Laid-off management association members file claim against city over alleged conspiracy to dump them
Did top Pasadena officials break the state’s open meeting law, as well as a number of labor statutes, by conspiring to get rid of employees from the city’s only management bargaining unit?
That’s the contention of seven members of the city’s Pasadena Management Association (PMA), who were among 10 association members laid off in February and last week filed a claim for damages totaling $9.8 million in addition to an undetermined amount in back pay.
The claim alleges City Manager Michael Beck and another 50 city officials referred to in the suit as “John Does,” including Pasadena Mayor Bill Bogaard, members of the City Council and other department heads, conspired to do away with their jobs, resulting in a violation of the state’s open meeting laws as well as state and federal labor statutes protecting employees.
The seven PMA members — Sheri Stevenson, Emily Stadnicki, Neville Pereira, Thelma “Jean” Luter, Antonio Gardea, Ursula Schmidt and Maria Valenzuela — also allege they were denied due process and suffered age discrimination at the hands of Beck and the other top city leaders.
One of the plaintiffs, Stevenson, a former management analyst serving as “representative claimant,” claims Beck libeled and defamed her at a meeting in West Covina in December in which Beck called Stevenson the “resident contrarian.” Within two months of that meeting, Stevenson was laid off.
In the claim, Pasadena attorney Stephen J. Horvath is asking not only for $9.8 million, but also his clients’ old jobs back, with compensation for time lost. Horvath is also asking that the city pay an additional $50,000 to the PMA.
“Claimants allege that each ‘Doe’ defendant is in some manner responsible for the wrongs alleged herein, in that each such defendant advised, encouraged, participated in, ratified, directed or conspired to do the wrongful acts alleged herein,” the claim states.
“With knowledge of the wrongful acts and omissions of every other defendant, each defendant encouraged, embraced, acquiesced in, benefited from and ratified the conduct of every other defendant,” according to the document.
According to its Web site, the PMA is the official bargaining unit for the city’s more than 500 management employees. It provides collective bargaining and other labor-related services to all city departments, except Human Resources and sworn members of the Fire and Police departments.
In a prepared statement, Beck said “The layoffs referred to in the [claim] are an unfortunate result of the economic realities that the city has been working through during the past few years. We realize this is a difficult time for those who were laid off, but we did provide up to six months of severance for each employee affected. They were done fairly and properly and helped us preserve as many other jobs as possible.”
“The layoffs fall disproportionately on the members of the PMA,” states the claim, filed June 7 with the City Clerk’s Office. “As all 10 employees selected for separation from employment were all members of the PMA, and no unrepresented employees or employees represented by collective bargaining units were laid off, these facts raise an inference that the claimants were separated from employment because of their membership with the PMA.”
All of the employees listed, except for Stadnicki, are over 40 years old, according to the claim, which also states all the affected workers were replaced by significantly younger employees with far less seniority.
“Claimants will concurrently or shortly file claims with the [state] Department of Fair Employment and Housing as prerequisite to filing a civil action for age discrimination based on the layoffs,” the claim states.
The claim was filed the same day the Pasadena Weekly reported that workers in the city’s 16 departments made more than $2.3 million in credit card purchases — much of it spent on food and travel costs — during the past five months, including the time PMA workers were being laid off.
One of those workers was Luter, a 31-year city employee and former management analyst charged with overseeing city credit card purchases. Luter was laid off before her superiors could act on her request to suspend the credit card privileges of Human Services and Recreation Department Director Mercy Santoro for making what Luter called questionable purchases.
Councilman Victor Gordo said he was contacted over the weekend by angry constituents demanding that he brown-bag whatever he eats at City Hall. Gordo said documents released by the city, which were initially believed to be individual credit cards, were actually receipts from a city account that is used by the council for food and travel costs, which in the council’s case totaled $10,759 from January to May.
Gordo has asked Beck to see all the credit card receipts from each department. “I want to see what they are purchasing, what these charges are for,” Gordo said.
