Empire State Pension Probe Could Snare Hundreds of Lawyers

May 9, 2008 (PLANSPONSOR.com) - A state probe into the practice of lawyers improperly receiving state public pension benefits could potentially snare several hundred attorneys.

That was the prediction offered Thursday to the New York Law Journal by state Attorney General Andrew M. Cuomo whose office has been involved in an investigation of local government agencies improperly classifying outside lawyers as pension-eligible employees.

Cuomo said rules are clear when people qualify as bona-fide employees properly earning state pension benefits and when they are independent contractors. “You’re an employee,” Cuomo told the Law Journal. “You have an office, a desk, a telephone. You go there.”

The attorney general said the problem goes far beyond a handful of Long Island school districts, which were the probe’s initial targets. “This is not a discrete area of the law,” Cuomo told the Law Journal. “This is a very well-known issue. This is a question between being an employee and being an independent contractor. It’s well litigated.

Cuomo said   Boards of Cooperative Educational Services ( BOCES) districts have classified outside attorneys as employees because there is an advantage for them under state regulations that provide higher state education aid for the payment of employees as opposed to paying independent contractors.

Cuomo announced settlements of $50,000 each between his office and the Hodgson Russ law firm in Buffalo and with Albany attorney Maureen Harris.