DALA Rules Assistant Principal’s Extended-Day Pay Was Regular Compensation

A recent decision from the Massachusetts Division of Administrative Law Appeals offers an important reminder for public employees: just because compensation is called a “stipend” does not automatically mean it is excluded from retirement calculations.

In Deborah Hood v. Massachusetts Teachers’ Retirement System, Administrative Magistrate Kenneth Bresler ruled that the full $10,000 paid to a Cambridge assistant principal for extended-day work counted as “regular compensation” for retirement purposes. The decision reversed the Massachusetts Teachers’ Retirement System’s determination that only $4,000 of that amount should count.

Hood served as assistant principal at Fletcher-Maynard Academy in Cambridge from the 2007-08 school year through the 2023-24 school year. The school participated in an Extended Learning Time program, which lengthened the school day on Mondays, Tuesdays, Thursdays, and Fridays. Ms. Hood was required to work those extended days as part of her job, and her duties during the extended-day period were the same as her regular assistant-principal duties. The collective bargaining agreement listed a $4,000 stipend for assistant principals who worked in the Extended Learning Time program. But for many years, Ms. Hood was actually paid $10,000 per year. That amount was not paid as a one-time bonus. It was included in her regular biweekly pay.

When Ms. Hood retired, MTRS decided that the extra $6,000 per year should not be included in her retirement calculation. MTRS reasoned that the collective bargaining agreement listed only $4,000, and that the additional $6,000 did not qualify as regular compensation. The magistrate determined that was an error.

The key issue was whether Ms. Hood was being paid for “additional services” or for her core job duties. The magistrate found that Ms. Hood’s extended-day work was not separate from her normal role. She was still performing assistant-principal duties. The work was required. It was part of her regular job. Because the payment was for core duties, it qualified as regular compensation.

The decision also rejected MTRS’s argument that a later settlement agreement should be treated as an improper retroactive salary increase connected to Ms. Hood’s retirement. The magistrate noted that the union grievance over the stipend was filed before Ms. Hood announced her retirement. In other words, the pay dispute was not created because the employer knew she was retiring.

The ruling is focused on what the employee was actually being paid to do, not merely the label attached to the payment. A payment described as a “stipend” may still be regular compensation if it is paid for required, central job duties.

The critical questions examined by the magistrate were: Was the work required? Was it part of the employee’s normal role? Was the employee performing the same duties they were hired to perform? How was the compensation paid? Even where a collective bargaining agreement lists one amount, the actual nature of the employee’s work and compensation may control. The final order reversed MTRS’s decision and held that the full $10,000 paid for extended-day duties was regular compensation.