The State Health Benefits Program and Its Affect on Your Employment

Currently, many labor organizations representing public employees are negotiating collective bargaining agreements with the State of New Jersey. One of the most significant issues surrounding these negotiations involves the healthcare/benefit program provided by the State of New Jersey to its employees. Specifically, the State’s proposal regarding the dollar amount of employee contributions to the healthcare plan provided by the State, also known as premium sharing, has become vigorously contested by many labor organizations. As such, the State Health Benefits Program has again risen to the forefront of labor law consciousness.

 

The operation of the State Health Benefits Program (hereinafter referred to as “the Program”) is governed by the New Jersey State Health Benefits Program Act (hereinafter referred to as “the Act”), N.J.S.A. 52:14-17.25 to -17.45. The goal of the Act is to provide comprehensive health benefits for eligible public employees and their families at “tolerable” cost. In essence, it establishes a plan for state funding and private administration of a health benefits program which will protect public employees from catastrophic health expenses. In addition, it encourages public employees to rely on the Program instead of seeking protection in the commercial insurance market. Heaton v. State Health Benefits Commission, 264 N.J. Super. 141, 151 (App. Div. 1993).   

 

The Act also spawned the State Health Benefits Commission (hereinafter referred to as “SHBC”). The SHBC is entrusted to establish the Program by negotiating and purchasing medical, surgical, hospital, and major medical benefits for participating public employees and their families, “in the best interests of the State and its employees” as well as retaining exclusive jurisdiction to determine disputed matters under the plan. N.J.S.A. 52:14-17.27 to -17.28. The SHBC is entitled to establish rules and regulations as deemed reasonable and necessary for the administration of the Act. See N.J.A.C. 17:9-1.1 to -7.4. The Act also states that the SHBC may set forth limitations and exclusions in coverage as it finds necessary to administer the SHBP.

 

In undertaking a very consequential role in the financial security of public employees and their families, the State has the duty and responsibility to bargain fairly with them. Hidden or unfair reservations in insurance policies are ignored because they do not reflect the reasonable expectations of the parties. Voorhees v. Preferred Mut. Ins. Co., 128 N.J. 165, 175 (1992); Sparks v. St. Paul Ins. Co., 100 N.J. 325, 336 (1985). Because of the significance of health insurance to public employees and their families, and the Legislature’s undertaking to furnish insurance and determine its scope, one of the goals of the Legislature must have been to assure the fair and even-handed application of the Program provisions. Inevitably, the issue of premium sharing and its potential ramifications will certainly be followed by many public employees and labor organizations throughout the negotiation process to determine whether it is violative of the Program’s policies. 

 

Presently the state has proposed that all state civilian employees and law enforcement personnel contribute 1.5% of their salary towards health insurance. Certain state public employee labor unions and law enforcement labor unions have agreed to premium share at the 1.5% rate. However certain attorneys practicing labor law believe that there are constitutional issues with percentage premium sharing. We will follow this issue as it winds its way through interest arbitration and possibly the courts of New Jersey.  

Free Speech and Labor Protesting Collide

On September 23, 2008, the New Jersey Supreme Court entertained oral argument in the case of State v. DeAngelo, A-73-07, wherein the issues of labor protesting and free speech collide. The case involves a union official who was fined for displaying a 10-foot tall, inflatable rat at a Lawrence Township labor rally, thereby claiming the municipality violated his constitutional and statutory rights.

Wayne DeAngelo, a senior official with the International Brotherhood of Electrical Workers Local 269, was fined $100 and assessed $33 in court costs for using the balloon to protest a gym being built without union labor. DeAngelo asked the Court to declare the ordinance in question, which prohibits “banners, pennants streamers, pinwheels, or similar devices; vehicle signs, portable signs, balloon signs or other inflated signs (except grand opening signs)”, unconstitutional and violative of the National Labor Relations Act. The trial court and the Appellate Division have rejected the challenge, finding the ordinance a valid time, place, and manner restriction on commercial speech.

At the hearing, DeAngelo asserted the ordinance was “overbroad” because it prohibits all forms of signs used in protests, while allowing a variety of other signs, such as political and industrial signs and those at grand openings and real estate sales. In response, the Township asserted the ordinance and its enforcement were both within constitutional bounds, namely because DeAngelo’s use of the rat balloon amounted to commercial speech, which can be regulated.

