|Legal Opinion: |
Text of Document: June 15, 2006
Dear City Manager:
You have the following questions:
1. Is it legal for a city commissioner to be a volunteer firefighter?
The answer is yes, but that answer may be a close one. Section 7-305 of the Municipal Code may give volunteer firefighters a property right in their status. If that is true, they might be employees for the purposes of two statutes related to this question. Under the first statute, Tennessee Code Annotated, ' 7-51-1501 et seq., a municipal employee cannot run for office on the board of commissioners. Under the second statute, Tennessee Code Annotated, ' 12-4-101 et seq., a municipal officer cannot have a direct interest in a contract with the city. My conclusion is that volunteer firefighters are not employees for the purposes of those statutes, but ' 7-305 of the Municipal Code makes that conclusion uncertain.
But regardless of the correct answer to this question, if the city does not think it a wise policy for volunteer firefighters to be city officers, there is no reason it could not adopt a regulation prohibiting them from being city officers. Likewise, such a regulation could be made retroactive to prohibit persons who presently hold city offices from being volunteer firefighters. .
2. Is it legal for the city recorder to be a volunteer firefighter?
The answer is yes with respect to the volunteer firefighter being the city recorder. But that answer may also be a close one for the reasons indicated in the answer to Question 1.
But even if volunteer firefighters have a property right in their positions under ' 7- 305 of the Municipal Code , they may have no property right in the office of city recorder. Section 6-21-108 of the general law manager-commission charter says this with respect to the city manager 's personnel authority:
Except as provided in this charter, appoint, promote, demote, suspend, transfer, remove, and otherwise discipline all department heads and subordinate employees at any time, subject only to any personnel rules and regulations adopted by ordinance or resolution by the commission....
I do not know what personnel rules and regulations have been adopted by the city that might restrict how the city manager can exercise that disciplinary authority over the city recorder. In the absence of any such rules and regulations, the city manager may have the right, on the penalty of discipline up to termination, to prohibit the city recorder from being a volunteer firefighter.
With respect to both questions, ' 6-21-701 of the general law manager- commission charter provides that "The city manager shall appoint a chief of the fire department and such other members of the department as may be provided by ordinance." Under Title 7, Chapter 2, of the Municipal Code , the city has a volunteer fire department. Section 7-301 provides that, "The volunteer fire department shall be composed of a chief and no more than thirty-six (36) physically-fit subordinate officers and firemen appointed by the city manager." Section 7-305 provides that, "The fire chief and all subordinate officers and personnel shall hold office so long as their conduct and efficiency are satisfactory to the city manager." Title 4, Chapter 5 of the Municipal Code , contains the city' s personnel policy. Section 4-502 creates a classified service, but also creates an exempt service consisting of certain officers, employees, and other positions. Among those positions placed in the exempt service are "(9) Volunteer personnel appointed without compensation." Both the city commissioner and the city recorder were volunteer firefighters before assuming those offices. As I understand it, the commissioner and city recorder are, like other volunteer firefighters, paid for fire calls on a per diem basis, and are paid their per diem pay twice a year, roughly $1,500 for each payment ' $3,000 per annum. The city operates under the general law manager-commission charter found at Tennessee Code Annotated, ' 6-18- 101 et seq.
Question 1: The City Commissioner
At least two statutes must be considered in answering the question of whether the city commissioner can be a volunteer firefighter.
First, Tennessee Code Annotated, ' 7-51-1501 generally authorizes municipal employees to participate in political activities, but provides that they cannot run for office on the municipal governing body, unless a law or ordinance permits them to run for that office. There is no law or ordinance that permits city employees to run for office on the board of commissioners.
