Cargill v. Metropolitan Water District
Employee Benefits Class Action

Class Member's Frequently Asked Questions

     
 
 
 
 
Q:

What is the status of the Cargill lawsuit?

 
A:
The entire Cargill employee benefits class action has been settled through a series of three settlements.

The first settlement was reached in May 2002. It provides relief solely to those class members who had been employed by MWD as "district temporary employees" (district temps or DTEs) and remained employed as of February 3, 2002. This settlement is referred to as "the Partial DTE Settlement".

The second settlement is class-wide and received court approval on June 12, 2006. This settlement created a monetary fund to compensate class members for certain non-pension employee benefits to the extent that they did not already receive these benefits while working at MWD. This second settlement covers annual leave/vacation pay, holiday pay, merit pay increases, paid contingent leaves (e.g., personal leave, sick leave, disability leave, bereavement leave, military leave and jury leave), severance pay, 401(k) contributions, and health insurance premiums. It also provides class members who remained employed by MWD with leave bank adjustments and long-term former employees with reinstatement rights. This settlement is referred to as "the Ad Code Settlement".

The third settlement also is a class-wide settlement, and it received court approval on January 29, 2008. This settlement addresses CalPERS pension rights and is referred to as "the CalPERS Settlement".

Each of these settlements required class members to file a claim form (the Ad Code Settlement and the CalPERS Settlement) or to sign an individual settlement agreement (the Partial DTE Settlement). Class members who submitted Ad Code claim forms were not required to submit CalPERS Settlement claim forms in order to participate in the CalPERS Settlement. Approximately 2,000 class members have opted to participate in one or more of the settlements. The time for filing claims has passed.

Class Counsel now are engaged in representing these claimants in a lengthy, interactive process with MWD and CalPERS to ensure that they receive the relief to which they are entitled under these settlements.

 

 
 
Q:
What is required to implement the Cargill settlements?  
 
A:
The implementation of the Cargill settlements involves the completion of a great number of tasks, all of which are progressing concurrently. The tasks include the following:
  • Finalize a claimant database that has the most accurate information available regarding each claimant's dates of employment and rates of pay while providing services as a district temp, agency temp and/or consultant. This process is hampered by a general failure to maintain written records not only by MWD and the claimants' employment agencies/consulting firms, but also by claimants themselves. Before this information can be finalized, Class Counsel must reach agreement with MWD on the applicable dates and pay rates or seek a resolution of the dispute through arbitration.

  • Develop information regarding the benefits already received by claimants from a source other than MWD, such as an employment agency or consulting firm, during their work at MWD.

  • Determine whether any of the claimants are ineligible for relief provided by the settlements because they are not within the scope of the class of persons represented by Class Counsel in this case. The class definition adopted by the Court excludes persons who either: (1) received were regular employee benefits from the consulting firms that paid them while working at MWD immediately prior to and during their MWD employment; or (2) worked on a part-time basis, i.e., a work schedule averaging fewer than 33 hours per week. In cases where Class Counsel and MWD disagree on whether a claimant falls within the class definition, the claimant's eligibility will be resolved through arbitration.

    ** It should be noted that a determination that a claimant is not a class member in the Cargill case is not a determination that the claimant does not have a valid claim for relief if he or she were to bring a separate lawsuit or to initiate a separate CalPERS administrative claim. It simply means that the claim was not resolved by this lawsuit.

  • Determine whether certain claimants are subject to exclusion from CalPERS benefits because they did not provide services to MWD as common law employees of MWD. In cases where Class Counsel and MWD disagree regarding a claimant's common law employee status, the issue will be resolved by CalPERS through its administrative process.

  • Determine whether certain claimants are subject to exclusion from CalPERS benefits because they were "limited term" employees under the state law applicable to CalPERS, i.e., they were expected to work, and did work, less than six months. In cases where Petitioners and MWD disagree regarding this exclusion, the issue will be resolved by CalPERS through its administrative process.

