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  Alston Hunt Floyd & Ing
Attorneys at Law, LLC
 


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Honolulu, HI 96813
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Fax: (808)524-4591


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Kamuela, HI 96743
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Fax: (808) 885-6011

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Wailuku, HI 96793
PH: (808) 244-1160
Fax: (808) 442-0794

 
 
   
   
   
   
   
   
   
 
Substitute Teacher CLASS MEMBER HOME    
 

HOW ARE THE AWARDS CALCULATED:

We apologize for any confusion regarding the amount of back pay substitutes have received.

Everyone's gross award for the back wages owed from 11/2000 through 6/2005 was reduced by the Court-awarded attorneys fees, costs, General Excise Taxes, and class representatives' stipends. Those amounts totaled approximately 34% of the gross awards. The resulting amount was, under law, your "gross income" (meaning you did not have to pay any taxes on those deductions). We then, as required by law, deducted federal and state taxes, FICA (social security) and Medicare taxes. The federal and state taxes were deducted on a percentage basis for all teachers in accordance with guidance from the IRS. Depending on each person's income in 2014, there may be refunds coming.

Many teachers have questions about how their back pay awards and the resulting individual payments were calculated.  Here is the answer:

1. The gross amount the DOE was liable for was determined person-by-person, paycheck-by-paycheck for each eligible teacher. The amount each person was underpaid varied according to the "class" they were in, the dates they worked, and the payments the DOE actually made in 2000-05. This is the amount shown on the Chart of Partial Settlement Amounts. Only the "Amount Owed" is being awarded at this time. The interest amount is still on appeal. 

2. From the Total Value of Remedy -- $14,672,916.43 (Wages plus Employer's share of FICA & Medicare); cash wages to Class Members $13,978,554.57 -- the following deductions were made:

Total Deductions from the Gross Amount owed: 32.77% based upon Total Value; 34.01% based upon Cash Value.

3. From the gross income amount, the following deductions were made:

  • Federal and State taxes (in the amount approved by the Court consistent with IRS procedures for back pay awards, which called for across the board withholdings of 25% (Federal) and 7.9% (Hawai`i).  These withholdings are likely more than your actual tax liabilities, so you should determine whether you are entitled to a refund in 2015.
  • Employees' shares of FICA (Social Security) and Medicare taxes

All of the withholdings were calculated by qualified experts.

 


LEGISLATIVE UPDATE - February 3, 2014

Honolulu - Bills were introduced in both the House and Senate to exempt from state income tax the payments received by the substitute teachers in settlement of our class action lawsuit. These bills would lessen your tax liability for these payments, netting more money for you and your families.

The House bill, HB 2016, has a double referral to the Education Committee and the Finance Committee. In order to move forward, it must be approved by the Education Committee by February 13. The Chair of the Education Committee is Representative Roy Takumi. He has expressed support for this bill, but he has many competing interests fighting for attention. To ensure this bill moves forward, the group should contact him to request that he hold a hearing on the bill. His phone number is 586-6170 and his email address is reptakumi@capitol.hawaii.gov. He should not be flooded with calls, but 10 to 20 should do it, especially if they are from his Pearl City, Manana, Waipio district. The Committee Vice Chair is Representative Takashi Ohno (a former public school teacher) who can be reached at 586-9415 or at repohno@capitol.hawaii.gov. He represents Nuuanu, Pauoa, Liliha, and Alewa Heights. He has also expressed support for this measure and just needs a friendly reminder of its importance to you and your families.

The Senate bill, SB 2283, has a single referral to the Senate Ways and Means Committee. That bill must be approved by the Committee by March 4. The Chair of the Committee is Senator David Ige who can be reached by phone at 586-6230 or via email at sendige@capitol.hawaii.gov. He represents Pearl City, Momilani, Pearlridge, Aiea, Royal Summit, Aiea Heights, Newtown, Waimalu, Halawa and Pearl Harbor and would be most receptive to calls from his constituents. The Committee Vice Chair is Michelle Kidani who represents Mililani Town, Waipio Gentry, Waikele, Village Park and Royal Kunia. Her phone number is 586-7100 and her email address is senkidani@capitol.hawaii.gov. They both signed the bills for introduction and are supportive.

Please be sure to thank the introducers of these measures if you see them. The House bill was introduced by Representatives Calvin Say, Linda Ichiyama and James Tokioka. The Senate bill was introduced by Senators Donna Kim, Suzanne Chun Oakland, Donovan Dela Cruz, Michelle Kidani, Malama Solomon, Kalani English, Brickwood Galuteria, David Ige, Gil Kahele, Ronald Kouchi, and Clarence Nishihara.

If a hearing is scheduled, we will let you know so that you can submit testimony in support of the bills.


 

 

Honolulu - On November 15, 2013, the Court granted Plaintiffs' Motion for Final Approval of the Partial Settlement Agreement, which provides for the resolution and payment of the class members' per diem wage claims totaling over $14 million.  At the hearing, the Court also granted Plaintiffs' (1) Motion for Award of Attorney's Fees and Reimbursement of Expenses under the Common Benefit Doctrine and (2) Motion for Class Representative Incentive Awards from the Common Benefit, therefore, allowing the approved amounts of the attorneys' fees and costs and the class representatives' stipends to be deducted from the common benefit fund before the individual payments are issued to the class members.

As for the timing of distributing the payments, the DOE has represented that it will need until March 2014 to prepare the disbursements and mail out the checks to the substitute teachers. We are continuing discussions with counsel for the DOE to reach a resolution to be able to issue the payments to the substitute teachers earlier than that.  We will provide more information on the timing of the payments once more information is available. 


