In Miller v. City of Milwaukee, 2020AP1346 (Dec. 28, 2021), the Court of Appeals District I held that because they were rehired as general employees, the two former police officers were entitled to begin receiving retirement benefits at the age of 60.
Re-hired After Retirement
James Miller and Marion Holley are former Milwaukee police officers. Miller worked as a policeman from 1986 to 2004; Holley from 1993 to 2001.
Both men retired before they reached the age of 57, the minimum retirement age for police officers and firefighters under the Milwaukee City Charter (MCC).
The minimum age for general employees – all employees other than police officers or firefighters – is 60.
Both men also chose the deferred retirement option under the MCC. That meant their contributions to the retirement fund remained in the fund until they reached the minimum retirement age.
Both men took jobs with the city after retiring as policemen.
Miller accepted a part-time job with the Milwaukee Public School system (MPS), a job he held from 2009 to 2015. Holley worked for the Department of Public Works (DPW) for a short time in May 2017.
Date Change Sparks Lawsuit
The Milwaukee Employees’ Retirement System (ERS) notified Miller in April 2016 that he would begin receiving retirement benefits at age 60. Holley received a similar notice in September 2017.
Miller and Holley filed a declaratory judgment, arguing that they had a vested right to receive their retirement benefits beginning at age 57.
The city argued that because of their rehiring as general employees, Miller and Holley were not entitled to receive retirement benefits until they reached age 60.
The circuit court granted summary judgment for Miller and Holley.
The circuit court concluded that the city had allowed the men to return to work with the city and earn additional benefits under one set of terms and conditions, while preserving the benefits they’d earned previously under another set of terms and conditions.
The court ruled that because the minimum retirement age of 57 was one of the terms and conditions under which Miller and Holley had worked as police officers, they had a vested right to begin receiving retirement benefits at that age.
The court also concluded that the city should not have changed the minimum retirement age for Miller and Holley without their consent.
In an opinion written for a three-judge panel, Chief Judge William Brash employed the standard tools of statutory interpretation to make sense of relevant provisions of the MCC, specifically the deferred retirement provision.
Under that provision, retired employees who choose the deferred retirement option and then return to active service with the city become active members of ERS and their previous retirement credits are restored.
Given the plain language of the MCC provision, “we conclude that it is clear that Miller’s and Holley’s decision to return to employment with the MPS and the DPW delayed their receipt of benefits until they reach the age of sixty,” Brash wrote.
“Any other result creates internal inconsistencies with the ERS such that the provisions are rendered inoperable.”
Not a Vested Right
The appellate panel held that the right of Miller and Holley to begin receiving retirement benefits at the age of 57 was not a vested right.
The two men had such a right during their time as policeman and upon their retirement as such. But by taking new jobs with the city as general employees, they gave up that right.
“As described in the deferred retirement section, re-employment with City reactivated their once inactive status as members in the ERS, and as members whose inactive service as policemen had been turned into ‘active service’ as generally city employees, they were now provided with a new minimum service retirement age of sixty,” Brash explained.
To hold that Miller and Holley had a vested right to begin receiving retirement benefits at age 57 would require looking at one provision of the MCC in isolation, Brash reasoned.
“However, a proper interpretation requires analyzing all the terms and conditions in Chapter 36 and how they operate together.”
Internal Inconsistencies Explained
Additionally, Brash wrote, adopting the argument advanced by Miller and Holley would render meaningless a provision in the MCC that specifies that the payment of previously earned retirement benefits is delayed when the employee is rehired by the city.
“Thus, the plain language indicates that there is one time for the release of retirement benefits, not to two as would be the case if the interpretation as argued by Miller and Holley applied.”
There would be an additional inconsistency if the court ruled against the city, Brash explained – one that would cut against an MCC provision that specifies that once former employees begin receiving their retirement benefits, they cease to become members of the city’s retirement system.
“If this court were to accept Miller and Holley’s interpretation, the result would be that they could be both the plain language indicates are re-employed with the MPS and the DPW and also inactive members receiving benefits earned during a prior period of employment with the City.”
One Retirement Age Only
There can be only one minimum retirement age for an employee, Brash reasoned. And that age for Miller and Holley was re-set when they were re-hired by the city.
“These provisions are clear that once re-employed with the City, there is one allowance upon subsequent retirement from the re-employment,” Brash wrote.
“Miller and Holley still cannot be beneficiaries in receipt of their retirement benefits as police officers and inactive members of the ERS awaiting any retirement benefits from their employment as general city employees.”