AUSTIN — State employees in Texas don’t get severance pay when they leave their jobs. In fact, it’s generally required that they work 40 hours a week to receive a full paycheck.
But that isn’t stopping top state officials, including Attorney General Ken Paxton and Agriculture Commissioner Sid Miller, from doling out hundreds of thousands of dollars in “emergency leave” to state workers in the weeks and months after they’re let go.
On Jan. 1, for instance, Cheryl Hines left her job as an investment manager at the Teacher Retirement System. But she received the same pay and benefits for another four months, until April 30.
Hines, who received $58,000 worth of emergency leave, is just one of dozens of workers who received substantial paid leave within their final three weeks of work, a Dallas Morning News data analysis shows.
At least eight retirement system employees — including high-paid investment portfolio managers, directors or lawyers — received between two and six months of paid leave before they were officially terminated.
That’s a cost to taxpayers of about $235,000, not including benefits, for work that never happened.
The News tracked more than 5,000 leave entries by 18 agencies from September 2013 until now and found that the Agriculture Department doled out the most emergency leave on average, on a per-employee basis. In his first few months in office, Commissioner Sid Miller continued to pay four staffers long after they were let go.
That decision cost taxpayers about $89,000, not including benefits.
Emergency leave is supposed to give state employees a financial cushion in the event of a death in the family, health issues or another extraordinary event. But revelations that the attorney general had quietly kept three ex-staffers on his payroll for months raised concerns that it’s being used in many cases as a financial send-off.
Agency heads have broad discretion to decide when and why to give out emergency leave. In fact, state law only limits doling out the once-obscure benefit by requiring heads to make sure employees give “good cause” for their leave. No lawmakers or state agency scrutinize its use.
Through an aide, Paxton has defended his decision to dole out emergency leave to two ex-staffers by calling it a “compassionate” way to continue to pay people “who worked tirelessly” for the state. The agency has not elaborated on the circumstances.
A spokesman for the Teachers Retirement System also would not say what leaders there consider “good cause,” but records show that when they find it, taxpayers pay generously.
In 2014, portfolio manager Marshall Reid got two months’ salary, about $24,000, and attorney Tina Marie Carnes got six months’ pay, about $46,000. Terri Krumnow, an investment analyst, got six months’ worth of leave in 2015, about $33,000.
“The executive director grants emergency leave to employees in accordance with state law and established policies, and when he determines that there is good cause to do so and it is in the best interest of the system,” said system spokesman Howard Goldman.
To be sure, state data show hundreds of examples where an employee received emergency pay for what appear to be brief family emergencies, such as a day for attending to a death in the family or when state government closed down due to bad weather. But those instances all have one thing in common that the others lack: The employee came back to work.
In the last three fiscal years, state agencies have paid at least 5,500 hours in emergency leave to employees in their final three weeks before they left state work,
The News found by evaluating data from the comptroller’s office.
The News contacted several agencies to ask if emergency leave has in fact become a workaround to give employees severance. Six said that’s not the case, citing the “good cause” proviso, as Paxton did.
The Department of Information Resources, for example, said it had “good cause” to pay 1,680 hours of emergency leave to five team members after they were let go from the agency.
“The employees you listed were granted this type of leave in conjunction with an agency reduction in force,” agency spokesman Elliott Sprehe told The News.
Only one agency, the Texas Water Development Board, acknowledged that leaders use emergency leave to pay severance.
The board has awarded large chunks of emergency leave almost exclusively to top level directors and managers. Notably, two directors were paid two months’ leave before both were removed from the payroll on Dec. 31.
Director William J. Harrison, who earned $123,000 a year, and Andres “Andy” Saenz, a former communication director earning more than $125,000 a year, both received emergency pay worth about $21,000 each.
“It was a severance,” said board spokeswoman Merry Klonower.
“Our executive administrator determined that those were positions that could be eliminated,” she added. “We always try to treat people humanely, so we gave them a severance.”
Asked if that complied with state law, Klonower said: “I can’t get into the details of that because I’m not a lawyer. I do know that it certainly is within the law.”
Shelia Latting says emergency leave was used to placate her as she was fired to make room for Miller’s new hires at the Agriculture Department.
In November 2014, just before Miller took office, the former deputy chief financial officer says, she was promised a promotion to chief financial officer.
But Miller’s office stopped responding to her calls after the new year, Latting said. Then, suddenly, she was told her position was being eliminated as part of a “reorganization” in her division.
She received 480 hours of “emergency leave” just before she was officially terminated on April 12, 2015, records show. Latting said she was not asked to sign a resignation letter or other document detailing her continued pay.
Instead, she received a letter saying that her position would be eliminated April 12, but that she would “no longer be required to report to the office after today.” It was Jan. 12.
“They said to me, ‘Hey, we’re going to keep you on the books for three months. I said, ‘OK.'” Latting told The News. “Mine was sort of a different situation with the severance because they had basically offered me the CFO position, and then they reneged on it.”
Latting, who is black, is now suing the agency for wrongful termination and racial discrimination. Two white females were hired to fill her job and another newly created position in her department, she said.
Department spokeswoman Jessica Escobar declined to discuss Latting’s termination, leave or lawsuit. She said the agency “makes all compensation decisions in accordance” with state law.
Latting, asked whether she would call the paid leave a severance, laughed and said, “I actually would call it ‘stupidity.'”
Three other ag department staffers also received 152 to 480 hours of “emergency leave” between March and May 2015. At least two of them received nearly identical letters, which cited a division “reorganization” and said they would no longer need to come to the office while they remained on the payroll.
All of the letters ended, “I realize this will be a difficult transition for you and your family.”
‘Shouldn’t be done’
While the law is fuzzy on emergency leave, former Lt. Gov. Bill Ratliff acknowledged, it was never his intention that emergency leave be used as a type of severance for state workers on their way out the door.
“As I understand it, in state government there is no such a thing as a severance,” said Ratliff, who as a state senator wrote the 1999 bill revamping state employee vacation, leave and pay. “There are a lot of things in government that people do that are legal that still shouldn’t be done.”
Eliminating a job and paying someone afterward would not be an emergency, he said — adding that neither would wanting to replace someone or allowing an employee to do different work with the intent to return.
“It seems to be that it’s a kind of common-sense definition,” Ratliff said. “It doesn’t mean an inconvenience. It doesn’t mean, ‘I’d like to do something else for a while.’”
Seth Hutchinson, organizing director of the Texas State Employee Union, said the state should use the money instead to provide pay raises for employees in the lower ranks.
“The union definitely doesn’t have an issue with severance pay, but it should be applied equally,” Hutchinson said.
Also used for investigations
Several agencies — including the Texas Alcoholic Beverage Commission and the Department of Insurance — said they routinely place employees on emergency leave if an employee is being investigated for wrongdoing or if an employment dispute is underway.
“I can tell you that some of the individuals listed on the spreadsheet were put on leave pending an investigation,” said Chris Porter, spokesman for the commission.
Some employees there have received ample paid leave because they were called to military service, he added.
The Texas School for the Blind and Visually Impaired also recently used emergency leave to handle problem employees, who received between 80 and 220 hours of leave just before they were fired.
“This emergency leave is not severance pay,” spokeswoman Vicki Weston said.
Weston said four of the school’s employees were placed on paid leave “pending disciplinary investigations that led to their eventual termination or resignation.”
Because of the loose nature of how state officials can award paid leave, and a lack of documented justification, it’s ultimately difficult to tell which employees were being rewarded for their work, such as Paxton’s office has said, and which were in hot water.
Staff writer Jon McClure contributed to this report.
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