  • Determine whether certain claimants are not entitled to relief under the Ad Code Settlement because they truly were "temporary" employees under the MWD Administrative Code, i.e., they were expected to work, and did work, less than four months. In cases where a claimant and Class Counsel disagree regarding this exclusion, the issue will be resolved through arbitration.

Class Counsel's efforts during this lengthy and complex implementation phase are dedicated to making sure that all qualified claimants obtain the relief to which they are entitled under the Cargill settlements. This effort also includes making sure that claimants who are not qualified to obtain relief do not dilute the relief available to qualified claimants.

 

 
 
Q:
How can I verify that I am considered a "claimant" under the Cargill settlements?  
 
A:

If you would like to know whether or not you are considered a "claimant," you should send an email to Class Counsel at mwdlawsuit@c-blaw.com. We will confirm your status by a return email.

 

 
 
Q:
How will it be determined whether I should be excluded from participating in the settlement because I am not a member of the Cargill class?  
 
A:
As mentioned above, certain claimants will be found to be ineligible for relief under the Cargill settlements because they do not fit within the class definition adopted by the Superior Court in November 5, 1999. The class definition expressly excluded two groups of workers, even though they may have provided services to MWD as a district temp, agency temp or consultant:
  • Those who never worked on a full-time basis. (See Answer to Question 5, below.)

  • Those who, immediately prior to their MWD employment, were regular employees of the consulting firm under whose contract they worked at MWD. (See Answer to Question 6, below

 

 
 
Q:
How will it be determined whether I worked on a full-time or part-time basis?  
 
A:

You worked on a full-time basis if you worked a schedule that would result in providing services to MWD at least 1,720 work hours per year. This is equivalent to a schedule requiring an average of 33 work hours per week or more.

 

 
 
Q:
How will it be determined whether I was a "regular employee of a consulting firm"?  
 
A:
You were a "regular employee of a consulting firm" if:
  1. You were on the payroll of a consulting firm immediately prior to providing services to MWD; this means that you had no break in service or loss of wages between your non-MWD work and MWD work;

  2. You were on the payroll of that same consulting firm while providing services to MWD;

  3. The firm was genuine consulting firm, not an employment agency, job shop or contract service provider;

  4. You either: (a) received the same rights and benefits as that firm's most favorably treated employees with comparable experience, education, training and skills, or (b) participated in the firm's primary pension plan; and

  5. You received these same rights and benefits both before and while you provided services to MWD.

 

 
 
Q:
Am I entitled to a receive a payment of money?  
 
A:
The Ad Code Settlement created a monetary fund to compensate class members for certain non-pension benefits that they would have received if MWD had been treated them as a "regular employee". The following non-pension benefits are covered by this settlement: annual leave; holiday pay; the average use by employees of personal leave, sick leave, disability leave, bereavement leave, military leave and jury leave; 401(k) contributions; health, dental, vision, life and long-term disability insurance premiums; merit pay increases; and severance pay.

Each qualified claimant is entitled to a pro rata share of this fund based on the value of the benefits they did not already receive, which is dependent on the claimant's length of employment, his or her pay rate, and the value of the benefits already received by the claimant from an employment agency, consulting firm or MWD. The method for calculating each claimant's pro rata share is described in much greater detail in the Description of Damages Model for Administrative Code Claim.

Please note that the CalPERS Settlement requires a claimant's share of the Ad Code Settlement monetary fund first to be used to pay the claimant's share of the employee pension contributions owed to CalPERS. This enables claimants to pay the CalPERS employee contributions in pre-tax dollars.

Under the CalPERS Setttlement, claimants are responsible for depositing at least 25% of the employee contributions attributable to their MWD employment prior to January 1, 2001. (See Answer to Question 8, below.) If your share of the monetary fund exceeds the amount to be deposited with CalPERS, the remainder will be paid directly to you.

Those claimants who do not want to keep their employee contributions on deposit with CalPERS will be able to withdraw these deposits at a later date. The employee contributions that can be withdrawn will include not only the claimant's 25% share of the pre-January 1, 2001 employee contributions that were paid from the settlement's monetary fund, but also the employee contributions paid by MWD (75% of the pre-January 1, 2001 contributions and 100% of the post-January 1, 2001 contributions).

