1. Amy Peabody Assistant General Counsel Kentucky Department of Education
Personnel law -- mini
Amy Peabody
Assistant General Counsel
Kentucky Department of Education

2. Topics today One time bonus/fringe benefit to employees
Responsibility to hold a position for an employee on WC or disability retirement
Break in service and sick leave
Teacher tenure basics
Non-renewals
Reduction of duties
Demotion of certified administrators
Change in assignment
Reduction in force (RIF)
Potpourri of issues we’ve seen lately

3. One time bonus/fringe benefit to employees
Kentucky Constitution Section 3 prohibits the expenditure of public funds except as payment for public services (can’t give away public funds).
KRS (3) and (4) requires that payments to employees, including bonuses or fringe benefits, be only in exchange for services to be rendered and for the benefit of the common schools.
This statute requires a local board of education to adopt a plan for employee gross salary payments and for employee fringe benefits at the beginning of the school year.
The board cannot give retroactive bonuses; however, the board can revisit this issue during the same school year (with the same employees) and order that a prospective bonus/fringe benefit be available to employees. Though the relevant statute does state that this is to occur at the beginning of the school year, this does not render invalid a board’s action during the school year. See OAG
It would be better for a board to order this prospectively before the school year begins but since district employees are paid for their school year services over the course of the entire July 1 to June 30, their total pay does not sound like it was unlawfully enriched by the board’s initial misstep in retroactively awarding this bonus/fringe benefit. There is still time in the school year for the bonus to be for prospective services to be rendered by these employees to the district.

4. One time bonus/fringe benefit to employees
A board action granting a bonus or fringe benefit to local district employees cannot be retroactive for services already rendered by the district employees.
The Kentucky Office of the Attorney General in 1996, in OAG interpreted the requirements of the Kentucky Constitution and KRS to prohibit a local board of education from granting district employees a bonus or fringe benefit or additional compensation of any kind for services already rendered. A local board of education’s decision, evaluated in OAG 96-23, to give additional compensation to a teacher for services already rendered was determined to be unconstitutional.

5. One time bonus/fringe benefit to employees
As you know, local school district funds are additionally limited by the Kentucky Constitution (Sections 180, ) to expenditure for “educational purposes” and provision of a bonus or fringe benefit or any additional compensation to employees for services previously rendered (decision to give additional benefit after the service was rendered) would be a violation of this constitutional restriction on school funds as well.
KDE understands these sections of the Kentucky Constitution and this statute to allow a local board of education to provide a one time bonus scheduled in the current or next school year for employees as a fringe benefit and must be described as compensation for serviced rendered in the future and for the benefit of the common (public) schools.

6. One time bonus/fringe benefit to employees
First, the decision on the expenditure can only be prospective for services not yet rendered by the employees (and compensation given after services rendered, according to local district payment schedule).
Second, the local school district finance officer must review the district’s finances and should be asked to provide information regarding the financial feasibility and soundness of a decision to undertake an additional expenditure.

7. One time bonus/fringe benefit to employees
Third, KRS states that the decisions as to the compensation, including extra duty pay, fringe benefits or bonuses, are to be made prior to the beginning of the school year, July 1, and for extra duty pay, fringe benefits or bonuses to be achievable during the next school year. While we interpret this last requirement to mean that a local school district should only vote to provide prospective additional compensation before the beginning of the next school year and relevant to services to be rendered during the next school year, there is the possibility that the statute allows this vote to occur during a school year and for the board to grant additional compensation to employees when future services are rendered.
KRS Manner of payment of salaries to school employees -- Pay for extra duties or services -- Fringe benefits program.
(1) All school employees working on a continuing, regular basis, shall be paid regularly, on dates determined by the employing board of education, during the school year or during the fiscal year for twelve (12) month employees, the provisions of KRS notwithstanding. The gross salary received on each pay date will be an amount equal to the school employee's annual salary divided by the number of pay dates, except a local board of education shall pay an employee any remaining salary owed prior to the end of the fiscal year upon completion of the employee's responsibilities or duties if so notified by the employee.
(2) Salary amounts shall be paid on the prescribed pay dates without deduction for days on which schools were closed; provided, however, any time not worked for which pay is received must be made up prior to the end of that current school year, or pay so received shall be withheld from the final salary payment of that school year.
(3) Gross Salary payments under subsection (1) of this section need not, but may, include pay for extra duties or services. Payment for extra duties or services must be paid pursuant to a payment plan adopted by the board of education prior to the beginning of the school year. The board of education may also adopt a plan for providing a program of fringe benefits to its employees.
(4) All payments made for salaries, extra duties, and fringe benefits by the board of education under the authority of this section are deemed to be for services rendered and for the benefit of the common schools; the payments do not affect the eligibility of any school system to participate in the public school fund as established in KRS Chapter 157. Nor shall any individual board member or administrator be held liable where additional payments for such service become necessary. Provided, however, that nothing in this section authorizes or requires the payment of salaries to personnel when schools are closed as a result of a strike or other work stoppage or when schools are open and personnel fail to render services. No part of this section shall be law if any part is declared unconstitutional.
(5) Subsection (2) of this section does not apply to those employed on a twelve (12) month basis.

