April 23, 2013 – Despite a state statute that prohibits counties from altering the compensation paid to elected officials, a state appeals court has ruled that Eau Claire County can increase paycheck deductions for retirement and health insurance.
A circuit court awarded damages to the county’s sheriff and treasurer, who had asked the county to reimburse them for retirement contributions and health insurance premiums they paid as a result of legislation affecting the benefits of public workers.
The controversial “budget repair bill,” passed in 2011, required public employees to pay more towards required retirement contributions and insurance premiums. This resulted in smaller paychecks for public workers, including elected officials.
Ronald Cramer (sheriff) and Larry Lokken (treasurer) argued that such reductions violate Wis. Stat. section 59.22(1)(a)1, which states that “compensation” for elected officials “shall not be increased nor diminished during the officer’s term. …”
However, in Lokken v. Eau Claire County, 2012AP1796 (April 16, 2013), a three-judge panel for the District III Wisconsin Court of Appeals ruled that section 59.22(1)(a) does not apply to “fringe benefits,” so reimbursement was not warranted.
“[T]he statute expressly protects only salaries and fees,” wrote Judge Michael Hoover, noting that the Wisconsin Supreme Court has previously excluded employer-paid pension and insurance contributions from the definition of “compensation.”
The officials argued unsuccessfully that fringe benefits are included in compensation packages, and section 59.22(1)(a) protects “compensation,” not just salary.
In the alternative, the plaintiffs asserted that if “compensation” means “salary,” Eau Claire changed their salaries by reducing take-home pay. “We reject this interpretation, which conflates salary with take-home pay,” Judge Hoover explained “The plain meaning of salary is fixed compensation for a set duration of time, not take-home pay.”