After a long and arduous legal battle, Gerry Serrano, a former Santa Ana police officer and prominent police union leader, faced a significant setback in his pursuit to maximize his retirement income through his CalPERS pension. Serrano, who had a commanding presence in Orange County politics, was earning nearly $300,000 annually while heading the city’s police officer union. However, his efforts to include all forms of compensation in his pension calculation, including pay for law enforcement assignments he did not perform while serving as a union leader, were recently thwarted by a court ruling.
The 4th District Court of Appeal ruled against Serrano, stating that he could not count perks for work he did not do while on leave as a labor representative towards his pension. This decision led to the exclusion of various incentives such as overtime, bilingual pay, holidays, and a uniform allowance from his pension formula. While this ruling directly impacted Serrano, it also raised broader implications for other California public employees considering union leave.
Serrano’s argument was based on the premise that California law mandates government agencies to provide union leave without a loss of compensation or benefits for designated labor representatives. His legal representative, Lina Balciunas Cockrell, emphasized the importance of maintaining fair compensation for union leaders to ensure effective labor relations. However, the ruling was commended by leaders at the California Public Employees’ Retirement System (CalPERS) for upholding previous decisions and reinforcing the disapproval of special compensation tactics to enhance pensions.
Despite the setback, Serrano’s retirement prospects remain stable. He retired in 2023 and currently receives a monthly pension of $14,810, equivalent to nearly $178,000 annually. His history of influencing Santa Ana politics through the union’s advocacy for police pay and benefits further underscored his impact in the community. However, his retirement journey was marred by controversies and legal disputes regarding his pension calculation.
One of the pivotal moments in the case involved a memorandum of understanding detailing Serrano’s pay structure upon assuming the union leadership role. This agreement included various pay differentials and special payments intended to compensate for lost overtime earnings. While Serrano saw a significant increase in his income during his tenure as a labor representative, the exclusion of certain compensatory elements from his pension calculation highlighted the complexities of pension regulations and their implications for public employees.
CalPERS’ meticulous review determined that Serrano’s pensionable income could not include compensation linked to work he did not perform during his union leave. This decision underscored the critical distinction between pensionable and non-pensionable income, particularly in cases involving special compensation arrangements or overtime pay. Serrano’s legal team argued that the compensation was intended to cover additional responsibilities rather than replace lost overtime earnings, but their reasoning was ultimately rejected by the appeals court.
Labor attorney Balciunas Cockrell emphasized the need for caution and transparency in structuring compensation for union leaders, urging unions to avoid connecting extra job duties to overtime pay. The delicate balance between fair compensation and responsible leadership highlighted the complexities of union roles and their impact on pension calculations. As public employee unions navigate similar challenges in the future, the case of Gerry Serrano serves as a cautionary tale on the intricacies of pension regulations and the need for clarity in compensation structures.
