Vicki Phillips is faster than I thought

On December 17, I predicted that Portland Public Schools and its director of human resources (what we used to call "people"), Steve Goldschmidt, would go their separate ways by the end of 2005.  Superintendent Phillips is nearly 11 months ahead of me; yesterday she terminated Mr. Goldschmidt and two of his aides.

She also said that the district would not pay Mr. Goldschmidt the severance package required by his contract, a package worth about $357,000, but would leave it to him to sue for it.  Under the reported terms of his contract, he is entitled to the severance package if he is dismissed without cause, "cause" meaning moral turpitude or dereliction of duty.  I've not seen anything in print, and Superintendent Phillips did not say or hint, that he had committed either one.

The Superintendent is making a mistake.  Yes, it's a lavish severance provision; yes, the district didn't have to put that into his contract; and yes, it's a waste of money.  But it is in fact a contract, no doubt drafted by the district's lawyers on whom she will now have to call to defend Mr. Goldschmidt's likely lawsuit to enforce it. 

It's not Superintendent Phillips' contract.  She can blame the expense on Ben Canada, who negotiated it, but unless she's going to tag Mr. Goldschmidt with moral turpitude or dereliction of duty, she should have the district pay up.  The government should honor its contracts.

Comments

[ron]

I do wish someone would help these folks understand that there is a difference between recognizing labor bargaining rights generally and outright support for a particular union. The entire PERS thing resembles a company union, which applies with equal force to Ted's plan for a common health plan for all teachers. When politicians dictate terms there is a matching loss of freedom to contract that is at the heart of labor rights. Tomorrow's politician could make a different bargain on behalf of labor.

Could a labor organization strike over a term that is no longer either a mandatory or permissive term due to state law? If no, isn't that a loss of labor rights, even if the current, and potentially fleeting, benefits might be greater than achievable through a threat to strike?

I had tried to highlight to the PPS folks that the PERS disparity between the tier-one and tier-three teachers creates an obvious legal conflict of interest for the legal representatives of PAT and OEA on the pension impact of salary decisions. I think Vicki's decision on Steve supported PAT (in support of tier-one) while it was hostile to the new teachers (against tier-three). I do not think this episode is over. (My focus on PERS might be too myopic, but still . . )

[Kate]

From what I understand, Goldschmidt CAN'T sue - Bob Lawrence said he could go to "arbitration", which is generally binding. Besides, I think if someone gets fired for cause (which I'll bet is the case here) the employer is completely within their rights to withhold the severance, no matter who wrote the contract. In any event, from what I understand about Phillips she would probably have checked with plenty of lawyers before doing anything.

[Randy Leonard]

I do not recall any public entity that has done more to improve public confidence than the Portland Public Schools Board has done in the past two years.

The decisions made by the Superintendent is among the most difficult an administrator can make. Whether or not her decision regarding Mr. Goldschmidt's severance package is ultimately upheld by an arbitrator is less important than the message she has sent by her bold decision to terminate him.

I appreciate very much the changes I have witnessed in the past two years at PPS.

[ron ledbury]

Randy --

I will presume the firing was based on policy differences and the status of the parties in resolving that dispute.

The PPS janitor solution, the one that allowed contracting out via a policy change and a mere 90 day period for the union to object was over the top in hostility to labor. A lawyer, a labor lawyer, would compare and contrast that to the current PPS support for the current PAT members and note the dramatic difference in treatment. The current state of labor rights has turned into an arbitrary and capricious mess.

As to Ms. Vicki Phillips . . . she needs to deliver a completed and fully written Collective Bargaining Agreement to the Portland Public School Board for their approval. I still do not have a copy. I had made a Public Records request for it the day after the board made a pretense of approving an agreement, an agreement that was not yet committed to writing. The gist of this is that the salary schedule for the 2004-2005 school year is not legally operative. The pay schedule must be the one that expired on July 1. I suppose the Tax Supervising and Conservation Commission would again balk at the opportunity to direct the District Attorney to order the PPS district to clean up their rather obvious and huge blunder.

Double speak. Huh. Lets suppose that the Itax had gone down in flames in November. Then on January 12, at my little hearing at the TSCC office, the fate of 574 fired young teacher's labor rights where being considered rather than the mere whining of ron. Would the happy political appointees have a clue as to the difference between labor rights generally and support for a particular union? They are clueless.

When the PERB has their hearing in a week or so, and demands more “employer contribution,” will the PPS finally announce, publicly, once again a threat to outdoor school and a shortened school year and bigger class sizes? Will they say it is out of their control?

