Walz v. Montgomery County

Weant, J., delivered the opinion of the Court. The appellants in this matter are former employees of Montgomery County, Maryland, who have previously left their employment either by reason of the fact that their positions were abolished or their employment was terminated by administrative action. They are seeking severance pay under section 33-26 (d) (8) of the Montgomery County Personnel Regulations. Specifically they rely on the following portion of that regulation: (8) Administrative Leave and Severance Pay.. . .

Severance pay shall be a lump-sum payment by the Chief Administrative Officer made to an employee who has not reached age 65 and who is being retired pursuant to the provisions of Section 33-38(h) "Administrative retirement on or after elective early retirement date or normal retirement date” or Section 33-45(c) "Discontinued service pension” or to an employee whose resignation is requested for administrative or organizational reasons. Severance pay shall be computed on the basis of one week of pay for each two years of County service. Severance pay may also be authorized by the Chief Administrative Officer whenever it is determined that it would be in the best interest of the County service not to require an employee to work the usual two week resignation notice period. Notwithstanding that none of the applicants had yet reached 65 years in age at the time of their retirement and that all seemed to have qualified for the requested severance pay, it was denied by the Chief Administrative Officer.

In fact it is agreed by all parties that severance pay has never been granted to any employee of Montgomery County who has retired either as a result of position abolishment or as a result of employment termination by administrative action. Having been so denied the requested severance pay, the appellants filed an action in the Circuit Court for Montgomery County seeking a declaratory judgment that ¹²⁷ pursuant to section 33-26 (d) (8) of the Montgomery County Personnel Regulations, they were entitled to severance pay under the conditions of their respective retirements from employment. They now have noted this appeal from the Memorandum and Order of the Montgomery County Circuit Court, which dismissed their Declaration. A précis of the issues raised by the appellants is as follows: 1.

Severance pay is mandatory. 2. Severance pay should be computed on a pro rata basis with interest. I. In determining this matter we deem it pertinent to consider the legislative intent when certain changes in the Montgomery County Personnel Regulations were proposed in late 1972. At that time section 33-26 (d) (8) was known as section 94-22 (d) (8).

In speaking of the suggested changes, the Chairman of the County Personnel Board said in a memorandum dated 16 October 1972: Under existing regulations, severance is optional at the discretion of the Chief Administrative Officer. It is the opinion of the Personnel Board and the County Attorney that optional provisions of the Personnel Regulations of this type should be eliminated to avoid possible abuse and also to assure that all employees receive uniform and equitable consideration. Under the proposed revisions the severance pay formula remains unchanged. There would be no additional costs implications except in any case that an employee would have been deprived of severance pay because of the optional feature of the existing Personnel Regulations.

In commenting on this memorandum of 16 October 1972, County Executive James P. Gleason wrote in a memorandum to the President of the Montgomery County Council: ¹²⁸ At the conclusion of the public hearing on Tuesday, October 31, 1972, the Council held the record open for a period of ten (10) days for receipt of additional written testimony or comments. Accordingly, I should like to express my concern with regard to the change in section 94-22(d)(8), "Administrative Leave and Severance Pay”, which removes the discretion of management with regard to payment of severance pay by making such payments mandatory. Normally, in such instances, there exists a mutual agreement between management and the employee which allows maximum flexibility for the employee to find other employment if he so chooses. Each such instance is