In the attached memorandum I wrote to Mike Tallent, I extensively considered the question of whether volunteers are employees under that statute. My conclusion was that for the reasons outlined in the memorandum they are generally not employees. However, the courts have made some exceptions to that general rule in the context of the Fair Labor Standards Act (FLSA). The rationale of both the rule and its exceptions appear to me to have application to other contexts where the question of whether a volunteer is an employee arises. What may create the exception to the general rule that volunteers are not employees is ' 7-305 of the Municipal Code , which reads as follows: "The chief and all subordinate officers and personnel shall hold office so long as their conduct and efficiency are satisfactory to the city manager." That provision may give volunteer firefighters a property right in their status by permitting their the dismissal only for cause.
It has been held that property rights in government employment are created under state law, and sometimes by ordinance or resolution where the state law is silent on that question with respect to the government employees at issue. [See the U.S. Supreme Court case of Cleveland Board of Education , 470 U.S. 532 (1985), and the myriad of cases on property rights in government employment that have followed that case]. I have been unable to find any cases involving the creation of property rights in volunteers, although I can think of no reason why such property rights cannot be created. However, it seems to me that where property rights are created in volunteers, they may lose their status as "volunteers" at least for certain purposes.
I am not sure whether the language contained in ' 7-305 creates a property right in the City's volunteer firefighters, and even if it does, whether those property rights elevate those volunteers to "employees" for the purposes of Tennessee Code Annotated , ' ' 7-51-1501 and 12-4-101. Indeed, volunteers are not even members of the classified service under ' 4-502 of the Municipal Code . But that provision also makes exempt from the classified service "Volunteer personnel appointed without compensation." On the other hand, ' 7-305 declares that, "All personnel of the volunteer fire department shall receive such compensation for their services as the board of commissioners may from time to time provide."
The amount of "compensation received by the city ' s volunteer firefighters is probably insufficient, standing alone, to make volunteer firefighters employees," but it is difficult to conclude that ' 7-305 does not intend to protect volunteers in their "jobs," the effect of which is, at least temporarily, to protect the continuance of that compensation.
My conclusion is that ' 7-305 is not enough to make volunteer firefighters municipal "employees" because there is still no "contract for hire" between them and the city. But I can see a court concluding that under all the circumstances, such a contract exists.
Second, as indicated above, Tennessee Code Annotated, ' 12-4-101 et seq., reflects Tennessee's Conflicts of Interest Law. That law entirely prohibits direct conflicts on the part of municipal officers, and requires municipal officers to disclose indirect interests, in the following language:
It is unlawful for any officer, committee member, director, or other person whose duty it is to vote for, let out, overlook, or in any manner to superintend any work or any contract in which any municipal corporation...shall or may be interested, to be directly interested in any such contract. "Directly interested " means any contract with the official personally or with any business in which the official is the sole proprietor, a partner, or the person having the controlling interest... [ Tennessee Code Annotated, ' 12-4-101]
It is unlawful for any officer, committee member, director or other person whose duty it is to vote for, let out, overlook, or in any manner superintend any work or any contract in which any municipal corporation...shall or may be interested to be indirectly interested in any such contract unless the officer publically acknowledges such officer's interest. "Indirectly interested," means any contract in which the officer is interested, but not directly so, but includes contracts where the officer is directly interested but is the sole supplier of goods or services in a municipality or county. [ Tennessee Code Annotated, ' 12-4-101]
Section 6-20-205 of the general law manager-commission charter also contains a conflicts of interest provision. It is less restrictive than is the Tennessee Code Annotated, ' 12-4-101 et seq. It provides that "Any member of a local governing body of a county or a municipality who is also an employee of such county or municipality may vote on matters in which such member has a conflict of interest if the member informs the governing body immediately prior to the vote
as follows: [There follows magic words that the employee utters to disclose his conflict of interest on the matter to be voted on.]" In addition, subsection (b)(4) of that general law manager-commission charter provision says:
Nothing in this subsection (b) shall be construed as altering, amending or otherwise affecting the provisions of ' 12-4- 104(a). In the event of any conflict between this subsection (b) and ' 12-4-101(a), the provisions of ' 12-4-101(a) shall prevail.
For that reason, Tennessee Code Annotated, ' 12-4-104(a) takes precedence over the conflicts of interest provision in the general law manager-commission charter.