Pensions must remain within the realm of a bargainable item, a mandatory bargaining term. The rights of the tier-three folks have been tossed into the trash can, by the so-called new and emerging cooperation between PAT and PPS. Time is on my side because there will be more ears that are receptive to my argument next year, and each year thereafter. Can you explain why PAT conceded, apparently, to the lopping off of the bottom two rungs of the pay scale, against their wishes?

The pest, the biggest pest on PERS, is building genuine credibility with the community as a whole. (I think, by the way, that the Portland Firefighters ought to oppose any policy change that transfers their retirement accounts to the state. The moves by the PERB on their equal-or-better argument are all wet. Oh, and yes I think the firefighters, just like the janitors in the PPS district, should have the freedom to strike over such a policy change even if it is the state that is taking the lead.)

When Vicki Phillips recognizes that the current janitor contract represents nothing more than classic “permanent replacements” in a labor dispute and recognizes the fired work's right to bargain then I might begin to respect the labor negotiation position, generally, of PPS. You, of all people, should see the threats to labor posed by the substitution of fleeting back room agreements for the age-old strike/lockout mechanism for resolving disputes.

Randy . . what pray tell, in particular, do you see as positive in the recent moves by the PPS?

At present I cannot think of any possible reason for Steve's firing other than some policy disagreement . . in which case I would rather see that disagreement aired in public in a timely fashion rather than hammered out over two or more years in court. Aren't policy matters of public importance supposed to be formed out in the open rather than in the back room? Vicki needs to explain her motivations, front and center, rather than hide behind an attorney saying shut up until the court action is complete. Steve . . . he could trump that district silence, unilaterally, by airing the real reasons for the firing, but he will likely have to give up the demand for pay so as not to piss off an arbitrator or judge.

Before the end of this school year or next the PPS will deliver to me an audience of perhaps 500 fired teachers that are motivated to listen to their options, their labor bargaining right options (vis-a-vis tier-one PERS members). The public will find that my claims are less incredible than those of the PPS.

The 400 million dollars of PPS borrowed dollars have not yet been irretrievably delivered to the PERB and a good PPS Superintendent could demand return of them by opposing the PERB on their anticipated demand for more “employer contributions.” I would really, really, like to know if this issue, a PERS issue, played any role in Steve's firing.

[Randy Leonard]

"At present I cannot think of any possible reason for Steve's firing..."

From what I read in this mornings Oregonian, I would say the reason for his firing is insubordination. That would, in my opinion, fall under the category of just "cause".

[ron ledbury]

The severance payment was a liquidation clause, specifically designed to accommodate insubordination. It is like a modified “at will” employment. The contract apparently does not say Steve could be removed, it only placed a financial contingency upon that removal.

The denial of the severance payment has more to do with trying to give Ms. Phillips and the district a reason to shut up pending legal resolution. Her lawyer will give her cover to be silent. The money that would cover the severance is of far less importance than the political discussion as to the real reasons for the firing. I want full public discussion of the policy disagreement; and I want it now. If the lawyer for Ms. Phillips provides her cover (to remain silent) so as to deceive the public then what recourse do I have? None, really. The OSB would likely toss out any little letter I might write in a flash.

This just adds another element of unaccountability to the growing list. And, as usual, it is facilitated by a lawyer. I do wish Ms. Phillips' new administration policy also applies to herself. I suppose her contract has no meaning either.

[Isaac Laquedem]

It's an interesting question, Commissioner. I think an employer would be justified in firing an employee who repeatedly refused to carry out orders or acted in a way contrary to established office policy. You and I (and most of the world) would consider that to be "just cause."

The wrinkle is that apparently Mr. Goldschmidt's contract says that "just cause" means only (a) moral turpitude, and (b) dereliction of duty, but not the wider range of things that give employers good reason to fire employees. Insubordination isn't moral turpitude, and I don't think it's dereliction of duty. I take dereliction of duty to mean not showing up for work, or showing up and not doing anything -- inaction, not bad action. If he carried out his duties, but in a manner contrary to how he was instructed to do them, then a court might say that he was insubordinate, but not neglecting his duty, and therefore wasn't derelict.

[Jack Bog]

The worst part was her having Derry break the news to him.

[Randy Leonard]

Sometimes restoring public confidence is more valuable than the cost of making a decision such as the one made by Superintendent Phillips in the Goldschmidt case.

Superintendent Phillips has sent a clear signal that it is no longer business as usual at PPS.

Bravo.

[ron ledbury]

At least Jack's wisecrack made me laugh.

It really is The Oregonian that needed an excuse to withhold details, to maintain their reporting credibility while reporting nothing. I wonder if they needed the aid of an outside PR firm to craft a cooperative position or whether a couple phone calls between attorneys was sufficient?