8. One time bonus/fringe benefit to employees
Fourth, a local board of education will need to consider and act on any proposed one time fringe benefit payment in a public meeting. Please note that the school district will want to remain mindful of the deadlines in KRS regarding notification to school district employees of any reduction in salary for the next school year ( ), the year after this one time fringe benefit payment is possible and is provided to district employees.

9. One time bonus/fringe benefit to employees
A motion by a board member for this kind of action could be phrased something like “a motion to provide a one time fringe benefit bonus scheduled as part of the compensation for the next school year (13-14) for employees. This fringe benefit bonus will be compensation for future services to be rendered and for the benefit of the common (public) schools.” The board should describe the future services in this same public meeting.

10. One time bonus/fringe benefit to employees
From a practical standpoint, we do suggest that the phrasing of the bonus mechanism not reference the teachers’ salaries except to state, if the bonus is different for different salary ranges, that teachers making between $a and $b would receive $x as a bonus and replicating that language for all salary ranges. The reason for this suggestion is just wanting to prevent teachers from asserting at the end of this year/beginning of next year that they received a salary increase and therefore have a right to the increase again next year. The district can, without violating any provision of law, choose to ignore this suggestion.
Districts should consider giving notice of reduction of salary, under KRS , since the compensation the year after the bonus/fringe benefit will be less.

11. Holding a position for an employee receiving workers’ compensation
Kentucky workers' compensation law does not require that a position be held open for an injured worker.  The only WC provision dealing with employment is the prohibition against firing a worker for bringing a workers' compensation claim in KRS (1).
Contact for this information was:
 John W. Mann
Attorney/Chief Specialist
Kentucky Labor Cabinet
Kentucky Dept. of Workers' Claims Division of Ombudsman & Workers' Comp Specialist Services         

12. Holding a position for an employee on disability
Classified employees can receive disability retirement from CERS/KRS under Kentucky statute KRS (worked 5+ years) or KRS (worked less but disabled on the job). See also KRS (4) and (10) (school board classified employees’ disability retirement governed by KRS ). Continuance of disability retirement reviewed every 1-5 years.
Certified employees can receive disability retirement from KTRS under Kentucky statute KRS (worked 5+ years) and (worked less but disabled on the job). “Periodic examinations” for continuance.
CLASSIFIED EMPLOYEES KRS : “The person, since his last day of paid employment, has been [permanently, which is expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months from the person's last day of paid employment in a regular full-time position,] mentally or physically incapacitated to perform the job, or jobs of like duties, from which he received his last paid employment.” Duty related injury of classified employee, not in a hazardous position, and disability retirement are in KRS
NOTE: Hazardous positions are different. Check with retirement agency regarding disability retirement requirements for hazardous positions.
CERTIFIED EMPLOYEES KRS : “In order to qualify for retirement by reason of disability a member must suffer from a physical or mental condition presumed to be permanent in duration [“reasonably expected to continue for one (1) year or more from the date of application for disability benefits”] and of a nature as to render the member incapable of being gainfully employed in a covered position. The incapability must be revealed by a competent examination by a licensed physician or physicians and must be approved by a majority of a medical review committee.”

