Matter of Derle v. Board of Fire Comrs., 40 N.Y.2d 224 (1976)
When a public employee’s termination is deemed excessive and reduced to a suspension, outside earnings during the period exceeding the suspension may be deducted from back pay to prevent a windfall, especially when the initial finding of misconduct is upheld.
Summary
A New York City fireman, Derle, was dismissed for misconduct involving soliciting fees and making false statements. While the courts upheld the finding of guilt, they deemed the dismissal too harsh and reduced it to a six-month suspension. The subsequent judgment stipulated back pay, minus outside earnings. Derle sought to eliminate the deduction of outside earnings, arguing he was entitled to full back pay after the suspension period. The Court of Appeals held that deducting outside earnings from the back pay beyond the suspension period was appropriate to prevent Derle from profiting from his misconduct, which was a breach of public trust.
Facts
Derle, a New York City fireman, faced charges in February 1969 for unlawfully soliciting fees, recommending a contractor for building violations, and lying about his income sources. After a hearing, he was found guilty of all charges and dismissed from the fire department.
Procedural History
Derle initiated a CPLR article 78 proceeding challenging his punishment. Special Term vacated the fire commissioner’s determination, finding the punishment excessive, and remanded the case. The Appellate Division modified the judgment to a six-month suspension without pay. The New York Court of Appeals affirmed this modified judgment. Special Term then entered a judgment for back wages owed to Derle minus any wages earned in outside employment during the period. Derle’s motion to resettle the judgment to eliminate the deduction for outside earnings was denied at Special Term, but the Appellate Division reversed this decision based on precedent. The Court of Appeals then reversed the Appellate Division’s order, reinstating the original Special Term order.
Issue(s)
Whether outside earnings should be deducted from a public employee’s back pay when a dismissal is reduced to a suspension, particularly when the underlying finding of misconduct is upheld.
Holding
Yes, because while the employee is entitled to be made whole for the period beyond the suspension, he should not profit from serious acts of misconduct affecting a public trust.
Court’s Reasoning
The Court distinguished this case from previous cases (Fitzsimmons v. City of Brooklyn and Kaminsky v. City of New York) where the departmental findings of misconduct were overturned. In Derle’s case, the finding of guilt was sustained. The court emphasized that only the *measure* of punishment was affected. Allowing Derle to retain outside earnings would create a windfall, which is inappropriate considering his breach of public trust. The court supported its decision by noting that Section 77 of the Civil Service Law permits such deductions. Although not directly controlling, the court referenced Matter of Lezette v. Board of Educ., Hudson, City School Dist. to further justify the principle that outside earnings should be considered. The court reasoned that the focus should be on ensuring the employee is made whole, but not unjustly enriched due to their own misconduct. The Court stated, “While the petitioner is entitled to be made whole for the period beyond the six-month suspension, he should not reap a windfall for serious acts of misconduct affecting a public trust.” There were no dissenting or concurring opinions.