AB 215 Affects Superintendent Employment Contracts as of January 1, 2016

On September 2, 2015, the Governor signed Assembly Bill 215, which imposes new requirements on school superintendents’ employment contracts entered into on or after January 1, 2016.

Current law requires all employment contracts between an employee and a local agency employer (such as a school district) to include a limitation on the amount of a cash settlement if the contract is terminated. Specifically, the maximum settlement an employee can receive is the employee’s monthly salary multiplied by the number of months left on the term of the contract, not to exceed 18 months. (Government Code § 53260(a).)

Effective January 1, 2016, AB 215 amends this requirement to limit the “maximum cash settlement” for school district superintendents to 12 months. Superintendent contracts entered into on or after January 1, 2016 must include this provision. The 12-month limitation does not apply to any other public employee or officer. Contracts that are in force prior to January 1 do not need to be amended, but any new contracts for current superintendents must specify this limitation.

Current law permits a cash or noncash settlement of up to six months’ salary in the case of a superintendent who is terminated because the school district believes, and subsequently confirms through an independent audit, that the superintendent has engaged in fraud, misappropriation of funds, or other illegal fiscal practices. (Government Code § 53260(b).) AB 215 also amends the Government Code to forbid the payment of any amount — in cash or otherwise — to a superintendent under these circumstances.

To address real or perceived abuses, legislation in recent years has required various restrictive provisions in the employment contracts of public officials. Districts should ensure their employment contracts comply with all of these requirements. Contracts that do not comply may be unenforceable.

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