But it does not appear that the commissioner-volunteer firefighter has either a direct or an indirect conflict of interest within the meaning of Tennessee Code Annotated , section 12-4-101. As I pointed out above, it is my opinion that generally volunteer firefighters are not employees, and that in particular, the volunteer firefighters in the city are not probably not city employees.
The twin triggers to Tennessee's Conflict of Interest Law appear to be:
- The existence of a contract between the city and the officer;
- The existence of a personal direct financial interest, or of an indirect personal financial interest, of the official in the contract.
It would be difficult to escape the conclusion that the commissioner would have a direct conflict of interest in the contract between the city and its volunteer firefighters (of which he is one), if he were an employee of the city. [See Madison County v. Alexander, 94 S.W. 604 (1906); Ramsey v. Gibson County, 7 Tenn. Civ. App. (7 Higgins) 52 (1916); Cagle v. Benton County, 181 S.W.2d 1 (1944); Southern v. Beeler , 195 S.W. 857 (1946).]
But my memorandum to Mike Tallent makes clear that the small on-call payments made to, and even insurance and retirement benefits provided by cities to, volunteer firefighters do not create the "contract for hire" that makes them an employee of the city; those payments and benefits are more in the nature of "gratuities." For the same reason, such payments and benefits by a city to a volunteer firefighter, standing alone, probably do not create a "contract" between the city and the volunteer that is necessary to trigger Tennessee Code Annotated, section 12-4-101 et seq. But if ' 7- 305 of the Municipal Code gives volunteer firefighters a property right in their status, they may have what amounts to a "contract" of employment with the city.
In City of Knoxville v. Christenberry , 247 S.W. 98 (1922), the Tennessee Supreme Court upheld gratuitous payments made by the board of mayor and aldermen to its members for work they had done outside of the duties prescribed by the charter against a claim that the payments violated the Conflicts of Interest Law. The Court reasoned that:
This is not a case in which it is sought to enforce a contract prohibited by law. At most, from the complainant ' s viewpoint, it is one in which a municipality paid a compensation for services rendered, and seeks to recover upon the ground that it could not have legally contracted to pay the defendants for such services. This distinction affords a material difference in the principles applicable. We have not a case where there is any intimation of fraud, graft, or moral wrongdoing of any character. These defendants performed valuable services, and the city received the benefit thereof in excess of compensation paid. It was perfectly legitimate and proper for the city to receive the benefit of this particular service. It could have employed third persons to perform it, and the city would have lost money in employing others to do the services performed by these defendants. Conceding that it, under the statute, could not contract with these defendants to perform the services, there was no legal prohibition against their payment for the services after they were received. The transition does not involve in any aspect a rendering of service in pursuance of a contract which the law prohibits being made. The defendants did not perform the service in pursuance of a contract. It was voluntary on their part without any agreement or understanding that they would be paid for it, and, indeed without any expectation that they would be paid. Not only does the case not involve the enforcement of a contract made in violation of a statute, but it is not even a case where a benefit was received as the result of or in pursuance of a contract. It is merely a situation in which the defendants rendered a valuable service without any agreement or contract and where they accepted reimbursement for benefits conferred and money expended. The case might be different if the services had been rendered in pursuance of a contract which could not be legally entered into.... [At 99]
The payments to volunteer firefighters by the City are continuing and made with a regularity; that was not true of the gratuitous payments made by the city to its board members in Christenberry . If the volunteer firefighters have a property right in their status under ' 7-305 of the Municipal Code, that property right may function as a sort of "contract or agreement" that makes Christenberry inoperative as to them.
I have concluded that ' 7-305 does not go far enough to make volunteer firefighters employees with whom the city has a contract within the meaning of Tennessee's Conflicts of Interest Law, but that conclusion is not a solid one.