13. Holding a position for a certified employee on disability
Leave of absence for certified employee, due to disability, is granted by the local board under KRS (1):
“(1) Upon written request of a teacher or superintendent, a board of education may grant a leave of absence for a period of not more than two (2) consecutive school years for educational or professional purposes, and shall grant such leave where illness, maternity, adoption of a child or children, or other disability is the reason for the request. Upon subsequent request, such leave may be renewed by the board.”
“(2) Without request, a board of education may grant leave of absence and renewals thereof to any teacher or superintendent because of physical or mental disability, but such teacher or superintendent shall have the right to a hearing and appeal on such unrequested leave of absence or its renewal in accordance with the provisions for hearing and appeal in KRS ”
Certified employee returning from leave, under KRS , resumes same contract status (tenured/non-tenured) the employee held before the leave.
The local board “shall grant” up to 2 year initial leave to a certified employee, for disability. The local board has discretion whether or not to continue to grant leaves of absence to a certified employee under KRS There does not appear to be a requirement to grant the leave (hold the job) after the initial leave for disability. As well, the board has the discretion to grant leave to a teacher or superintendent (certified employees only) without a request from the employee (under Subsection 2). This appears to be a “placing a certified employee on leave” provision.

14. Certified employee’s right to return to work and disability retirement application
Certified employee retains tenure during disability retirement application processing period. KRS (3): “Retirement because of disability under this section shall not be cause for termination of the contract of a teacher or superintendent under KRS during the twenty-four (24) calendar month period described in this section. A teacher or superintendent who applies for disability retirement under the provisions of KRS shall retain continuing service status during the period of time the application for disability retirement is being processed. If the application is not approved, the teacher or superintendent may return to the contract, employment, or leave status held prior to submission of the application.”

15. Certified employee’s right to return to work and disability retirement
Certified employee retains tenure during 24 months from date of disability retirement.
KRS (1): “Teachers and superintendents with continuing status who retire because of disability shall, notwithstanding provisions of KRS to to the contrary, retain continuing status in the school district from which they retired for twenty-four (24) calendar months from the date of retirement, if the teacher or superintendent:
(a) Is approved for disability retirement under the provisions of KRS , or
(b) Is approved for disability retirement but elects to have benefits calculated on the service retirement formula under the provisions of KRS , or
(c) Is disqualified from receiving disability retirement benefits by KRS (2) but is otherwise eligible for disability retirement under the remaining provisions of KRS

16. Certified employee’s priority consideration after disability retirement
After 24 months (and before 43 months), the certified employee does not have a right to return to work in the district, but does get priority consideration for future hiring.
KRS (4)(b): “If the teacher recovers from the disability and presents written notice of such recovery, supported by the statement of a licensed physician, to the superintendent within twenty-five (25) through forty-two (42) months from the date of retirement, the superintendent shall give priority consideration to reemployment of the teacher for the first available position for which the teacher is qualified and certified.”
There is a similar provision for superintendent in KRS (4)(a).

17. Holding a position for a certified employee on disability
Certified employee return to work notice to district requirement:
KRS (2)(b) provides: If the teacher recovers from disability and presents written notice of such recovery, supported by the statement of a licensed physician, to the superintendent within the twenty-four (24) calendar month period but not later than April 15 prior to the beginning of the school term, the superintendent shall reinstate the teacher to active continuing status at the beginning of the school term. If notice of recovery from disability is not presented to the superintendent within the twenty-four (24) calendar month period, or if the teacher states to the superintendent, in a verified document, prior to expiration of the twenty-four (24) calendar month period that he or she will not return to employment in the school system, the continuing service contract of the teacher shall terminate as by retirement under the provisions of KRS
No certified employee has a right to any particular position or school assignment, per KRS
Failure of the teacher to provide notice of return and recovery prior to April 15 means the district has the discretion whether to return the employee to the district the next school year.

18. Holding a position for a classified employee on disability leave
Granting leave: Board policy, per KRS , governs leave of absence for classified employees. Continuation of leave and whether the district will hold the classified job will be governed by board policy as well. See KSBA Model Policy No
Return to work: Local board policies include the return to work notification requirements for classified employees returning from disability leave and notice regarding whether employee has the right to return to a particular position or school assignment. See KSBA Model Policy No and (classified employee leave and return to work notice).

