First Lawsuit Against Work Day Reduction Is Filed
The organization 'Servidores Públicos Unidos de Puerto Rico' (SPU by its Spanish initials) filed a lawsuit against the Fiscal Control Board (FCB) in order to curb the reduction in work days approved in the entity tasked with overseeing the public finances of the country's last meeting, which should enter in force next September even though Governor Ricardo Rosselló has established his refusal to implement the measure.
In the lawsuit, the SPU alludes to the fact that the measures promoted by the JCF are 'a product of an unauthorized and illegal policy adopted by an unelected entity', a fact which also indicates that the seven members of the Board were not democratically elected.
According to the lawyer representing SPU, Manuel Rodríguez Banchs, the lawsuit argues that the FCB amended the Fiscal Plan made by the Governor, which supposedly did not include the work day reduction nor the cuts on pensions in the sense that the federal entity created under the Promesa Law agreed to implement it.
'The board had two options: either approve the Fiscal Plan the Governor presented or write their own plan,' the lawyer pointed out.
Another of the arguments in the lawsuit is that the FCB does not have authority to tell the Government of Puerto Rico how to administer. They believe that the Board can suggest the amount of savings, but cannot implement methods to achieve it.
'These actions from the Board are illegal because they violate the terms of Promesa (a law enacted in Congress that authorizes the FCB) and exceed the powers that Promesa gives the Board,' the document states.
'If the FCB moves forward in its position of making these kinds of cuts, they will impoverish the public employees and their families, and at the same time will adversely impact the economy and all commerce in Puerto Rico,' the president of SPU, Annette González, said in a press conference.
In that sense, the SPU asks the court to issue a declaratory judgment that indicates that the amendments to the Fiscal Plan related to working hours and pensions are 'illegal or not part of the Fiscal Plan as it was certified.'
Specifically, on the country's Retirement System, the group also requests the naming of 'a legal or constitutional Trust over the existing assets' to avoid the sale or diversion of the funds from the retirement of employees and another declaratory judgment that establishes that any reduction to retirees 'constitutes a measure of unconstitutionality without fair compensation or due legal process.'
The organization argued that employees' contributions to their own individual retirement funds have to be paid in full and cannot be affected in an adjustment plan under Title III of the Promesa Act for debt restructuring.
The syndicate had previously filed a lawsuit at the Federal Court where they challenged the Fiscal Plan in question presented by the Government and approved if certain conditions were met by the FCB. However this process was halted once Puerto Rico filed bankruptcy under Title 3 of Promesa.
Prior to this lawsuit, and after the approval of these measures by the FCB, Rosselló Nevares has publicly stated that he will not abide by the moves that the FCB deems necessary to add more cuts to the country. However, this entity advanced through a letter that they will go to all relevant forums to enforce both the reduction of working hours and the cutbacks in pensions.
You can view the legal document below: