Presently before the court are preliminary objections filed by the Executive Board of the Commonwealth of Pennsylvania and the Department of Labor and Industry (collectively referred to as the Executive Board)*fn1 to the First Amended Petition for Review filed in our original jurisdiction by the Pennsylvania Workers' Compensation Judges Professional Association (Association) seeking declaratory and injunctive relief.*fn2
The following summary is drawn from the allegations in the Association's first amended petition for review. Since 1996, Workers' Compensation Judges (WCJs) have been classified as management level employees and, hence, are not represented by a union and do not engage in collective bargaining. Every four years, the various unions that represent other Commonwealth employees engage in collective bargaining with the Governor's office with respect to a new collective bargaining agreement (CBA).*fn3 This collective bargaining invariably involves wages and general pay increases, which result in a specified percentage increase in each longevity step within each pay scale group of the Commonwealth's pay plans.
Each year, the Executive Board issues a resolution authorizing payment of any negotiated increase for union employees. At the same time, the Executive Board also issues a resolution to "pass on" the same increase to management and other non-union employees. On March 18, 2008, the Executive Board issued a resolution to "pass on" to management employees, including WCJs, a 3% general pay increase in July 2008 and a one-step longevity increment in January 2009, which equates to a pay increase of 2.25%, provided that they were employed continuously since January 31, 2008.*fn4 In the case of a WCJ who has reached the maximum salary in his/her pay range, the resolution promised a lump sum equal to 2.25% of the WCJ's annual salary in effect on the day preceding the first day of the first full pay period in 2009. The WCJs and other management employees received the 3% general pay increase in July 2008.
However, on December 19, 2008, the Executive Board adopted a new resolution rescinding the January 2009, one-step longevity increment or lump sum payment contained in the March resolution, stating that "fiscal challenges resulting from revenue falling significantly below budgetary projections during Fiscal Year 2008-09, have prompted the need for cost savings measures to address these fiscal challenges."*fn5 In response, the Association filed a class action complaint against the Executive Board in this Court's original jurisdiction on December 17, 2010, followed by the Association's First Amended Petition for Review.*fn6 In this petition, the Association set forth the following counts and requests for relief: Counts I and II -- Declaratory Relief - seeking a declaration that the December resolution violated the Contract Clauses of the United States and Pennsylvania Constitutions; Counts III and IV -- Declaratory Relief -- seeking a declaration that the December resolution violated the Taking Clauses of the United States and Pennsylvania Constitutions; and Counts V and VI -- Declaratory Relief -- seeking a declaration that the December resolution violated 42 U.S.C. §1983.
The Association sought further relief as follows: a permanent injunction barring implementation of the December resolution; certification of the proposed class (all individuals employed continuously as WCJs from January 31, 2008, until the first day of the first full pay period in January 2009); an order directing the Executive Board to make all class members whole; and an award of attorney fees and costs.
On January 24, 2011, the Executive Board filed preliminary objections in the nature of a demurrer alleging as follows: the Association's 42 U.S.C. §1983 claims must be dismissed because section 1983 provides for a cause of action only against "persons" acting under color of state law and individuals sued in their official capacity are not "persons" for purposes of that section; the Association cannot bring direct claims under the Contract or Taking Clauses of the United States Constitution against the Executive Board; even assuming that these claims were procedurally proper, the claims are without merit because a public employee has no personal or property right to employment, the Executive Board is not statutorily prevented from modifying salaries, the March resolution created no vested rights in the salary increases, the March resolution did not create any contractual or property rights in favor of the Association, and the December resolution was not a legislative act and, as such, did not implicate a viable Contract Clause claim; assuming that a contract did exist, this Court lacks jurisdiction because the Association's sole relief is for breach of contract, which must be brought before the Board of Claims and such a claim is time barred as it was not filed within 60 days of the December 19, 2008, resolution; the Association's claims are barred by the doctrine of sovereign immunity; and there is no private right of action for money damages under the Pennsylvania Constitution.
The Executive Board seeks an order sustaining its preliminary objections and dismissing with prejudice the Association's §1983 claims and its claims premised on the Contract and Taking Clauses of the United States and Pennsylvania Constitutions.*fn7
The Executive Board argues that the Association's §1983 claims must be dismissed because §1983 provides for a cause of action only against "persons" acting under color of state law, and individuals sued in their official capacity are not "persons" for purposes of that section. We agree.
This Court has repeatedly held that the Commonwealth, a department of the Commonwealth, and officials acting in their official capacities are not "persons" under 42 U.S.C. §1983. Association of Settlement Companies v. Department of Banking, 977 A.2d 1257 (Pa. Cmwlth. 2009) (citing Will v. Michigan Department of State Police, 491 U.S. 58 (1989) in support of its holding that the Department of Banking is not a "person" to whom 42 U.S.C. §1983 may apply); Faust v. Department of Revenue, 592 A.2d 835 (Pa. Cmwlth. 1991), appeal denied, 530 Pa. 647, 607 A.2d 257 (1992) (neither the Commonwealth nor its officials acting in their official capacities are "persons" under 42 U.S.C. §1983).
Moreover, to state a claim under §1983, a plaintiff must (1) allege a violation of rights secured by the United States Constitution and the laws of the United States and (2) show that the alleged deprivation was committed by a person acting under the color of state law. Owens v. Shannon, 808 A.2d 607 (Pa. Cmwlth. 2002). The Association claims a contract right with respect to the March resolution providing WCJs with a 3% general pay increase in July 2008 and a one-step longevity ...