Rosen admitted he gave 15 of his top attorneys administrative leave to counteract the cut in differential pay.
Top-paid supervising deputy district attorneys received a 5 percent differential-pay cut as part of a contract deal between the Government Attorneys Association union and Santa Clara County that started Sept. 5, 2011.
The cut spared lower-level deputy district attorneys and the courts from a furlough day as part of union concessions. The agreement saved the county millions of dollars, said Christopher Platten, an attorney for the GAA. The concessions are to remain until June 23, 2013.
But Rosen's arrangement allowed supervising attorneys to preserve paid vacation time that can later be cashed out as unused vacation, either annually or when an employee leaves. That means the 104 hours of administrative leave granted to the supervising attorneys is the equivalent of preserving the 5 percent cut in terms of pay, Platten said by phone on Monday.
Supervising deputy district attorneys receive salaries of about $193,000 annually after the differential cut, he said.
Platten said in an opinion letter to union officials that Rosen's policy could be illegal.
But Rosen maintains he did nothing wrong. In a letter he wrote to staff on April 8, he said that county and union officials were aware of the policy, and the county had supported it.
"All effected (sic) prosecutors, including their GAA representatives, were aware of this policy. Many expressed their support. None objected. This was not a 'secret' policy," he said.
But GAA President Max Zarzana disputed Rosen's claims.
"That's flat-out untrue," he said by phone on Tuesday.
Zarzana said that Rosen never informed him or the GAA of the policy.
"To this day, the GAA board has never sat and discussed this 'policy' in any format with any member of executive management. Because we were never informed until the NBC story that there was an official policy of awarding 5 percent, we were unaware until this weekend of the legal issues surrounding admin leave," the GAA said in a written statement.
Rosen's policy could cause the county millions of dollars if other labor agreements are nullified regarding cost-saving cuts, Zarzana said by phone on Tuesday. Many county-employee contracts have a "Me Too" clause, which could open a Pandora's box for the county if other unions decide to throw out their concessions, he said.
Overall, the unions gave $75 million in concessions to the county, he said.
"We're talking potentially millions of dollars of givebacks to other employees," Zarzana said.
In his letter to employees, Rosen called the county and union agreement unfair.
Lower-paid deputy district attorneys took a pay cut of approximately 3 percent, while their supervisors took an 8 percent pay cut — the 3 percent plus the 5 percent reduction, he said.
"The result of this unequal treatment was bitterness and divisiveness in the DA family. I believed then, and I believe now, that removing the 5 percent differential was fundamentally unfair. I then spent weeks working with the county to find a way to restore it. Those efforts were unsuccessful," he wrote in the letter.
The contract expressly included the district attorney's authority to grant administrative leave, he added.
"It is, and was well known, and has been thoroughly documented. In fact, as recently as last week, County Executive Jeff Smith told our chief assistant that such use of administrative leave is authorized. Other East Wing officials, including attorneys in the County Counsel's office, confirmed that we were authorized to grant administrative leave under the terms of county policies and the MOU," he said.
But Zarzana said while Rosen can grant administrative leave pursuant to the contract, "he does not have authority to violate the contract between Santa Clara County and the GAA, which suspended the lead-pay differential."
Zarzana said the GAA represents three groups of county lawyers: deputy district attorneys, deputy public defenders and child-support services lawyers, who all had the same 5 percent cut. But only Rosen's top 15 supervisors received the administrative leave arrangement, which left out other groups in the department, including criminalists and other investigators, he said.
"It seems pretty unfair that he focused on one small group of people," Zarzana said.
Platten said Rosen had opposed the pay cut during negotiations. On Monday, Platten blasted the district attorney for what he said was "probably a gift of public funds." The costs to taxpayers could be in the hundreds of thousands of dollars, he added.
"Mr. Rosen has made it real clear that he circumvented the memorandum of understanding by providing administrative leave to the supervising deputy district attorneys in an amount equal to 5 percent of full-time work hours for at least one full calendar year," he said.
Rosen may have violated civil and criminal law, Platten wrote in an April 7, opinion letter to union Zarzana following the NBC investigative report.
"This is an additional cost to the county and a financial benefit to the employee. It is clear that Rosen has approved a gift of public funds in violation of Government Code, Section 8314. (unlawful use or permitted use of public resources for personal or other purposes not authorized by law). He may have violated Penal Code Section 424 (illegal use or dispersion of public funds without authorization or knowingly keeping a false account.)
"Rosen spent public funds in the form of administrative leave for the private benefit of individual supervising deputy district attorneys," Platten wrote.
The union should inform its members that receipt of the administrative leave constitutes a gift of public funds, and it should recommend members immediately offer to re-credit the county for the administrative leave and cooperate with any investigation, Platten said in his letter.
Rosen maintains he instituted a transparent policy regarding the additional leave to recognize his supervisors for their additional duties, experience, and responsibilities.
He said the issue cropped up after a recent discovery that a supervisor's paycheck hadn't taken the 5 percent hit that it was supposed to, 1.5 years after the cut should have gone into effect. When the county notified the DA's office that the supervisor was receiving extra, the DA's office agreed that the employee was not entitled to it and that the employee is paying it back.
The administrative leave was also discussed at that time. In his letter Rosen said the county counsel confirmed:
"Administrative leave hours were properly granted ... as authorized by the Santa Clara County District Attorney's Policy and Procedure Manual ... These hours have been documented in our payroll system pursuant to a process approved by the district attorney with the assistance of County Labor Relations."
But the GAA wrote on Monday: "The GAA is unaware of a formal letter or message being sent to any district attorney members of GAA advising them of this policy. The district attorney's Policies and Procedures Manual (PPM) has never been updated to reflect Rosen's new policy. The county informed both GAA and Jay Boyarsky that the only valid policies are those which are in writing in the PPM or written agreements with the union."
County officials did not comment on Rosen's assertions.
Rosen said in a statement on Tuesday that he welcomes the Attorney General's review.
"I have the highest regard for the Attorney General. However, I told the County Executive that the Attorney General has endorsed my candidacy for reelection as district attorney and may not be the appropriate person to review this matter due to the potential conflict of interest," he said.
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