As of April 30, 2008, the Ad Code Settlement monetary fund amounted to $25,577,063.49. This fund is invested in tax-exempt municipal bonds and is being monitored by the Los Angeles Superior Court through the filing of quarterly reports.

 

 
 
Q:
Who will pay the CalPERS contributions if I am found to be entitled to CalPERS credit?  
 
A:
Under the CalPERS Settlement, MWD may be required to pay a portion of the claimant's employee contributions as well as the usual employer contributions. For most claimants, the claimant will be responsible for paying 25% of the employee contributions for CalPERS service credit attributable to employment prior to January 1, 2001, and none of the employee contributions for service credit attributable to employment after that date.

However, claimants who received a form of retirement benefits from an employment agency or consulting firm during some or all of their MWD employment will be required to assume responsibility for paying more of the CalPERS employee contributions. Those claimants who already received employer contributions to a 401(k) plan while working at MWD will be required to deposit with CalPERS the amount of those employer contributions in addition to the 25% of the pre-January 1, 2001 employee contributions, but they will not be required to deposit any increase in value of the 401(k) account resulting from those employer contributions . Moreover, those claimants who participated in a "defined benefit" pension plan while working at MWD will be responsible for depositing with CalPERS all employee contributions attributable to their MWD employment.

 

 
 
Q:
I worked as a district temp (DTE) and was not enrolled in CalPERS until 6 months or more after I was hired. Will I get CalPERS service credit for my excluded service? If so, who will pay the CalPERS contributions for this service credit?  
 
A:
MWD was obligated to enroll you in CalPERS from the first day of your employment unless, at the time you were hired to work full-time, the length of your employment was genuinely expected to be limited to 6 months or less. If, however, it was genuinely expected that your full-time work for MWD would not exceed 6 months, MWD should have monitored your employment dates and enrolled you in CalPERS as soon as it was known that you would exceed 6 months of full-time service.

Under the CalPERS Settlement, you are entitled to receive service credit back to the date that you should have been enrolled in CalPERS, and the employee contributions due for this time are subject to the same 25%-75% split between you and MWD described above.

If you were properly enrolled in CalPERS as of a date later than your first day of employment, you may wish to purchase CalPERS credit for the properly excluded time as "membership prior to service". If so, you should contact CalPERS.

 

 
 
Q:
I already purchased service credit for my "temp" time. Can I get a refund for the employee contributions MWD has agreed to pay under the Cargill settlement?  
 
A:

Yes. You are entitled to a refund. Please make sure you inform Class Counsel that you purchased this service credit.

 

 
 
Q:
If I worked for MWD for fewer than 5 years and do not expect to vest a CalPERS pension by working at another public agency, do I still have to deposit money with CalPERS?  
 
A:

Yes. You are entitled to a refund. Please make sure you inform Class Counsel that you purchased this service credit.

 

 
 
Q:
Can I receive CalPERS service credit for my part-time service?  
 
A:

The Cargill case addresses only your full-time employment, even though you may be eligible for CalPERS service credit for your part-time service with MWD or some other public agency. As a general rule, you will have to seek credit for part-time service directly from CalPERS on your own. However, there are a few exceptions for claimants who have part-time service in addition to one or more full-time tenures with MWD.

If you qualify to receive CalPERS credit through the CalPERS Settlement for one or more full-time tenures with MWD and you have part-time service to MWD that falls into one of the categories outlined below, you also will be able to obtain service credit for that part-time service through the settlement.

  • The first exception is for qualified claimants with part-time, common-law employment with MWD that took place after the claimant's CalPERS enrollment date, whether or not that enrollment date was established through the CalPERS Settlement. MWD has agreed to pay the same 75% and/or 100% of employee contributions (subject to offsets) as it has agreed to pay for full-time employment starting with the first day of the part-time employment that falls in this category.