But even where the service by a city officer as a volunteer firefighter is not prohibited by either Tennessee Code Annotated, ' 7-51-1501 or Tennessee Code Annotated, ' 12-4-102, the city undoubtedly has the authority to prohibit its volunteer firefighters from serving as officers of the city. Even the U.S. Supreme Court in United States v Boeing Company, Inc ., 494 U.S. 152 (1990), has said that:
Congress appropriately enacts prophylactic rules that are intended to prevent even the appearance of wrongdoing and that may apply to conduct that has caused no actual injury to the United States....Legislation designed to prohibit and to avoid potential conflicts of interest in the performance of governmental service is supported by the legitimate interest in maintaining the public ' s confidence in the integrity of the federal service. [At 164-65]
I can think of no reason the same authority would not reside in state and in municipal governments.
Indeed, the General Assembly made it mandatory that municipalities adopt ethics legislation, and gave them broad authority in that area. Public Acts 2006, Chapter 1 (E.S.). It does not appear that Public Acts 2006, Chapter 1 (E.S.) requires that municipal ethical standards prohibit dual service, only that they require the disclosure of personal interests that that appear to impact the discretion of municipal officers and employees. But it does not appear that Public Acts 2006, Chapter 1 (E.S.) prohibits municipalities from adopting ethics polices that prohibit members of the municipal governing body from holding positions as volunteer firefighters.
The city manager may already has the authority to dismiss volunteer firefighters who are members of the board of commissioners. But the answer to that question depends on whether volunteer firefighters have a property right in that status. It may be that the city has created such a property right in ' 7-305 of the Municipal Code , which provides that "The chief and all subordinate officers and personnel shall hold office as long as their conduct and efficiency are satisfactory to the city manager." Presumably, because the provision applies to "personnel" as opposed to "employees," it covers volunteer firefighters.
I have been unable to find any cases on the question of whether a city manager or any other municipal officer with personnel authority can dismiss subordinate employees or other personnel on the ground that their dual service as municipal officers affects the efficiency and conduct under such a provision. For that reason I am reluctant to conclude that the city manager can dismiss volunteer firefighters for that reason. But I repeat my opinion that the board of commissioners of the city has the authority to prohibit volunteer firefighters from holding positions as municipal officers, and had that authority even before Public Acts 2006, Chapter 1 (E.S.) was passed by the General Assembly. Moreover, it has the authority to make that prohibition retroactive so that it covers present volunteer firefighters.
Question 2: The City Recorder
Unlike a city commissioner, under ' 6-21-401 of the general law manager- commission charter, the city recorder is clearly appointed by the city manager. In short, the city manager has personnel authority over both the city recorder and of the control over both the city recorder and of volunteer firemen. As pointed out above, the volunteer firemen may have obtained a property right in their status under ' 7-304 of the Municipal Code , which declares that subordinate officers and "personnel" of the fire department "shall hold office so long as their conduct and efficiency are satisfactory to the city manager."
But the city recorder also appears to be a member of the classified service under ' 4-502 of the Municipal Code . The significance of that fact is that ' 6-21-108 of the general law manager-commission charter provides that among the powers of the city manager is the power to:
(2) except as otherwise provided in this charter, appoint, promote, demote, suspend, transfer, remove, and otherwise discipline all department heads and subordinate employees at any time, subject only to any personnel rules and regulations adopted by ordinance or resolution by the commission .
Title 4, Chapter 5 of the Municipal Code provides for a city personnel system, and gives the city manager the authority to adopt personnel rules and regulations, which are to be adopted by the city commission. I do not know what rules have been adopted with respect to the city recorder. It may be that the city recorder is an at will employee who can be dismissed by the city manager with or without cause. If that is true, while a firefighter may have a property right as a firefighter under ' 7-304 of the Municipal Code , the city recorder may have no property right in his or her job.
But I repeat here the proposition that the city commission can prohibit volunteer firemen from holding the position of municipal officers even though such a prohibition is not contained in Tennessee Code Annotated, ' 7-51-1501 et seq. or in Tennessee Code Annotated, ' 12-4-101 et seq., and have that right to make that prohibition retroactive.
Sidney D. Hemsley
Senior Law Consultant