A Wrongful Firing

An arbitrator rules Saugus School Committee fired Ex-Supt. McMahon without proper cause; awards her substantial lost wages and benefits to make her whole

By Mark E. Vogler

Ex-Saugus School Superintendent Erin McMahon only got about halfway through the second year of an unprecedented five-year, million-dollar contract before going on paid administrative leave in early January of 2023 as she was being investigated for alleged misconduct, which led to her firing 10 months later. But McMahon, who maintained from the outset that the School Committee violated her contract and later fired her unfairly based on a flawed report, has convinced an arbitrator that the committee failed to justify her termination.

“On the merits, the School Committee did not establish that there was good cause for the termination,” arbitrator Sherrie Rose Talmadge wrote in a recent 30-page report that awarded McMahon “all lost wages and benefits” from the date of her Nov. 2, 2023, termination to the end of her employment agreement, which would have expired on June 30, 2026.

Megan C. Deluhery, of the Boston law firm of Todd & Weld LLP, welcomed the American Arbitration Association Labor Arbitration Decision And Award as a vindication of her client, who was the first woman school superintendent hired by the Town of Saugus. “Dr. McMahon is gratified by the outcome which confirms there was insufficient evidence to support termination of her employment for the reasons set out in the investigation report,” Deluhery told The Saugus Advocate.

“The parties have yet to confer on the calculation of the award, but with 2.5 years remaining in her contract which requires payment of her annual salary of just under $200,000 plus benefits less post-termination earnings, we anticipate the dollar value will be substantial,” she said.

No comment from Saugus School Committee

Saugus School Committee Chair Vincent Serino issued a comment on behalf of the entire School Committee that essentially declined to rebut the decision. “You and your readers will note that the Saugus School Committee has refrained from making any public comment concerning the former superintendent since she placed herself on administrative leave in January of 2023,” the statement began. “Since that time, the investigative report, the former superintendent’s response and the entirety of the disciplinary hearing have been publicly released. Our main focus has been and will continue to be the district and the students, teachers and support staff. We will continue to refrain from making any public statements.”

Serino declined to provide a copy of the arbitration report to The Saugus Advocate, citing the advice of the committee’s attorney. “It’s not public,” he said in an email to the newspaper.

However, The Saugus Advocate was able to obtain the report from two sources. Several state websites post arbitration decisions periodically. The decisions are filed and are the basis for financial settlements.

No attorney fees are warranted pursuant to the terms of Section 12.1, which provides “The parties…shall be responsible for their own legal fees.” The arbitrator will retain jurisdiction for 60 days from receipt of the award to assist with issues implementing the remedial order, if requested.

She came to Saugus with high expectations

McMahon was hired by the School Committee to turn around the Saugus Public Schools (District), which, according to the 2019 state Department of Elementary and Secondary Education report, was on a state watch list. The hiring marked the first time in recent memory that the School Committee approved a five-year contract for an incoming superintendent to lead the town’s public education system. And no Saugus School Committee has ever invested so much money – close to a million dollars over the life of the contract – for a school administrator.

But School Committee members were unanimous in their belief that it was worth every penny that they approved to bring in Erin McMahon with the great expectation that she would drastically improve the town’s school system. The committee members were so impressed with her credentials and her interview that they entered into an Employment Agreement with her for a five year term: July 1, 2021, through June 30, 2026.

At the time of her hiring, McMahon was the senior advisor to then-state Education Commissioner Jeffrey C. Riley. She was the committee’s 4-0 unanimous choice to replace retiring School Superintendent David DeRuosi, Jr. Then School Committee Chair Thomas Whittredge abstained from the vote because of a potential conflict of interest, as his sister, Dawn Trainor, is the executive director of Pupil Personnel Services & Special Education – a high administrative position that reports directly to the superintendent.

Lack of “good cause”

“The School Committee did not meet its burden of establishing good cause for the termination of Dr. McMahon as required by Section 12.1 of the Employment Agreement,” Arbitrator Talmadge concluded.

