On February 4, 2016 the First District Appellate Court issued its Rule 23 Order in Village of Chicago Ridge v. Board of Trustees of the Chicago Ridge Firefighters’ Pension Fund. In 2014 the plaintiff, a firefighter, retired. Pursuant to the collective bargaining agreement (“CBA”), the plaintiff was entitled to a 20% increase in his salary on the last day he worked. The pension board granted the plaintiff a pension inclusive of the 20% salary increase and the village appealed. The trial court reversed the pension board’s decision and the appellate court affirmed the trial court’s decision. Both courts held that the pension board’s decision was clearly erroneous.
The CBA contained a letter of understanding that provided that any firefighter who retires on his 25th anniversary is entitled to a 20% increase in salary (paid per hour only for the last day worked). The pension board, citing section 4402.35 of the Illinois Administrative Code determined that the 20% increase constituted salary attached to rank for pension purposes.
The appellate court held that the plain language of 40 ILCS 5/4-118.1(d) and section 4402.30 of the Illinois Administrative Code required that salary be “approved through the appropriations ordinance of the municipality.” The appellate court held that the village did not approve, through an appropriations ordinance, the 20% buyout provision in the CBA. The appellate court rejected the pension board’s argument that the village’s approval of the CBA had the same effect as though the village had approved an appropriations ordinance providing for the 20% increase in salary. The appellate court held that a municipality’s approval of a CBA and an appropriations ordinance are not the same thing. “Where an act is required by ordinance, anything less, such as a referendum or resolution, is not sufficient.” As such, the village’s “resolution” approving the CBA and side letter was not sufficient to make the 20% increase “salary” for pension purposes. Additionally the appellate court rejected the pension board’s reliance on an arbitration decision and an Illinois Department of Insurance advisory opinion that the 20% increase constituted “salary” for pension purposes. If the plain language of the statute is clear, the appellate court does not have to resort to additional sources to determine the legislature’s intent.