Despite its listed exceptions, Justice Roberto Rivera-Soto said the ordinance appeared strictly worded and content-neutral. Conversely, Justice Barry Albin seemed troubled by the ordinance because it gave the gym owner permission to use an inflatable sign to announce his grand opening, but barred labor protesters from using inflatable signs at the same location. It will be interesting to see how the Court ultimately rules and addresses the intersection of these important issues. Undoubtedly, the case will be followed closely by labor organizations, who want to ensure their rights are adequately protected. 

         

New Jersey Public Employment Labor Law 101

Many public safety officers in the state of New Jersey understand that the terms and conditions of their employment to include the wages they are paid and the benefits they receive are derived from a collective bargaining agreement reached between the public employer and their collective bargaining unit.  However many public safety officers are not aware of the inner-workings of public employment labor law in the state of New Jersey.  This post is being written to provide public safety officers with a brief oversight of the statutes and agencies that govern public employment labor law in the state of New Jersey.  It will be the first post in a series that discusses public employee labor law and the effect it has on New Jersey Public Safety Officers.

In 1968, the New Jersey State Legislature passed the New Jersey Employer-Employee Relations Act (hereinafter referred to as “the Act”). This Act granted to all public employees the right to join or refrain from joining employee organizations (labor unions), and the right to conduct collective negotiations with public employers through majority representatives. N.J.S.A. 34:13A-5.3. The avowed purpose of the Act was to foster the prevention and prompt settlement of labor disputes in the public employment sector of the state. N.J.S.A. 34:13A-2. To that end, the Act authorized majority representatives to negotiate agreements with public employers on behalf of the employees in the relevant bargaining unit. N.J.S.A. 34:13A-5.3. It further required that the majority representative “be responsible for representing the interest of all such employees without discrimination and without regard to employee organization membership.” Ibid. 

The Act also established PERC, the Public Employment Relations CommissionN.J.S.A. 34:13A-5.2. This administrative body was granted exclusive jurisdiction over reviewing and adjudicating unfair labor practices, grievance arbitrations, and compulsory interest arbitration for public safety officers in the state of New Jersey. PERC was also authorized to make policy and establish rules and regulations governing employer-employee relations in public employment. N.J.S.A. 34:13A-5.2, -5.4.  Almost all labor disputes and aspects of public employment labor law is under the oversight of PERC, its administrative rules and regulations, and the New Jersey Employer-Employee Relations Act.  An association acting as the majority representative must be sure that it has leadership that is familiar with the inner workings of PERC but even more importantly, has counsel to call on that is familiar with public employment labor law. 

Internal Affairs Records and Reports May Be Released Subject to Redaction

In the case of Spinks et al. v. The Township of Clinton et al., 52-2-1684, The Township of Clinton sought to bar the release of an internal affairs investigation of the police department that was submitted to the trial court as part and parcel to a summary judgment proceeding.  The Township argued that the disclosure of these types of documents are forbidden by law and under common law principles of fairness, the township's interest in confidentiality  outweigh the public's interest in accessing the records. 

In making this decision the trial court applied the balancing test articulated in the matter of Hammock v. Hoffman-La Roche Inc. 142 N.J. 356 (1995).  After applying the balancing test that weighs the township's interest in confidentiality  versus the public's interest in accessing the records, the trial court held that the records could be released but only after all personal information was redacted from the records and with held.  In examining this issue on appeal, The Superior Court of New Jersey, Appellate Division, remanded the case to the trial court for further redaction of the records for confidentiality purposes that was consistent with the trial court's previous ruling.

This case stands for the principle that in certain circumstances internal affairs reports and records can be released to the public, however only after the court conducts an "in camera" review of the records and makes a decision concerning the redaction of personal information that will be necessary to preserve privacy.  Therefore, if you are looking for confidential records and reports that were produced by internal affairs, you may be able to get your hands on them in certain circumstances.

Retirees Not Entitled to Collective Bargaining Unit Representation Under The New Jersey Employer-Employee Relations Act, N.J.S.A. 34:13A-1 et.seq

In the case of Grasso v. Fraternal Order of Police, Glassboro Lodge No. 108, 33-2-1617, the Superior Court of New Jersey, Appellate Division, held that under the New Jersey Employer-Employee Relations Act, N.J.S.A. 34:13A-1 et.seq, the Defendants owed no duty to the Plaintiff to represent him in a dispute with the Borough of Glassboro due to his status of not being an "employee" as defined under the act.

