MARTINEZ -- Retirees from Alameda, Contra Costa and Merced counties are the only clear winners in Superior Court Judge David Flinn's preliminary decision in the public employee unions' yearlong legal challenge of the state's 2012 pension anti-spiking law.
But the outcome remains uncertain for those among the approximately 21,000 public employees still on the job who expect to include in the formula used to calculate their retirements the banked vacation, holiday and other types of leave now barred under the pension-reform legislation signed into law last year.
In his 44-page tentative ruling unveiled earlier this week, Flinn declared the 15-year-old practice unlawful but said it was unfair to abruptly take away a promised benefit from workers who were advised and encouraged to take advantage of it.
Yet, none of the numerous union leaders and lawyers for the public employee unions, retirement associations, state or the myriad other public agencies involved were celebrating or criticizing the ruling either inside or outside the courtroom Friday.
Instead, the document appeared to generate more questions than answers, and Flinn offered scant additional clarity to the roughly 50 people -- mostly attorneys -- who attended the hearing.
Following a largely procedural discussion, Flinn set the next hearing for Feb. 11, and invited the parties to submit their arguments and offer suggested modifications.
"We had hoped we would have something definitive to tell our members after today, but it looks like we'll have to wait awhile longer," said United Professional Firefighters of Contra Costa County Local 1230 President Vince Wells.
For now, Flinn's decision appears to allow workers to count any unused vacation that exceeds what they could earn and be paid in their final compensation periods -- typically the highest earning year or an average of the highest three years -- as long as it was accumulated before the pension-reform law went into effect on Jan. 1, 2013.
But as written, the exemption isn't permanent.
It appears the judge intends that workers will be required to start using their oldest vacation first, which means that younger employees who cannot retire right away will likely draw down some or all of the excess unused leave they accrued before Jan. 1, 2013, unless they never take another day of vacation.
The value of the extra leave adds anywhere from 3 percent to 24 percent onto a pensioner's monthly check, depending on the agency.
The stakes are particularly high for Contra Costa firefighters and deputy sheriffs, where the disputed perk accounts for approximately 15 percent of their promised retirement benefits.
While the deputies and firefighters have been permitted since 1998 to count toward their pensions one year of accrued vacation, they can cash out the time only upon termination. The 2012 pension-reform law specifically restricts what can be included in the pension-calculation formula to income that is both earned and cashable in a typical year.
The unions argue that since the time was earned in a typical year, it was part of their compensation and factored into their annual contribution rates. The fact that they cannot convert their vacation into cash except when they retire is irrelevant, they say.
Also unresolved is whether on-call pay will continue to count toward retirement calculations.
Flinn's ruling appears to put the issue back into the retirement association's hands, but several attorneys requested the judge make a more definitive statement in the final ruling.