SB 338: "An Act relating to actionable claims against state employees; relating to the state's defense and indemnification of its employees and former employees with respect to claims arising out of conduct that is within the scope of employment; amending the Public Employment Relations Act regarding claims against the state or state employees; and providing for an effective date."
00 SENATE BILL NO. 338 01 "An Act relating to actionable claims against state employees; relating to the state's 02 defense and indemnification of its employees and former employees with respect to 03 claims arising out of conduct that is within the scope of employment; amending the 04 Public Employment Relations Act regarding claims against the state or state employees; 05 and providing for an effective date." 06 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 07 * Section 1. AS 09.50 is amended by adding new sections to read: 08 Sec. 09.50.253. Actionable claims against state employees. (a) Except as 09 provided in (f) of this section, the remedy against the state provided by AS 09.50.250 10 for injury or loss of property, or personal injury or death arising or resulting from the 11 act or omission of an employee of the state while acting within the scope of the 12 employee's office or employment is exclusive of any other civil action or proceeding 13 for money damages by reason of the same subject matter against the employee whose
01 act or omission gave rise to the claim or against the estate of the employee. Any other 02 civil action or proceeding for money damages arising out of or relating to the same 03 subject matter against the employee or the employee's estate is precluded without 04 regard to when the act or omission occurred. 05 (b) A state employee against whom such a civil action or proceeding is 06 brought shall deliver, within the time after date of service or knowledge of service 07 determined by the attorney general, all pleadings and process served upon the 08 employee, or a copy of the papers served, to the person designated by the head of the 09 employee's agency to receive such papers. The state employee also shall give notice 10 of the civil action or proceeding by promptly furnishing to the attorney general and to 11 the head of the employee's state agency copies of the pleadings and process delivered 12 under this subsection. The giving of notice under this subsection to the attorney 13 general constitutes an agreement by the employee to cooperate with the attorney 14 general in the state employee's defense of the action or proceeding, and a consent that 15 the attorney general conduct the defense as the attorney general deems advisable and 16 in the best interests of the employee, including settlement in the attorney general's 17 discretion. 18 (c) Upon certification by the attorney general that the state employee was 19 acting within the scope of the employee's office or employment at the time of the 20 incident out of which the claim arose, any civil action or proceeding commenced upon 21 the claim in a state court is deemed an action or proceeding against the state under the 22 provisions of this title and the state is substituted as the party defendant. The civil 23 action or proceeding certified under this subsection is subject to the same limitations 24 and defenses applicable to an action or proceeding against the state. The attorney 25 general or the attorney general's designee shall defend the civil action or proceeding in 26 which the state was substituted as the party defendant under this subsection. 27 (d) If the attorney general refuses to certify under (c) of this section, the state 28 employee may at any time before trial petition the superior court to find and certify 29 that the employee was acting within the scope of the employee's office or employment 30 at the time of the incident out of which the claim arose. Upon such a certification by 31 the court, the civil action is deemed to be a civil action or proceeding brought against
01 the state under the provisions of this title and the state is substituted as the party 02 defendant. A copy of the petition under this subsection shall be served upon the state 03 in accordance with the provisions of Rule 4(d)(7) of the Alaska Rules of Civil 04 Procedure. The petition to the superior court is the exclusive remedy to challenge the 05 noncertification decision by the attorney general of a state employee under this 06 section. 07 (e) A claim or suit for damages may not be filed against the state or the 08 attorney general arising out of the process for certification under this section. 09 (f) This section does not extend or apply to a civil action or proceeding against 10 an employee of the state that is brought for a violation of the Constitution of the 11 United States, or that is brought for a violation of a statute of the State of Alaska under 12 which such an action or proceeding against an employee is expressly authorized. 