19. Break in service and sick leave
The sick leave statute for all school district employees, KRS requires continuity of employment from one district to another for accumulated sick leave to transfer. Sick leave transfers with the employee when an employee moves without a break in service from one public school district to another or to KDE and back to the district.  The statute requires that the transfer be without a break in service. One cannot resign, have a break in service, move somewhere new and pick up the formerly accumulated sick leave. There is Kentucky case law that says the phrase in KRS “transfers…from one school district to another” means that there must be continuity in employment from one district to another in order for the sick leave to transfer.  Young v. Board of Education, 661 S.W. 2d 787 (Ky. App.  1983).
Note: School district employment typically runs through June 30 so the person is still employed through that date and a “break in service” doesn’t usually begin before then.
Cross reference: KRS (transfer from/to KDE and school district).
No current ceiling on number of sick leave days the employee can transfer.
Reduction in Force (RIF) break in service: Classified, in KRS (8)(c), get sick leave restored with recalled. Certified, in KRS , also most likely get sick leave back when restored to tenure status.
KRS (2) and KRS (4) currently have no ceiling to the number of sick leave days a KDE or school district employee can transfer when transferring to another school district or to KDE. The case Sublette v. Board of Education of Fulton County, Kentucky, 664 F.Supp. 265 (W.D.Ky. 1987) details the legislative history on this issue, which describes the previous limit on the number of sick leave days a district employee could transfer to another district or to/from KDE (also, the provision was previously contained in Section 3 of KRS and was moved to Section 4 some years ago). See excerpt from the case below:
Plaintiff Sublette was initially employed by the defendant Board as a teacher in the 1952–53 school year. At the time of her employment, Kentucky law provided that teachers would receive 10 sick leave days per year, and that a maximum of 20 unused sick leave days could be accumulated and used in subsequent years, unless a greater number of accumulated days was “authorized” by the district board of education. Ky.Rev.Stat (3) (1948).
… At the end of the 1969–70 school year, plaintiff Sublette's sick leave card showed that she had accumulated 89 sick leave days. In 1969, the Kentucky legislature amended Ky.Rev.Stat (3) to provide for an increase in the maximum number of accumulated sick leave days allowed, to 60 days, unless otherwise “authorized” by the board of education.
During his employment as superintendent with the defendant board, from 1969 until his resignation in 1983, Harold Garrison recorded sick leave days on teachers' sick leave cards in such a manner as to permit an unlimited accumulation of sick leave days. Board members appear to have been unaware of this, or any other procedures, for keeping such records.
In 1974, the Kentucky legislature again amended Ky.Rev.Stat (3) so as to permit unlimited accumulation of sick leave days. A 1980 amendment further provided that upon retirement, a teacher could receive compensation for accumulated sick leave days, not to exceed 30 percent of the retiring teacher's daily salary. Ky.Rev.Stat (5).
Language remains in KRS (2) referencing the previous ceiling to the number of sick leave days a district employee could transfer when transferring employment to another school district.
There is no current ceiling affecting the transfer of accumulated sick leave any KDE employee could transfer to a school district or that any school district employee could transfer to another district or to KDE. The only thing to change this would be a change to KRS (4) (which would then result in a change to KRS (2)’s application as a result of its direct reference to any ceiling provided by KRS (4)).
The separate question of whether a teacher is entitled to transfer of tenure under Kentucky law involves two issues:
1. Did the teacher have teacher tenure in the first school district? and
2. Was the teacher able to transfer her tenure status to the second school district?
Transfer of tenure is provided by KRS (1)(c)  found at and allows a teacher who has attained tenure in a school district to transfer his/her employment to a second school district and attain tenure after one year of employment in the second district and after an offer and one day of work for a second school year in the second school district:
(c) When a teacher has attained continuing contract status in one district and becomes employed in another district, the teacher shall retain that status. However, a district may require a one (1) year probationary period of service in that district before granting that status. For purposes of this subsection, the continuing contract of a teacher shall not be terminated when the teacher leaves employment, all provisions of KRS to to the contrary notwithstanding, and the continuing service contract shall be transferred to the next school district, under conditions set forth in this section, for a period of up to seven (7) months from the time employment in the first school district has terminated. Nothing contained herein shall be construed to give a teacher a right to reemployment in the first school district during the seven (7) month period following termination.
See the attached opinion of the Office of the Attorney General, OAG which provides:
… [W]e believe KRS (1)(c), as amended by the 1982 General Assembly, effective July 15, 1982, the so called “portable tenure law,” may be applied to any teacher who either had already resigned or who since July 15, 1982, has resigned and seven months have not elapsed since the resignation. In either situation, at the time of the resignation, the teacher must have enjoyed continuing service contract status with the school district resigned from.
The language of the tenure statute does not state that the teacher is “transferring” employment to the next school district but instead sets forth the conditions for transfer of tenure from a district where the teacher had attained tenure to a district in which the teacher “becomes employed.” There can be no longer than a 7 month break in service (no more than 7 months between jobs) between working in the first school district and “becoming employed” in the second district for tenure to transfer after the first full year at the new school district. If a teacher resigned from the first school district and did not transfer to the second school district within 7 months of the end of employment in the first district, then the transfer of tenure is not available and the teacher would have to start over again to attain tenure in the second school district. Again, this is all per the requirements of the statute and a school district cannot choose to add to these requirements. A school district could choose to award teacher tenure to a teacher transferring from a school district where s/he had tenure since the statute allows the second school district the option of requiring a one year probationary period but the school district would have to award tenure after completion of that one year and could not extend the number of years required for tenure to transfer.

