New Jersey Public Safety Officers Law Blog : New Jersey Public Safety Employee Lawyer & Attorney : Pellettieri, Rabstein & Altman Law Firm : Workers Compensation, Discipline Representation for Police & Firefighters : New Jersey

Recently, it has come to our attention that many individuals aside from Public Safety Officers utilize this website as a reference guide for the various pension systems available to individuals employed by municipalities, counties, and the New Jersey state government. As such, this entry will focus upon a few of these pension systems and help our readers understand their background, membrship, and administration.

Overview of the Various Pension Systems

Public Employees Retirement System

The State of New Jersey established the Public Employees Retirement System (“PERS”) in 1955 after repeal of the laws that created the former State Employees Retirement System. Like the Police and Firemen’s Retirement System (“PFRS”), the New Jersey Division of Pensions and Benefits is assigned all administrative functions of the retirement system except for investment of the assets.

The PERS Board of Trustees has the responsibility for the proper operation of the retirement system. The Board consists of six (6) employee representatives, the State Treasurer, and two (2) individuals appointed by the Governor with advice and consent of the Senate. The Board meets monthly to conduct its business. 

Membership in the retirement system is generally required as a condition of employment for most employees of the State or any county, municipality, school district, or public agency. Generally, an employee is required to enroll in PERS if:

·         They are employed on a regular basis in a position covered by Social Security;

·         Their annual salary is $1,500.00 or more; and

·         They are not required to be a member of any other State or local government retirement system on the basis of the same position which gives them membership in PERS.

Teachers Pension and Annuity Fund

The Teachers Pension and Annuity Fund (“TPAF”) was established in 1919 and completely reorganized in 1955. The New Jersey Division of Pensions and Benefits is assigned all administrative function of the retirement system except for investment of the assets.

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During the course of a public safety officer’s career, many uniformed employees become injured and disabled on the job. If a public safety officer is unable to continue his or her employment as a result of the injury, they are often left with no choice but to medically retire. The Police and Firemen’s Retirement System (PFRS), is the New Jersey public employee retirement system that services the vast majority of public safety officers in the state of New Jersey. PFRS offers two disability retirement pensions that have diverse entitlements based primarily on how the accident occurred that lead to the disabling injury. It is the Board of Trustees for PFRS that makes the determination of what type of disability pension an individual will qualify to receive. In this post, I will talk briefly about the two types of disability pensions and the benefits associated with each. In my next post, I will discuss the current state of the law as it pertains to accidental versus ordinary disability, and how the applicable pension standards are being interpreted by the Board of Trustees for PFRS and the New Jersey Courts.    

ORDINARY DISABILITY

To qualify for Ordinary Disability retirement benefits a public safety officer must:

• be a member in service at the time the application is filed with the Division of Pensions and Benefits;
• have 4 or more years of New Jersey service credit in the pension system (the purchase of out-of-state, military, and U.S. government civilian service cannot be used to attain the 4 years); and
• be considered totally and permanently disabled (the member must prove that he or she is physically or mentally incapacitated from performing the normal or assigned job duties with no possibility for significant improvement).

Ordinary Disability Retirement benefits are not reduced by any Social Security or private insurance benefits that may be payable.   However, any Workers' Compensation award receive from the accident that may have caused the disability may be reduced, or receive a “setoff”.

Ordinary Disability retirement benefits are subject to federal tax to the same extent as other pensions.

ACCIDENTAL DISABILITY

To qualify for Accidental Disability retirement benefit,s a public safety officer must:

• be a member in service at the time the application is filed with the Division of Pensions and Benefits;
• be an active member of PFRS on the date the “traumatic event” occurred that caused the injury;
• be considered totally and permanently disabled as a direct result of a” traumatic event” that happened during and as a direct result of carrying out his or her regular or assigned job duties;
• file an application within five years of the date of the traumatic event; and
• be examined by physicians selected by PFRS. Said physicians must render an opinion that the member is totally and permanently disabled as a result of the “traumatic event”.

The definition of a "Traumatic Event" has been the subject of great debate and disagreement by the New Jersey courts. This definition will be discussed in more detail in my next post.

If a public safety officer qualifies for an Accidental Disability Retirement pension, the annual benefit will be 2/3 of the annual compensation on which pension contributions were being made at the time of retirement or the date of the traumatic event, whichever provides the higher benefit.

If the Public Safety Officer is receiving periodic Workers' Compensation benefits, the Accidental Disability retirement benefits will be reduced dollar for dollar by the periodic benefits paid after the retirement date. The retirement benefit is not reduced by any Social Security or private insurance benefits that may be payable.

The Division of Pensions and Benefits reports Accidental Disability retirement benefits as exempt from federal income tax; and benefits are not subject to New Jersey State income tax until the age 65.

With the high occurrence of injury on the job, public safety officers and union leadership must make themselves familiar with the different retirement benefits in order to give proper guidance to their membership. It is often disability retirement benefits that injured public safety officers rely on to support their family members after they can no longer protect and serve.

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