Legislature(1993 - 1994)

02/09/1994 01:15 PM JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
  HB 277 - INDEMNIFICATION OF PUBLIC EMPLOYEES                                 
  Number 490                                                                   
  REP. PORTER informed the committee that the Department of                    
  Law had rewritten HB 277 basically with the same content,                    
  but so it makes better sense.  He said the definition of                     
  public employer means the state or quasi public                              
  corporations, but excludes University of Alaska, municipal                   
  school districts or Rural Education Attendance Area, and the                 
  reason is there is existing state law that already provides                  
  this benefit, indemnification, for those employees.                          
  REP. PHILLIPS addressed the definition and said she was                      
  concerned the committee was setting a precedent in statute,                  
  and that definition can be used for any case.                                
  REP. PORTER explained that the definition is for the                         
  purposes of this act.                                                        
  Number 547                                                                   
  SUSAN COX, Supervisor, Special Litigation Section,                           
  Department of Law, testified that HB 277 had been reworked                   
  from the one the committee saw a week ago, broken down into                  
  several statutes, and made into a chapter to make the                        
  legislation more manageable.  She highlighted a few things:                  
  one being to address the concern that employees would be                     
  terminated to avoid having to indemnify or defend them, a                    
  provision has been added to make it clear that former                        
  employees are covered the same as current employees if they                  
  are sued about something that pertains to their former                       
  Number 575                                                                   
  MS. COX then addressed a new section that discusses when an                  
  employee is paying the tab fully for defense and                             
  indemnification, they can settle a case without the                          
  employee's consent as long as they settle all the claims                     
  against the employee.                                                        
  Number 584                                                                   
  REP. DAVIDSON indicated he still had a concern about some                    
  settlements that leaves questions about the reputation of an                 
  Number 592                                                                   
  MS. COX replied there are two things:  one, the common                       
  practice of including a provision that says nothing in this                  
  settlement is an admission of guilt, or responsibility or                    
  liability; and two, if the employee feels maligned by                        
  litigation, he or she can bring a counter-claim against the                  
  individual.  She added that the state doesn't pay costs in                   
  this case.                                                                   
  Number 620                                                                   
  REP. DAVIDSON asked, what if there was just cause to                         
  counter-claim, how do you ensure that the suit doesn't                       
  create a bad situation for that person?                                      
  Number 633                                                                   
  MS. COX responded that the employee could strongly object                    
  and an agreement could be made by the state, and the                         
  employee can go on and continue to litigate, but at his or                   
  her own expense.                                                             
  Number 655                                                                   
  REP. DAVIDSON expressed concern that the resolution is money                 
  versus whether someone was right or wrong.                                   
  Number 661                                                                   
  REP. PORTER observed that he had been in the employee's                      
  position personally and tried to address it, but all of                      
  this, for these kinds of employees, is just policy.  He                      
  continued, saying to try to balance the rights of an                         
  individual versus the rights of the employer is basically                    
  the direction HB 277 went, and he agrees that the employer                   
  cannot, by settlement, sign away the rights of the employee                  
  to take further action if he or she chooses to do so.                        
  Number 676                                                                   
  REP. GREEN asked if the litigation record could have an                      
  adverse effect if the employee pursued the case.                             
  Number 688                                                                   
  MS. COX indicated she couldn't conceive of circumstances                     
  where that would be the case.  She said the claim you may                    
  have against someone else, i.e., defamation, would arise                     
  from certain facts, and so it wouldn't matter what was                       
  developed in the first lawsuit in terms of what's on the                     
  record, so the issue is going to be what happened, and will                  
  most likely have nothing to do with the lawsuit.                             
  MS. COX added that many attorneys don't put an individual's                  
  name on the suit, usually it is the employer who is fully                    
  engaged, but not the individual.                                             
  Number 743                                                                   
  REP. PHILLIPS returned to the subject of the definition of                   
  public employer and said it needs to be clarified that it                    
  only applies to this act.                                                    
  Number 750                                                                   
  The committee discussed various ways of handling Rep.                        
  Phillips' concerns.                                                          
  Number 796                                                                   
  REP. PORTER introduced Amendment No. 1, which would add that                 
  written notice must be given to the employee if it is the                    
  employer's intention not to provide defense, and the notice                  
  must be given within 60 days in writing after receiving a                    
  request for legal defense.                                                   
  Number 854                                                                   
  REP. GREEN moved Amendment No. 1.  Hearing no objection,                     
  Amendment No. 1 was adopted.                                                 
  Number 861                                                                   
  REP. PHILLIPS introduced Amendment No. 2, which would                        
  address the definition of public employer and state that it                  
  is "for the purposes of this act only."                                      
  TAPE 94-20, SIDE B                                                           
  Number 000                                                                   
  The committee discussed Amendment No. 2 and asked for                        
  Legal's interpretation of the amendment.                                     
  Number 083                                                                   
  TERRY CRAMER, Legislative Legal Counsel, Legislative Affairs                 
  Agency, drafter of HB 277, told the committee that it was                    
  contrary to drafting procedures to include that type of                      
  definition.  She said HB 277 would become statute, and the                   
  amendment implies that it's not a chapter.                                   
  The committee discussed Ms. Cramer's interpretation and Rep.                 
  Phillips asked that Amendment No. 2 be withdrawn.                            
  Number 165                                                                   
  REP. GREEN made a motion to move CS HB 277(JUD) out of                       
  committee with individual recommendations and zero fiscal                    
  Hearing no objection, it was so moved.                                       
  CHAIRMAN PORTER adjourned the meeting at 2:30 p.m.                           

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