Grasso initially filed suit against the Borough of Glassboro for their failure to reimburse him for Medicare Part B. premiums pursuant to a collective bargaining agreement.  Some time during the suit Grasso called on the FOP for representation as the matter dealt with an issue related to the collective bargaining agreement.  The FOP declined representation of Grasso, and following his success in the underlying action against the Borough, Grasso then moved against the FOP for their failure to represent him.

The Appellate Panel affirmed the Trial Court's decision to grant Summary Judgment in favor of the FOP due to the fact that Grasso can not be considered an employee under the New Jersey Employer-Employee Relations Act, N.J.S.A. 34:13A-1 et.seq

This case is important to both collective bargaining units and retired Public Safety Officers alike as it clearly defines the roles and responsibilities of each party under the New Jersey Employer-Employee Relations Act, N.J.S.A. 34:13A-1 et.seq

Constitutionality of Paid Convention Leave Statutes Challenged

On September 11, 2008, the New Jersey Law Enforcement Supervisors Association (“NJLESA”) and New Jersey Law Enforcement Commanding Officers Association (“NJLECOA”), jointly filed a lawsuit in the Superior Court of New Jersey, Law Division, Mercer County against the State of New Jersey challenging the viability of N.J.S.A. 11A:6-10 and N.J.A.C. 4A:6-1.13, the provisions of New Jersey law providing convention leave for State employees.

It is alleged that on or around July 15, 2008, NJLESA, the exclusive representative of those employees in the primary level supervisory law enforcement unit, and NJLECOA, the exclusive representative of superior officers and other command law enforcement personnel holding the rank of Captain or its equivalency in classified career service, requested a leave of absence with pay for certain union officials and duly authorized delegates within their organizations to attend a state convention jointly hosted by NJLESA and NJLECOA. In response, the New Jersey State Office of Employee Relations denied the request and took the position that it was not permitted to grant plaintiffs’ request because neither NJLESA nor NJLECOA were affiliated with any of the organizations delineated in N.J.S.A. 11A:6-10 and N.J.A.C. 4A:6-1.13 which are entitled to convention leave.

The complaint asserts N.J.S.A. 11A:6-10 and N.J.A.C. 4A:6-1.13 are arbitrarily exclusive in conferring the benefit of convention leave on certain fraternal organizations while excluding others, thereby violating certain provisions of the United States and New Jersey Constitutions. Consequently, NJLESA and NJLECOA seek a declaration that N.J.S.A. 11A:6-10 and N.J.A.C. 4A:6-1.13 are unconstitutional or, alternatively, for an order directing the State of New Jersey to award convention leave to members of their organization. It will be interesting to see how this suit develops and how the state of New Jersey reacts to preserving this piece of legislation.

Minor Disciplinary Charges Challenged in the Superior Court of New Jersey

The Superior Court of New Jersey, Law Division, Passaic Vicinage, (DeLuccia, J.S.C.) recently interpreted a collective bargaining agreement (CBA) pertaining to discipline in the case of Whitaker v. Passaic County Sheriff's Department, 33-3-139.  In this case the Plaintiff appealed her right to challenge minor disciplinary charges which were previously dismissed for alleged failure to exhaust administrative remedies under the CBA. 

Instead of proceeding with the grievance procedure as outlined under the CBA, Whittaker opted to challenge the minor discipline at a disciplinary hearing.  After the disciplinary hearing was decided, Whittaker next attempted to appeal the decision through the grievance procedure as outlined in the CBA.  Whittaker was denied the right to grieve the charges by her employer stating that she was precluded from doing so due to the fact that she had chosen to challenge the charges at a hearing and is thus not entitled to pursue the case by way of grievance. 

The Superior Court of New Jersey, Law Division, took the liberty to interpret the CBA and held that a reasonable interpretation of the agreement would permit an employee charged with a minor disciplinary infraction to proceed first to an administrative hearing to challenge the charges and then, if adverse action is taken by the employer, to demand arbitration of the dispute under the CBA. 

This is an interesting case in that it appears to give a Public Safety Officer "two bites at the apple" when challenging minor disciplinary charges.  Furthermore, we normally do not see Superior Court Judges stepping into disputes between public employers and employees especially when it comes to the interpretation of a CBA.  Interpretation of agreements is traditionally left to the Public Employment Relations Commission (PERC) and the Appellate Division.  I think what we should take away from this case is that there is always more than one reasonable interpretation of a collective bargaining agreement, and Public Safety Officers should not be afraid or hesitate in certain circumstances to challenge their employers in the Superior Court of New Jersey, Law Division.