13 Sec. 09.50.254. Defense and indemnification of state employees. (a) 14 Except as otherwise provided in AS 09.50.254 - 09.50.257, the state shall provide 15 legal defense of civil claims against, and pay settlements and judgments including 16 attorney fees and costs entered against, a state employee if the claims, settlements, or 17 judgments are based on acts or omissions that occurred during the course and within 18 the scope of the employee's employment with a state agency and are not covered by 19 AS 09.50.253. 20 (b) The state does not have an obligation to defend or indemnify if the 21 (1) acts or omissions at issue were a result of gross negligence or 22 intentional or wilful misconduct on the part of the employee; however, the state may 23 not, based solely on an allegation of gross negligence or intentional or wilful 24 misconduct made by a party other than the state agency employing the state employee, 25 withhold legal defense in a civil action; 26 (2) acts or omissions at issue were not within the scope of the 27 employee's employment with a state agency; 28 (3) acts or omissions at issue are covered by AS 09.50.253; 29 (4) claim or action involves a disciplinary, administrative, or criminal 30 matter brought against the employee or is an appeal from a disciplinary, 31 administrative, or criminal action;
01 (5) civil claim or action is based on conduct for which the employee 02 has been convicted of a criminal offense or was terminated from employment by the 03 state agency employing the state employee; or 04 (6) state employee settled or compromised the claim or action before 05 requesting the state to provide legal defense or indemnification or while a request for 06 defense was pending. 07 (c) The state does not have an obligation to pay an award for punitive damages 08 against an employee. 09 (d) Defense or indemnification provided to a state employee under this section 10 does not constitute a waiver, limitation, or expansion of sovereign immunity or of 11 other immunity. 12 (e) If a legal defense is required under this section, the attorney general shall 13 provide legal services to the employee under the procedures set out in AS 09.50.253. 14 (f) This section applies to a former state employee to the same extent as a 15 current state employee. 16 Sec. 09.50.255. Employee's duties when requesting defense and 17 indemnification. (a) The state's obligation to defend and indemnify a state employee 18 under AS 09.50.254 - 09.50.257 arises only if the employee 19 (1) complies with the notice process set out in AS 09.50.253(b); and 20 (2) cooperates in the defense and resolution of the claim or action. 21 (b) A state employee for whom the state has provided legal defense under 22 AS 09.50.254 - 09.50.257 or who has a request for the provision of legal defense 23 pending may not settle the claim brought against the employee unless the attorney 24 general approves the settlement. 25 (c) If the state has provided legal defense and indemnification under 26 AS 09.50.254 - 09.50.257, the attorney general may settle a claim or action without 27 the consent of the employee so long as the settlement resolves all the outstanding 28 claims against the employee. 29 (d) This section applies to a former state employee to the same extent as a 30 current state employee. 31 Sec. 09.50.256. Employee's rights if the state declines to provide legal
01 defense. (a) If the state declines to provide a legal defense for a state employee under 02 AS 09.50.254 - 09.50.257, the attorney general shall provide the employee with 03 written notice of that decision within 60 days after receiving a request for legal 04 defense from the employee, or after service of the summons and complaint on the 05 employee, whichever is later. 06 (b) A state employee whose legal defense is declined under AS 09.50.254 - 07 09.50.257 may file a petition for legal defense in the superior court. The employee 08 must file the petition within 30 days after the employee received the written notice of 09 refusal to defend from the attorney general. A copy of the petition under this 10 subsection shall be served upon the state in accordance with Rule 4(d)(7) of the 11 Alaska Rules of Civil Procedure. 12 (c) If a state employee who has been denied legal defense settles the claim or 13 action without filing a petition under (b) of this section, the employee waives any right 14 to defense or indemnification. 15 (d) If the court grants a petition under this section, the attorney general shall 16 undertake the defense of the employee. 17 (e) This section is the exclusive means for resolving a dispute about 18 representation under AS 09.50.254 - 09.50.257. 19 (f) This section applies to a former state employee to the same extent as a 20 current state employee. 