  • The second exception is for qualified claimants with part-time, common-law employment with MWD (1) that took place prior to the claimant's CalPERS enrollment date for full-time employment, and (2) for which MWD has confirmed that there is a hiring requisition stating that the position was expected to last at least one year for an average of at least 20 hours per week. MWD has agreed to pay the same 75% and/or 100% of employee contributions starting with the first day of the part-time employment that falls in this category.

  • The third exception is for qualified claimants with part-time, common-law employment with MWD (1) that took place prior to the claimant's CalPERS enrollment date for full-time employment, and (2) for which MWD has confirmed that the class member worked more than 1,000 hours within any fiscal year (July 1 - June 30) during the period of part-time employment. MWD has agreed to pay the same 75% and/or 100% of employee contributions starting the first day of the first pay period of the month following the month in which 1,000 hours of service in a fiscal year were completed.

 

 
 
Q:
When can I expect to receive my settlement money? Why is it taking so long?  
 
A:

The distribution of the Ad Code monetary fund to qualified claimants will be the last step of the settlement implementation. Before each qualified claimant's pro rata share can be calculated, there must be a final resolution of: (1) which claimants are eligible for this relief; (2) the eligible claimant's employment dates and pay rates; and (3) the benefits already received by eligible claimants from employment agencies and consulting firms. The time required to resolve these issues will be depend on how many contested issues must be resolved through arbitration or the CalPERS administrative process. (See Answer to Question 2, above.) At this time, it is impossible to give a meaningful estimate of the time that will be required to get final resolution on all of these matters; however, based on the number of issues that still need to be resolved for individual class members, it is very likely that the earliest date the distribution could take place is the end of 2009.

 

 
 
Q:
How much money can I expect to get?  
 
A:

This question also can not be answered at this time. Each qualified claimant will receive an unknown percentage of their lost non-pension benefits as calculated by the above-referenced damages model. This percentage is dependent upon the total of all damages for all qualified claimants and the final amount in the monetary fund at the time of the final distribution.

For example, if there is $25 million to be distributed to qualified claimants and the total value of those claimants' non-pension benefits (as calculated by the damages model) is $100 million, each claimant would receive 25% of the value of his or her lost non-pension benefits.

 

 
 
Q:
Will attorneys' fees be deducted from my settlement check?  
 
A:

The Court already has determined the amount of attorneys' fees to be paid to Class Counsel. The fees related to the Ad Code Claim already have been paid from the overall monetary fund created by the Ad Code Settlement. The fees related to the CalPERS Claim are being paid by MWD, not by members of the class. There will not be any further deductions from the monetary fund or from class members' settlement checks to pay fees to Class Counsel.

 

 
 
Q:
Will any of the fees paid by participants in the Partial DTE Settlement be refunded?  
 
A:

No. Class Counsel placed this issue before the Court in connection with its motion for an award of attorneys' fees and costs for the Ad Code Claim. The Court considered the monetary value of the relief obtained for the Partial DTE Settlement and the Ad Code Settlement participants and then ruled that the fees paid by class members who benefitted from the Partial DTE Settlement were proportionate with the fees being paid by the other class members by having their relief reduced by the amount of the fees that were deducted from the Ad Code Settlement monetary fund. Accordingly, the Court refused to apportion any part of the monetary fund created by the Ad Code Settlement to reduce these fees.

 

 
 
Q:
Will I be reimbursed for the money I paid to buy medical and dental insurance during the time I worked for MWD?  
 
A:

No. However, one of the factors in determining the amount of your pro rata share of the Ad Code Settlement monetary fund will be the cost of the insurance premiums that MWD would have paid for you if you had been classified as a regular employee.

 

 
 
Q:
I am about to retire. Can I have my CalPERS claim expedited?  
 
A:

Yes. Please contact Class Counsel as soon as you decide to retire. The MWD and CalPERS have agreed to give priority to processing the CalPERS claims of those claimants who already have retired or are planning to retire. Class Counsel and MWD will have to reach agreement on your dates of employment as a district temp, agency temp and/or consultant as well as your rates of pay during those time periods. You can help move the process forward by sending Class Counsel copies of any documents you have or can obtain that provide such information.

