kontgis that she had been designated for layoff "due to the City Council's decision to discontinue funding for your position based upon budgetary issues." Ms. Kontgis was also apprised of her right to file an appeal with the Employee Appeals Board.

Five days later, on June 7, 2010, Ms. Kontgis wrote a letter to the City Council asking them to reconsider their decision. As of June 7, 2010, Ms. Kontgis understood that, although the City Council had voted to eliminate her position, their action would not be final and official until June 16, 2010. Other than her June 7 letter, however, Ms. Kontgis did not communicate with the City Council in any way. For example, she did not go to the City Council meeting and speak in opposition to the proposed elimination of her position.

Following the formal City Council vote, Mr. Everitt presented Ms. Kontgis with a letter placing her on layoff status effective immediately. The letter informed Ms. Kontgis that shewould "be released from her employment with Salt Lake City Corporation effective July 16, 2010." Additionally, the letter stated that Ms. Kontgis had the "right to appeal the City Council's layoff decision to the Employee Appeals Board."³ If she chose to file such an appeal, she was required to "submit written notice on the proper form to the City Recorder's Office no later than Wednesday, June 30, 2010." Mr. Kontgis' employment with the City ended on July 17, 2010. Mr. Kontgis filed an untimely appeal on July 28, 2010, which was dismissed. The Utah Court of Appeals subsequently affirmed this decision.

Ms. Kontgis subsequently filed the instant action, alleging causes of action for (1) Unconstitutional Ordinance (Employee Appeals Board...