In Re Retirement Cases

The counties involved in these consolidated appeals maintain employee retirement plans under the County Employees Retirement Law of 1937 (CERL) as codified in 1947. (Gov. Code, § 31450 et seq.) The retirement boards in these counties are required to determine whether items of remuneration paid to employees qualify as “compensation” under section 31460 and “compensation eamable” pursuant to section 31461, and therefore must be included as part of a retiring employee’s “final compensation” (§ 31462 or § 31462.1) for purposes of calculating the amount of a pension.

Prior to 1997, many, if not all, of the 20 retirement boards operating under CERL calculated employees’ pension benefits according to the holding in Guelfi v. Marin County Employees’ Retirement Assn. (1983) 145 Cal.App.3d 297 [ 193 Cal.Rptr. 343 ] (Guelfi). The Guelfi court held that an item of “compensation” under CERL must be received by all employees in the applicable grade or class of position for it to be a mandatory part of a retiring employee’s “compensation eamable” and “final compensation” on which an employee’s pension is based. (Id. at pp. 303-307.) Fourteen years later, our Supreme Court, in Ventura…