 

 
 
Q:
Can I draw a pension from CalPERS and also collect social security payments?  
 
A:

Yes. There may be a reduction to your social security payment, but the combined payments should exceed the social security payment alone. See the Social Security Administration's Windfall Elimination Provision for details. If you have further questions you should contact the Social Security Administration and/or CalPERS for more information.

 

 
 
Q:
Am I eligible for CalPERS retiree heathcare?  
 
A:

To be eligible for CalPERS retiree healthcare, (1) you must have at least five years of CalPERS service credit, and (2) you must retire with an effective date no later than 120 days following the date of your separation from your CalPERS employer. If you are eligible, you may enroll for retiree healthcare as an annuitant within 60 calendar days of receipt of the notification of your eligibility or during any open enrollment period.

CalPERS has interpreted these statutory requirements as binding on you even if you were not aware at the time you left your employment with MWD that you later would obtain, through the Cargill lawsuit, sufficient CalPERS service credit to enable you to seek a retirement allowance and retiree healthcare from CalPERS. However, if you obtain employment in the future with another CalPERS agency or the State of California, you may be eligible for retiree healthcare when you separate from that employment if you have five years or more of CalPERS service credit, including the service credit you obtain through the lawsuit for your work at MWD.

 

 
 
Q:
I currently am a member of CalPERS. I previously tried to sign up for CalPERS Additional 5-Year Service Credit Plan that would allow me to purchase extra service credit toward retirement ("air-time"), but CalPERS told me that I needed to have 5 years of existing service credit to be eligible for the Plan. If my formerly excluded district temp, agency temp and/or consultant time had been counted, I would have had the necessary five-years of service credit, and I would have been able to purchase the additional five years credit based on my salary at the time when I made the inquiry. When I finally receive credit for my "temp" time, will I be able to purchase air-time at a rate based on what my salary was at the time I first would have been able to purchase it if MWD had correctly given me credit for my "temp" time? I hope the answer is yes, because purchasing the credit will be much more expensive if I am forced to buy the additional credit at the higher rate based on my current salary.  
 
A:

The Cargill settlement does not alter the statutory requirements related to this specific issue. CalPERS takes the position that CalPERS is required by California state law to set the cost of purchasing any air-time based on the person's wage rate at the time of the purchase.

CalPERS has indicated that claimants will be considered eligible to purchase "air-time" so long as: (1) they have at least five years of service credit already granted by CalPERS; (2) they are in compensated employment with a CalPERS agency at the time of the request; and (3) they have not previously purchased any air-time. Claimants who will not have five years of service credit until they receive additional service credit through the Cargill settlement will be unable to purchase air-time until that time.

 

 
 
Q:
How will CalPERS enrollment/adjustment affect me if I already am receiving payments from another retirement system?  
 
A:

You should contact the pension administrator for the other retirement system or your local CalPERS office to get an answer to that question.

 

 
 
Q:
How do I contact CalPERS?  
 
A:

If you have a question that relates to the service credit being obtained through the Cargill settlement, you should contact Class Counsel. These questions require a knowledge of the Cargill settlement and are being passed to CalPERS through the attorneys who have represented CalPERS in the Cargill lawsuit.

f your question involves matters outside the Cargill lawsuit, many question can be answered through CalPERS's website www.calpers.ca.gov or by calling CalPERS at 1-888 CalPERS (or 1-888-225-7377). You also can visit one of CalPERS' local offices; for most class members it will be one of the following:

Glendale Regional Office
Glendale Plaza
655 North Central Avenue, Suite 1400
Glendale, CA 91203
Counties Served: Los Angeles, Santa Barbara and Ventura

San Bernardino Regional Office
50 East Hospitality Lane, Suite 330
San Bernardino, CA 92408
Counties Served: Inyo, Riverside and San Bernardino

Orange Regional Office
500 North State College Blvd., Suite 750
Orange, CA 92868
County Served: Orange