01/25/1994 08:00 AM House STA

  HB 277 - INDEMNIFICATION OF PUBLIC EMPLOYEES                                 
                                                                               
  Number 032                                                                   
                                                                               
  REPRESENTATIVE BRIAN PORTER presented CSHB 277.  He said the                 
  committee substitute addresses a number of concerns put                      
  forth by the Department of Law.  He reiterated comments of                   
  last week regarding  SEC. 1A and SEC. B.                                     
                                                                               
  REPRESENTATIVE PORTER further explained that an employer is                  
  not required to provide indemnification if that employer                     
  feels that the act was outside the scope of employment or as                 
  a result of gross negligence or an intentional act.  If this                 
  is the allegation of the employer and the employer has been                  
  dropped from the suit or never was named in the suit, the                    
  remedy of the employee it to bring suit if he or she feels                   
  that indemnification is still justified under this act.  If                  
  the employer is named in the suit and still refuses to                       
  indemnify, there is a provision for a cross claim by the                     
  employee.  If the employer takes advantage of the provision                  
  that allows for indemnification to the extent of providing a                 
  defense for the employee, but reserves the right to                          
  indemnify damages until the end of the proceeding, which may                 
  or may not establish that there was outside of the scope of                  
  gross negligence, they may do so.  The employees remedy then                 
  is, within one year, to file suit for indemnification under                  
  this act.  He went on to say the suggestion by the                           
  department that an employee must notify his or her employer                  
  within ten days can be waived for good cause and cited an                    
  example.                                                                     
                                                                               
  REPRESENTATIVE PORTER continued with an overview of letters                  
  of support, starting with the letter from Kent. E. Swisher                   
  from the Alaska Municipal League.  In addition, he noted the                 
  updated memo from the Anchorage Telephone Utility, a letter                  
  of endorsement by Michael Grimes, statewide President of                     
  Alaska Peace Officers Association, and a letter from the                     
  Alaska Association Chiefs of Police.                                         
                                                                               
  REPRESENTATIVE PORTER noted the presence of Terry Cramer                     
  from the Division of Legal Services, Legislative Affairs                     
  Agency.                                                                      
                                                                               
  REPRESENTATIVE VEZEY asked Representative Porter if there                    
  were other public entities that have a problem in this area.                 
                                                                               
  REPRESENTATIVE PORTER said he has been aware of individual                   
  employees, who have expressed concern over the years about                   
  being vulnerable.  He further noted that municipalities                      
  change policy, potentially every four years.                                 
                                                                               
  REPRESENTATIVE VEZEY asked for clarification regarding                       
  punitive damages to the employee.                                            
                                                                               
  Number 207                                                                   
                                                                               
  REPRESENTATIVE PORTER said that it is not a requirement                      
  under this legislation, but it also does not preclude it.                    
  He further stated that a labor contract or any other policy                  
  may provide for punitive damages, but it is not mandated by                  
  this bill.                                                                   
                                                                               
  Number 261                                                                   
                                                                               
  REPRESENTATIVE VEZEY referenced the Fairbanks ordinance                      
  outlining indemnification.  He noted the importance of local                 
  self-determination, and voiced a concern about usurping                      
  that.  He asked if there was a provision to allow a                          
  municipality's ordinance to supercede state law in cases of                  
  indemnification.                                                             
                                                                               
  Number 317                                                                   
                                                                               
  REPRESENTATIVE PORTER responded by saying that as a sponsor                  
  of the bill, he did not have a problem with language that                    
  would defer to the codification of public employee                           
  indemnification that exceeds what is outlined in HB 277.                     
                                                                               
  REPRESENTATIVE PORTER asked Representative Gary Davis, as a                  
  former municipal official, if he had a problem with HB 277.                  
                                                                               
  REPRESENTATIVE G. DAVIS said he supported the bill.                          
                                                                               
  Number 346                                                                   
                                                                               
  REPRESENTATIVE VEZEY asked Representative Ulmer if she had                   
  anything to share regarding this legislation, as a former                    
  municipal official.                                                          
                                                                               
  REPRESENTATIVE FRAN ULMER responded by saying she supports                   
  the policy goal of statewide uniformity that the bill puts                   
  forth.  She asked for clarification in cases of age, race or                 
  specifically, sexual harassment cases.                                       
                                                                               
  Number 361                                                                   
                                                                               
  REPRESENTATIVE PORTER reiterated the provisions in the bill                  
  regarding gross negligence, the options of the employer and                  
  the employee, in a situation where they do not agree on                      
  indemnification.                                                             
                                                                               
  Number 368                                                                   
                                                                               
  REPRESENTATIVE ULMER asked Terry Cramer if she had any                       
  comments or insights on how the employer would proceed,                      
  internally, whether or not they should provide counsel.                      
                                                                               
  Number 407                                                                   
                                                                               
  TERRY CRAMER, DIVISION OF LEGAL SERVICES, said that it would                 
  be up to the individual public employer to follow whatever                   
  procedures they have established for those kinds of                          
  decisions.                                                                   
                                                                               
  Number 412                                                                   
                                                                               
  REPRESENTATIVE G. DAVIS echoed comments made by Terry                        
  Cramer:  the individual employer usually has a sexual                        
  harassment policy in place which outlines procedures to deal                 
  with decisions regarding sexual harassment.  He pointed out                  
  that though wording in the bill defining "scope of                           
  employment" and "good faith" can be subject to                               
  interpretation, in sexual harassment cases, there is most                    
  often a separate policy specific to that issue.                              
                                                                               
  Number 432                                                                   
                                                                               
  REPRESENTATIVE PORTER followed up by saying that "scope of                   
  employment" and "good faith" have generally accepted                         
  definitions.                                                                 
                                                                               
  Number 443                                                                   
                                                                               
  REPRESENTATIVE ULMER moved to adopt CSHB 277                                 
                                                                               
  Number 450                                                                   
                                                                               
  CHAIRMAN VEZEY called for a roll call vote.  CSHB was MOVED                  
  out of committee with a unanimous vote.