Honolulu - On September 16, 2013, the Court granted Plaintiffs' Motion for Preliminary Approval of Settlement and approved the Notice of Proposed Partial Settlement of Consolidated Class Action.  An Amended Class Notice ("Class Notice") was approved by the Court and filed on October 1, 2013 to provide the class members with additional time to submit any objections to the Partial Settlement.  For your reference is the Class Notice on the Partial Settlement. The Department of Education will also be mailing a copy of the Amended Class Notice to the substitute teachers.

 
Please review the Class Notice carefully as it sets forth information about the terms and conditions of the partial settlement with the Defendants and your rights as a class member.
The Court has also scheduled a hearing for final approval of the partial settlement for November 15, 2013 at 10:00 a.m. to determine whether the settlement is fair, adequate, and reasonable. You are welcome to attend the hearing.
 
Information about your individual per diem backpay amount and the related interest is contained in the chart (Garner-Sub-Id-Chart.pdf), which is organized by your DOE Identification Number. The amount to be paid to each Class Member was agreed upon by Class Counsel and the State in consultation with their respective experts based upon detailed payroll records received from the DOE, which were represented to be complete and accurate. Notably, after the deductions discussed below, the Class Members are receiving 100% of the per diem back pay owed to them as calculated jointly by the Parties’ respective experts. In exchange for early pre-appeal distribution of the per diem back pay and the Defendants’ agreement to expedite the individual payments to the Class Members, the Parties agree that any claim for interest, if ultimately awarded, on the per diem amount will cease accruing as of May 31, 2013.

For information about your DOE identification numbers and estimated backpay and interest amounts, please DO NOT contact the Department of Education.  You can send a request for this information to classaction2@ahfi.com, and we will get back to you.

As further discussed in the Settlement Agreement, which was posted earlier this month, the individual payments to the Class Members will be deducted by the share of Social Security and Medicare contributions, Federal and State withholding taxes, attorney’s fees and costs, and class representative stipends. As further set forth in the Amended Class Notice, we will be filing a Motion for Attorneys' Fees and Costs to request the Court to award Plaintiffs’ counsel 25% of the total economic benefit recovered for the class plus general excise tax and litigation costs and expenses. We will also be filing a motion requesting the Court to award stipends to the Class Representatives to compensate them for their time and efforts in these class actions.

 
   

Honolulu - On September 10, 2013, counsel for the Plaintiffs and the Defendants entered into a Settlement Agreement for the substitute teacher class actions to address the per diem back wages due to the class and the procedure for the distribution of the payments by a claims administrator. A copy of the executed Settlement Agreement is provided for your reference.

In the Settlement Agreement, Defendants agree to pay up to $14,031,874.70 for the claims covered by the Agreement. The Hawaii State Legislature has appropriated funds in this amount (plus the amount to be paid to the appropriate federal agency by the State for Social Security and Medicare taxes) to effectuate this Agreement. The amount to be paid to each Class Member was agreed upon by Class Counsel and the State in consultation with their respective experts based upon detailed payroll records received from the DOE, which were represented to be complete and accurate. Notably, after the deductions discussed below, the Class Members are receiving 100% of the per diem back pay owed to them as calculated jointly by the Parties’ respective experts. In exchange for early pre-appeal distribution of the per diem back pay and the Defendants’ agreement to expedite the individual payments to the Class Members, the Parties agree that any claim for interest, if ultimately awarded, on the per diem amount will cease accruing as of May 31, 2013.

As further discussed in the Agreement, the individual payments to the Class Members will be deducted by the share of Social Security and Medicare contributions, Federal and State withholding taxes, attorney’s fees and costs, and class representative stipends. Plaintiffs’ counsel will be filing a Motion for Attorneys’ Fees and Costs requesting the Court to award 25% of the covered claims fund. Plaintiffs’ counsel will also be filing a Motion for an award of stipends to the Class Representatives to compensate them for their time and efforts in these class actions.

On September 12, 2013, Plaintiffs filed a Motion for Preliminary Approval of the Settlement, which the Court has agreed to expedite the hearing date to September 16, 2013.

Subject to approval by the Court, a Notice of Proposed Partial Settlement (“Settlement Notice”) will be distributed to the class members by mail and also published in the newspaper. We will also post a copy of the Settlement Notice at www.hawaiiclassaction.com along with information on the per diem wage due to each Class Member, which will include the Class Member’s DOE Identification Number and the gross amount owed (before any of the deductions described above). The Settlement Notice will set forth additional information on the Settlement Agreement and your rights as a Class Member. Please review the Settlement Notice carefully when you receive it.

A final hearing on whether the partial settlement is fair, reasonable, and adequate will likely be held by the Court in November 2013. Once the partial settlement is approved by the Court and the Motions for attorneys’ fees and costs and class representative stipends are determined, the distributions and payments to the Class Members can then be made. We estimate that the payments will be distributed to the Class Members in either November or December of this year.


 

 

 

 

 

   

About the Lawsuits

David Garner, David Hudson, Patricia Smith, Andrea Christie, Allan Kliternick, Karen Souza, and Jo Jennifer Goldsmith, substitute teachers, have brought these suits to gain justice for the class. David Garner (Garner v. Department of Education) is a substitute teacher on Maui and Allan Kiternick (Kiternick v. Hamamoto) is a substitute teacher on Oahu’s North Shore. Co-counsel in both lawsuits is Murray Lewis, Esq.

 

 

 

   
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