PEEHIP Update: One Step Closer to Repayment

June 10, 2019 12:00 AM


By Theron Stokes, AEA Associate Executive Director


AEA recently secured another important victory in front of the Alabama Supreme Court in the PEEHIP case.  The court once again agreed with AEA that Court oversight in the repayment process is necessary to ensure that each and every educator receives every penny to which he or she is entitled.  In denying’s PEEHIP’s application for rehearing, the justices returned the case to Montgomery County Circuit Judge Johnny Hardwick to oversee the payment of refunds.


In its argument, PEEHIP was essentially telling the Court, with regard to the amounts of refunds, “trust us.” More importantly, PEEHIP wanted to shift the burden from itself to local school systems’ payroll staff by sending money to the local school systems for distribution to their employees. 


We calculated that this would cost hundreds of hours of work for payroll staff and chief school financial officers (CSFOs) – innocent school system employees who should not have to bear the burden of this work.  Payroll clerks would have nightmares trying to decide how to manage the complex problems of calculating refunds for PEEHIP members who have left their district or recent PEEHIP members that have transferred into their school districts from other school districts. Therefore, AEA disagreed with that proposed method of returning refunds by the local school system’s staff. 


Further, PEEHIP was not going to make any effort to explore possible ways for its members and their employers to issue the refunds without payroll taxes being deducted.  PEEHIP’s plan would have required millions of dollars in payroll taxes to be paid by school systems without trying to figure out if it was absolutely necessary. It may still be required, but now that the case is returning to Judge Hardwick, we will be able to exhaust every possibility and make sure that every possible dime is returned to you and no innocent third party will suffer from the mistake made by PEEHIP. 


As soon as the case is officially returned back to Judge Hardwick’s docket, we will be seeking a conference with the Judge so that both AEA and PEEHIP will be able to discuss possible methods for expeditiously returning refunds to you. With the assistance of the Court, we are hoping that this will speed up the process in returning refunds and also ensuring that each and every PEEHIP member will receive the correct amount in which he or she is legally entitled to receive. 


AEA is taking the position that it has a legal responsibility to make sure that the order of the Court, requiring that PEEHIP members receive a correct refund with interest, is complied with by the PEEHIP staff.  


Thus, we ask for your continued patience. We will continue to attempt to work with the PEEHIP staff to return to you the refund you are entitled. That is why we continue to request that PEEHIP provide us with all relevant data for each PEEHIP participant so that we can verify that all calculations are correct. Please understand that AEA’s lawyers know that this is our  highest priority, and will continue to give this case all the necessary attention it deserves. 


While we celebrate this victory, which brings us ever closer to the final victory of the issuance of refunds, we would be remiss not to also mourn. As outlined in this issue of the Journal, AEA lost one of our own last week with the passing of former AEA President Sheila Hocutt-Remington. You may recall that the formal name of this litigation is Remington v. Swindle. It was President Remington who took the lead in fighting this fight. She was the one who stood up and put her name on the lawsuit and took ownership of it, not just as AEA President, but as an individual. She stood before the media and said that we were not going to let PEEHIP, or anyone else, walk all over the Open Meetings Act.  Without her leadership, one can only wonder if we would have had the same success.  We thank her and we will miss her.


This column was originally published in the June 10, 2019 edition of the Alabama School Journal, a publication of the Alabama Education Association.