Judge Halts Deep Pay Cuts for L.A. Teachers : Education: Temporary order comes on eve of reductions. Planned one-day walkout is canceled.

In a stunning eleventh-hour victory for Los Angeles teachers, a Superior Court judge Thursday ordered the Los Angeles Unified School District to temporarily stop deep pay cuts from taking effect today.

Judge Stephen E. O’Neil instructed the district to issue supplemental checks to about 28,000 teachers who will be receiving paychecks today showing a cumulative 12% pay cut. He ruled that under the state education code the district cannot reduce teacher salaries after the start of the school year on July 1.

The judge set a Nov. 25 hearing on whether the pay cut rescission order should be made permanent and encouraged both sides to continue negotiations to reach a contract agreement. O’Neil said he wants to rule on the matter before the next paychecks are delivered Dec. 4.

“I can’t believe it. I am stunned,” United Teachers-Los Angeles President Helen Bernstein said Thursday. “This is one more example of how we have a bunch of people who don’t know what they are doing,” she said of school district officials.

Union officials said a one-day classroom walkout planned for next Friday will be canceled. Protests scheduled for today may go ahead but the union said it will not encourage them.

If the temporary restraining order stands, it could push the district into insolvency. The board on Oct. 2 adopted the pay cut to help close a $400-million gap in a $3.9-billion budget.

“There is not a victory yet in terms of a final court order,” said district Supt. Sid Thompson. “This will have a very serious impact on our cash flow and there is a question of whether we can do it or not. . . . This is a no-win situation.”

An attorney for the district said the ruling potentially could cost $120 million, the amount of the already budgeted pay cuts for teachers and those administrators who hold credentials.

The education code section at issue does not apply to the district’s 29,000 other employees, including secretaries, teachers’ assistants, custodians and other service workers.

UTLA attorney Lawrence Trygstad argued that an agreement between the union and district to delay the specific amount of the intended pay cuts until after budget negotiations were completed in Sacramento was null and void because it is prohibited by the education code.

He cited a section decreeing that salaries for certificated employees must be set by the beginning of the school year and cannot be decreased until the next year.

The ruling clearly stunned the three attorneys representing the school district and Thomas Allen, who represented the state Public Employment Relations Board, which is mediating the contract talks. Allen argued unsuccessfully that his board should have sole jurisdiction in the dispute because it arose out of contract negotiations.

“If the judge is right, then this district is insolvent,” said Gordon Krischer, an attorney with O’Melveny & Myers who was representing the school district. “I was very encouraged by the fact that he told us to continue bargaining. It gives me some hope that he has not made up his mind on this.”

Krischer also said he expects the state Department of Education and the Los Angeles County Office of Education to await the outcome of the Nov. 25 hearing. The county Office of Education has repeatedly warned the district that it must implement its pay cuts to meet state requirements for a balanced budget. It reiterated the warning in an Oct. 19 letter to school board President Leticia Quezada: “We cannot overemphasize the importance of the district carrying out . . . all cost reductions.”

A key issue in Thursday’s court hearing centered on an agreement struck between UTLA and the district shortly before the scheduled June 30 expiration of the 1991-92 contract.

On June 25, both sides acknowledged that the school board intended to make pay cuts but agreed to wait to determine how deep they would be until they had a clearer idea of state funding levels. Up to now, teachers have been paid at the previous year’s rates.

On Oct. 2, the Board of Education approved pay cuts ranging from 6.5% to 11.5% for nearly all employees.

In seeking the restraining order, UTLA’s Trygstad cited California case law and the education code, arguing that teachers are prohibited from waiving their right to have a set salary scale at the beginning of a school year.

The judge sided with Trygstad, saying it appeared that the June agreement “is not worth the paper it’s written on.”

“The whole purpose of (the June agreement) was to not force both parties to do the impossible,” school district attorney Krischer said, adding that it benefited both sides to avoid making a decision without a clear picture of the district’s finances.

He added that the union and district have engaged in similar practices for years and followed essentially the same procedure and timetable last year when they negotiated a contract that led to a 3% pay cut after the 1991-92 school year began.

Calling the district’s situation “unique,” Michael A. Cirasole, an official with the county Office of Education, said he was uncertain what the next step would be. “We first have to see how the district reacts,” he said.

If the pay is permanently restored, the district must come up with equivalent savings or revenues, county officials said. Otherwise, the budget will be out of balance and the district could face the appointment of a state financial adviser or, in a harsher step, a state takeover.

“We would have concerns about their solvency,” said Cirasole, business advisory services consultant for the county Office of Education. But he cautioned that Thursday’s court decision does not necessarily mean that the district is insolvent.

In another setback for the district, a significant proposal on the bargaining table also appears to be illegal.

The district and union had been discussing a proposal to restructure the workday of kindergarten teachers to save up to $30 million. Under the voluntary program, teachers would conduct two kindergarten sessions a day instead of one. However, state education codes prohibit kindergarten teachers from teaching double sessions.

A state waiver would be required for such double sessions and state funding for those classes could be reduced.

Union officials lashed out against the district for “wasting their time” with the proposal. Several hundred kindergarten teachers met in the San Fernando Valley on Thursday to protest the plan.

Times education writer Larry Gordon contributed to this story.