20. Initial acquisition or regaining of tenure in a district:
Teacher has to be certified by EPSB with a certificate that meets the definition of KRS (6) for service time to apply toward tenure.
Teacher has to work at least 140 days, at least 6 hours in length, in certified duties in a single school year in a single school district for a year to count toward tenure in that district (substitute teaching time can count toward tenure per OAG ).
Teacher has to work 4 consecutive years or 4 of the last 6 years in a single school district.
Teacher has to be offered a certified position contract for the 5th year while currently employed.
Teacher has to accept the contract for the 5th year and work at least 1 day of the 5th year to attain tenure.
Tenure cannot be granted or denied by a district; tenure is a creation of statute and attaches to the teacher’s status when the requirements of the statute are met.
Retired teacher cannot acquire tenure due to KRS and KRS ’s very narrow circumstances and restrictions on the hiring of retired-reemployed teachers.
Regaining tenure involves the same process and requirements.

21. Transfer of tenure from a first district to a second district:
Teacher has to have tenure in the first district (working the 4 years and then transferring without receiving 5th year contract and without working at least 1 day in 5th year in first district does not count).
Teacher has to "transfer" employment to the second school district within 7 months of terminating employment in first school district.
Teacher has to work one probationary year in second school district.
Teacher has to be offered second year teaching contract and work one day of second year in second school district for transfer of tenure to occur.
Transfer of tenure is only possible when transferring from a district where the teacher earned tenure (worked 4 years and 1 day of 5th year) and transferring to a second school district and meeting the transfer requirements in the second district.

22. Termination of tenure:
Once a teacher has attained tenure in a school district, the teacher has a continuing right to a contract of employment with that school district until the teacher retires or resigns, or until:
The tenured teacher is terminated for cause under the circumstances and provisions of KRS A district notifies the teacher that dismissal for cause is intended and the teacher can request a teacher tribunal hearing to make the final decision.
The tenured teacher is laid off in a reduction in force in the school district, based on the circumstances and procedures outlined in KRS Local board policies usually have information on rights and benefits of tenured and non-tenured staff upon return to the district after a reduction in force.

23. Non-renewal/termination:
Districts have to provide notice of non-renewal by May 15 to limited contract (non-tenured) classified (KRS ) or certified staff (KRS Notice to quasi-tenured classified employees of non-renewal has to be given by May 15th too and then the employee can request a hearing on the grounds (for cause) for non-renewal. If the district failed to provide notice of non-renewal to limited contract (not tenured) employees by the May 15 deadline, then the district has given the employee another year of employment. If a district missed the May 15 deadline then the district has to find spots for them for next year, even if the positions in which they worked last year have been eliminated at this time.

24. Reduction of duties and salaries (still stay employed, just less money and less duties):
A reduction of duties and salary can be accomplished by complying with the notice and deadline requirements of KRS (3) ("ninety (90) days before the first student attendance day of the school year or May 15, whoever occurs earlier"). If a district meets the deadline in KRS (3) for notice of that reduction of duties and salary, then the district can reduce the employee's salary the next school year. An administrator with 3 years of more administrative experience will get due process rights regarding the demotion as stated in KRS (2)

25. Demotion of certified administrators:
KRS provides the procedural requirements and due process rights of demoted certified administrators. If the demoted certified administrator has less than 3 years of certified administrator experience, then the notice provisions in KRS for notice of reduction of responsibilities and duties is sufficient for providing notice of administrator demotion.

26. Change in assignment:
KRS (4) does not provide any teacher the right to any placement/position in the district. To move or reassign a school employee, like a teacher, to another position within the same school, the principal has the authority to do so under KRS if the move is to another position in the same school; but, if the teacher needs to be transferred to another position in the district (or in another school in the district), then this requires the coordination and acquiescence of the superintendent (for the district position) or other school's principal (for the other school position) too.

27. Reduction in force (classified)
A reduction in force (RIF) of classified staff is conducted per KRS (8) and includes no deadline for notice to classified employees or restriction as to when the RIF can be conducted (anytime during the school year): (8) The superintendent shall have full authority to make a reduction in force due to reductions in funding, enrollment, or changes in the district or school boundaries, or other compelling reasons as determined by the superintendent. (a) When a reduction of force is necessary, the superintendent shall, within each job classification affected, reduce classified employees on the basis of seniority and qualifications with those employees who have less than four (4) years of continuous active service being reduced first. (b) If it becomes necessary to reduce employees who have more than four (4) years of continuous active service, the superintendent shall make reductions based upon seniority and qualifications within each job classification affected. (c) Employees with more than four (4) years of continuous active service shall have the right of recall positions if positions become available for which they are qualified. Recall shall be done according to seniority with restoration of primary benefits, including all accumulated sick leave and appropriate rank and step on the current salary schedule based on the total number of years of service in the district.

28. Reduction in force (certified)
A RIF of certified staff is conducted per KRS and includes no deadline for notice to certified employees. A reduction in force (RIF) of certified staff is conducted per only the triggers and in the order specified in KRS
When by reason of decreased enrollment of pupils, or by reason of suspension of schools or territorial changes affecting the district, a local superintendent decides that it shall be necessary to reduce the number of teachers, he shall have full authority to make reasonable reduction. But, in making such reduction, the local superintendent shall, within each teaching field affected, give preference to teachers on continuing contracts and to teachers who have greater seniority. Teachers whose continuing contracts are suspended shall have the right of restoration in continuing service status in the order of seniority of service in the district if teaching positions become vacant or are created for which any of the teachers are or become qualified.
The district can at any time implement a reduction in force to layoff certified staff but this has to be for one of the triggers listed in KRS and has to be conducted in the manner described in that statute (can't just pick particular certified employees for layoff).

29. Potpourri Issues we’ve seen lately at KDE legal:
Procurement law compliance issues
Calendar questions regarding MLK day
Use of school funds and “educational purpose” evaluation
Affordable Care Act questions
Surplus property sale and appraisal requirement

30. District procurement
Has to meet requirements of procurement law (bid law or MPC, whichever you are under)
District has the responsibility to review and ensure, if they use another entity’s bid contract, that the bid met the requirements of procurement law.
District needs to secure a copy of that bid if they plan to buy off it.
District procurement guidance, training, and resources on KDE’s website at:
Questions on district procurement in practice: Jeff Coulter
Questions on all procurement in practice: Tom Stratton
Questions on procurement law and nutrition procurement: Lisa Lang

31. Calendar and MLK day
The language of KRS does not allow districts to use MLK day as a make-up day.

32. School funds and “educational purpose”
Power Point presentation on this topic on KDE’s website at:
Examples of issues: coaches cards, retirement incentive (OAG 96-23)
Some funds have additional restrictions (e.g., nutrition funds) requiring expenditure for only their exclusive purpose (rebates too)

33. Affordable Care Act
KDE resources (including an implementation guide and podcast guidance) at:
Contact Susan Barkley or Melissa Sullivan for guidance.

34. Sale of surplus real property
After board action, can sell by public bid, public auction, or private sale.
Have to sell for fair market value (FMV).
FMV is the certified appraised value, regardless of method of sale.
Have to get an appraisal before selling and sale price has to be at least the appraisal amount.

35. Questions?
Amy Peabody Assistant General Counsel Kentucky Department of Education