Employment Law: When the Supreme Court strikes down the two provisions in a law specifying how the Public Employee Retirement Board will collect excess benefits paid in 1999, PERB may, instead, exercise its authority under ORS 238.715 and issue an order to recover the funds.

Two groups of “Window Retirees” (employees that retired in a certain time period) received excess benefits due to an error crediting their accounts. After much litigation and legislative action, the Public Employees Retirement Board issued an order to recover the excess benefits. The first group of retirees challenged the order on four grounds: breach of contract, promissory estoppel, wage claims, and declaratory and injunctive relief under the Administrative Procedures Act (APA). The Court affirmed the lower court’s ruling that a new statute did not create a contract granting the group the benefits, that they could not rely on the benefits due to timely objections, that there was no claim for wages because the benefits were in excess of what they were owed, and that PERB acted within its statutory authority. The second group claimed that the order violated a law enacted to resolve the error which specified how the excess benefits had to be collected. The Court found that both those methods were invalid, and that PERB could proceed under its already-existing authority and choose new methods. Affirmed in part, reversed in part.