Along with spending $978 for a Busy Body Home Fitness machine purchased in January, art supplies from Blick Art supply shop in Old Pasadena totaling $587.71, $2,083 in party supplies from the Oriental Trading Co., $981 for Dodgers tickets on May 4, $1,883 for bowling at AMF 300, and $1,456 paid to the Cheerleading Co., which specializes in cheerleading equipment, Santoro’s department also charged $9,640 of the $177,295 spent on credit on food or food-related items from a number of restaurants, markets and other vendors. Santoro has not responded to numerous calls for comment.
“I was outraged,” said Ralph Royds, a public labor adviser working with the former employees, after reading about some of the spending done by the city’s top managers during the months that longtime workers were being let go and replaced.
“City management made public statements that they were going to take all the steps they could to save jobs. Yet, they were spending freely on their own jobs with their city credit cards. At the time they were doing that, they gave us notice that there were 63 open positions. If you are trying to save jobs, why aren’t you freezing positions and cutting back on lunches with the credit cards?”
Royds told the Weekly he believes Beck started targeting PMA employees after the group did not agree to make further contract concessions during negotiations.
He also said that since 2011, about 80 percent of the city employees laid off have been PMA members and that Beck is clearly trying to break the association, which was first formed in 1994.
In February, city credit receipts obtained by the Weekly through a Public Records Act request showed employees in Beck’s office charged $1,368.37 at local restaurants, including $522.84 spent for two rooms at the Miramonte Resort and Spa in Indian Wells, located about two hours from Pasadena in Riverside County, where Beck previously worked. Another $72.80 apiece was spent on two rooms at Harrah’s Casino in Las Vegas in May.
All told, $13,237 of the $38,725 charged to the cards, or nearly 30 percent, was spent by the City Manager’s Office on food or food-related services. Travel came to just more than $5,000, or 13 percent of total credit card purchases claimed by Beck’s office.
And now, with the layoff of Luter, the sole person charged with monitoring credit card buying among the more than 500 employees in possession of a city credit card, it appears there will be even fewer controls in place to ensure taxpayer-backed purchases are justified.
Luter told the Weekly she thought she was laid off because of her age, even though she had recently questioned spending by the Human Services and Recreation Department.
Differences between the city and PMA members came to a head in early February. During a closed-session meeting before the Feb. 6 City Council meeting, the council engaged in a labor conference with representatives from the group. Although the Ralph M. Brown Act — a state law that governs meetings of legislative bodies like the Pasadena City Council — requires action taken in closed session to be reported at the start of open session, no action was reported to have come from that meeting. Three days later, employees began receiving layoff notices, although none had received disciplinary meetings or were given the chance to appeal the decision, two guarantees stipulated in the group’s memorandum of understanding (MOU) with the city.
The closed session decision was allegedly later revealed by the city’s Human Resources manager, Richard F. Kunz, who the claim says admitted to employees that the decision to terminate them had been made by the council during closed session at the Feb. 6 meeting.
First Amendment expert Terry Francke, head of Carmichael-based Californians Aware, told the Weekly the city may have violated the Brown Act.
“Any decision to terminate employees by council would have to be reported,” Francke said. However, “The ambiguity is depending on what the city structure is. A charter structure [which Pasadena has] usually gives the city manager full discretion to hire and fire,” he said.
“If [the council] simply heard a report from the city manager, they probably would say there is no reportable action,” Francke said.
According to the minutes of that meeting, the discussion was listed as a “City Council conference.” The PMA, along with other city unions, as well as two other separate matters, “were discussed, with no reportable action at this time,” according to the meeting’s minutes.
Along with Beck and Bogaard, the lawsuit lists Kunz, Director of Finance Andrew Green and, former Acting Human Resources head Julie Gutierrez as the city employees responsible for “conspiring” with Beck to eliminate their positions.
According to Royds, the problems began during negotiations for a new MOU between the city and the PMA. Both sides agreed to concessions, but city officials allegedly wanted more.
“Right after signing a new memorandum of understanding with the city, where both parties agreed to concessions, the PMA went on with their business and then the city started laying off members,” Royds told the Weekly.