“Section 12.1 states, ‘good cause’ herein shall be defined as any ground put forth by the Committee in good faith that is not arbitrary, irrational, unreasonable or irrelevant to the task of building and maintaining an efficient school system,” it continued.

“The School Committee relied on the findings of the independent law firm, Arrowood, to terminate the Superintendent. Those findings included that the Superintendent: 1) accepted payments from consultants without proper disclosure or notice, 2) approved invoices from a vendor that included inflated hours, unapproved hours, and alcohol, and 3) spent excessive time out of the district.

The Arrowood report

These are highlights from the report that were the basis for the School Committee voting to fire McMahon:

• The superintendent had a longstanding relationship with Relay, performed paid consulting services for Relay, which she did not disclose to the School Committee nor did she submit any conflict-of-interest disclosure about said consulting until April 6, about 15 minutes before she was scheduled to be interviewed in connection with this investigation and more than a year after her initial consulting services were provided to Relay.
• McMahon also received gratis professional development training from Relay, which she did not disclose to the School Committee nor reference in her conflict-of-interest disclosure. Superintendent McMahon retained Relay to provide professional development services for the District at a cost of $84,000, of which $56,000 was contracted for and paid out after she performed her initial consulting services for Relay, representing tuition costs for four individuals to attend professional development training in New York City and Denver, Colorado, and does not include any expenses paid directly to those individuals in connection with their attendance at that program.
• The superintendent either intentionally or negligently permitted a professional development provider (Excellence Reflex Consulting LLC) to charge the District in excess of amounts actually earned for the services provided to the District.
• Superintendent McMahon either intentionally or negligently permitted a professional development provider (Excellence Reflex Consulting LLC) to charge the District for the purchase of alcohol on one occasion from Title I grant funds, and did so in spite of her receipt of an admonition from at least one member of the District’s leadership team that such charges could not be made to the District, through permitting the use of multiple revised invoices from said professional development provider.
• Between July 1, 2022, and January 19, 2023 (the date on which she began administrative leave), Superintendent McMahon was out of district 40.5 days, nearly double the amount of time the previous superintendent spent out of district.

But in each instance, the arbitrator’s report concluded there was no basis to substantiate the allegations.

On November 2, 2023, the Committee conducted the hearing in an open public session at Dr. McMahon’s request. At the November 2 termination hearing, Dr. McMahon only knew the information provided in the redacted Executive Summary given to her. Right before the public session started, Dr. McMahon provided the School Committee with a large number of documents in a rebuttal statement to respond to the information disclosed in the redacted Executive Summary. Chair Serino summarized the four matters from the August 30 letter at the outset of the hearing. While certain Committee members testified that they had an issue with McMahon providing this information at the hearing, she was unable to provide the information beforehand because the parties had reached a settlement in principle, and she understood that the Rebuttal would not be necessary. However, the settlement fell through 48 hours prior to the hearing. McMahon received notice of the November 2 termination hearing on October 31, two days prior to the termination hearing. Dr. McMahon’s counsel made a request for the full report on the record, and Chair Serino replied by implying the Committee had not seen the full report, although this was not the case. After Dr. McMahon was given an opportunity to orally address the School Committee, she asked the Committee to review and consider her Rebuttal, and invited the Committee to ask any questions. The hearing lasted 25 minutes. The Rebuttal consisted of a nine-page written statement by Dr. McMahon with 18 exhibits, including an affidavit of Chi Tschang, who was referenced in the Arrowood report although he had not been interviewed. Some of the Committee members briefly reviewed the materials, although none requested a brief recess so they could do so. No one asked Dr. McMahon any questions. Shortly following the Superintendent’s presentation, the Committee unanimously voted to terminate Dr. McMahon’s contract. Chair Serino stated that the Committee’s vote was based on the findings and potential violations of law suggested by Arrowood in the Executive Summary. After the termination on November 7, 2023, the School Committee provided the full unredacted Arrowood report to Dr. McMahon, which included the name of the whistleblower, Dr. Ferrick. The Arrowood report was also leaked to the media.