21 Sec. 09.50.257. Defense with reservation of rights; denial of 22 indemnification; employee liability for expenses. (a) The state may undertake the 23 defense of a state employee under AS 09.50.254 - 09.50.257 while contesting the 24 obligation to indemnify the employee, either partially or fully. If the state offers a 25 defense with a reservation of rights to an employee, the attorney general may provide 26 a legal defense and place limitations on the agreement to indemnify an employee 27 pending the outcome of the case. 28 (b) If the state denies indemnification or offers a defense with a reservation of 29 rights to an employee, the attorney general shall provide written notice to the 30 employee. The notice must include the reason for the denial or reservation of rights. 31 (c) If the state has defended an employee under AS 09.50.254 - 09.50.257, the
01 attorney general may bring an action against the employee for expenses incurred in the 02 defense if the trier of fact found that the employee's conduct was not within the course 03 or scope of employment. The action for expenses under this subsection must be 04 brought not later than one year after the execution of a written agreement settling the 05 underlying claim or action or entry of final judgment in the action. 06 (d) This section applies to a former state employee to the same extent as a 07 current state employee. 08 * Sec. 2. AS 09.50.300 is amended to read: 09 Sec. 09.50.300. Compromise by attorney general. Except as provided in 10 AS 09.50.253 - 09.50.257, the [THE] attorney general may, with the approval of the 11 court, arbitrate, compromise, or settle any action filed under AS 09.50.250 - 12 09.50.300. 13 * Sec. 3. AS 09.50 is amended by adding a new section to article 3 to read: 14 Sec. 09.50.301. Definitions for AS 09.50.253 - 09.50.257. In AS 09.50.253 - 15 09.50.257, 16 (1) "acting within the scope of the employee's office or employment" 17 means acts or omissions 18 (A) that the state employee is employed or authorized to 19 perform; 20 (B) of the state employee that occur substantially within the 21 authorized time and space limit; 22 (C) that are activated by a purpose to serve the state; and 23 (D) that do not constitute acting, or failing to act, with willful, 24 reckless, or intentional misconduct, or with gross negligence or malice; 25 (2) "settlement" means the execution of a written agreement settling 26 the claim or action that gave rise to the employer's obligation to defend or indemnify 27 the state employee; 28 (3) "state employee" 29 (A) means 30 (i) a permanent, probationary, seasonal, temporary, 31 provisional, or nonpermanent employee in the executive, legislative, or
01 judicial branch of the state government, whether in the classified, 02 partially exempt, or exempt service; or 03 (ii) a person appointed to a board or commission of the 04 state government; 05 (B) does not include an employee of 06 (i) the University of Alaska; 07 (ii) the Alaska Railroad Corporation; or 08 (iii) a political subdivision of the state, including a 09 regional educational attendance area. 10 * Sec. 4. AS 23.40.075 is amended to read: 11 Sec. 23.40.075. Items not subject to bargaining. The parties may not 12 negotiate terms contrary to the 13 (1) reemployment rights for injured state employees under 14 AS 39.25.158; 15 (2) reemployment rights of the organized militia under AS 26.05.075; 16 (3) authority of the Department of Health and Social Services under 17 AS 47.27.035 to assign Alaska temporary assistance program participants to a work 18 activity considered appropriate by the Department of Health and Social Services; [OR] 19 (4) authority for agencies to create temporary positions under 20 AS 47.27.055(c); 21 (5) provisions of AS 09.50.250 - 09.50.300. 22 * Sec. 5. The uncodified law of the State of Alaska is amended by adding a new section to 23 read: 24 TRANSITION. Nothing in this Act terminates or modifies a collective bargaining 25 agreement in effect on the effective date of this Act; however, for a collective bargaining 26 agreement between a state agency and an organization representing state employees that 27 expires before July 1, 2004, the new agreement may not contain provisions contrary to this 28 Act. 29 * Sec. 6. The uncodified law of the State of Alaska is amended by adding a new section to 30 read: 31 APPLICABILITY. This Act applies to a cause of action that arose on or after the
01 effective date of this Act. 02 * Sec. 7. The uncodified law of the State of Alaska is amended by adding a new section to 03 read: 04 REVISOR'S INSTRUCTIONS. The revisor of statutes is instructed to change the 05 heading of art. 3 of AS 09.50 from "Article 3. Claims Against State" to "Article 3. Claims 06 Against the State or State Employees." 07 * Sec. 8. This Act takes effect immediately under AS 01.10.070(c).